Posted: 26th September 2016 | Written by: Pippa Nicholas
The annual refit or yard period of a yacht is a time that many yacht captains and engineers dread.
Lists of requirements for cost approval from the management company or owner, with the constant need to justify these expenses against ever lessening budgets. And as the yachts grow in size there are, of course, more mandatory requirements to fulfill for commercial registrations. These bring headaches for the captains and crew who also have to keep up with the ever growing number of books on safety and operating procedures.
This begs the question of whether or not it's prudent to retain the services of a professional project manager for the shore based operations of the vessel. Having made a successful business in Yachtprojects International, I may have a biased view but, in my experience, it still takes a special relationship between the captain, engineer and project manager for this solution to work well.
Some of the larger management companies who offer these services may have a project manager who oversees four or five vessels, which is easy enough when they are at sea and working but, if they all fall into the same schedule for yard time, the sheer volume of information that needs to be collated and fully understood can bring even the most efficient operator to a standstill.
Let's take a look at the options for a refit project manager.
The retention of a project manager or ship manager via a management company has its benefits, but I’d suggest that a smaller company, or even an individual, retained as a project manager is a greater asset. The benefits start when the captain, engineer and project manager become friends, an important link, I believe, especially if the association is ongoing beyond a single refit or yard period.
As friends you gain a trust and understanding of the same tactics and field plan to achieve the same goal. Trust is paramount and in my experience, with the larger management company approach, this trust is seldom achieved. After all, the management company is there to make money so sometimes the decisions made are not solely based on what is best for the ship but sometimes what is best for the bank balance.
Once a friendship and trust are established, smaller companies or individuals work together towards the same goal with less regard for personal financial gain and more for the owner's financial position. In every refit I have been involved with, be it as the engineer on the ship, the project manager, or as a vendor doing work on the ship for the yard, I have yet to see one that has not turned into an 'us and them' scenario between the ship and the yard.
For the small company or individual this poses no issue, unlike a management company, which will have to bring another vessel to the yard for works at some point in the future. The knock-on effect of issues today can therefore affect the bottom line.
As the project manager and shore based engineering support for the yacht 'Senses' for seven years (2003 to 2010), prior to her current owner, I gained several awesome friends in the shape of the captain and engineers onboard, and the program ran seamlessly and efficiently with cooperation between all of us and the owner.
His own cost analysis of the time we were involved compared to that of the management company showed him a saving of some 45% overall and, during the annual refits, it showed a saving of over $2 million in negotiated discounts and cost reductions. Each refit period was negotiated in advance, with three facilities being offered the chance to bid, and with contracts signed prior to the vessel's arrival.
In each yard period there were always those 'hiccups' that occur and each was negotiated harshly by us to meet the owner's best needs. Each refit came in on budget and only once in six yard periods were we late on delivery dates. However, to do this. myself and our small company were retained on an annual basis for a small fee, recovering costs during each work period based on performance and savings as opposed to set fees regardless of the outcome for the owner.
Going quickly back to the point on trust. During those seven years the captain and I had enough trust between us for him to pull into the dock and 'too me the keys' saying, "I’ll see you in six weeks when she's ready to go”, before taking a cab to the airport and setting off on his annual leave. I’ve seen it work on so many occasions.
Currently I'm refurbishing a Headhunter waste water system with a vessel in a yard in southern Spain. It's an unfortunate scenario where the original refit had some problems and the vessel then had an operational mishap and a few things got wet in the engine room, sparking off a dispute as to whose fault it was and who would pay. An insurance company is now involved and although we are working through the yard, the rhetoric between all parties means that scheduling and payments are almost as much work as the job its self.
The captain of the yacht finally hired an independent project manager after the back and forth between the yard, the management and himself had driven him to become a chain smoking alcoholic. I've noticed that after the introduction of the project manager he has returned to his normal laid-back Kiwi self and there is now a semblance of calm on the project and... our invoices have been paid.
I know many captains and engineers feel it's their responsibility to oversee a refit in detail and, in fairness, I agree with this philosophy. But when you have people who specialize in this work it can be of huge benefit to both the captain and the owner, financially as well as for peace of mind.
About Yacht Projects International
Yacht Projects International is a network and engineering solution consultancy specialist providing international marine communications, all hardware, all airtime, GMDSS, and remote/local management of systems. Headhunter water treatment global agents. Offices in Florida, USA and the south coast of the UK.