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Suggested Citation:"1. Summary and Conclusions." National Research Council. 1986. The Roles of Government and Industry in Research and Development for the Maritime Industries: An Interim Report. Washington, DC: The National Academies Press. doi: 10.17226/977.
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Page 1
Suggested Citation:"1. Summary and Conclusions." National Research Council. 1986. The Roles of Government and Industry in Research and Development for the Maritime Industries: An Interim Report. Washington, DC: The National Academies Press. doi: 10.17226/977.
×
Page 2
Suggested Citation:"1. Summary and Conclusions." National Research Council. 1986. The Roles of Government and Industry in Research and Development for the Maritime Industries: An Interim Report. Washington, DC: The National Academies Press. doi: 10.17226/977.
×
Page 3
Suggested Citation:"1. Summary and Conclusions." National Research Council. 1986. The Roles of Government and Industry in Research and Development for the Maritime Industries: An Interim Report. Washington, DC: The National Academies Press. doi: 10.17226/977.
×
Page 4
Suggested Citation:"1. Summary and Conclusions." National Research Council. 1986. The Roles of Government and Industry in Research and Development for the Maritime Industries: An Interim Report. Washington, DC: The National Academies Press. doi: 10.17226/977.
×
Page 5
Suggested Citation:"1. Summary and Conclusions." National Research Council. 1986. The Roles of Government and Industry in Research and Development for the Maritime Industries: An Interim Report. Washington, DC: The National Academies Press. doi: 10.17226/977.
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Page 6

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1 SU - ARY AND CONCLUSIONS Research and development (R&D) are widely recognized as essential instruments in the nation's efforts to maintain its competitiveness in the world economy. The R&D process in the maritime industries (i.e., shipbuilding, ship operating, marine terminal operations, and inland waterway operations) encompasses a broad array of developments and commercial applications in hardware, operating methods, and information and management systems. This report addresses the importance of fostering the R&D process in U.S. maritime industries, and the roles of industry and government in this. The starting point for an assessment of the importance of R&D in the maritime industries is an understanding of present conditions in the maritime industries in the United States and the world. A global maritime depression has affected all sectors of the,mariti,ms industries for S years, and shows few signs of a turnaround. Despite this, development and application of new technologies in the U.S. maritime industries have continued to a considerable extent, primarily as a result of intense competition. Several collaborative R&D programs, which have been sponsored in partnership with industry by the MarAd, also have spurred innovation. A list of the most significant technology developments and applications of the last decade would include: advances in shipbuilding industrial processes, improved utilization of the seagoing work force leading to more effective manning and crew reduction, introduction of fuel-efficient diesel engines into U.S. commercial vessels, utilization of state-of- the-art technology in cargo handling and the operation of marine terminals, and a trend toward truly intermodal freight transportation networks in part a consequence of government deregulation. There is also, for the first time in a decade, at least a glimmer of hope for renewed public investment in capital improvements to the nationts harbors and waterways. These developments, the driving forces behind them, their principal benefits, and the roles of industry and government in the past and in the future are summarized in Table 1.* *Not all of these developments and applications have been won easily. In nearly every instance formidable barriers in the area of government regulations, business conditions, management attitude, labor and management relations, and environmental constraints have had to be overcome . 1

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4 Table 1 and the material in the report support the following conclusions about the appropriate roles of industry and government in the R&D process. PRIVATE SECTOR ROLES Concerning the role of the private sector in maritime research and development, the committee arrived at two conclusions 1. Industry sponsorship of proprietary R&D is governed principally by the expectation of individual corporate financial gain or a requirement to comply with a regulation in the most cost-effective manner. Individual company sponsorship of R&D has focused to a great extent on activities that have short-term payoffs. In the difficult financial environment that exists today, there is little likelihood that this pattern will change. 2. There is scant evidence of collaborative R&D among companies, except where it has been stimulated by third-party, usually U.S. government agency, activities. Given the financial condition of the industry and its structural fragmentation, there seems little possibility of significant collaborative R&D in the future, unless the government continues to stimulate collaborative R&D. Notwithstanding the above, companies may be interested in collaborative R&D when the benefits of the R&D process are likely to be applicable to a group of companies and/or the costs/risks of such work are greater than individual firms are willing to bear. More fundamental research not directed to specific product development and technology developments directed at areas of operational interchange among or between companies are particularly appropriate candidates for collaboration. PUBLIC SECTOR ROLES Concerning public sector roles, the committee made two conclusions: 1. Government sponsorship of R&D is necessary to support national needs for security, public safety, ports and waterways planning and development, ensuring that the base of scientific and technical knowledge exists to support existing laws, and promoting international competitiveness. In support of these needs, the government · Acquires data, conducts feasibility and other analyses, and supports demonstration prod acts . · Conducts R&D in support of policy or program development, such as the assessment of technology and implications of current or proposed laws, rules, or standards. · Conducts R&D that directly benefits the government, such as efficiencies in the handling of government impelled and preference

5 cargoes or advances in naval shipbuilding technology, which reduce the cost (to the government and the nation) of naval ship acquisition. 2. Government sponsorship of industrial R&D is desirable where it acts as a catalyst to achieve broad national benefit to industry and the nation. Government collaboration with industry is especially appropriate where the benefits of R&D are likely to be applicable across an industry (and will benefit the nation as a whole), and where, whether because of unacceptable risk or for other reasons, proprietary incentives to conduct the R&D are lacking. DISCUSSION OF THE MARAD R&D PROGRAM The R&D program of the Maritime Administration (MarAd) has contributed in several ways to improving or maintaining the competitiveness of the U.S. maritime industries. Through collaborative approaches with industry, MarAd has promoted technology transfer in shipbuilding process technology, vessel manning, cargo handling, and fleet operations. It has facilitated the diffusion of innovations and their application, especially where supporting changes in labor-management relations or government rules have been necessary. The collaborative programs conducted by the MarAd have been appropriate because they have, at relatively small cost, addressed two weaknesses in the U.S. maritime industries. Maritime interests in the United States have been very fragmented between such entities as U.S.-flag and non-U.S.-flag, liner and bulk, operators and builders, and builders and designers. This fragmentation can be traced to competing objectives arising from different operating and regulatory environments, and a history of aggressive antitrust enforcement. In part due to the fragmentation of the industries, the U.S. maritime industries have never developed strong cooperative institutions such as independent R&D centers. Such institutions are common in the maritime industries of other countries.* The MarAd R&D program has sought to fill the role of a technology center for the industry and also has sought to identify and address common R&D objectives in this fragmented industry. Without government participation, the industry- based collaborative R&D institutions that are now in place (as a direct result of the activities of the MarAd R&D Program) are not likely to continue. Top-level industrial interest in the R&D program of the Maritime Administration has not been extensive, but has been increasing in recent years. Even with this increasing top-level interest and support, it appears that government involvement in maritime R&D will shortly be cut back, perhaps even beyond that which is necessary to National Research Council. 1983. Ship Operation Research and Development: A Program for Industry. National Academy Press Washington, D.C.

6 support the go~rernment's functional needs. This would certainly have some negative impact on R&D in the maritime industries. Without government sponsorship, the collaborative programs in shipbuilding, fleet management, manning, and cargo handling are likely not to be continued separately by industry. To a great extent, the collaborative programs that the government has implemented address derived needs--the identification and prioritization of problems and the development of approaches to them are derived from industry. The success of this kind of arrangement depends on communication. It is necessary, therefore, to develop a process for communication. Periodic top-level review of needs and programs is important. MarAd's collaborative programs have established processes for communication in the development and implementation of technical work programs. Its programs need more emphasis on sustaining top-level commun icat ion on industry needs to ensure their continuing relevance. RECOMMENDED CHANGES IN DIRECTION In summary, the R&D program of MarAd should direct: · Greater effort in support of the government's functional needs. A particularly promising area is providing the technical basis for modernizing laws, rules, or standards that adversely affect the capacity, productivity and cost-effectiveness of the maritime industries. · Greater effort to identifying industry needs with top-leve1 industry management. Through collaboration with industry, MarAd should continue to sponsor R&D where government sponsorship acts as a catalyst to achieve broad national benefit to the maritime industries and the nation. Regardless of the direction of future activities, it is essential to maintain at least a minimum level of funding and program activity, if the U.S. government is to maintain its technical capability to understand and reap the benefits of technology developments in the world maritime industries. Furthermore, it is essential to continue to monitor technological developments around the world and to make that information available to U.S. industry. For their part, the highest levels of U.S maritime industrial management should demonstrate their interest in and support for the R&D process on a continuing basis, with MarAd, in industry forums, as well as within their own companies. Without top-down direction and involvement, continued investment and leadership in maritime R&D by government and industry cannot reasonably be expected.

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