The firm and the sea: chains, flows and connections
The sea – whether considered as open ocean or as a mass of water bordered by land
masses – is an enormous economic resource for mankind. Not only is it the principal way of
transportation for goods and humans but it’s also a formidable source of food. Since we
want to link the sea with the business unit (the firm, as well as other organizational units
like clusters, networks and global value chains) the focus of the next EBHA conference will
be on two units of analysis that are both extremely relevant for the sea as well as economic
resources – ships and harbors.
In order to perform its function, the ship (a means for transporting goods and people)
is run in a very hierarchical way, more than what occurs with a factory or a retail company
(two good comparison points). Just as with a factory or retailer, ships embody economic
goals to be achieved by workers, managers, and – this is the difference – CEOs whose
decisions cannot be challenged given that the cargo and (more importantly) the life of its
“inhabitants” can be at stake.
Rarely does the ship stand on its own as a business unit (unless we talk of an activity
like fishing which is certainly important). It’s part of a group that refers to a shipowner
acting in a very complicated world where the ups and downs of charters and continuous
struggles with government regulations and policies render decisions delicate and complex.
The ship is the nexus of a tremendous amount of activity – just consider the
shipyards, metallurgic factories, plants producing precision equipment, and those dedicated
to heavy machinery. And think of other sectors like the extraction of raw materials and
agricultural products that could have a real global circulation in relation to the capacity of
the maritime vehicle.
Then there are associated service sectors such as insurance and banking activities
focused on navigation (often with government support). Credit for navigation is a landmark
of the modern economy with both successes as well as bankruptcies. Also worthy of further
study is the role that passenger ships have played in the social and economic development
of many nations. From the large ships of the late 19th and early 20th centuries that plied the
Atlantic Ocean transporting passengers between the Americas and Europe to the postwar
ocean liners that offered a glamorous way to travel to new destinations, ships helped make
the tourism industry grow.
And we can’t close our eyes to some of the unlawful activities connected with the
world of navigation including the illegal transportation of human beings, prohibited goods,
and money laundering. Even today there are occasional episodes of piracy, something that
we thought limited to history books and old novels.
The second actor we consider is strictly related to the first one – ports, an
unavoidable reference point for ships that make them their destination for the goods and
passengers on board. It’s in the port that a ship can stock materials needed when at sea and
eventually undergo repairs before embarking on a new journey. We see the port as an
entrepreneur (formed by stakeholders with both common and divergent goals) which
should be analyzed in an historical perspective. First are the many aspects of the
governance of the port: who’s in charge? Is it a function of the State or the military? Is it a
managerially run port authority that, even if designated by State powers, has relative
autonomy in its actions? Are there private operators who handle the terminals? How does
the type of governance impact a port’s efficiency? Second, we have to single out the crowd
of operators in a port: maritime agents, stevedores, people who maneuver the cranes, pilots,
dock workers. Several of these activities are strictly regulated, at times resulting in strong
conflicts between various actors in the port.
The relationship between a port and the areas around it, the presence of appropriate
infrastructures, and the many activities making up the field of logistics – all are
tremendously important for the port as a kind of entrepreneur. Given their role of
stimulating the trade of goods, raw materials and energy sources, the port becomes a key
actor of the development of productive areas. Ports can strengthen or even launch the
industrial take-off of the territories they supply. Moreover, ports are historically linked to
global cities, nodes in a complex network of trade, but also of political international
alliances, which emerged progressively in the phases of globalization (from Singapore to
Hong Kong and from San Francisco to Yokohama, for example).
Even today seas and their ports remain a theater in which important geo-political and
geo-economic stances take place; their relevance for business history can’t be
underestimated. From the building or restructuring of infrastructures that are pillars of the
first wave of globalization (the Suez and Panama Canals, for example) to new opportunities
brought about by the latest waves of globalization, the sea continues to be an essential,
physical component of the complex web of trade relations which allow the existence of
global value chains that take advantage of its unique means of connection and
Last, but not least, ports, ships, and even the sea are highly sensitive to technological
change and the resulting emergence of competitive and alternative infrastructures (from
railways and motorways to airlines and large airport hubs).