A Question of Trust

Trust. It’s a short word with a complex meaning and an even more difficult goal to truly achieve in today’s world. Unfortunately, it is easier for people to find practical reasons for not trusting than to trust.

What would you trust to a digital network in today's world? Your money or some of the duties at your job? Nowadays, more people are doing both. We are even talking about metaverses as complete digital worlds in which you would be able to "live", work, earn and spend money.

Multibillion-dollar industries are now in the process of going fully digital: Neobanks with millions of new users in a couple of years; triple-digit growth rates in e-commerce in developing countries; stock trading platforms reaching literally millions of new accounts in only two years; skyrocketing prices of cryptocurrencies generating triple-digit profits by the day … you name it.

According to Statista, since 2019, fintech startups in Mexico have grown 200 percent in digital banking, 117 percent in trading and markets and 57 percent in enterprise technologies for financial institutions. These are clear signs of an industry in full transformation by adopting technology as a means to exchange greater value with their customers.

On the other hand, Kongsberg, through its 2020 maritime software landscape report, demonstrates the widespread fragmentation of tech innovation in the maritime industry as a whole, not specifically in the oil and gas niche. In this case, tech innovation is spread along geographic regions (mainly Northern Europe and Southeast Asia) and in diverse segments, such as autonomous vessels, fuel consumption efficiency, maintenance and operation and fleet management. However, what really stands out here is the absence of Latin American (needless to say, Mexican) startups.

Basically, the Mexican startup ecosystem totals more than 300 new companies in which people are trusting their money, but not even a handful of startups are addressing one of the Top 3 income-generating industries: oil and gas.

Apparently, people have no real issue in trusting their money (and financial information) to a series of digital platforms. However, multibillion-dollar industries, such as offshore oil and gas logistics, are hesitant to get on board the digitalization trend, at least in Mexico. This sector has suffered serious trust issues derived from historic problems that lasted decades. Cash flow shortages, payment delays and even fraud make it difficult for the stakeholders in this industry to take the "leap of faith" and trust technology as a means to improve the way they transact.

Some of them blame regulation, which could be a serious cause of this backwardness, but financial regulations are the toughest anywhere in the world and fintech apps and business models are operating all along the planet.

Others claim that technology is expensive, but this industry is used to heavy investments, mostly in their assets. Furthermore, the plainest technology, paired with some creativity, could achieve more than millions of dollars in equipment. You just have to be smart about it.

Ok, so maybe it's the people in this sector. Some of them have been in the business for generations and are used to saying: "We have been doing this for decades, why change?" But if the people in this industry can't trust in technology as a means to improve their activities, maybe they can believe in outside disruptors that, when (not if) they come, will leave these people defenseless.

So, it's not technology, it's not regulation, it may be the people. In the end, what is holding back the offshore oil and gas logistics industry is a lack of trust. They don't trust their peers, they don't trust technology and they mistrust change. Nevertheless, they trust they can transfer their money through electronic virtual networks called wire transfers and SPEI.

Why don't they put their trust where their money is? Why don't they start adopting new business models to solve old problems?

As Samuel Johnson once said, "You may be deceived if you trust too much, but you will live in torment if you don't trust enough."

Should they continue handwriting ship logs and signing paper contracts each and every time they get a job? Or shall they change to use peer-to-peer online platforms to do it automatically, easily, cheaper and more efficiently?

Food for thought for Mexican ship and helicopter operators and their customers in the oil and gas logistics sector.