“If you can’t beat ’em, join ’em”
Tourism in the Caribbean has been impacted by the disrupting eco-system of Cruise ships. More and more visitors shift from stay-overs – flying in on a jet and taking it slow at a resort hotel – to consuming the Caribbean ports-of-call on cruise ships. This is not all good; there are some dire consequences. The economic engines are all in shambles because of this shift. The result is less economic impact to the local markets.
When a cruise ship arrives in port, over 4,000 passengers disembark – they are the 800-pound Gorilla – their presence is felt; the ship cannot be ignored and cannot be dismissed …
… we cannot beat this industrial giant, so we have to join them [… then beat them].
This “joining-beating” refers to an Industrial Reboot. Yes, as a region, we must first stop the bleeding, then reboot our industrial landscape so as to explore the opportunities associated with Cruise Tourism.
What? How? Why?
Rebooting the industrial landscape means understanding the macro-economic factors affecting a community and then applying changes to assuage negative developments and to exploit the positives. This 800-pound Gorilla is hard to “beat” alone, each Caribbean country will have to collectively-bargain with the Cruise industry – along with the other Caribbean countries – to have any hope of negotiating for changes to this industrial landscape.
This thought is what was related in a previous blog-commentary, from May 6, 2015, by the movement behind the book Go Lean…Caribbean:
The book … opens with the thesis (Page 3) that the problems of the Caribbean are too big for any one member-state to tackle alone. Some of the most popular cruise destinations include the Bahamas, Jamaica, Cayman Islands and Saint Martin. Alone, these port cities/member states cannot effect change on this cruise line industry. But together, as one unified front, the chances for success improves exponentially. The unified front is the Caribbean Union Trade Federation (CU). The term Union is more than a coincidence; it was branded as such by design. The Go Lean book serves as a roadmap for the introduction and implementation of the CU.
The vision of this integration movement is for the region to function as a Single Market. …
The book Go Lean…Caribbean asserts that we cannot just maintain the status quo – 1.0 – with Cruise Tourism. The port-city merchants are not happy; the rest of the tourism landscape is not happy; the passengers are not happy; and the cruise line employees are not happy. The book relates:
The Bottom Line for the Caribbean Cruise Industry
The Caribbean is the number one (1) destination for the cruise line industry, with some 10 million passengers a year and an annual growth of 7.4% since 1980. But each cruise line serves multiple ports and so can play one market against the other. They are the “800 pound gorilla that can sleep wherever it chooses”. The cruise line industry “squeezes every bit of copper out of a penny”, challenging their stakeholders to optimize their business model more and more every year – they maximize revenues from the marketplace and minimize their spending. And yet, without the Caribbean as a whole, their product is far less appealing. – Page 193
The only people that are happy with cruise operations are the shareholders of the cruise lines. (It is doubtful that many of these one would be Caribbean stakeholders). The Cruise Tourism 1.0 business model needs to transform to 2.0.
This Go Lean book presents a roadmap to elevate the economic engines in Caribbean society; it details new strategies, tactics and implementations to reboot the Cruise Tourism eco-system. One tactic is to deploy a scheme for Passenger Payment Cards (smartcards or smart-phone applications) that function on the ships and at the port cities. This scheme will also employ NFC technology (Near Field Communications) – so as to glean the additional security benefits of shielding private financial data of the guest and passengers.
Another tactic is to double-down on Culture! We would want to overwhelm cruise passengers with our unique culture. Under 1.0, these passengers only consume a port-city for portions of 1 day. So we need to fill the port-side harbors, courtyards and verandas with so much locally-produced cultural expressions; think: art, parades, dance, song, storytelling, souvenirs …
- … modeling Walt Disney World’s 4 Parks and their afternoon character parades …
… we must overload our guests-passengers so that they feel underserved by the cruise experience, and would prefer a fuller experience. Cruises should be likened to Movie Trailers: “Previews of Coming Attractions”.
This new technological, cultural and economic scheme will usher in change for Cruise Commerce. The Go Lean book projects that 800 new direct jobs can be created just with the proposed Cruise Passenger Payment Card. (Even more indirect jobs – 3.75-to-1 multiplier rate – can be created). This is how the industrial landscape of the Caribbean region can be rebooted, by starting with this mandatory smartcard/chip-card for every cruise passenger.
For this month of July 2018, the phraseology “reboot” has been a consistent theme. This commentary has previously identified a number of different industries that can be rebooted under this Go Lean roadmap. See the list of previous submissions on Industrial Reboots here:
- Industrial Reboots – Ferries 101 – Published June 27, 2017
- Industrial Reboots – Prisons 101 – Published October 4, 2017
- Industrial Reboots – Pipeline 101 – Published October 5, 2017
- Industrial Reboots – Frozen Foods 101 – Published October 6, 2017
- Industrial Reboots – Call Centers 101 – Published July 2, 2018
- Industrial Reboots – Prefab Housing 101 – Published July 14, 2018
- Industrial Reboots – Trauma 101 – Published July 18, 2018
- Industrial Reboots – Auto-making 101 – Published July 19, 2018
- Industrial Reboots – Shipbuilding 101 – Published July 20, 2018
- Industrial Reboots – Fisheries 101 – Published July 23, 2018
- Industrial Reboots – Lottery 101 – Published July 24, 2018
- Industrial Reboots – Culture 101 – Published July 25, 2018
- Industrial Reboots – Tourism 2.0 – Published July 27, 2018
- Industrial Reboots – Cruise Tourism 2.0 – Published Today – July 30, 2018
This 14th (and final) submission to the commentary considers the basics of economic stewardship (financial payments, collective bargaining and labor relations) for the Cruise Tourism industry and how it can harness many jobs if we reboot our industrial landscape to optimize the industry. There is no need for a new commentary; this subject had already been elaborated upon previously. See here the highlights of these two Encores of Go Lean commentaries:
- “RBC EZPay – Ready for Change” from January 23, 2015
- “Cruise Ship Commerce – Getting Ready for Change” from May 6, 2015
See the Encores here:
1. Go Lean Commentary – RBC EZPay – Ready for Change
It’s time to introduce the Caribbean Dollar (C$) as a regional currency. Though there will be coins and notes, the primary focus will be on electronic transactions. This is the future!
Electronic Payments schemes (card-based & internet) are very important in the strategy to elevate the Caribbean economy, bring change and empower people, process and profits.
According to the subsequent news article, the regional banks – in this case the Royal Bank of Canada (RBC) – are ready for this change.
This Go Lean/CU/CCB roadmap looks to employ electronic payments schemes to impact the growth of the regional economy. There are two CU schemes that relate to this foregoing news story, as they require the demonstrated POS terminals:
- Cruise Passenger Smartcards – The Go Lean roadmap posits that the cruise industry needs the Caribbean more than the Caribbean needs the industry. But the cruise lines have embedded rules/regulations designed to maximize their revenues at the expense of the port-side establishments. The CU solution is to deploy a scheme for smartcards that function on the ships and at the port cities.
- e-Commerce Facilitation – The Go Lean roadmap defines that the Caribbean Dollar (C$) will be mostly cashless, an accounting currency. So the Caribbean Central Bank (CCB) will settle all C$ electronic transactions (MasterCard-Visa style or ACH style) and charge interchange/clearance fees. This scheme allows for the emergence of full-throttle e-Commerce activities.
The focus of these schemes is not technology, its economics. These electronic payments provide the impetus for M1, the economic measurement of currency/money in circulation (M0) plus overnight bank deposits. As M1 values increase, there is a dynamic to create money “from thin-air”, called the money multiplier. The more money in the system, the more liquidity for investment and industrial expansion opportunities.
See the full blog-commentary here.
2. Go Lean Commentary – Cruise Ship Commerce – Getting Ready for Change
This is the focus of this commentary and advocacy. There are strict divisions of labor on cruise ships – wait staff and cabin stewards are reserved for citizens from Third World countries like the Caribbean and Asia – with terrible pay scales – while the officers/leadership roles are reserved for Europeans-only – Scandinavians proliferate. We appreciate the fact they set aside jobs for people of the Caribbean, but it is unacceptable that job advancements are unattainable. The resultant discrimination is real. Cruise ships, and other maritime vessels in general, are the last bastion of segregation. Descriptors like “modern-day-slavery”, “sweatships” and “extreme poverty” are far too common. Case in point, many ship-domestic staff are “tip earners”, paid only about US$50 a month and expected to survive on the generosity of the passengers’ gratuity.
This is a human resource matter and thusly will be within the sphere of influence for the new HR executive at [Royal Caribbean Cruise Lines or] RCL. While many ships are only governed by maritime laws, injustice is injustice. Good shepherding of Caribbean economic eco-system requires some focus to these bad practices.
The confederacy goal entails accepting that there is interdependence among the Caribbean member-states. Implementation-wise, this shifts the responsibility for cruise line negotiations to a region-wide, professionally-managed, deputized technocracy that can result in greater production and greater accountability.
An advocacy, in this case collective bargaining, on behalf of the oppressed workers in Caribbean waters is a just and honorable cause. The quest of this Go Lean movement is to make the Caribbean region better to live, work and play. Labor practices on cruise ships are therefore within scope of the CU.
This is the change … that now confronts the new RCL HR executive. But the CU quest to elevate Caribbean society should not run afoul of this or any cruise line’s modus operandii. The CU sets out to be their trading partner, not adversarial opponent. This should be win-win.
See the full blog-commentary here.
Sign the petition to lean-in for this roadmap for the Caribbean Union Trade Federation.