As in all companies, if one disregards/by-passes hierarchy commits a crime, the same happens in shipping companies. In the case of a tall organization it is needed 3 times more time, we reckon, for instructions to reach executives, i.e. those that will implement them. Thanks God, computers dis-regard hierarchy and made organizations simpler with fewer levels, except for the speed and the directness of transmitting orders, which they provided.

Moreover, Chaos Theory (Goulielmos, 2019a) enabled us to vision a different management, we will call it management by… attractors (expanded below). Attractors are… employees who have the answer to all problems by: ability, personality or experience, regardless their hierarchical position. Attractors may be found also among divisional-departmental managers, operators, and Captains, no doubt. This means that companies have to train managers to become attractors… in their field of specialization. This further means to train people to focus exclusively on providing solutions to all emerging problems, in other words to be useful… The scan below (Figure 1) indicates that what we ask is not easy!

To be an attractor, one has to get heads or tails out of the situations. Figure 1 indicates that what we ask is not easy! This is because an attractor has to get-out heads or tails of an emerging situation! Is this possible?

An attractor is a model representation of the behavioral results of a system (Battram A., 1998: p. 149). Some believe that attractors are passive (Lissack, 1996). This tells us that top-managers have to discover them. Others believe that an attractor means someone attracting something or somebody. McMaster, M. (1996) argued that the attractor is “someone with a clear intention, a great deal of energy, etc.” Our attractor is “human”.

Attractors e.g., for weather, and for freight markets, are shown in Figure 2.

The attractor (left) is… strange. The shipping markets attractor (right)—let us call it “spider”—is… stranger¹⁰. The left is known as “owl’s eyes” or the “butterfly’s wings”.

Figure 3 indicates that for problem-solving and decision-making processes in shipping, the leader has to organize a meeting, where attractors only from relevant departments participate. The deeper meaning of Figure 3 is that in a shipping problem-solving process, the top-manager, through his/her leader (aide), needs recommendation from all relevant departments11. The leader holds the top hierarchical position. He is the one who will transmit to top-management the recommended solution.

The difference of the above from what is really happening now, is that the team-members (managers of the departments usually) are all of equal rank, and thus they have difficulty in cooperating. In such a scheme the (Greek) participants most probably will argue indefinitely… The attractors know the solution to the problem, within their specialty. The meeting acts as a holistic environment. The final decision will be in line with all those taking part (operators, lawyers, safety, crew, insurance, port captains and engineers).

A manager has to monitor, compare and correct company’s work performance. This function is most difficult, and it is more difficult if it is done from a distance, as in shipping. Decision-making in shipping as far as vessel is concerned is in Captain’s hands… This delegation, which has to be implemented, whether shore managers like it or not, due to distance, is a crucial one and regrets occurred. For the time being, we can say that formalization¹² and advanced communications¹³ created serious hopes for shore-managers to manage ships effectively and efficiently. Surely this style of management is more expensive and more complex, requiring selection of best Captains and providing motives… A step near a better control is management by walking around¹⁴ and the reports of travelling personnel from shore office visiting company’s ships¹⁵.

Control is useless if red lines are not drawn by planning. This is so as without knowing what has to be done, especially in costs (budget¹⁶), a manager cannot “see” the deviations and cannot proceed to corrections. A new management is also emerging i.e. “managing by digitalization” (Goulielmos, 2020a).

A manager… has to lead, meaning to inspire. It is a sociological fact that working people do not give 100% of what they can, provided their salaries are fair. A leader has the task to convince employees to give the maximum of what they are able to. Leaders have to “influence” staff and Captains towards achieving company’s goals and objectives.

Sometimes managers put the right amount of responsibility on the shoulders of someone, who they know that he/she will carry it out successfully, if challenged, (called in Greek shipping “patent-finder”). Certain leaders provide participation of Captains in company’s profits. Leadership is an important property for Captains as well.

Planning is easier in shipping compared with other industries, as Revenue (price times quantity: R = Q * P: given distances) is not possible to be planned. This is so as what voyages will be undertaken by company’s ships next year is not pre-known. Planning in shipping is exhausted by working-out next year’s budget17. Managers have to give their utmost attention for an accurate budget—a responsibility of company’s Finance Manager and Chief Accountant.

Planning is the weak point of management emanating from the fact that forecasting is… not possible. This is also manifested by the existence of 9 different plans in management theory. This is also shown by the suggestion of theory to narrow down planning horizons from 7 years to 3, as time goes by. Greek shipowners, however, have found the proper strategy for growth of their companies, which showed elsewhere (Goulielmos, 2020b), and is successful with no forecasting, but simply identifying the rock bottom ship prices.

In 2016, “Vafias” group, owned18 83 vessels of 2.9 m dwt, holding the 32nd position among Greek-owned fleets, (4 positions up since 2014).

Photo 2. Father & Son.

Graph 3. The Vafias group, 2006.

As shown (Graph 3), the Group had a sense of a clear specialization over 3 market sectors, and 1 common service. However, is common among Greek shipowners to establish separate companies for specific business. The initiative to enter into shipping was due to N. Vafias19—the father—who in 1974 bought a general cargo vessel of 3500 dwt (with a partner). He founded “Brave Maritime” Shipping Company (in 1972). The father (Photo 2) was also active in 1985-1986 in the 2nd hand ship market. “Eco Dry Ventures’’ is also one of his subsequent companies, who bought 2 Capes in 2016—alleged at rock bottom prices—one being the cheapest one over the last 15 years or so.

The Stealth Maritime established (in 1980) as a result of owning 1 “Aframax” tanker, a trade in which the company later specialized, attempting also a number of renewal strategies. It owned originally 15 vessels, and in 2006 7: 2 Capes, 1 Panamax, 1 handy (built 1981-1983), (from prior fleet), 1 Panamax (built in 1977); and 2 handy (built in 1999). Company’s vision was, in 2006, to own 15 ships as in the past. Company, clearly, adopted a “tonnage maximization strategy”. “Stealth Maritime” decided to sell all “single skin” ships, and 4 Aframax, built in 2001-2004, in anticipation of their phasing-out by IMO of these tankers.

The “StealthGas Maritime” (2004) specialized in LPGs, where the group owned 26 ships (July 2006), where 4 were under construction. In 2005 (Oct.) “StealthGas” listed in NASDAQ—in a rather bad timing—because many companies listed one year before. The fourth company: “Brave bulk transport”, dealt with chartering cargoes of grain, fertilizers and other bulks, using also chartered-in vessels.

In October 2009—following the GFC—“Brave Maritime”²⁰ sold all its dry cargo ships, during prior 3 years, excluding 2 under construction. “Stealth Maritime” chartered all its tankers to long time charters (3 - 8 years). The “StealthGas Inc.” postponed delivery of 5 new-building gas carriers (to 2011 and 2012), and chartered 70% of the fleet for 12 months. Twelve expensive orders of new-buildings cancelled. Mr H Vafias - Harry, admitted that the end-2008 crisis was not expected. All above actions are classical among Greek shipowners during a crisis. Table 1 presents the history of the Vafias Group from 1999 to 2016.

Sources: As shown in footnotes.

The group had, in 2007, the following vision (Graph 4):

Graph 4. Vafias group 2007 vision.

Harry admitted that in end-2005, at the time of IPO, he promised investors that he would triple existing fleet from 9 tankers—in 6 months—to 27, but he did not… The share price went up from $12 to $14 at that time, despite his failed promise. Investors forgave him.

Company’s flags²³ were those of: Panama, Bahamas, Marshall Islands, Cyprus and Malta, with Filipino and Latvian seafarers. Moreover, company incorporated technology (computers etc., latest IT) into operations to keep-up with competition, and stay on top, using information. Company had all vessels with e-mail facilities and the shore-office departments were interlinked (Dec. 2005).

Company’s vessels (42 vessels plus new-buildings; May 2006)—of 9 years average age vis-à-vis 15 years of company’s competitors—geographically, specialized, in Far East (75%). Important matter is that company achieved a cost of $500 per vessel/day, which was 1/3 and 1/2 of company’s competitors! Company had few executives, a lean organization, and a family structure (with cousins in finance and purchasing departments), and father in charge of dry bulk division.

Clever is for the company to use (May 2006) 5 different 3rd-party ship managers: “V. Ships”; “Hanseatic”; “TESMA”; “Stealth Maritime” and “Swan”! It could compare own, and managers’ performance; also, the fee could be negotiated. Company was thinking in concentrating eventually to only 2 managers. Harry argued that the 3rd-party managers are promising, and experienced, if ships are of high technology and complicated, like chemical tankers, LPGs and LNGs.

Harry argued that there is a lot of emphasis in family structures, where Greeks refuse to lose their commercial and technical control of ships. Since 2003-2004 certain Greek shipping companies expanded and developed further by resorting to “USA capital markets”—requiring a non-old fashion and non-traditional way of company running. The successful modern competence is based on concepts like: greater transparency and efficient corporate structure, while the industry is moving towards more openness, to convince investors to trust company’s managerial decisions.

Interesting is to be informed from first-hand (Harry) the advantages and disadvantages of listed companies (Table 2), presumably in NASDAQ.

Harry’s competitors, defining those, who in end-2015, ordered LPG ships were (Table 3).

Source: author; data from one of Harry’s interviews.

Source: “Naftiliaki” journal, 2016.

O travelled in 1923 to Buenos Aires²⁴ from Athens. His tobacco-dealing family lost everything—except family’s savings—when Smyrni burned-out by Turks, in 1922. O became a superstitious person brought-up in Turkish kismet²⁵. In Argentina, O worked during nights, (earning a better salary of ~$100/month), in the “British United River Plate” - Telephone company²⁶.

He imported oriental27 tobacco, during the day, and managed to increase it (25%). He adopted Hellenic nationality by alleging that he came from Thessaloniki. After 2 years in Argentina, O earned $100,000 from commissions (5%) on tobacco sales. Then he dealt with cigarette manufacturing28 and commodity trading (leather, linseed). He made a small profit by speculating also on commodities. By the age of 31, he had made his 1st million $! He also acquired Argentinian nationality.

“Onassi Socratis” was the name of his “1st” ship30 afloat in 1932. He bought 6 ships in fact, (10,000 tons each; built in 1914-1918), from a Canadian company for $120,000. O attracted to shipping mainly—we believe—by industry’s ability to create millionaires… His close friend Gratsos31 (1902-1981)—a charismatic shipowner—surely fed his imagination.

In 1932, in London, O tipped-off that the “Canadian National Steamship Company” had 10 cargo ships, tied-up in St. Lawrence River, selling 2 of them at $30,000 each (presumably a price near scrap value). O hired a naval architect and inspected the ships personally, for 3 continuous days, from head to tail, under a severe weather with thick snow… The psychological pressure exerted by O on sellers by his daily findings written-down in his notebook, reduced price to 1/3… This indicates a good negotiation skill, based on knowing human psychology. The 3 out of 6 ships named: “Penelope Onassi”, “Socratis Onassi” and “Canadian Spinner”. O learned, that in shipping, he had to32 (Graph 5):

Graph 5. Onassis first 8 shipping lessons.

O’s desk, at “Leadenhall Street”, was in the office of Dracoulis shipbroking firm. There O was reading any shipping information coming-in… He struck by the “Great Depression” in 1929-1933, as everybody else. In Argentina, (ally of Germans), O’s non-shipping business subsidized his shipping ones during those difficult days for shipping, and not only.

Vessel “Onassis Penelope” was stuck in Rotterdam, as her cook fell ill and another from Greece had to come. She had to deliver cargo next in Copenhagen, and also to follow-up a subsequent charter. The loss from delays was substantial. The Greek consul insisted: “the ship has to follow the law”. O decided to replace Greek flag with that of Panama… working overnight with lawyers and agents.

The real great leap forward for O took place in 1938. O built then his 1^st tanker, and newbuilding, and a giant (for her time): the “M/T Ariston³³”—which slid down at Gothenburg’s shipyard. A Sweden shipyard has “agreed” to build M/T Ariston, finally, for: 25% of the price to be paid in 3 installments—during building, and the remaining 75% in 10 years at 4.5% interest. This was the world’s largest tanker in water in 1938 of 15,000 dwt (1.71 times larger than any other tanker; in fact, she was 15,360 dwt).

The shipyard, which built M/T Ariston, felt as taking a high risk by building this large tanker for the 1st time, for one unknown and… perhaps crazy—Greek shipowner, and thus charged a rather high price (= $800,000) … Also, O did not have—as most Greeks shipowners—the best credit rating,and the initial terms for “M/T Ariston” were tough (e.g. 50% of vessel’s price in cash). O, however, insisted in building her, convincing—his hesitant shipbuilders—out… They were challenged by ship’s goliath size—a double size of what has been built so far—leading them to unknown territories…!

O knew that Ariston would earn more than 2 times any other, i.e. compared with any existing tanker of any other owner and under the same hire. He was right. This was the 1st time when a businessman obliged naval architects, ship designers and ship engineers alike, to go beyond their limits… The “M/T Ariston” obtained a year charter from “J P Getty’s Tidewater Oil”³⁴ company.

To achieve the above O mobilized his good public relations, which he cultivated in Argentina (1934), with Miss I. Dedichen—the daughter of a leading Norwegian shipowner, and a Swedish socialite. “International public relations”were indeed a way for entrepreneurial success for O,and for others,indeed few,Greek shipowners (e.g.the late D.Manios;late Niarchos St.).The excellent international public relations were crystalized by O by using a beautiful small island the Scorpios, and an exceptional yacht (the M/Y Christina)…

Shipowners are of 2 types: those who wait businesses to come-in to them by cargo brokers via e-mail, and those that go-out and find the cargoes. The first I call managers. The second I call entrepreneurs…

Matters changed from the past; in old times, shipowners were merchants, which means that they owned cargoes, and they had then to become shipowners to transport them where they could be sold. Specialization then introduced. Specialization harmed Greek shipowners, and at the same time benefitted them. As a result, shipowners had to seek for cargoes… Modern owners had, as a result, to concentrate to chartering. Chartering is what are the sales for non-shipping companies, and good - profitable - companies are distinguished by the good chartering brokers they have.

Onassis observed that “M/T Ariston”s building was in delay and he had to travel to Sweden to speed it up! How on earth one—superstitious man—could not believe that she was (“M/T Ariston”) the reason, which saved his life? (Photo 3)

Photo 3. Air transport.

The M/T “Aristophanis”, 15,000 dwt, delivered during the outbreak of the 2^nd World War to O, was chartered under Norwegian flag. Also, the larger M/T “Buenos Aires”, 17,500 dwt, was near completion at “Gotaverken yard”. The “M/T Ariston” was impounded in Stockholm; 2/3 of O’s tankers served Allies in convoys in Atlantic Ocean.

In 1940, O travelled to NY. UK had to be, sooner or later, the target of Germans… The “M/T Aristophanis” finally “arrested” (…by Onassis) when called to “Rio de Janeiro” (!). Norwegians compelled to pay O $1m for her contribution to war… Moreover, 3 of O’s ships were chartered by USA Navy, earning $750,000 p.a. In 2^nd World War O lost no ship or crew… A “star”, i.e. O’s star, could be responsible for it? He believed so.

O was not allowed³⁵ to buy any of the 107 wartime surplus ships built by USA for world’s Liberty (Appendix 1), which “Fed maritime commission” allocated to Greece for its wartime toll, paid by country’s merchant marine! O applied for 20;he received none. The reasons were: his ships were not under Greek flag; he was not a member of Greek shipowners Union and he had no ship lost (during 2^nd World War)… This was the price O paid for not using Greek flag,but this, however,was only 1reason…

O saw that there was an opportunity to transport coal to America, France and Germany, if he had 16 Liberties—for which he made the calculations—but… he did not have the ships… (!). In fact, O had a wishful thinking… He applied to First National City Bank for a loan, but the bank gave him only 1/2 of total amount. He then wanted (1947) to acquire certain T2 tankers—priced at $1.5 m each—considered by him as an opportunity—each being able to carry 16,000 tons, or 6 m gallons, of oil. This caused O troubles.

O felt that he has been treated unfairly over the allocation of the 107 Liberty ships by his Greek colleagues, and so he decided to obtain them from market… O’s bitter feelings were manifested in his open letter36, published in 1947, where he wrote: “I, the victim of being Greek, began from zero, without being the offspring of a shipowner… I worked, and I succeeded, without exploiting: either the name, or the flag, or the guarantee of Greek people, or of Greek Embassy, during my residence in USA. I am proud of that, in contrast to you37, who enjoyed capital from your parents, the opportunities of 2 wars, and the scandalous leniency from Greek state in order for you to succeed”.

O was a newcomer to the profession (mainly since 1938), where his competitors were there since early 18th century or even before. They regarded themselves as the “Aristocracy of Shipping”. Moreover, while O became a shipowner before the 2nd World War, he was mal-treated, because he lacked tradition and his riches were newly obtained (Harlaftis, 1993)—he was called in Greek: “Νεόπλουτος” (the new rich). O found, however, the way to gain his admission into the club of Greek traditional shipowners. He married the daughter of a prominent traditional shipowner, i.e. of Stavros Livanos.

O dared then to make an offer for 16 liberties… he did not have, to carry coal to N America. O had the entrepreneurial inclination to know that to find cargoes was more important than owning ships! Using the charter parties as collateral, O easily raised finally the funds to… buy these 16 Liberties, which he has dreamed of…

The post-2nd WW recovery favored—no doubt—the dry cargo ships38 as well, as far as size is concerned. O still believed in tankers, where he used to be the leader since 1938.

As the war-US T2-tankers could not be allocated to non-US citizens, O… established an American corporation39—where US citizens had the majority of shares and obtained40 4-T2 tankers from “US Maritime Commission”, at a time when a severe winter intensified demand for oil (1947)—“his star” favored him! O eventually gained the 49% stake in this company… This whole project was, however, an entrepreneurial mistake, we believe, mobilizing the whole official USA against O… O new 4 (Graph 6) important facts.

O was right⁴¹. Moreover, O believed that a newbuilding could have the superior quality an owner wanted, and more so it could be ordered in numbers. Growth for O had no limits if aided by finance. Finance is the necessary, but not the sufficient condition to become a shipowner, and grow fast, as economists say. O had 3 targets (Graph 7).

Graph 6. Onassis’ 4 important facts.

Graph 7. Onassis 3 targets.