Managing Shipping Companies, the Way Their Pioneers Did: The Case-Studies of Aristotelis S. Onassis II and Angeliki Frangou

Abstract

This work finalized the presentation of the business life of the late (golden) Greek shipowner Aristotelis S. Onassis, which we started in a previous paper (in this journal1). Our purpose was to provide a real example, in which prospective managers may find-out certain strong points. Onassis believed in his arithmetic as far as shipping economies of scale are concerned and in the future of oil consumption, since 1938. The largest tanker in the water was always his, a fixed target. He was also after a rapid growth of his fleet, using other people’s money. He was building almost 3 ships each year on average for about 4 continuous decades! The top Chian shipowner Mrs. Angeliki N. Frangou, reached a fleet of over 18 m dwt-3 times larger than that of Onassis! She is strong knowing capital markets, as she used to work in Wall Street, and she has the ability to derive the funds she needs at low interest rates. She (a mechanical Engineer by education) understands also the “cost minimization” principle. She was round during the end-2008 global financial crisis, when she learned that a hundred of opportunities crop-up during such a time, provided one has funds. Unlike Onassis, she was on board her father ships since a little girl, and surely tradition, (and her conservative father), taught her the old shipping wisdom…while the modern one, she learned by herself. The method used was to read a great number of books, articles, announcements and interviews, many more than those mentioned in the reference list. To note-down the business style of each shipowner, dropping-out all irrelevant facts and private life. For Onassis, we read more than 10 books. Our scientific curiosity and our experience as a professor of shipping management enabled us to single out the management ways and the principles applied by these two managers. The end purpose was to teach readers of how shipping business can be carried-out with success given the changes occurred.