Improving business performance while managing challenges



Martin Sharp, Business Development Manager, BMT Hi-Q Sigma Ltd., London, UK


The business context:

Ports and terminals are complex businesses and a key link within the overall logistics supply chain. However, some might argue that they are indeed the weakest and least transparent link in the chain. Examples of these complexities include:
• Operating in different ways, for example Gateways, Transhipment, Free Trade Zones, to name a few
• The structure of ports in terms of land, terminal infrastructure, terminal superstructure, quayside operations, landside operations and the ownership of these, which vary considerably
• The volumes of cargo expected to be handled by a port are ever increasing, and the need for flexibility is creating a new set of challenges
• Ports will soon need to consider the berthing of nuclear-powered vessels, and when this is combined with unrest and terrorism around the world security quickly becomes an added pressure
• Technology – be it automated handling systems, port community systems, planning systems, security systems and so on – and the need to ensure the safety of workers in a dangerous environment
• A growing need to reduce the adverse effects on the environment.

It is clear from this list that running a port is growing in complexity and with no sign of this easing, certainly not in the near future, the question is how do we improve business performance whilst dealing with continuing pressures?

Business planning

Into this complex environment we have to add the customers. Professor Robert Cochrane recently spoke at the FACT 2011 Seminar in London and suggested that “The Terminal Manager’s objective is: to satisfy the shareholders by making a profit through providing terminal facilities which attract and serve customers including shipping lines and agents, hauliers, financiers and insurance companies – the most important of which are the shipping lines.”

Ports exist to move cargo and passengers between sea and land (not forgetting dry ports and transhipment hubs) as quickly as possible; therefore the amount of cargo that customers wish to move through a port is critical to the success of the businesses involved in a port. BMT is frequently asked to provide terminal operators, port owners, financial investors and others with traffic forecasts that provide vital input into business plans looking forward for the next 10 to 30 years. Our multi-faceted approach to port traffic forecasting incorporates a wide variety of variables that directly relate to the port sector, and recognize the importance of relationships between:

• Cargo volumes and developments in both sectors of the economy and industry, as well as with the economies of partner countries.
• Past and future interactions and how these have, or are likely to, shift over time as economic relationships change; whether on a temporary or permanent basis. This is achieved through econometric and other statistical analysis, as well as market research to ascertain structural changes in the industries that import and export.

In addition, and most importantly, the impact of changes in the infrastructure, technology and the commercial state of the transport sector are factored in by a process of specialized desk and field research. What everybody is trying to achieve is the highest level of confidence in the volume of goods, passengers and so on through a port, and therefore have a better understanding of the potential for ongoing business in a changing environment. With this ever-changing market, how can we keep on improving the business performance?

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