IMROVING PERFORMANCE
IN PORT AUTHORITIES
WAFI DAWOOD JAFFAR
Dubai Ports Authority, UAE
Gordon Berry
Ian Ridley
University of Sunderland, UK
Integrating for Excellence Conference
16 June 2005
Sheffield, UK
Contents
Overview of ports
Port Performance Research
The Strategic Approach
Overview of Ports
Major reference books on ports list
around 3500 to 4000 ports worldwide
Any ports story begins when the two
way exchange between land and water
transport is performed at a place
Generally, Ports are places with
facilities for shipping lines where
equipment are available to transfer
goods from and to the ship
Role of Ports
Traditionally, ports were:
sources of employment,
attractors of industries,
places of lower prices,
communications nodes
and centres of militant activity
Traditional ports began to decline in the United
States during the 1950s and throughout the
rest of the world during the 1960s and 1970s
Role of ports in todays
global market
Essential links in the transportation chain
The gateway that enables trade as 90% of
world trade is carried by vessels
Major economic multiplier as they attract
other industrial activities (banks, hotels
agencies,)
Change in Demand Competition
Trade patterns
Inland Water depth
transport (ship size,
Dredging)
Port
development
Environmental Cargo handling
pressures technology
Different ownership Port Labour
(different goals: Management
Region, country, (unions)
City, private)
Main types of cargoes
handled in ports
Dry bulk,
Liquid bulk,
Containerised cargo
Non-containerised non-bulk cargo
Each of these types require a certain type
of ships and certain cargo-handling
equipment, thus certain type of ports
The pressure to redesign the
method of cargo handling came
after World War II
Costs while in ports had risen to over
40% of all costs for shippers
Labour frequent strikes
Damages were causing losses of up to
24% of cargo
Containerisation offered
solutions to all these problems
Containerisation is simply the loading of
cargo into uniform-sized package, whose
dimensions are generally 8 feet wide, 8
feet tall, and either 20, 30, or 40 feet
long
The first use of containers was
in 1956 as a shipment of 58
boxes between New York and
Houston. This shipment was
organized by Malcolm McLean of
the McLean Trucking Company,
which later became Sea-Land
Service
Due to the multiplicity of port
functions and various cargoes handled
in ports, this paper will examine
container ports only
Container Ports can be defined as
places with facilities for shipping lines
where equipment are available to handle
container flow from vessels to rail or
road, and vice versa.
Growth in Container Business
200
180
160
140
120
100
80
60
40
20
0
1985 1990 1991 1992 1993 1994 1995 1996 1997 1998
M i l l i o n T EU s
Million TEUs Nort h & West Europe Medit err anean Middle East Indian Sub-Cont inent
Nor t h- East Asia China Port Region Sout h-East Asia Nort h Amer ica Cent r al Amer ica & caribbean
Sout h America Aust r alasia Af rica
Problems associated with
container business
large investment
increase in size and complexity of
ships
need for a comprehensive information
system and greater efficiency
A significantly smaller but better
trained workforce
Port Performance
Research
The need for Port
Performance Approach
Global Market
Increase Competition
Different Parties involved in port
development
Port Performance Improvement
An important issue facing policy makers
in container ports
Earlier studies suggested a model for
port performance management (Jaffar
and Berry 2004, and tested the model
using time series analysis (Jaffar et al
2005)
The model consisted of TEU as
a performance measure
5 main predictor variables
(criteria)
29 performance enablers (sub
criteria)
Leadership commitment to
excellence
The government working as a facilitator to
privatise the port
Adoption of modern management concepts
Customer satisfaction
Port charges
Quality of personnel
Motivation of staff
Modern technology
The use of latest port equipment
IS department to handle customers
requirements
Communication technology
Use of modern software in various port
operation
Integration to Custom IT
Use of security technology
The efficiency of the
terminal
Crane productivity
Technical productivity
Yard equipment productivity
Gate productivity
Equipment utilisation
No. of berths
Port size
Geographical position
Port capacity
Spare capacity
Level of congestion
The ability to handle Mega ships
Master plan
Port hinterland
Level of economic activity
Accessibility to modern roadwork
system
Access to wide range of markets
Feeder services
Transshipment traffic
Freezone
Model Testing
The time series Analysis and the
multiple regression suggested that
the most sensitive enablers in the
model are:
1. The government working as a
facilitator to privatise the port.
2. Port capacity
3. Crane productivity
The aim of this paper is to
develop a strategic approach
that can assist policymakers in
container ports to manage and
improve performance
Originality of the
Research
Fundamentally, this research makes a contribution to the
knowledge by adopting a strategic approach for managing
performance in container ports.
Earlier studies investigated the performance of ports at
a defined year.
This study investigates the performance change over
five years
There is lack of academic materials using ports in the
Middle East
This study has used 3 ports from the Middle East
within its sample
Methodology
Research sample was container ports: 12
ports world wide (purposive sampling)
Data collected using interviews and
questionnaires with the port managers
Data analysis approach included grounded
theory, multiple regression and time
series analysis
The Strategic
Approach
Major port
operator to
provide Improved
value Performance
added
activities
Major Port Operator Port Capacity Crane
to prepare / improve Productivity Use of
/ modify the Technology People
following according to Security
the overall objective
Port
Strategic
Alliance
Government
Commitment
to support
the port
Phase I: Government commitment
to support the port
macroeconomic level: improve external
trade by reducing transport costs
microeconomic level: develop alliances
with port operators
Phase II: Strategic Alliances with
major port operator
Port authorities cannot compete with the efficiencies
and capital offered by port operators
major port operators are controlling 58% of the world
container market
Ports a not wishing to have an alliance, might loose their
business trying to compete with major port operators
Governments should decide on the best approach of the
strategic alliance depending on the countrys
economical, political and social environment
Phase III: The port operator to
prepare/improve/modify the
following enablers according to
the overall objective:
9 Port capacity
9 Crane productivity
9 Use of Technology
9 People
9 Security
Port Capacity
Diffrent definitions in the literature
The research considers the quayline in meters
(berth availability is more critical comparing with the
yard space)
9 Utilising the current capacity
9 Expansion plans
Capacity should be extended
promotionally to the predicted
growth
Increasing capacity of container
terminals in Europe has more
obstacles when comparing with the
Middle East because of the pressure
from environmental groups
Crane Productivity
Measured by Moves/hr
The increased vessel size has affected the
cranes design
Container terminal management has to plan
that the future containerships will require
increasingly larger container cranes.
Use of Technology
Using different computerised packages to
support the terminal operations
Use of ERP (Enterprise Recourses Planning),
a system that covers all the port business
including communication, operation,
maintenance, marketing and finance, by
integrating the management resources as a
whole through business process
reengineering.
People
Recognised as a vital element in management models
A detailed study to evaluate the people productivity:
number of employees, average age of total labour
force, average hours worked per week and idle time
percentage
Develop the local people using the supervision of its
expert professionals. They could also be trained in
major terminals worldwide to enhance their abilities
and skills in managing container terminals.
Security
The precautions implemented against terrorist, theft,
sabotage, stowaways, illegal immigrants and
smugglings. A particular aspect that is a major
concern currently is the measures against terrorism.
the ISPS (International ship & port security code),
which is a mandatory regulation by IMO
Risk Assessment to evaluate the port security
measures
Value Added Activities
9 Freezone
9 Pre-trip inspection
9 E services
9 Break-bulking
9 Packing / Re-packing
9 Packaging / Re-packaging
9 Sorting / Grading
9 Labelling / Re-labelling
9 Repair of goods in storage or transit
Thank You
Questions?
wafi.dawood@dpa.ae
