Port Management: Integration of logistics
Capt Gajanan Karanjikar, Multi-modal Transport expert, Independent Port Consultant.
Logistics and supply chain has evolved to a great extent in Last 2 decades and with the Artificial intelligence the integration would soon be the need of the hour. Everything that some in to the port and gets out of it is covered under the services called logistics. This also includes personnel as well as other service providers, equipments etc.
Logistics integration may be defined as “the integration of key business processes from end user through original suppliers that provides products, services, and information that add value for customers and other stakeholders” (Lambert et al. 1998).
Going by definition there is an urgent need to understand the business processes that are important for End user and close gaps, optimise the overlaps based on needed performance.
Nothing can be as better for the efficiency. If you look at the ports as gateways to the Cargo either way, import or export. So, it would be a factor of degree of integration in ports with respect to logistics.
Key objectives of integration should include:
• economies of scale, based collaboration
• encompassing operations, everything is seen as whole
• visibility throughout the entire supply chain
• customer needs meeting and exceeding
• Know lacunas in operations
• Skill development Seamless operations
• strengthening the supply chain’s performance
• enhancing their marketing edge, as they compete with other supply chains.
It is always an integration of resources:
It entails the broadest visions of holistic supply chain management that links the activities of supply chain partners as a source of customer value and competitive advantage.
From a ports’ perspective, integration encompasses three levels:
a. Port operations, that is, from cargo handling to storage
b. Port facilities planning, monitoring, controlling, and maintenance
c. Holistic integration at a corporate level, where the port reaches out to the entire supply chain for the exchange of information, resources, and corporate goals
Port being at the confluence of the Shipping and land-based industry for all export /import needs as well as being key factor in developing coast /port /community, it plays a vital role. An inefficient port will have to face lot of issues locally and the industry will suffer. Both internal and external integration i.e. one within port systems and other to support the industry needs is needed. Internally the port will have to align with Shipping industry’s needs, good work processes to serve better with greater efficiency. The leadership roles at ports are the key and service providers for the ports are also to be integrated with port policies. The best thing is to adopt the best practices in the industry. The port KPIs should be made to percolate to the service provider even if he is just one of.
The external integration will start with understanding the needs to the industry and then finding the gaps in present practices and expectations. The gaps which need to be taken on priority are the ones which are affecting the business processes and bringing in inefficiency. Performance adjustments to be applied horizontally (supply chain) and vertically (port authorities) so it has enough check and balances in place. Sharing innovation, talent, and resources to achieve economies of scale is very important. The communication within and outside port is need to be on need-to-know basis. More transparency in communication builds confidence in customers and will necessarily entail for hand holding for future businesses.
Indian ports especially need to do is to create value for the Indian Business houses, Maritime domains are not known to many business houses and thus export import become a agency operated functions and thus lot of ill information is either passed on or mal- practiced. There needs to be a transparency in what port can do and this would be a best component of building trust for ease of doing business. The private ports are not operated like this, the onus from business to operation falls on head of the port and he then steps pout for all necessary hand holding. Govt ports somehow lack in this as too many players involved which are criss-crossed linked to powers that be. The stark difference between the businesses of Private and Govt port (whether state or central) is because of the systems that are implemented. Standalone systems with integration even for port operations breed inefficiency.
(Courtesy: Marex Media)