Brave operators

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Carly Fields finds out why you need nerves of steel to run a port in today’s business environment

“You must be a brave man to operate in ports today” was the sombre opening of MTBS director’s Paul van Eulem session at the International Association of Ports and Harbours’ annual conference.

Addressing an audience of high level port executives, Mr van Eulem’s comment struck a chord.

Ports today have to deal with numerous external threats, piled on top of the operational challenges faced day to day.

“We see that today's socioeconomic realities question the fundamentals of growth. We need to create additional capacity while at the same time dealing with congestion. Threats, externally and internally, are tremendous,” he said.

Shipping lines that have re-organised themselves into ever-larger alliances to call at ports with ever-larger vessels put pressure and risks on port operations, both commercially and competitively.

Meanwhile, privatisation and commercialisation have fundamentally changed the mandates of many port authorities, not only through internal organisation, but also through altered business models and shifts in a port’s ability to finance port infrastructure.

“The market changes at a very, very rapid speed,” said Mr van Eulem, something that ports in western Europe that embarked on large port expansions in the early 2000s only to be hit by the financial crisis can attest to.

Despite this, ports will continue to grow and as a result, the port/city interface will become more complex and more multi-dimensional. But while stakeholders might be better organised today, they are not necessarily better informed, a challenge in itself. “There is an essential role for port authorities to communicate, discuss and inform those stakeholders about the plans for tomorrow,” said Mr van Eulem.

And as if that wasn’t enough, ports still need to protect, uphold and preserve public interest in a rapidly changing industry where the rules of the game can be changed during the game. “That is why port people and port authorities are among the bravest people on the planet,” said Mr van Eulem.

Meeting threats

IAPH president and Port of Barcelona deputy director general Santiago Garcia-Milà translated this into a constant need to transform to meet the challenges posed by ever-changing regional, national and international economies, trade and logistics patterns.

“In this modern global trading environment, we are well aware that ports must be efficient, cost effective, sustainable and responsive to changing market demands,” he said. “It is not an easy task and will not be done overnight, but it is worth a try. Nowadays, people write and talk about smart ports, digitalisation and productization and of course, ports greatly benefit from advanced technology.”

Mr Garcia-Milà added that ports must take advantage of this ‘advanced technology’ to offer better and more efficient services for all stakeholders in the global trade and logistics chains.

Automation is just one output of this advanced technology and one that is gaining traction in the industry. TBA’s Yvo Saanen provided a checklist of things to take into account for ports considering introducing automation to their quays: build a financial business case around true 24/7 operations; consider operational control options; consider the environmental benefits of automation; and last but not least, factor in the safety improvements offered by an automated terminal.

“A business case for automation is composed of many different components, way beyond the financial ones,” he said.

Looking to the future, Dr Saanen predicts that we will soon see humans and robots working side by side, while Internet of Things uptake will spread even further. Added to this, there will be autonomous vehicles that will not need centralised systems to control them, increased supply chain transparency, and more and more deployment of electrical technology.

“We will see and hopefully get better use out of the wealth of data we are collecting,” he said. “What does it mean for container terminals? They need to deal with this available data and use it to operate more efficiently so they can also reduce the cost of operations. And they need to deploy more automated decision making and more robots, taking people away from hazardous situations.”