{"id":3980,"date":"2014-07-28T10:00:00","date_gmt":"2014-07-28T09:00:00","guid":{"rendered":"https:\/\/portstrategy.nfdtesting.uk\/coastlink\/2014\/07\/28\/connecting-the-process-dots\/"},"modified":"2026-08-27T15:36:20","modified_gmt":"2026-08-27T14:36:20","slug":"connecting-the-process-dots","status":"publish","type":"post","link":"https:\/\/www.portstrategy.com\/coastlink\/2014\/07\/28\/connecting-the-process-dots\/","title":{"rendered":"Connecting the process dots"},"content":{"rendered":"

Port executives are being encouraged to embrace enterprise resource planning (ERP) solutions as a means of streamlining information flow across their numerous internal processes and systems, in order to deliver improved business performance and reduce costs.<\/p>\n

Traditionally, ports have run separate systems to manage each aspect of their businesses – terminal operations, finance, procurement and inventory, human resource, payroll, management and workforce management.<\/p>\n

However, such an approach fosters the opportunity for inconsistencies, inaccuracies and delays in the sharing of information required between the different business units in order to process a given transaction.<\/p>\n

Contrastingly, the integrated architecture approach of ERP presents the opportunity for ports to embrace a multitude of performance improvements, says Envecon chief executive Rajesh Nair.<\/p>\n

\u201cERPs traditionally provide an integrated cross-process view of mega processes such as order-to-cash, procure-to-pay or recruit-to-retire and have one common data model,\u201d he tells Port Strategy<\/i>.<\/p>\n

\u201cThey also have standardised interfaces to external third-party solutions that enable both batch and real-time integration from systems that deal with front-end processes such as terminal operations, vessel billing and EDI systems.<\/p>\n

\u201cKey KPIs for any port or container terminal are operational efficiency and ability to optimise costs across a large labour force, expensive equipment and maintenance operations. ERP systems address these needs well since they have fairly comprehensive features for asset management, complex financial and procurement capabilities, warranty and spares procurement and repairs, and deal easily with large workforce planning and scheduling operations.<\/p>\n

\u201cCosting is a key module and the ability to track and report costs by equipment, function and unit enables better planning and control.\u201d<\/p>\n

Mr Nair says having one integrated data model means a \u201csingle version of truth\u201d is created.<\/p>\n<\/p>\n

Truth talk<\/strong> <\/p>\n

\u201cERP systems also enable strong automation and workflow processes that make it easier for organisations to streamline existing operations and enable quick turnaround of activities.\u201d<\/p>\n

Accenture Greater China products operating group director Fox Chu adds it is time executives embraced developments such as ERP to \u201crevolutionise the port industry\u201d.<\/p>\n

\u201cIf you analyse GDP forecasts of different countries, you will come to the basic conclusion that global consumption will only go up as consumers become more affluent,\u201d he says.<\/p>\n

\u201cThis will naturally result in increased trade and with more trade means the demand for cross-country shipping will increase, leading to busier international container traffic.<\/p>\n

\u201cERP on its own cannot solve all problems but it is without a doubt a powerful tool to be leveraged on a port operator\u2019s journey to transform into a high-performance organisation, better equipped to face the increased demands in an ever-changing business and economic environment.\u201d<\/p>\n

In terms of cost, complexity and time required to transition to ERP, Mr Chu says that is ultimately dependant on the objectives and vision of each port.<\/p>\n

\u201cWe will develop a benefit case with the port operator and identify the case for change before nailing down the technical scope of the ERP implementation.<\/p>\n

\u201cIn some instances, ports envision a roadmap that requires a longer and more complex process when it comes to implementing ERP. For example, a project involving business transformation and deployment of new capabilities would be most complex, followed by operational transformation involving BPR [business process re-engineering].<\/p>\n

\u201cOn the flipside, technical replacement will take up the least amount of time and is the least complex process.\u201d<\/p>\n<\/p>\n

Late arrival<\/strong> <\/p>\n

Harbour Mastery Inc chief executive George Walters concurs that ports have been \u201clatecomers\u201d to the concept of embracing integrated ERP systems, primarily due to the challenge of configuring for each individual operation.<\/p>\n

\u201cThey are therefore considered a niche market and off-the-shelf solutions do not really exist,\u201d he says.<\/p>\n

However, once port executives have embarked on the ERP path, Mr Walters notes that varying levels of implementation can be undertaken.<\/p>\n

\u201cWe have one client who went the route of limited implementation with interfaces to legacy systems and it took over seven months to deliver their solution. It works extremely well but they are supporting a lot of costs to keep three separate systems running.<\/p>\n

\u201cWe have another client who replaced five systems with our one integrated solution and they have greatly reduced costs. The delivery time was about the same, but their accelerated time for delivery of services and the reduction from supporting five systems to one, has brought them the efficiency they are looking for and more than they expected.\u201d<\/p>\n<\/p>\n

In or out?
<\/strong><\/p>\n

Another key decision for port executives is whether they implement an in-house or hosted solution.<\/p>\n

\u201cThe advantage of in-house is that you can see it, touch it and \u2018feel\u2019 like you have more security,\u201d continues Mr Walters.<\/p>\n

However, he lists the disadvantages as:<\/p>\n