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{"id":7651,"date":"2017-12-07T02:00:51","date_gmt":"2017-12-07T02:00:51","guid":{"rendered":"http:\/\/moovafrica.com\/news\/?p=7651"},"modified":"2017-12-12T12:17:21","modified_gmt":"2017-12-12T12:17:21","slug":"the-modern-port-and-global-supply-chain-optimization","status":"publish","type":"post","link":"http:\/\/moovafrica.com\/news\/the-modern-port-and-global-supply-chain-optimization\/","title":{"rendered":"The Modern Port And Global Supply Chain Optimization"},"content":{"rendered":"
The Modern Port And Global Supply Chain Optimization: Photo: Port of Ningbo\u00a0Zhoushan, China<\/em><\/p>\n
<\/p>\nDr. Obiora Magu<\/figcaption><\/figure>\n
<\/p>\n
\n
No matter how information technology advances, the world trade cannot be materialized without ports. This is exactly why every country needs to develop much more advanced and efficient ports for its prosperity <\/em><\/span><\/strong><\/p>\n
–\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dr. Mahathir, former Prime Minister of Malaysia <\/em><\/p>\n\n
<\/p>\n
INTRODUCTION <\/strong><\/span><\/p>\n
Ports today face two competitive challenges the large increase in volumes and the need for greater efficiency. This paper will identify catalysts for the optimum future development of port infrastructure as well as the implication on export competitiveness, port commerce, inter-port co-operation and competition. It will also provide a framework for improving integrated logistics network as a tool for utilizing the full capabilities of modern ports, provide some insights on the cost of poor logistics to country competitiveness and the sources of those higher costs. Beyond cost and time taken to deliver goods, it will also delve into the predictability and reliability of supply chains.<\/strong><\/span><\/p>\n
Seaports and Supply Chains <\/strong><\/span><\/p>\n
Ports, as members of a supply chain and a part of a cluster of organizations, have a huge role to play for seamless operations. These roles include:<\/span><\/p>\n
\n
relationships between the port operators and the focal firm<\/span><\/li>\n
supplied services that add value<\/span><\/li>\n
information and communication technologies<\/span><\/li>\n
performance measurement indicators common to supply chain partners and<\/span><\/li>\n
introduction of the logistics concepts of lean and agile<\/span><\/li>\n<\/ul>\n
The challenges facing shipping and the world’s ports today are not only related to the quantity but also the quality of services. The continuous progress of globalization of shipping and trade business is resulting in increasing pressures on ports cost and improve operational efficiency.<\/span><\/p>\n
The Role of Modern Seaports <\/strong><\/span><\/p>\n
The role of modern seaports involves integration in the supply chain. Fulfilling this role means greater ability of the port to satisfy customers and achieve its objectives. On this basis, it is hypothesized that specific measures of integration in the supply chain will be positively related to specific measures of port performance and competitiveness the measures themselves reflecting contemporary logistics goals and not merely traditional efficiency measures.<\/span><\/p>\nThe Port of Mombasa is the key entry and exit point for cargo belonging to a vast hinterland that include Kenya, Uganda Rwanda, Burundi, Democratic Republic of Congo, Tanzania, South Sudan, Somalia and Ethiopia. The port of Mombasa dates back to 18th century when the Portuguese and the Arabs came to the East African Indian ocean shore for spice and slave trade. In 2014\u00a0Port of Mombasa was voted the top\u00a09th global port, being one of the world\u2019s biggest or busiest seaports.<\/figcaption><\/figure>\n
<\/p>\n
Key Challenges Faced within a Global Logistics Network <\/strong><\/span><\/p>\n
Achieving True Excellence within a Global Supply Chain is as much a journey as it is a goal. The key challenges which ports face within the global logistics network include:<\/span><\/p>\n
\n
lengthening of the supply chain<\/span><\/li>\n
difficulty & cost inefficiencies in transportation execution<\/span><\/li>\n
lost sales\/mismatch in supply & demand<\/span><\/li>\n
disconnect between international and domestic transportation<\/span><\/li>\n
lack of strong technology support<\/span><\/li>\n
lack of experience and skill sets<\/span><\/li>\n<\/ul>\n
Characteristics of a World-Class Transportation Logistics Network <\/strong><\/span><\/p>\n
The characteristics of a World-Class Transportation Logistics Network include:<\/span><\/p>\n
\n
optimal design of global supply chain<\/span><\/li>\n
integrated planning and execution processes<\/span><\/li>\n
integrated international and domestic logistics<\/span><\/li>\n
global logistics visibility<\/span><\/li>\n
dynamic logistics routes<\/span><\/li>\n
logistics process automation<\/span><\/li>\n
collaboration with supply chain partners<\/span><\/li>\n
compliance with changing regulations<\/span><\/li>\n
making the financial supply chain connection<\/span><\/li>\n<\/ul>\n
Competitive Performance Measures for Ports <\/strong><\/span><\/p>\n
Marlow and Paixao (2003) and Tongzon and Heng (2005), among other writers, had identified the following five competitive performance measures for ports:<\/span><\/p>\n\n
Price (Cost Advantage)<\/span><\/li>\n
Quality<\/span><\/li>\n
Reliability<\/span><\/li>\n
Customization<\/span><\/li>\n
Responsiveness<\/span><\/li>\n<\/ol>\n
Laggards are taking the full brunt of rate increases and capacity\/performance shortfalls while leaders are taking action to avoid these problems by:<\/span><\/p>\n
\n
trying to improve overall service and financial performance<\/span><\/li>\n
Contemporary developments in maritime transport and logistics indicate that ports should play an important strategic role as a member of a supply chain that involves sea and inland transportation.<\/span><\/p>\n
There are six parameters that account for most of the variation in the degree of seaport integration in logistics and supply chain management.<\/span><\/p>\n
These parameters are<\/span><\/p>\n\n
adoption of information and communication technologies,<\/span><\/li>\n
relationships with shipping lines,<\/span><\/li>\n
value-added services,<\/span><\/li>\n
inter-connectivity\/inter-operability with inland modes of transport,<\/span><\/li>\n
relationships with inland transport operators and<\/span><\/li>\n
channel integration practices and performance<\/span><\/li>\n<\/ol>\n
Infrastructure and Export Competitiveness <\/strong><\/span><\/p>\n
Infrastructure development is a key element of a country s ability to produce and move goods. O Rourke and Williamson (1999) argue that all of the commodity market integration in the Atlantic economy after the 1860s was due to the fall in transport costs between markets…<\/span><\/p>\n
Weak infrastructure is a major impediment to trade, competitiveness and sustainable development in most African countries. Recent literature has emphasized the dependence of trade costs on infrastructure.<\/span><\/p>\n
Trade costs <\/strong><\/span><\/p>\n
Trade costs can be defined as the cost of transaction and transport associated with the exchange of goods over and above the marginal cost of production. Broadly defined, trade costs include all costs incurred in getting a good to a final user other than the marginal cost of producing the good itself.<\/span><\/p>\n
Such costs include transportation costs (both freight costs and time costs), policy barriers (tariffs and non-tariff barriers), communication costs, utility costs, and local distribution costs (wholesale and retail).<\/span><\/p>\n
Trade Competitiveness <\/strong><\/span><\/p>\n
Improved trade logistics and facilitation can improve competitiveness by:<\/span><\/p>\n\n
Increasing profitability of existing exports and encouraging expansion in production.<\/span><\/li>\n
Reducing delivery time and cost of imports, benefiting both domestic & export sectors.<\/span><\/li>\n
Allowing manufacturers to enter high-value market segments e.g. premium garments requiring shorter delivery cycles.<\/span><\/li>\n
Opening up new markets e.g. horticulture – flowers, fruits, etc.<\/span><\/li>\n<\/ol>\n
In addition to the macro incentive regime, what is also important is that firms have access to efficiently-produced critical backbone services and inputs. Countries where firms have to pay more than their competitors for energy, telecommunications, customs services, transport, logistics, and business registration and operations, will find it hard to compete in the global markets.<\/span><\/p>\n
![\"\"](\"http:\/\/moovafrica.com\/news\/wp-content\/uploads\/2017\/10\/Dr.-Obiora-Madu-Profile-Photo-1-271x300.jpg\")
![\"\"](\"http:\/\/moovafrica.com\/news\/wp-content\/uploads\/2017\/12\/MombasaPort-1.jpg\")
![\"\"](\"http:\/\/moovafrica.com\/news\/wp-content\/uploads\/2017\/12\/Bus-Travel-Ad-24-A.jpg\")
<\/a><\/p>\n