Ports are being challenged on many fronts. Globalisation has led to an increase in shipping and a corresponding increase in demand for port services. At the same time, competition between ports is intense and the nature of the market is changing.
TEU capacity and throughput remain important but now there are added complications, with operators of mega ships seeking suitably mega facilities, while other shipping clients demand flexibility in facilities, to cope with a mix of containerised and non-containerised cargo.
All of these factors have placed port and terminal operations under the spotlight. Considerations such as the time it takes to load or unload a ship, the type of assets a port owns, and the availability and reliability of this equipment have become critical to a port's competitive positioning.
In a bid to outdo others, operators around the world are discovering that the key to cost-effective port efficiency lies in driving value and productivity out of port assets.
The nature of assets
Typically, the assets owned by ports are costly. From forklifts to cranes, the assets are expensive to purchase and to maintain. The other fact about them is they are absolutely essential for revenue. Containers can't berth or be unloaded without the right equipment. But at the same time, no port can afford to tie up money or excess assets.
To avoid these pitfalls, it is important that ports have an integrated view of their operations and maintenance. The aim is to strike a balance between the need to load and unload ships swiftly and efficiently, yet still have the ability to schedule essential maintenance.
Alignment with strategic objectives
The best and most accurate way of achieving this is by aligning operations and maintanance with the organisation's strategic objectives.
Begin by calculating anticipated TEUs for the year and consider how this number may grow. Then break the figures down to asset management objectives such as the number of berths and cranes that will be required to meet the expected throughput.
If you expect to have the equipment in operation for 70 per cent of the time, that leaves a potential 30 per cent when no ships are coming in and when maintenance can be carried out.
Hopefully, this 30 per cent fits with the actual amount of time you require to conduct maintenance. If you need more time, that's when the juggling act between priorities -asset availability, reliability and cost -comes into question. Exactly how these needs are balanced will depend upon the priorities of each individual port operator.
It's all about balance
When trying to maximise productivity and contain costs, there's one other particularly helpful best practice.
Analyse your assets in two distinct ways -in isolation and as a portfolio. It's important to know the costs, utilisation and productivity of a particular berth, for example, but it's equally essential to know the status of all the organisation's berths.
Their condition, capability and TCO not only points to capacity. It can also indicate risks, such as reliability, availability or exposure to upcoming replacement costs.
This latter risk is of particular relevance to companies that respond to the current increase in demand by suddenly investing in a variety of new assets.
An influx of new equipment ultimately creates an imbalance in the age of the asset fleet, which means maintenance demands will increase in sync and many of the assets will need to be replaced at a similar time.
This points to a significant cost burden in the near future. Good life cycle planning and clarity about priorities, especially in regard to operations, maintenance and costs, are essential in these circumstances.
This is where asset management can make a considerable contribution towards business and profitability by reducing costs and increasing the productivity of assets.
The emergence of frameworks including PAS55 and ISO55000 have helped shift the thinking of how to manage assets from that of determining what cost to meet a level of service, to one of understanding the implications of the perforamnce, cost and risk trade-offs at various investment levels.
In many ways, the best examples of asset management involve balance. The balance between new and old equipment required to avoid risk. Balance between productive utilisation and maintenance, so that output is maximised and downtime minimised.
Balance between cost-cutting and investment, so that financial imperatives are met while keeping the fleet, and ultimately the company, competitive.