Linking Strategic Planning and Port Performance

Measurement

A joint project across the Port Training Programme Networks

September 2014

Prepared by Dr Joseph Hiney

UNCTAD Consultant

For

Human Resources Development Section - TrainForTrade, Knowledge

Development Branch, Division on Technology and Logistics of UNCTAD
 Contents
1. Introduction ............................................................................................................................. 1

Part A: Port Performance Management

2. Port Performance in a post-reform world............................................................................... 3
2.1. Overall goal ........................................................................................................................ 3
2.2. Linking strategy to comparative performance ..................................................................... 3
2.3. Pilot Study 2013 ................................................................................................................. 5
2.4. Port Performance Research Community ............................................................................. 7
2.5. Port Community of actors................................................................................................. 10
2.6. Defining the performance measures .................................................................................. 11
2.7. The port performance scorecard (PPS).............................................................................. 14
2.7.1. Finance..................................................................................................................... 15
2.7.2. Operations ................................................................................................................ 16
2.7.3. Labour...................................................................................................................... 16
2.7.4. Market...................................................................................................................... 16
2.7.5. Context factors ......................................................................................................... 17
2.8. A process for sharing – actions ......................................................................................... 18
3. Port Classification .................................................................................................................. 20
4. External appraisal ................................................................................................................. 23

Part B: Data Management

5. Finance ................................................................................................................................... 30
6. Operations .............................................................................................................................. 36
7. Labour.................................................................................................................................... 41
8. Market.................................................................................................................................... 42
9. Reporting ............................................................................................................................... 43
References ...................................................................................................................................... 45
 List of Tables
BOX 1: Pilot Study 2013 ................................................................................................................. 4
BOX 2: Technical Challenges ....................................................................................................... 12

Table 1: Market Performance Matrix ............................................................................................... 17

Table 2: Port Classification Questionnaire ........................................................................................ 20
Table 3: Finance Data ...................................................................................................................... 31
Table 4: Finance Benchmarks 2012 .................................................................................................. 35
Table 5: Financial Ratios .................................................................................................................. 35
Table 6: Operations Data for Vessels ............................................................................................... 36
Table 7: Operations Data for Cargo .................................................................................................. 38
Table 8: Operations Data for Land ................................................................................................... 39
Table 9: Operating Benchmarks - LOLO ............................................................................................ 40
Table 10: Operating Benchmarks – Liquid Bulk ................................................................................ 40
Table 11: Operating Benchmarks – Dry Bulk .................................................................................... 40
Table 12: Labour Data...................................................................................................................... 41
Table 13: Sample Benchmark Report ............................................................................................... 43

List of Figures
Figure 1: Port Performance Research/Data Community ..................................................................... 8
Figure 2: Port Performance Scorecard ............................................................................................. 15
Figure 3: PPS Network Structure ...................................................................................................... 18
Figure 4: Port Logistics (Adapted from figure 2.1 in ADB 2010, p33) ................................................. 24
Figure 5:Trade and public sector institutional quality 2010 .............................................................. 24
Figure 6: Perceptions of port infrastructure quality 2010 ................................................................. 25
Figure 7: Barriers to trade (tariff and non-tariff) 2010 ...................................................................... 26
Figure 8: Perceptions of port performance 2010 .............................................................................. 27
Figure 9: Environmental performance 2010 ..................................................................................... 27
1. Introduction
At the training network coordination meeting in Belfast 2013 it was agreed to extend a port
performance project to include a workshop of all the network ports. At this workshop the goal
will be to agree a set of metrics that can be used as port performance and benchmarking
measures, the data collection work to provide the necessary inputs, and the nature of the
resultant periodic reporting.

The programme of work is ambitious. Each of the sessions requires agreement on data
definitions and reporting protocols. The elements of the programme reflect the structure of a
balanced scorecard and the goal is to agree a roadmap for
delivery. Another is also to produce the first set of
benchmarks for publication. This is the Port
Performance Scorecard (PPS). Therefore, the
commercial sensitivity of the data is a key
topic for discussion.
The most important goal for the participants
is to establish the level of commitment from
the participating countries. There are two
parts to such a project. First, there is data
collection and analysis. Second, there is a need
for each participant to see value in the process to
justify commitment in the future reporting cycles.
By addressing these two points the programme will be
sustainable.
The document is divided into two parts covering a review of best practice in port
performance measurement, and the detailed data collection requirements to be completed in
advance of the workshop.
As with all such endeavours the quality of advance work and preparation will dictate the
quality of the outputs, and in turn the sustainability of the project.

1
Part A: Port Performance Management
The demand for consistent and reliable methods to measure performance across international
ports comes from many quarters. The difficulties with developing a coherent cross national
data sharing process remain the same as they were when UNCTAD1 published a monograph
on the subject. The pressure on port managers to deliver is now at a critical level as policy
makers, port users, and other stakeholders (e.g. environmental and security) are setting about
the task of compiling data directly and/or regulating for performance reporting. The pressure
on port managers closer to home is also at a critical level as modern management practices
seek to link performance measurement to strategic planning processes.

This section of the manual reviews what is current in the academic and industry debates on
port performance. It also sets out a proposition to address the critical need to define ports in a
fashion that facilitates consistent comparisons across time, across ports, and cross-nationally.

Part B will address specific data collection proposals for the workshop

1
UNCTAD/IAPH Port Monograph. 1987. G. De Monie_UNCTAD_ship494/6

2
2. Port Performance in a post-reform world
2.1. Overall goal
By contributing to this Port Performance mechanism, each port will have an external tool to
evaluate and position itself in a competitive environment. These tools should be seen by
senior managers as a value added resource, developed by UNCTAD, to improve the
management and competitiveness of their port.

2.2. Linking strategy to comparative performance

The Human Resources Development Section (HRD)-TrainForTrade of UNCTAD is
promoting an initiative to produce a set of port performance metrics to be used as an internal
strategic management tool, and as a benchmarking tool across the Port Training Programme
Networks. The project has two needs. First, the network ports must commit to the project as
owners of the data, given the role of UNCTAD is to facilitate the cooperative process.
Second, each port at the highest level must commit a senior resource to drive this initiative
and contribute to the Port Performance Scorecard (PPS) development process. This dual
commitment reflects the decisions taken at the Coordination Meeting of the English-speaking
network, held in Belfast (Northern Ireland), July 2013.
Change and reform drives the strategic direction of modern seaports towards greater
competitiveness based on higher standards of performance. Competition itself can be
understood as inter-port between port authorities, inter-port between operators, and intra-port
between operators. Strategic planning can be parsed between business definition, situational
analysis, and objective setting. There is a requirement therefore for port managers to measure
achievements in a dynamic strategic environment. Scholars and practitioners continue to
engage with this demand for performance assessment across a number of academic
disciplines. Industry practitioners, customers, port managers, and policy makers also seek
information on performance. What is of particular interest is that port users are also taking the
initiative arguably because there is so little reliable data coming from ports themselves.
Therefore, as port managers, we can agree on the need to maximise the value from our shared
membership of the Port Training Programme Networks to jointly develop such a system. The
Pilot Study initiated in 2013 by UNCTAD, and sponsored by Irish Aid, is a constructive step
on this journey and the outcomes are summarised in BOX 1.
Performance metrics require definition, data must be collected, data management tools
selected, and a means to share confidential information must be negotiated and agreed. This
will be progressed at the 2014 Manila workshop and represents the technical element of the
PPS initiative.
However, to avoid the workshop focussing on process alone we need to develop a structure to
ensure delivery, year after year. The core of such a structure is the CEO/Director, from each
of the Port Training Programme Networks across all the language groupings, providing the
necessary leadership. This is matched by high level managers responsible for strategic
planning and performance measurement committing to delivering the project goals.
UNCTAD, in this context, will provide expertise and facilitation support. The reality is that

3
UNCTAD's TrainForTrade Programme can initiate such a process, but it will only prosper
when the Port Training Programme Networks commit to a shared structure.

BOX 1: Pilot Study 2013

A Pilot study in 2013 confirmed that the key issues with Port Performance
measurement are, as reported in trade and academic literature2, that gaining
access to raw data depends on who collects and controls the information; that
data definitions may vary; and that comparing ports remains problematic
without some form of port categorization. Thus defining the unit of
analysis is problematic.

The Coordination meeting concluded that this “is a project that is essential for
participating ports, and consistent with the recommendations to Irish Aid for
a monitoring process, and is of value to policy makers and international
institutions. The senior management present, including from new
participating countries, agreed that the process will best be supported by the
appointment of local designated managers who will participate in any future
port performance workshops. The Balanced Scorecard model, as applied to
port business processes, is the best approach to design and implementation of
performance benchmarks”.

The needs of information users vary. For example, policy makers may be interested in cross-
national and temporal comparisons on a port-wide basis. Port customers may be interested in
operational and financial measures at a cargo mode level. Managers of port authorities will be
interested in measures that compare performance for limiting factors particular to their
immediate circumstances. Political economists are interested in data that compares policy
outcomes and performance at the national level. Maritime economists will be interested in
data that allows them to propose explanations for performance quality. To produce measures
that are of value to prospective policy, research and industry users requires developing tools
and standardising assumptions that allow for ‘like for like’ comparisons. This argument
resonates with maritime, engineering and finance professionals intent on producing measures
for comparison against competitors, targets, and technical standards within management
disciplines.

Disaggregating port services into strategic business units, which is the ‘product’ mix, is the
challenge. Overlaying the local context as an external data dimension provides further nuance
to any comparative work. With this multi-dimensional combination of port statistical data, the
product mix, and the local context, one can observe the variation caused by a difference in
ownership configurations, investment levels, asset quality, labour training and skillsets,

2
The various sources will be discussed in the following sections

4
physical and operational constraints, economy wide factors, and regulatory regimes. Across
the various disciplines there are different views as to the value of these apparently disparate
measures. This paper takes the view that each has a different, rather than invalid, research
objective and therefore there is much to be gained from a range of insights and consequential
data sharing.

The starting point for the workshop will be the scorecard mechanism endorsed at the 2013
Coordination meeting. This workshop paper explores each of the scorecard elements in
considerable detail and those present will discuss, amend, and agree the final set of metrics to
be used. We will also agree on an implementation plan, and a protocol for this network
initiative.

This chapter provides an overview of the Port Performance Scorecard (PPS) as it relates to a
nascent South-South joint initiative. The remaining chapters deal with the technical issues;
however, the balance of this chapter provides the research and institutional context for the
workshop agenda. The chapter proceeds with a summary of the Pilot Study completed in
2013, a review of relevant literature and port performance projects, concluding with a set of
propositions for the workshop to discuss and act upon.

2.3. Pilot Study 2013

In earlier programme reviews of the port training network the goal of producing port
performance measures was included in the respective recommendations. In the Cycle 1 report
Port Efficiency Indicators were proposed to provide a “stronger monitoring framework to
measure results and outcomes”.
In the Cycle 2 report the task became a joint effort among the Port Training Programme
Networks:

“In order to better measure the effectiveness of the programme,

UNCTAD/TrainForTrade and the member port communities will exchange
information on a set of indicators necessary for measuring port efficiency. The
indicators are yet to be determined on a consensus basis due to business sensitivities
in certain areas. Port Efficiency Indicators will provide a solid measurement for the
programme, as well as keeping track of the progress in the port communities”.

While the proposed indicators are not intended as a means to measure directly training
effectiveness they will add to the knowledge base of donors and participants of relative
performance cross-nationally as a form of benchmarking; and as a means to monitor
improved performance post-training. There are other dimensions to measuring training
programme effectiveness such as quality surveys, career progress of graduates, and
dissertation quality through recommendation adoption. These are all elements to the ongoing
work of UNCTAD. The dissertation initiative resulted in the publication of the first in a new

5
series of Port Management publications3 highlighting the best of the work from across the
Port Training Programme Networks.

The challenges with collecting data for performance measurement are well documented in the
literature4. Among the most relevant to this work is access to the raw data given the varied
distribution of roles and data ownership in port communities, the pliable nature of data
definitions along with problems of comparison cross nationally, and the wide range of
functional areas in a port to monitor. The key findings of the Pilot Study are consistent with
the literature. The solutions are relatively easy to specify but experience shows that they are
quite difficult to deliver without ports themselves as the principals in the process.

Gaining access to raw data depends on who collects and controls the information. For
example, charting the performance of a port in handling containers is usually best measured
by the average number of lifts per crane hour. This information will be known to the terminal
management but not necessarily to the Port Authority. Given the Port Authority is the
reporting body in this study a suitable proxy is required. This is normally best measured by
the average number of TEU (Twenty foot equivalent units) loaded or unloaded per crane
hour. As a comparative measure across a Port Training Programme Networks this is
conventionally regarded as a suitable proxy for cargo handling efficiency in the Load
on/Load off (LoLo) mode. Similar compromises are required in other cargo modes and are
described further in the relevant data chapters to follow.

Data definitions vary depending on common practices for each port and/or national
requirements. There are many standards available to draw on. In the data input file circulated
to the ports as part of Phase I a set of definitions were adopted based on ease of use. Rules
were also applied to convert national currency values to current US dollar values for ease of
comparison. These definitions will be reviewed as part of the workshop and the process
would be greatly enhanced by the participation of a designated officer from each reporting
entity to ensure maximum compliance.
Comparing ports remains problematic across all studies reviewed. In a World Bank paper 5,
which echoed earlier research including by UNCTAD 6, the difficulties associated with
constructing port performance benchmarks were highlighted. The report argued that “in most
cases, it is not possible to determine benchmarks which would be applicable for any port, and
that all expressions of port performance do not address the same requirements”7. It is this
variability in size, cargo mix, technology, domestic economic scale, transit dimensions to
trade, and mix of private and public sector control, that make it meaningless to compare
metrics without some form of port categorization. A number of such categories exist

3
UNCTAD, 2014. Port Management Series: volume 1. Available at: learn.unctad.org
4
The various sources are discussed in the following sections.
5
World Bank paper (2005) available at http://siteresources.worldbank.org/INTPRAL/Resources/338897-
1117630103824/fourgeau.pdf
6
See 1
7
See 5

6
including the UNCTAD generational model8. A standard pedagogical device divides ports
into combinations of private and public based on an assessment of three port functions:
regulation, operations and landlord9. The World Bank published a reform toolkit for port
managers with a similar typological approach10. The weakness in such models is that they are
difficult to apply in a practical sense on a port wide basis. The categorization data for the
workshop includes a new port governance typology11 that measures the mix of private and
public across market dimensions of competition, property, and regulation for each cargo
mode. This builds on other typologies and from a practical perspective makes use of the same
raw data in its compilation. Equally the raw material collected can be applied to other models
such as those recently proposed in an ESPO/EU12 study.

Defining the unit of analysis, that is the port functional areas to include, is problematic.
Producing comparative analysis is again constrained by the differences between ports. There
are two reference points for this discussion. First, the users of the comparative metrics will in
large part be port managers or those interested in their performance. Therefore, the functions
to monitor are management focused. Second, drawing on a piece of research 13 on the
application of the Kaplan14 and Norton Balanced Scorecard approach the key port
management functions of market operations, finance and human resources were selected for
the Pilot Study. The additional dimension of economic governance is included to allow for
comparative assessment of ownership and competitive configurations as these are often
regarded as drivers of improved performance. This was a partial use of the model and was
intended to focus on data considered collectible and reportable by a Port Authority without a
significant additional cost to the port. The format of the data input form also separated the
collection into data for each cargo mode, again to facilitate a valid comparison cross-
nationally.

2.4. Port Performance Research Community

Measuring service and asset performance for public utilities is a challenge. This is not
because of technical measurement challenges but rather the difficulty in isolating timely and

8
UNCTAD Port Generations classification. For an interesting critique of this and other classification models see
Bichou and Gray (2005). “A critical review of conventional terminology for classifying seaports.” Transportation
Research Part A. See also UNCTAD. Module 2: The Organisation of a Port System. Port Management Training
Programme.
9
Baird, A.J. 1995. Privatisation of trust ports in the United Kingdom: Review and analysis of the first sales.
Transport Policy, 2(2), pp.135-143.
10
World Bank Group. 2003. World Bank Port Reform Toolkit: 2nd Edition.
http://www.worldbank.org/html/fpd/transport/ports/toolkit/mod3.pdf
11
This is from a PhD (comparative political economy) manuscript (Hiney 2014), which specifies a port policy
outcome measure constructed as an index of privatisation: Hiney J. 2014. Politics, Path Dependence and Public
Goods: The case of International Container Ports. PhD Manuscript. Dublin City University.
12
PPRISM, an ESPO coordinated EU funded research project on port performance indicators. The result was a
port indicator dashboard. This project demonstrated the feasibility of producing such a suite of indicators.
13
Yuhling Su. 2003. A STUDY ON INTEGRATED PORT PERFORMANCE COMPARISON BASED ON THE CONCEPT
OF BALANCED SCORECARD. Journal of the Eastern Asia Society for Transportation Studies, Vol.5.
14
Kaplan and Norton: Balanced Scorecard: Translating Strategy into Action, Harvard Business School Press,
Boston (1996)

7
relevant raw data with which to construct measures and comparators. Transport nodes are of
particular interest as they represent a complex mix of public and private services, as well as
short- and long-term investment cycles. This applies to any major transport node where goods
and people transition, such as seaports and airports. Add to this research problem the
competitive nature of transport service provision and the significant problem of data access
comes to the forefront. Therefore the owners of activity data protect their own interests and
do not share commercially sensitive information. The transport chain is also divided into
various modes of transport such as air, sea, road and rail. Equally people and cargo are
further characterised by their operational differences into discrete cargo modes. Nevertheless
most analysts draw from the same well in terms of raw data. Thus far projects have focussed
on case level analysis and confidential sharing of data. This work is largely academic and
focussed on efficiency studies with more recent contributions in terms of port service
effectiveness. Figure 1 is a representation of this port data community.

Figure 1: Port Performance Research/Data Community

There are a number of externally available metrics employed in high level country
comparative studies, such as the World Bank infrastructure and service indices 15. These are
survey based with an inherent time lag and are focussed on a perception of ports as a national
aggregate. Other metrics are also available that will provide economic and trade context to a
comparative study. For example UNCTAD’s Liner Shipping Connectivity Index16, World
Bank Development Indicators17, and cargo volumes shipped and transhipped. Chapter 4
provides a comprehensive discussion on these public datasets and an analysis of the data for
the network countries.

15
Quality indices such as the Logistics Performance Index produced by the World Bank available at
data.worldbank.org
16
LCSI: Liner Shipping Connectivity Index produced by UNCTAD
17
WDI: World Development Indicators available at data.worldbank.org

8
At a base level port efficiency can be understood as the actual level of performance measured
against the optimal performance level assuming a given set of inputs 18. Comparisons can then
be made over time and across units provided they are qualified for any variation in
production inputs. This theoretical point understates the practical problems that arise in a
sector such as a comprehensive (multi-modal) international port. In fact it is not an
exaggeration to suggest that efficiency measures can only be of value for a particular unit and
for a particular time, when compared against a production standard that in turn reflects the
ports’ unique characteristics.
Definitions of port performance depend on the economic objectives of the policy makers and
the choices they make from the many variables. Control over these variables will be
measured as the key performance indicators for the port management 19. In a study of a two-
cargo port with the objective of maximising volume throughput while making a minimum
profit, Talley identified a number of choice variables that should be focussed on by
managements to maximise performance. There are two points of interest here: first, the
economic objective must be clearly stated by policy makers; and second, that there are choice
variables for port managers and therefore one must also consider choice variables for policy
makers. It is the effective management of these variables that will define the success or
otherwise of policy decisions. For example, although Talley assumes pricing is within the
control of port management, in many developing countries pricing is controlled directly by
the State. Bichou20 also engages with the subject of port performance and in part refers to its
assessment in the context of trade facilitation. There are conceptual and analytical difficulties
with the task of measuring performance in the context of trade facilitation given the multitude
of variables, their interaction, and in choosing the correct data21. The assumption that there is
one port model in itself poses a challenge to any attempt at performance measurement.

A World Bank series of reports examines the question of trade facilitation in some detail22.
One study argues that in the literature “it has been found that poorly performing ports can
strongly reduce trade volumes and may have a greater dampening effect on trade for small
less-developed countries than many other trade frictions. Thus we may expect improvement
of port infrastructure affects positively the trade flows” 23. Another economic study showed
that privatisation has a positive impact on port efficiency24. However, this conclusion is
qualified in the context of a port functional model separating the landlord, regulator and
operating roles25. Privatisation arguably has the best results when port policy establishes Port

18
González M.M. and Trujillo L. 2009. Efficiency Measurement in the Port Industry: A Survey of the Empirical
Evidence. Journal of Transport Economics and Policy, Vol. 43(2) pp. 157-192
19
Talley W K. 2006. An economic theory of the port. Research in Transportation Economics. 16, pp43-65.
20
Bichou, K. 2006. Review of port performance approaches and a supply chain framework to port performance
benchmarking. Research in Transportation Economics, 17, pp.567-598.
21
Ibid: page 575.
22
Njinkeu D., Fosso B.P., and Wilson J.S. 2008. Expanding Trade within Africa: The Impact of Trade Facilitation.
Policy Research Working Paper 4790. The World Bank Development Research Group.
23
Ibid
24
Cullinane, K. and Song, D.W. 2002. Port privatization policy and practice. Transport Reviews, 22(1), pp.55-75
25
See 9

9
Authorities as landlords and regulators leaving the private sector to provide port services,
especially in cargo handling 26.

2.5. Port Community of actors

Ports, specifically international seaports, operate as facilitators of trade in the global
economy. They are strategic instruments of trade policy in the domestic economy and
represent a key interface between nations through the efficient and cost effective movement
of goods, people and information. Ports are vital nodes in the world trade network and have
been so throughout history. They are also sites where different cultures engage and the veil of
sovereignty is negotiated or lifted by goods, information and people. Global trade and
investment flows have also provided domestic political agents, used to operating within
informal norms of behaviour, with opportunities for rent seeking and the servicing of client
needs.
The industry itself, which is a subset of the maritime industry, has changed dramatically with
the growth in world trade. Global economic growth was facilitated greatly by dramatic falls
in transport costs27. This remains a driving force in the global economy. As shipping began to
specialise in vessel design and tonnage size the port industry also began to respond to the
challenges of servicing these vessels. In considering the political impact on port organisation
and development it is also important to understand the constituent elements or actors in the
port community. Such an examination will assist with developing an appreciation of the
varied actors within the port community and indeed their potential policy preferences. Ports,
as critical nodes in the ever more complex and sophisticated logistical networks that drive the
transport of goods around the globe, are made up of a number of sub-groups that together
constitute the port community.

The first group develop, operate and fund infrastructure. In the main the State, national or
local, will own and develop this foundation to a port in a Port Authority or equivalent.
Infrastructure is typically defined as the land and the permanent assets that configure the site
as a working port e.g. quay walls, breakwaters and dredged channels.

The second group own and maintain the superstructure. Typically this will include the
equipment such as cranes as well civil engineering services like electrical supply and paving.
The actors in this group are wide and varied depending on the cargo type and the national
legislative environment.
The private sector, mainly in the form of international shipping groups, participates in the
container market through ownership or as concession holders to a container terminal. In turn
the private sector own and maintain the superstructure. In some ports the Port Authority
finances, operates and maintains the superstructure in the form of multi-user container
terminals. Similar arrangements apply in other cargo modes although the private actor is
more likely to be a cargo owner rather than a ship owner in bulk trades.

26
Tongzon J. and Heng W. 2005. Port privatization, efficiency and competitiveness: Some empirical evidence
from container ports (terminals). Transportation Research Part A: Policy and Practice. 39(5) pp. 405–424.
27
Hummels D. 2009. Globalisation and Freight Transport Costs in Maritime Shipping and Aviation, Forum Paper
2009-3. International Transport Forum. OECD/ITF, Paris.

10
By far the largest sub-group in the port sector are service providers. Cargo handling services,
such as stevedoring, cranes and other handling methods, and cargo processing through the
customs institutions are common to all ports. In this sector actors can include the State as an
operator, customs authority, and as a regulator across economic, security, navigation and
environmental dimensions. Other actors are international shipping groups, local stevedoring
companies, cargo agents, freight forwarders, and labour unions associated in the main with
dock labour.

2.6. Defining the performance measures

As described above there are difficulties with data definition, access, and collectability.
Assuming that the structural difficulties of access and collection can be overcome the key
task is to overcome the problem of unit definition. This project makes the simple assumption
that port performance metrics should be based on cargo mode as the base unit. These in turn
can be combined into port level, regional, and national metrics depending on the
requirements of the data user. External data sources tend to focus at national level, and from
the outside in, while this proposition is based on an inside out approach. Therefore the
owners of the data, Port Authorities and port service providers, must be the drivers of the
process. Before discussing institutional arrangements that will be required to deliver on the
project goals, it is useful to review earlier projects to understand better the technical and
administrative challenges.
An UNCTAD/IAPH monograph28 is arguably the historical genesis for this new UNCTAD
initiative. The challenges reported then remain true today and are summarised in BOX 2. A
more recent contribution by the World Bank argued that “in most cases, it is not possible to
determine benchmarks which would be applicable for any port, and that all expressions of
port performance do not address the same requirements” and that “port performance should
be assessed for a homogenous set of berths or a terminal” 29. Maritime economists also
conclude that “any port comparison can only be valid and meaningful if a port's efficiency is
compared with a similar port”30. The most significant advance in constructing a comparative
port dataset is arguably the EU funded and ESPO led research project (PPRISM)31 completed
in 2010, with the production of a performance dashboard of metrics.

The PPRISM project also highlighted issues of relevance to this Port Training Programme
Networks initiative. In sum, any such project requires trust among the stakeholders to
underwrite a data sharing programme, minimise transaction costs by relying on standard data
generated by ports, and a demonstrable value proposition. Among EU countries there is some
progress towards achieving the goal of a European Ports Observatory32. This progress is in no

28
See 1
29
Fourgeaud P. 2007. Measuring Port Performance. The World Bank. See also Port Strategy magazine, June
2007.
30
See 25
31
European Seaports Organisation (ESPO) – PPRISM Project Coordinator. 2010. Port Performance Indicators:
Selection and Measurement – work package 1. AND Verhoeven, P. 2010. European port governance. European
Sea Ports Organization (ESPO).
32
www.portopia.eu

11
small part due to institutional funding for research and collaboration; and an EU wide
legislative context for statistical definition and collection.

BOX 2: Technical Challenges

(G.DeMonie_UNCTAD_ship494/6)
“In fact the challenge taken by anyone wanting to analyse port
performance is most formidable, as a result of the combination of the
following factors:
a) The sheer number of parameters involved;
b) The lack of up-to-date, factual and reliable data, collected in an
accepted manner and available for publication or divulgation;
c) The absence of generally agreed and acceptable definition;
d) The profound influence of local factors on the data obtained;
e) The divergent interpretations given by various interests to
identical results”.

A further EU funded project is currently engaged with the next stage of the ‘Observatory’
project by developing tools for data collection and dissemination across the participating EU
ports33. This port industry performance platform (PORTOPIA34) is funded under an FP7
research and technological development initiative and commenced in 2013 with a planned
duration of four years. This is part funded by the EU (70%) with the balance coming from the
industry and an ICT provider. The objective is a cloud based technological solution with a
user friendly interface managed by an entity trusted by port industry stakeholders. Again
progress is underwritten by investment, industry engagement, and an institutional
arrangement to manage delivery.

A network of maritime economists, functioning as part of the International Association of

Maritime Economists (IAME) and coordinated by Professor Mary Brooks of the Dalhousie
University in Canada, gathers together interested scholars under the banner of the Port
Performance Research Network35 (PPRN). The group was founded in 2001 and its members
have published widely on port governance and performance individually and in special issue
book compilations of the groups work. They are organised in a number of working groups
covering topics such as port efficiency, effectiveness, concessions, and strategies. They also
consider issues pertinent to climate change and cruise ports. One theme on effectiveness is
the use of SEAPORT 36 as a tool to measure port service effectiveness. This is a survey tool
reaching carriers, cargo interests and service providers to establish the factors that contribute
to effectiveness. Thus views external to the port authority are used to gain insights into

33
Dooms, M. 2014. Port Industry Performance Management. Port Technology International, Issue 61, February
2014.
34
See 32
35
http://www.dal.ca/faculty/management/schools_and_centres/centre-for-international-trade-and-
transportation/port-performance-research-network.html
36
SEAPORT: See Brooks, M.R., Schellinck, T. and Pallis, A.A. (2011). “A systematic approach for evaluating port
effectiveness”. Maritime Policy and Management, vol. 38, no. 3, pp. 315-334.

12
performance. Professor Brooks chaired a meeting of UNCTAD Ad-hoc port experts in 201237
where the PPS initiative for the Port Training Programme Networks was first debated. One
key finding from the meeting was that analytical tools are plentiful however, source data is
scarce.

A body of academic research published in 2013 38 considers a range of topics relevant to port
management in the modern era. One topic that relates to port governance in the post reform
period covers Libya, Brazil and China. One relevant finding is that there is a cultural element
to port policy frames consistent with the Matching Framework model proposed by Baltazar
and Brooks39. This is developed in a later study into policy metrics to compare policy frames
across 26 countries40. This metric is adapted for use in Chapter 3 to follow. The editors make
a particular call for research on policy performance in terms of a feedback loop from policy
initiatives to expected improvements in performance. From this we can add value to future
policy debates across the network and nationally. The base port data, the macro economic
data, and the context variables will provide useful insights for port stakeholders in this area.

The 2013 collection of works edited by Brooks and Pallis 41 also looks at port performance
measurement and port strategies. In the latter case the strategic context is explored given the
difference between a Port Authority and purely private or public organisations, along with
articles that consider new strategic directions such as city-port relations, stakeholders as
citizen interest groups, international diversification, private equity considerations,
environmental risks (green portfolio analysis), and social responsibility (CSR). This strategy
section is of interest given the ultimate goal of a comparative project is to link strategies to
performance metrics. How these are measured and benchmarked is our challenge.
The key section, however, is in the port performance measurement articles. One contribution
points to the development of port benchmarks by stakeholders given ports have in large
measure not succeeded to do so. One example is the Journal of Commerce survey of terminal
efficiency among shippers (PIERS- port productivity tool)42. The editors remark that if “ports
do not proactively participate in efforts to bench their performance, we expect that a number
of stakeholders will do it for them” 43. A number of the articles focus on terminal efficiency.
In this document the higher level abstract of the port is considered. For example, economists
will use econometric tools that measure technical efficiency based on a theoretical production
model. The models do not accommodate context variables, which are generally of more

37
See issues, presentations and reports from the meeting at unctad.org - Trade and Logistics Branch.
38
Brooks, M.R., and Pallis, A.A. Eds. (2013). Advances in port performance and strategy. Research in
Transportation Business & Management. Vol, 8, pp. 1-6.
39
Baltazar, R. and Brooks, M.R. 2006. Port governance, devolution and the matching framework: A
configuration theory approach. Research in Transportation Economics, 17, pp.379-403.
40
See 11
41
See 38
42
https://www.piers.com
43
See 38

13
interest to port managers. They provide the means to explain variations in performance
against practical frontiers of efficiency44.

Another article proposes that as concession agreements are drafted and/or reviewed
consideration be given to data sharing issues. This reflects an issue highlighted widely,
including in the Pilot Study, that key data are held by operators and not willingly shared for
commercial reasons. The emphasis of the article is on using these data as a means to ensure
concession performance45. Another issue raised as a performance measurement requirement
is inter-modal connectivity46, reflecting the door-to-door demands of international logistics,
adding another dimension to the PPS operations element of the scorecard. This is a critical
issue for ports serving landlocked countries.

The editors end with a prediction. “Within five years, we believe that it is likely that port
performance benchmarking will happen on both efficiency and effectiveness vectors, with or
without port cooperation in the process, as users become increasingly engaged in
understanding and measuring end-to-end supply chain performance in order to improve their
own competiveness and create value for customers”47.
Much of the research and initiatives to date are based on developed and/or OECD countries.
There is little evidence of such work in developing or transitional economies. There is a
strong case therefore for a South-South initiative, drawing on the organisational potential of
the Port Training Programme Networks, to develop a port performance platform for port
stakeholders. The organisational focal point for this is the Port Authority with UNCTAD
providing support.

2.7. The port performance scorecard (PPS)

The scorecard is analogous to the Kaplan and Norton Balanced Scorecard48, which is a tool to
link strategy and performance. The merits of such management tools that are internal to each
port organisation are not the issue here. However, it is a valuable heuristic device to progress
the discussion on which metrics are important and why. The objective is to take the four
strategic perspectives and examine the generic measures that will or should be developed by
all Port Authorities. These inevitably will be used to compare ports nationally and
internationally. To do this we will need metrics that classify ports, that is, context variables so
that we can make meaningful comparisons. Figure 2 sets out the dimensions of the scorecard.
This can also be a useful device to disaggregate the complex nature of a port system and
deliver the project in discrete phases or blocs. The detail of the variables, their collection and
metric calculation are discussed in the following data chapters. What follows here is a brief

44
Bergantino, A.S., Musso E., and Porcelli F. 2013. Port management performance and contextual variables:
Which relationship? Methodological and empirical issues. Research in Transportation Business & Management.
8 pp.39-49.
45
Ferrari C., Puliafito P., and Tei A. 2013. Performance and quality indexes in the evaluation of the terminal
activity: A dynamic approach. Research in Transportation Business & Management. 8 pp. 77-86.
46
De Langen P., and Sharypova K. 2013. Intermodal connectivity as a port performance indicator. Research in
Transportation Business & Management. 8 pp. 97-102.
47
See 38
48
Kaplan R., and Norton D. 1996. The Balanced Scorecard: translating strategy into action. Harvard Business
School Press, Boston.

14
outline of the scorecard across finance, operations, human resources and customer
dimensions. The goal of the workshop is to focus on those elements where data is readily
available and review the other elements in terms of future feasibility.

Figure 2: Port Performance Scorecard

Investment;
Port Performance Profit; Asset;
Cash and
Scorecard solvency
[based on metrics that can be
benchmarked against similar
ports] Financial


Ship
Market share; handling;
Portfolio cargo
analysis; Customers  Port Strategy  Operations handling;
Service service
effectiveness provision;
Environment


Human
Resources

Training;
Efficiency;
Organisation;
Safety; Wages

Benchmark/Context variables: Port/Mode size; service portfolio; Governance/economic

regulation; Economic Development (GDP, GNIPC); Region; Distance; Connectivity;
Economic and political institutions; Transit role

2.7.1. Finance
Measuring the financial performance of a port across all services is the ultimate prize and
generally an unrealistic target. This is because the many service providers in a port operate
through a mix of private and public corporate models. Nonetheless, we can focus on the
financial performance of the entity commonly described as the Port Authority. To do so we
need to be clear as to what revenue streams and activity costs are included in any financial
report. Therefore, the data requirements will be constructed by cargo mode and differentiated
between port dues (vessel and cargo), service charges (Pilot and Tugs), stevedoring (cargo
handling), land based activities as landlord, and other activities. Costs will be more difficult
to analyse; however, with care it is possible to separate Landlord/Regulator costs from those
associated with operations. The data requested in the Pilot Study focussed on high level

15
revenue streams as a proportion of total sales, the operating margin that excludes non routine
expenditure and funding costs from the calculation, and the proportion of labour costs to total
revenue associated with the Port Authority.

The objectives for the workshop are to clarify any definitional issues that arise and to extend
the performance metrics into asset and investment quality, cash generation and liquidity, and
funding comparisons. Revenue streams by mode are another level of analysis required to
produce average price and yield comparators.

2.7.2. Operations
This is the largest and most applied area in port performance assessment. In terms of the
primary data concerned with the movement of vessels, people, cargo and information the
measures consist of volume moved in relation to time, area and technical capacity. This is
especially focused on the cargo mode (product mix) and the spatial dimensions of the
handling location. Typically the comparative metrics refer to handling rates for vessels and
cargo and this was the focus of the Pilot Study. In the detailed chapters to follow this will be
extended to include other port services. The PPS in later phases will also include other
operational dimensions such as energy, environment, and security.

2.7.3. Labour
This bloc of metrics is of particular interest in the context of the Port Training Programme
Networks given its core objective is the development of human resources to further enhance
port service delivery, trade facilitation, and in turn national economic welfare. The Pilot
Study focussed on numbers employed by broad category, the nature of labour institutional
arrangements such as permanent or temporary, and the incidence of lost time due to strikes or
other labour related stoppages. The relative cost of labour types as a proportion of all costs
and/or revenue is a useful comparative measure. These groups at the highest level of
abstraction are port authority, stevedoring (private and public), and casual pooled resources.
From this, metrics related to efficiency can be calculated on a sensible comparative basis. The
objective in the workshop is to extend this set of metrics to account for a wider set of
employee scenarios and their relationship with specified cargo modes. Training metrics, plus
health and safety dimensions, are of particular interest as comparators to port managers and
to stakeholders such as the network donors.

2.7.4. Market
This is the area not covered in the Pilot Study as the data collection is more expensive and
problematic. Nonetheless, the workshop should identify the metrics required of a
benchmarking process and prioritise accordingly. In the following chapters a discussion of
the market or customer based measures is presented and mechanisms are proposed. It is
divided into customer satisfaction, market share by cargo mode, service effectiveness such as
the SEAPORT 49 model, and portfolio analysis based on value added for specific traffic types
e.g. mode.

49
Brooks Mary R, Schellinck Tony, and Pallis Athanasios A. 2011. A systematic approach for evaluating port
effectiveness. Maritime Policy & Management, 38(3).

16
The objective of the portfolio analysis is to identify the market standing of each port in terms
of the matrix in Table 1. It essentially tracks the changes over time of the port market share in
relation to market growth. Adapting this approach will provide a basis to measure
performance in terms of the port market place and the relative competitive position of each
port product. As with all studies the matrix is a one period snapshot and takes no account of
change over time.
Table 1: Market Performance Matrix50
Market Relative market
Performance share

LOW HIGH

High Star
HIGH
potential performer
Growth
Rate
Minor Mature
LOW
performer leader

The dynamic analysis including measurements for multiple periods on each port will
illustrate how the port is progressing from or to the ‘star’ category. By relating the selected
time periods to policy reform and/or strategic shifts, then policy performance can be
measured and compared51.

2.7.5. Context factors

In the Pilot Study data, fixed or semi fixed in nature, was requested in terms of ownership,
economic governance, functional models, and market dimensions. This was the most difficult
to complete in the Pilot Study for many reasons including gaps in interpretation and
understanding. However, as the earlier sections highlight there is a critical need to
differentiate ports based on local conditions in order to contextualise any benchmarking
report. This will be discussed further in the chapters to follow.
Local context is not only based on internal variables. There are a range of external variables
that again can contextualise a benchmarking exercise. They are generally publically available
data such as macro-economic conditions over time, connectivity and distance to and from
markets, and the set of rules in the political economy of local maritime trade. This latter point
includes capital controls, customs procedures, labour rules, investment regimes, and ease of

50
Cruz, R., Ferreira, J., and Azevedo S. 2012. A Dynamic Strategic Portfolio Analysis: Positioning Iberian
Seaports. South African Journal of Business Management. 43 (1) pp33–43. Also drawn on a matrix developed
by Boston Consulting Group (BCG).
51
Castillo-Manzano, J.I., López-Valpuesta, L. and Laxe, F.G. 2010. Political coordination costs in the Spanish
port devolution process: A note. Ocean & Coastal Management, 53(9), pp.577-580.

17
doing business as well as the relative openness of the political system. By including such
context variables, performance can be plotted against indices of economic and political
openness; or indeed any combination of the context variables. On such plots ports can see
how they perform relative to other ports adjusted for conditions outside direct management
control. The external variables will be sourced by UNCTAD for the workshop.

2.8. A process for sharing – actions

This chapter has set out the technical benchmarking framework in the form of the Port
Performance Scorecard. This initiative is also discussed in terms of other port performance
research projects and academic insights relevant to this project. The document will stand as a
‘workbook’ in the PPS workshops in the future; and the data exercise completed as part of the
workshop will be combined with this document and issued as part of the Port Management
Series produced by UNCTAD.

Figure 3: PPS Network Structure

Port Authority 1
(Contact Point)

Port Training
Networks:
UNCTAD Port Authority 2
TrainForTrade
Platform (Contact Point)

Port Authority N
(Contact Point)

The proposal is to establish on a formal basis a South-South dimension to the project by

recognising that all the network ports across the four language groupings constitute a single
Port Training Network (PTN) – see Figure 3. The support for the network comes through
UNCTAD with expertise as required from country port partners. There are two essential
agreements. First, the power of the project will come from the direct support of the Chief
Executive52 to one senior manager acting as the Port Authority Contact Point. This is
intended to provide clear direction and energy to the project. Second, the Contact Point must
be of sufficient seniority and expertise to ensure the sustainability of the project. Fulfilling
both these objectives will ensure that the benchmarking reports are of value to senior
management and make a meaningful contribution to the Strategic Planning process in each
Port Authority. The workshop will develop this further and discuss the specific arrangements
required to give life to the programme.

52
Chief Executive is the generic term to include all those who have ultimate management responsibility for the
Port Authority, whatever the title used in each organisation.

18
The following chapters will extend the ideas discussed thus far into greater detail to conform
to the dynamics of the planned workshop. In this format we will be able to agree on progress
and actions in a modular approach including the institutional structures required to guarantee
a focus on delivery. The modules are the four dimensions of the scorecard, the context
variables, and the necessary protocols that need to be in place to establish this South-South
Port Performance Scorecard system for intelligent benchmarking purposes.

19
3. Port Classification
Chapter 2 highlighted the problems with making comparisons at a port level. They have also
highlighted issues of context as important in discussing performance, which will be discussed
in the next section. There is a wealth of academic material that highlights the difficulties with
the use of port classification systems for comparative purposes 53. There are a number of
classification systems available each with strengths and weaknesses in terms of providing
those interested with sensible comparators. The data collection therefore sets out to gather
information for application in a varied set of classifications. This includes a port governance
classification on a scale of 0 to 5, with 5 representing total private ownership of the port and
0 representing total public ownership. From these data we can classify ports in a variety of
ways to mirror the specific analysis topic.
The classification models used are the World Bank typology based on functional profiles 54;
an ESPO55 approach to categorising the economic profile of a port by way of strategic
objectives56; and a market governance scale based on assessments of private versus public
profiles across property (ownership), cargo handling competition and economic regulation
(price and investment rules)57. The application of the port generational model58 in the modern
port setting will also be examined based on the data. Table 2sets out the base questions asked
of each port to be completed in advance of the workshop. This table describes the overall
logic for requesting the information.

Table 2: Port Classification Questionnaire

Port Governance, Competition, Ownership, and Economic Regulation
What is the name of the Port For coding and identification purposes
Authority?
When was the Port Authority in its To identify any change on governance
current form established? structures
What is the current governing To identify national and/or local ports
legislation for the Port Authority? policy

What year was this legislation To identify changes in policy

passed?
What is the name of the port To establish if an economic regulatory
regulator (if any)? structure is in place

Is the Port Authority controlled To identify the ownership structure for

privately or by central, regional or the Port Authority, private or public. If
municipal government? public then identify the level of
government involved.

53
Bichou, K. and Gray, R. 2005. A critical review of conventional terminology for classifying seaports.
Transportation Research Part A-Policy and Practice, 39(1), pp.75-92.
54
See 9
55
See 31
56
See 19
57
See 11
58
See 8

20
 Port Governance, Competition, Ownership, and Economic Regulation
Is the Port Authority classified as This is often a policy definition. This
a Landlord, Tool, or full service question may require a separate answer
(private or public) organisation for each cargo mode.
Is Port Authority a corporate To identify the governance regime and
entity? degree of commercialisation of the Port
Authority
Where the Port Authority is This will identify any private control of
privatised or part privatised what the Port Authority.
is the private share?
Does the Port Authority directly This is to identify any operating role for
provide stevedoring/cargo the Port Authority
handling services?
Are there two or more competing To establish levels of competition
stevedoring/cargo handling
providers?
On an equity basis what This will identify any joint venture (or
proportion of the equivalent) arrangements in place
stevedoring/cargo handling
entities is owned by the Port
Authority or another public body?
Is public sector approval required Where government (at any level)
for price adjustments for port approval is required for price
dues, stevedoring, or other port adjustments
services?
Does the public sector fund To identify policy approaches to port
investments in infrastructure or development spending across terminal
superstructure? infrastructure and superstructure, plus
marine access infrastructure.
Is public sector/political approval To identify the level of political control
required for major port projects or veto over port generated development
(outside of standard approval plans
process for infrastructure
planning)
Are other port services provided To identify who provides services such
by the public sector? as pilots, tugs and cranes.

This is an extensive questionnaire that will show little change year-on-year. However, it is a
rich vein of data from which a range of port categorisations can be developed. It is consistent
with similar work at EU level on port studies although on a reduced scale to reflect the
resources available. A key task for the workshop will be to consider this questionnaire in
terms of individual ports and test its practical application. Equally the workshop can extend
the questionnaire to take on board classification issues relevant to their regional profile. This
is consistent with one of the themes in the literature that identifies a relationship between
governance profiles and the influence of local social and economic history. Thus, in an Asian
cluster of ports, we might expect to see greater reliance on state investment especially in the
larger marine infrastructure such as breakwaters and channel dredging. One element of the

21
governance metric scores this approach to differentiate it from the liberal philosophy of the
market supplying all new investment. Therefore in comparing returns on investment, for
example, it is important to compare ports in the full knowledge that their investment profiles
may be very different. Similarly it is important to quantify the level of effective private
participation in ports to ensure we address a standard public versus private comparison in any
analysis.
The modernisation trends in ports over the last decades of the twentieth century involved a
range of policy measures. The information to be collected will facilitate an assessment of
where each port is positioned on a private versus public scale. For example, we will
understand the level of intra-port competition, the nature of the ownership structure, the
business model such as landlord, investment regimes, price management, and project
approvals. Compiling these data into a single index will provide a means to categorise ports
for comparison on a like with like basis.
It is important not to underestimate the challenge with collecting and sharing such data. The
link to performance assessment and benchmarking is perhaps not obvious. However, much of
the data in this chapter is available on public websites and published documents. More
importantly it deals with the primary issue of a solid basis for port comparisons, highlighted
in past projects. Without this profile information the business data discussed later can only be
related to their own port.

22
4. External appraisal
.For this project there is a wealth of data collected and shared at Nation-State level.
International institutions such as the UNCTAD, the World Bank, the IMF along with
academic/research resources such as the World Economic Forum, the Frazier Institute in
Canada, the Quality of Governance Institute in Sweden, and many others provide a range of
data relevant to maritime logistics. They do not however provide port specific data.
Nonetheless they provide a context for specific port performance and a basis for explanations
across the PPS metrics. For example, where economic growth is slow then it may provide
some explanation for slow port growth. Also where trade barriers, including non-tariff
barriers, are high then port growth may be slow. This publication is not a review of the scope
and range of such datasets. The intent here is to highlight their value with illustrations for the
countries included in the project. It must always be remembered that a number of the
measures are based on survey data, that is, they are based on the perceptions of the business
community at a point in time.

In this review, data on trade facilitation, institutional constraints, the environment, and
perceptions of performance are discussed. There are more permutations to draw on and will
form a significant part of the port workshop analysis of the port level data. A full session is
devoted to this topic in the planned workshop to facilitate discussion and agreement on the
most relevant measures to use in any benchmark reports.

Quite often performance systems will provide useful data on business activity and
infrastructure quality. For port performance external ‘soft’ infrastructure is a key driver of
performance. Soft infrastructure includes those institutional and policy arrangements that
govern trading and logistics activities. Equally, the absence of a set of rules to govern the port
service market constructs a de facto regime of past custom and practice. Many of the metrics
in this area are again perception based. Figure 4 describes this mix of hard and soft
infrastructure in terms of the international container market. It is drawn from a report by the
African Development Bank 2010 59. It also highlights the role of institutional or policy frames
for the efficient operation of port logistics. This includes customs regimes and business
environments that facilitate investment and the movement of capital. They also cover the
rules and institutions that govern labour practices in each country.

59
African Development Bank. 2010. African Development Report 2010: Ports, Logistics, and Trade in Africa.
Oxford University Press: Oxford.

23
Figure 4: Port Logistics (Adapted from figure 2.1 in ADB 2010, p33)

Soft (Services)
Infrastructure Hard (Physical) Road, Rail, and
[A] Infrastructure River Infrastructure
[B]

Global and International Domestic

Landlocked
Regional Container Markets
countries
Markets Ports (Hinterland)

International and
domestic container
logistics companies Institutional Infrastructure: economic, safety,
corporate, customs, labour, anti-corruption [C]

The World Bank publishes a set of measures that consider the institutional arrangements in
each country60. This is the Country Policy and Institutional Assessment (CPIA), which are
compiled by World Bank staff based on their assessment of institutional quality against a set
of agreed criteria. For the year 2010, which for consistency is used for all the charts to follow,
not all countries are given a value. Nonetheless, Figure 5 can be used as an illustration of how
each country is rated in terms of transparent and accountable regimes against e.g. corruption
in the public sector, and institutions that support trade in goods.

Figure 5:Trade and public sector institutional quality 2010

Togo
Tanzania
Senegal
Nigeria
Maldives
Guinea
Ghana
Djibouti
Cote d'Ivoire
Cameroon
Benin
Angola
0 1 2 3 4 5

Accountability Trade Policy

No country with data for 2010 reached the maximum score of 6, which represents strong
institutions. Most countries reached a score of 4 for trade policy with the notable variances
60
Available at data.worldbank.org

24
occurring in the area of an accountable public sector. Ghana shows the strongest institutions,
with Guinea and Cote D’Ivoire showing the weakest. The value of these data depends on our
collective assessment of these institutions as contributing factors to port performance.

An example of survey data is drawn from World Economic Forum61 data that rates the
quality of port infrastructure. It is mapped in Figure 6 against the level of customs burdens.
Combined we have a picture of perceived performance towards a country in terms of trade
facilitation. There appears to be a relationship between the rising quality of customs
procedures and the perception of port quality.

Figure 6: Perceptions of port infrastructure quality 2010

As with all such relationships the apparent association may be accidental and certainly does
not indicate a causal relationship. It may however indicate that perceptions of one factor may
leak into perceptions of a related factor. Both numbers are of interest to the port community
as an indicator of how potential and actual port users perceive port service quality.
Beyond customs procedures and infrastructure quality there are barriers to trade, both in
tariffs and in non-tariff institutions. This level of soft institutional quality, and complimentary
economic institutions, may have an impact on port performance. It is likely that they will
have an impact on perceptions, if not on real performance. Figure 7 compares tariff and non-
tariff barriers across the network countries.

61
Available at data.worldbank.org

25
Figure 7: Barriers to trade (tariff and non-tariff) 2010

These values are on a rising scale of market (or private sector) openness and are compiled
into a set of indices62 from measures prepared by the IMF, WEF and the World Bank. They
avoid subjectivity and survey data weaknesses. The results appear to show that the network
countries have a varied level of performance with formal trade barriers. However, the values
for non-tariff barriers cluster quite noticeably. Are such measures useful as indicators of
constraints on trade and port growth?

Is it also likely that institutions that control the level and form of investment in port
infrastructure, domestic and international, will influence the level of port performance.
Through such investment and innovation it is likely that port performance, and the perception
of performance, will improve. Figure 8 makes this comparison based on a mixed set of data
from the World Bank CPIA measures and economic institution indices compiled by the
Frazier Institute. As the values cluster around a narrow range of openness to foreign direct
investment, the expected improvement in logistics performance is not obvious from these
data. In fact, the levels of performance vary quite widely. Logically we have two
explanations. First, the mix of survey and objective data may not be compatible and may
indeed be different in timing. Second, perhaps such a relationship between investment rules
and performance does not exist and performance is driven by other factors.

62
Data available from the Fraser Institute at www.freetheworld.com

26
Figure 8: Perceptions of port performance 2010

A growing dimension for port managers is the impact of environmental regulations on port
operations and port cost structures. From a policy making perspective the contribution made

Figure 9: Environmental performance 2010

27
by the transport sector to national emission levels is an indicator of environmental
performance. Figure 9 compares trade activity through ports against emission levels.

The Liner Shipping Connectivity Index63 is used as a proxy for port activity as we can expect
higher levels of connectivity to mirror higher throughputs. There is no obvious association
with low levels of connectivity showing most countries with varying levels of CO 2 transport
emissions as a percentage of total national levels.
The charts represented here are intended to provide an initial survey for the countries in the
network. To make best use of the dataset, it is best that there is a direct question to answer or
theory to test. The above are descriptive only and consider some common external
perceptions of ports. As a port community we may have many reasons to dispute the use of
these reports but we must also be aware that they are in common use among policy makers
and port users. There is a need therefore to engage with these data in any benchmarking
analysis.

The session in the workshop will be interactive with a working set of data tables available for
participants to use. The goal is to identify a reasonable set of external metrics to include in
benchmarking reports. The analysis will be included as an addendum to the manual. This can
be in direct statistics or in explanatory accounts of performance for each country. This last
distinction should not be forgotten as the internal data generated by the network is port level
and the external data is country level.

63
Available at www.unctad.org

28
Part B: Data Management
At the UNCTAD Ad-Hoc Port Experts meeting held in Geneva (2012) the consensus view
was that analytical methods are many, but access to quality data is limited. The current
project seeks to address this problem and in the following chapters initial data requests are
specified. The data requested aim to be non-controversial and are expected to be typically
available across all the PTP Networks. Crucially the requests seek to minimise the costs of
collection and transmission to UNCTAD to a minimum.

The chapters in this document set out the data required as a reference text as the actual data
input models will be available at learn.unctad.org in the Port Management Training section.
By completing the data input models on time, the review that will take place will have the
benefit of some initial analysis and benchmarking. From this definitions can be agreed on,
and/or modified, as appropriate. In general the objective is to gather raw data rather than the
metric itself. This will facilitate the introduction of modified or new metrics as the process
evolves. At all times the data files will be held securely by UNCTAD and the reports
generated will not identify confidential information shared by participants.

The key year in the data is 2010. Where participants can offer data going back to 2000, then
this will be welcomed and add to the depth of analysis available.
It is open to all participants to prepare a submission for the workshop, which should be
shared with UNCTAD in advance. Again this will facilitate a productive and efficient
workshop.

29
5. Finance
The scope for benchmarking financial performance is extensive. The capacity to deliver the
raw data to perform such comparisons varies. The issues are time, currency, data definitions,
accounting standards, and business scope. In the case of time we can agree to adopt the
calendar year as a standard leaving each reporting authority to convert, pro rata, any financial
data compiled on a different basis. For currency conversion we can again agree on a standard
of current US dollars and UNCTAD will apply accepted accounting rules for conversion. For
example, for trading values we can use an average rate for the period; and for balance sheet
values we can apply a conversion rate based on the date of balance sheet valuation (January
1st and December 31st). Data definitions are described below for the most basic requirements
of a benchmarking exercise. They can be discussed and modified to match the practical
requirements of the network members provided we all agree to apply them consistently. It is
consistent application that justifies the comparison rather than the definition itself. Where
possible the metrics proposed avoid the complications and differences across jurisdictions
associated with accounting standards. For example, valuation rules for liabilities and
provisions are not an issue as such data is not requested. The focus is on profitability and
investment ratios. However, the key issue is in defining the business scope for the metrics.
The basic assumption in this document is that the financial data relates to the Port Authority
on a port by port basis. The authority may be private, or more likely, public in nature. It may
be a national body or port specific. It may provide port services such as stevedoring or that
may be provided by the private sector. The metrics below make assumptions about the nature
of a Port Authority revenue and costs profile. In other words the metrics reflect the
transactions associated with the regulatory and landlord functions. Pilotage and Towage are
added as they are often provided by the Port Authority. The main areas therefore are port
dues on vessels and cargo, pilots, towage, and property based income from leases or
concessions. It is unlikely that stevedoring revenue and costs will be available in this early
stage of the PPS network project. Nonetheless, the workshop should identify useful measures
and consider the steps required to obtain such data.

As with all financial data, it is assumed that accounts are consistent with International
Financial Reporting Standards (IFRS). If this is not the case then there is a need to identify
any technical conversion steps required. As the data requests are at a high level and do not
deal with the more complex accounting issues, such as valuation of intangibles, it is expected
that these returns will be sufficient to provide a reasonable comparative dataset. All the
measures requested are typical of summary published financial accounts. They are not split
by cargo mode, as are the operations figures, as they are typically regarded as confidential
and some revenue heads are difficult to allocate in a modal fashion. It is desirable though to
include average revenue and costs per service line and mode. This modal split may be
difficult to deliver for revenue and especially for costs; however, it is consistent with the
metrics sought across the operations and market dimensions of the PPS. While revenue data
can generally be collected on a modal basis it is more likely that expenditure reflects the
traditional accounting dimensions of cost type e.g. electricity. The records do not necessarily

30
provide the additional dimension of which trade the electricity is used for. Therefore, the data
requirements for cost profiles remain at a high level of abstraction.

The workshop should consider actions to enhance the scope and reliability of this data
category.

Table 3: Finance Data

Item Description

Total This is the total sales turnover for port and port related
Revenue services provided to third parties. Excluded are any
sales/value added taxes. This can be applied to a simple
measure of average revenue per tonne of cargo. It is
important to clearly specify the elements that make up
this revenue. The assumption in this paper is that it
includes revenue from port dues on vessels and cargo,
income from rent or equivalent on land provision, and
other port services such as pilots and tugs. The total
revenue should be reconciled with the revenue elements
sought below.

Gross Profit This is the total sales less direct costs, often defined as
the cost of sales. It is before administration and general
costs often referred to as overhead. Another term for
Gross Profit in the port accounting context is
Contribution (to overhead). This number has particular
value when considering profitability by business unit in
a port e.g. cargo mode or port service.

Operating This is a conventional measure known as Earnings

Profit before before Interest, Tax, Depreciation, and Amortisation.
depreciation This is a useful comparative measure as it excludes cost
(EBITDA) items that can vary in policy approaches cross
nationally. It is also a good high level measure of
performance comparable across time and other industry
types. As the modern port industry is capital intensive a
high value as a proportion of total revenue is expected
in order to provide sufficient income to support
continuous development through investment.

Operating Operating profit includes the charges for depreciation

profit and amortisation but exclude the costs of funding the
(EBIT) operation or the payment of taxes. This facilitates a
useful comparison as funding models and tax regimes
can differ from port to port. By taking the cost of assets
(depreciation) into account the measure is a useful
indicator of performance on a total cost basis.

31
Item Description

Net interest This is a simple measure of the funding costs of the Port
costs for the Authority for the period. It is the cost associated with all
period forms of debt less any income from deposits and near
cash investments. This can be applied to measures of
funding rates and the relationship between debt and the
capacity of profits to cover the repayments.

Net Profit This is the ‘bottom line’ and refers to the profit that is
Retained held over in reserve for later periods and/or is
distributed as dividend to shareholders.

Port dues - This is the total figure earned by the Port Authority on
vessels revenue headings associated with servicing vessels.
They are various local charges against all seagoing
vessels entering a harbour (or at anchor), to cover
maintenance of channel depths, buoys, lights, etc. They
are typically referred to as Tonnage Dues (wharfage)
and charged on the vessel size e.g. GT (Gross Tonnage).

Port dues - This is the total figure earned by the Port Authority on
cargo revenue headings associated with provision of cargo
handling infrastructure/facilities. Charges are raised
typically based on cargo categorisation using an
international convention such as Standard International
Trade Classification (Rev.4).

Port This is the revenue received for the provision of

Services pilotage, towage, and crane services to port users by a
revenue Port Authority. It will be useful also to identify who
provides such services if not the Port Authority.

Property In many port environments there can be substantial

portfolio income earned from the wider port estate. This
income represents the total income from the Port Authority
property portfolio in the form of rental income. In some
accounts it is possible to separate such earnings from
direct cargo/quay side operations from income
associated with a land bank owned by the port authority.
This is necessary to identify high relative rental income
from ports with a significant property portfolio when
comparing them with ports functioning with land
exclusively dedicated to cargo handling. This will
require careful definition at the workshop. In most
accounts it is not difficult to provide such analysis.

32
Item Description

Fees and In some ports where many services are provided by the
licences private sector the Port Authority may receive income in
the form of licences and fees. Where this is a relatively
large or growing figure it might represent a wider
regulation of the port service market. In other words
where the Port Authority issues permits (or equivalent)
to private operators but maintains a regulator role for
quality, or competition reasons.

Labour costs This a useful comparator measure of the relative

dependency of port managers on labour costs. It is
intended to capture direct payroll costs and related
taxes. This relates to direct port authority employees
generating a comparative ratio of labour to sales.
Adding the cost of stevedoring, casual and permanent,
to this number provides a ratio of port employees to
stevedoring. This is an issue for discussion at the
workshop as such values are not generally available to
Port Authorities. However, trends in concession
agreements suggest an obligation to report such data.

Non- Labour This and labour costs should represent the total
costs operating cost base of the port authority. It will be
useful for the workshop to agree a template for
disaggregating this to defined large port operating
elements e.g. insurance, consulting, maintenance.

Capital This represents the gross spend on assets by class for the
expenditure period and provides a basis to compare investment
for period levels as ratios of sales, opening asset values, and trade
- fixed assets volumes. The class division is typical of financial
- equipment accounts but will require formal definition at the
- estate workshop.

The objective is to capture investment levels to chart

relative levels of development. A more comprehensive
analysis will collect these numbers by business division,
i.e. cargo mode. Having charted the level of investment
it can be associated with data such as ownership
(private/public), debt levels, and returns on asset ratios.

33
 Item Description

Distributions There are a number of instruments and methods used to

to transfer funds to the shareholders/Owners/State. These
shareholders transfers are over and above normal payments such as
taxation. They are typically dividends. They may also
be repayments of earlier state aid. The intent is to
capture the flow of funds from the Port Authority to the
State, outside of operating costs. In this case the State
can be represented nationally, regionally and/or locally.

Investments There are a number of ways that the shareholders can

by invest in a Port Authority. This can be equity in a
shareholders corporatised model, grant aid (repayable or not), and
other direct aid. The intent is to capture the nature of the
state’s role in funding the Port Authority. It is useful to
identify the level of state authority involved and this is
captured in the governance section.

Debt This is a simple balance sheet measure typically

available from standard summary accounts. Net debt is
outstanding loans less any cash, or near cash
equivalents, held at the balance sheet date. This is the
comparative value required. Collecting the gross and net
facilitates a more efficient comparison. It is also
important that any off balance sheet debt is identified,
e.g. where the shareholder sources the capital.

Equity This is a simple balance sheet measure typically

available from standard summary accounts. Given the
varied governance structures across the network such
numbers are not always recorded as share capital.
Therefore, equity is calculated as the total shareholder
funds recorded in the Balance Sheet. In a standard
Balance Sheet this equals (is in balance with) the value
for net assets.

With the above data a range of comparative ratios and measures can be used in a
benchmarking report. Table 4 describes the metrics used in the pilot exercise in 2013. What is
worth noting is that no port is identified. A further list of common financial ratios is included
in Table 5.

34
 Table 4: Finance Benchmarks 2012
Metric Average Min Max Ports
Operating Margin* 39% 26% 60% 6
Vessel dues/sales 29% 20% 43% 3
Cargo dues/sales 39% 18% 57% 3
Rents/Sales 6% 2% 10% 2
Labour/Sales 23% 8% 45% 3
ROCE 16% 12% 18% 3
* EBITDA/Sales

The value of financial benchmarks in port performance reporting is very high for a number of
reasons. First, it provides real comparisons of profitability and sustainability across time,
between ports, and with other service industries (public or private). The argument therefore
moves away from the ‘special’ nature of the port business and allows for real time
performance appraisal. There are challenges with definition. However, the research done to
date indicates that they can and should be overcome.

Table 5: Financial Ratios

1 Growth % = Yr2 Sales - Yr1 Sales
Yr1 Sales
2 Gross Profit % = Gross Profit
Sales
3 Operating Margin = Operating Profit
Sales
OR
= EBIDTA
Sales
4 Net Margin = Net Profit (after interest and tax)
Sales
5 Return on Equity (ROE) = Net Profit (after interest and tax)
Equity
6 Return on Assets (ROA) = EBIT
(productivity) Total Assets
7 Return on Capital = EBIT
Employed (ROCE) Total Capital
8 Asset Turnover = Sales
Total Assets
9 Interest Cover = EBIT
Interest Charge
10 Gearing = Total Debt
Shareholder funds

35
6. Operations
Data from port operations are the most common cited as port performance measures in public
and academic reports. This can lead to misleading analysis if the specific context of the port
is not included. For example, a very large multi-modal international port, operating as a hub
on global trade routes, functioning as a landlord port with a competitive market for port
services, independent price control and access to new capital, is very different to a small
single mode centrally controlled full-service port functioning within a regional or domestic
network of ports.

The data below sets out the basic requirements of a port operations benchmarking system
with sufficient scope for expansion and development. The specifications are divided into a
service type by cargo mode matrix. For example, we can compare dry bulk vessel data across
network ports on a like for like basis. Similarly we can compare other services by cargo
mode. Aggregating measures on a cargo weighted basis to produce port wide indices is also
provided for. This is a bottom-up dataset with the basis unit of analysis focussed at the cargo
mode or terminal level. By aggregating the data it is possible to develop weighted averages as
an additional level of comparison.
The initial specification for port operations is ambitious. Nevertheless, as ports continue to
evolve in a changing regulatory environment there are demands for new performance
measures. For example, environmental measures that consider energy efficiency and various
forms of emissions are now required in some locations. Comparing such outputs across a
network with similar economic development contexts will be of value to port managers and
policy debates. Agreeing a strategy for this and other operational areas such as security
(ISPS) is a task for the workshop.
The data specification is designed to capture volume activity, per resource consumed such as
time or space, by product type such as cargo mode. There are three categories of data
covering services to vessels, cargo and land. In many cases the data requirement is for the
actual calculated metric rather than the underlying data. This is because the data volumes can
be large and commercially sensitive.

Table 6: Operations Data for Vessels

Vessels All measures are per cargo mode
Number of This is the total vessel arrivals, reported separately for each
arrivals for mode, for the year. It is assumed that all vessels that arrive
period. also depart. Please exclude those smaller vessels that move
within the port or to and from local destinations such as
fishing and small local ferry operations. The assumed cut
off point for other vessels is 30m LOA, which the workshop
will need to agree.

36
Vessels All measures are per cargo mode
Average The length overall (LOA) is typically expressed in metres
length of and often used as a basis for charging for berth usage. This
vessel (LOA) is recorded on vessel certificates and available from Lloyds.
Where a vessel trades in two or more cargo modes then the
larger mode should be used to categorise the vessel.

Average This is calculated from the time of first reporting and/or

waiting time arrival at the port to the time of completion of the berthing
for berth process.

( Hours plus part of as a decimal)

Average time This is calculated from the time of completing the berthing
on berth process to the time of completion of the un-berthing process
on final departure.

( Hours plus part of as a decimal)

Average This is calculated from the time of starting the unloading
working time process to the time of completion of the loading process
on berth before departure.

( Hours plus part of as a decimal)

Number of In order to standardise the comparison process the aim of
pilots used the calculation is to understand the number of pilot
(in/out = 2) operations that are undertaken in a period. Hence using the
pilotage service on arrival and on departure requires a score
of 2. The total figure for the period is required which can
then be applied in the analysis to compare average activity.
Vessel shifts that require a pilot are additional movements.

Number on In some ports masters that sail into and from a port are
self-pilotage certified to pilot their own vessels. In order to standardise
the comparison process the aim of the calculation is to
understand the number of self-piloted operations that are
undertaken in a period. The counting rules for standard
pilotage apply here also.
Number of In order to standardise the measure for comparison purposes
tugs used (In please record the number of tugs used in and out.
+ Out +
Shift)
Average Vessel draft (or draught) is the distance from the waterline
vessel draft to the keel of the vessel. It therefore will vary depending on
(loaded) how much cargo the vessel carries.

Average The Gross Tonnage of a vessel is recorded on the ships

Gross tonnage certificate in accordance with the measurement
Tonnage rules of the International Convention on Tonnage
(GT) Measurement of Ships adopted by the IMO in 1969 and
fully implemented in 1982. It is a volumetric measurement

37
 Vessels All measures are per cargo mode
and replaced the GRT measure, thus standardising
measurement systems. It is often used as a measure for
pricing purposes. It is a measure often used to show the
size of vessels serviced in a port.

Table 7: Operations Data for Cargo

Cargo All measures are per cargo mode
1. Total cargo This is a total number of units handled in the period.
handled for For LoLo vessels the measure to use is the TEU. For
period RoRo and Ropax vessels the unit to use for freight is
2. Total cargo the FEU. For all other cargo the unit is metric tonnes
transhipped to with the exception of vehicles, commercial and
outgoing vessel tourist, where the number of units is required. In the
3. Total cargo case of cruise vessels two numbers are of value,
transhipped over namely the number of those on board and the
land (to 3rd numbers who use your port to leave or join a cruise.
country)
Average number of This is a simple measure based on the number of
cranes per vessel working cranes allocated to a vessel loading or
unloading.

Average TEU per This is a standard calculation in unitised cargo

hour operations and is a measure of port performance in
handling cargo. It is assumed that lifts are not always
known to the port authority.

Average yard dwell This is another measure of performance that provides

time per TEU insights into cargo handling on the land side. Time in
yards can be an issue for a number of reasons such as
customs delays, slow pickup by consignees, poor
storage and equipment, or lack of quality information
systems. The measure simply calculates the average
time a container remains in the yard across the port.

This is best done by terminal however; the first

objective is to capture a port wide measure for
comparison purposes.

Port cargo It is useful to compare capacity in terms of design

throughput capacity calculations on a modal basis.

Average passengers In the case of ports that handle passenger traffic

(on + off) across borders or on a national basis it is useful to
measure the extent of this activity.

38
 Cargo All measures are per cargo mode
Average tourist In the case of Ropax vessels that may also service
vehicles (on + off) tourist traffic by carrying the passengers car/vehicle
on board.

Average commercial In the case of specialised vehicle carriers and/or in

vehicles (on + off) the case of RoPax vessels the number of commercial
vehicles through the port is a valuable statistic.

Table 8: Operations Data for Land

Land All measures are per cargo mode
Hectares allocated A limiting factor in many ports is the availability of
land for direct cargo handling. This measure is
intended to capture the extent of land allocations to
cargo handling on a modal basis. It requires some
reasonable assumptions in the case of mixed terminals
and areas and the assumption here is that such an
allocation will be calculated on the basis of cargo
volumes.

Total berth metres A limiting factor for many ports is the availability of
berth space for ship and cargo handling. This measure
is intended to capture the extent of berth metre
allocations on a modal basis. Where a berth is used
for mixed purposes then we can apportion the
availability of metres for the period based on vessel
arrivals by length overall (LOA).

Total berth numbers A further measure of berth availability or otherwise

per mode is the number of berths. This reflects the
fact that berth length requirements may be different
across cargo modes.

Number of terminals In the container sector it is useful to compare the

spread of activity across intra port competing
terminals.

The success of the pilot study (2013) was most important across the operations data. The
tables below describe the benchmark values by cargo mode. As with all benchmarking
measures they provoke a new series of questions that can only be answered by including
more detailed operational measures. They can be further enhanced when examined along
with context variables such as governance, and macro-economic data.

39
 Table 9: Operating Benchmarks - LOLO
Operating average ratios 2010-2012 - LOLO
Metric Average Min Max Ports
TEU per arrival
438 133 1,158 4
Average waiting time-hrs
122 1 223 3
Average time at berth
46 16 77 4
TEU per working hour
10 3 22 3
Average GT per vessel
18,523 10,177 26,870 2

Table 10: Operating Benchmarks – Liquid Bulk

Operating average ratios 2010-2012 - Liquid Bulk
Metric Average Min Max Ports
Tonnes per arrival
12,788 5,079 30,277 4
Average waiting time
72 30 121 3
Average time at berth
60 44 78 3
Tonnes per working
hour 226 102 390 4
Average GT per vessel
33,146 6,230 82,092 4

Table 11: Operating Benchmarks – Dry Bulk

Operating average ratios 2010-2012 - Dry Bulk
Metric Average Min Max Ports
Tonnes per arrival
26,866 11,546 47,460 4
Average waiting time
55 28 69 3
Average time at berth
129 98 149 3
Tonnes per working
hour 125 77 153 4
Average GT per vessel
40,323 22,372 90,706 4

40
7. Labour
A range of studies have identified the reform of labour arrangements as a critical element of
policy responses to globalisation64. This is not entirely focussed on efficiency studies as the
social consequences of such change remains a key issue for port managers. One point of note
is that most studies are based on case work in developed economies with relatively high
labour to sales ratios. The main narrative describes a radical reduction in dock worker
numbers as a result of ‘privatisation’ of stevedoring. This can include a scenario where
private terminal operators take on an agreed number of workers suitable for business levels, a
further casual pool may be maintained to cover fluctuations in demand, and the balance of
dockworkers are made redundant funded by the State, the Port Authority and perhaps the
terminal operator. This latter case is often through an operator licencing system. The status of
each port in terms of labour numbers and their organisation is therefore a key comparator and
the list below reflects this.
The list can be extended provided the data is available for sharing. For example, providing
data on numbers and gross wages by employee group allows for volume and value averages
per employee. This is difficult to do but should be part of the workshop agenda. Work
stoppages, training and safety records are key metrics in a port environment. These should
also be part of the future work of the network.

Table 12: Labour Data

Human Resource Data

Average employed Full time Equivalents (FTE) are the relevant
by PA for period measure for employees, especially if there is a
strong element of part-time workers in the Port
Authority. This should also include outsourced
labour.
Number of labour Work stoppages are often a critical factor in
disputes by PA explaining poor performance.
employees
Average duration Equally the number of days lost due to work
of PA labour stoppages by PA employees is a useful
disputes comparator.
Training spend as Quite often in benchmarking exercise a
proportion of total comparison is made of training expenditure. In
PA revenue this case it is related to the scale of the business.
What is the dock This is intended to capture the arrangements for
worker hiring dockworkers such as permanent, casual, and/or
regime? labour pool.

64
Turnbull, P. 2012. Port labor. The Blackwell Companion to Maritime Economics, pp.517-548. AND
Turnbull, P. 2000. Contesting globalization on the waterfront. Politics and Society, 28(3), 367-392.

41
8. Market
This dimension of the Port Performance Scorecard is additional to the metrics explored in the
Pilot study 2013. There are a number of challenges with the collection of comparable data
across customer and market profiles. The most obvious measurement categories are customer
satisfaction and market share analysis. In the former case, regular customer surveys are
generally used to chart satisfaction levels. An innovative approach developed for North
American ports65 in more recent times, explores through precise survey work measures of
service effectiveness. So not only can we measure efficiency of services through operational
measures, (doing things well), we can measure effectiveness (doing the right things) as
scored by port customers/users.
In the case of the latter one study66 argues for the application of the Boston Consulting Group
market performance matrix. This provides the basis for charting changes to a port’s market
share over time. It also provides the means to chart (scatter graph) a number of ports on this
matrix plot by way of comparison. Table 1 in Chapter 2 provides a schematic of the matrix.

For both of these market based performance scores raw data is required. In the case of
effectiveness structured surveys are required. One such modelling technique is the SEAPORT
model, again based on a study of North American ports. This is not included in the early
phases of this project primarily because it requires time and funding. The guiding brief at
present is to engage with readily available data where possible. Nonetheless the workshop
should consider this as a future proposition.
The market share matrix however can be delivered in the near term provided the workshop
can agree a common definition for the market. In this first version the recommendation is to
assume that total national volumes represent the market; and the share of this market by
volume is the port’s market share. So a port with a high market share and a high growth rate
is a STAR performer. Change in performance or comparisons with similar ports is therefore
of value. As an internal assessment each port can also relate their market performance against
strategic decisions and thus chart their outcomes. Equally where legislative regimes have
changed any shift in performance can be benchmarked as pre or post this policy shift. In short
the volume data collected under operations by cargo mode can be used again here. National
level statistics which quantify the national market volume are also required for each cargo
mode. The workshop objective is to define how this area can be developed in the next phase.

65
See 36
66
See 50

42
9. Reporting
The output from the workshop and the continued commitment to the project of Irish
Aid/UNCTAD provides an excellent opportunity to construct a valuable port management
tool across the PTP Networks. It will also make a significant contribution to the development
of port performance systems outside of the normative environment of developed economies.
Table 13 is a sample of the type of summary report that is available.

Table 13: Sample Benchmark Report

Benchmark Report 2012
Metric Port Mean Rank N
Operating Margin 60% 39% 1 6

Financial - all port

Vessel dues/sales 20% 29% 2 3
Cargo dues/sales 18% 39% 2 3
Rents/Sales 10% 6% 1 2
Labour/Sales 8% 23% 1 3
ROCE 12% 16% 2 3

TEU per arrival 133 438 4 4

Operations LoLo
Average waiting time 1 122 1 3
Average time at berth 38 46 2 4
TEU per working hour 4 10 2 3
Average GT per vessel 10,177 18,523 2 2

Tonnes per arrival 30,277 12,788 1 4 Operations LB

Average waiting time 121 72 3 3
Average time at berth 78 60 3 3
Tonnes per working hour 390 226 1 4
Average GT per vessel 82,092 33,146 1 4

Tonnes per arrival 23,310 26,866 3 4

Operations BS

Average waiting time 68 55 2 3

Average time at berth 139 129 2 3
Tonnes per working hour 153 125 2 4
Average GT per vessel 25,196 40,323 2 4

It is a sample only that is intended to illustrate the potential of the data collection work and
also to highlight the confidential nature of individual port ratios.
One key feature of the final sessions of the workshop will be to agree the type, frequency,
and delivery method for port performance reporting. At this stage of development the final
product is envisaged as an annual publication with statistics and analysis across the network
ports. This will be augmented by individual port access to detailed benchmarks for their own
strategic planning and management purposes. The detailed protocols associated with this will
be agreed at the workshop. However, the participants should contribute in advance their own

43
expectations of a regular set of benchmark reports. From this debate a plan for the future can
be agreed.

44
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