By Kurt J. Nagle, President & CEO, AAPA
LEADING THE SUPPLY CHAIN FROM WITHIN
Sometimes it’s hard to see from end to end of the supply chain. Take a seemingly simple commodity like road salt used to treat highways during winter storms. Salt is harvested from all over the world and shipped to North America. It seems straightforward: The salt is mined and then shipped to the cities and state/municipal transportation departments that spread the salt on roads. A straight line with a clear beginning and an end.
But what if the equipment used to harvest and transport the salt from mines to ships is made in North America? All of a sudden, the seemingly simple, linear supply chain becomes a loop.
And what if the equipment that is being exported to harvest and transport the salt is manufactured using imported parts or raw materials? The loopy supply chain turns into a corkscrew.
The reality is that the global logistics network has made it possible for the supply chain to look like a Six Flags roller coaster. By the time a finished product reaches a consumer, it may have traveled the world many times in whole or in part. But whether a line, a loop, a corkscrew or a roller coaster, the supply chain almost always includes ports.
Ports are an undeniable presence in the supply chain, here different modes and stakeholders physically converge. As cargo moves from water to land or land to water, the sheer magnitude and the complexity of the supply chain are evident.
Port executives have a responsibility and an opportunity to be leaders within the supply chain, using their unique positions to articulate and execute visions for the facilities within their fence lines but also the landside and waterside connections that link ports to the warehouses, distribution centers, factories and farms that own and use the cargo being moved.
This issue of Seaports magazine focuses on the topic of supply chain leadership. This leadership can occur at many different levels. A port can be a key convener of stakeholders and disparate interests in a supply chain or a region, or it can be the successful manager of an important local project that is critical to efficient goods movement.
Sometimes this leadership emerges because a port sees a need and fills that void. Sometimes federal legislation such as the U.S. FAST Act sets in motion processes that create opportunities for ports to become more visible at the state, regional or national level.
One of the ways that ports can demonstrate leadership is securing funding for infrastructure projects. With capital needs that always seem to be outpaced by trade projections and ship size, ports must know how to work with a variety of funding sources, from state and federal grant funds to private financing, often finding ways to combine funds from different pots of money.
But efficiently and effectively using those funds also requires a measure of leadership.
Having the foresight to anticipate potential roadblocks and obstacles can make a difference in whether a project stays on time or goes over schedule and whether it stays within budget or requires an infusion of cash to complete.
Ports are always looking for new avenues to be leaders, one of the most promising pathways emerging in the use of digital information and technology. Ports have the ability to persuade disparate stakeholders to participate in sharing data in meaningful ways, setting the stage for potential game changing use of technology in the supply chain.
No matter the type of cargo that ports handle, there are opportunities for them to be supply chain leaders.
This issue of Seaports highlights both emerging and ongoing success stories to serve as inspiration and blueprint for the entire hemispheric port industry, to create individual leaders within the realm of ports but also to position the entire port industry as an indisputable leader within the global supply chain.