Marine Terminal Operations Technology

Past, Present and Future

Perspectives on the global role of information technology in container terminal operations A perspective from Zebra Enterprise Solutions

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The age of scope and scale

The past 20 years have been a time of unprecedented growth in the scope and scale of the maritime container business. During this intense period of development, massive investment in container shipping capacity and landside infrastructure has helped to open up new manufacturing and consumer markets worldwide, enabling global trade as we know it today. In the process, global container port throughput has rocketed from less than 76 million TEU at the end of the 1980s to more than 524 million TEU in 2008. At 6 million TEU in 1988, Singapore was the worlds largest container port. It topped the global port league again in 2008, at nearly 30 million TEU. Many factors have played into the considerable production efficiencies that container terminal operators have been able to deliver during this period of rapid growth in vessel size and throughput. But undoubtedly, the achievements of the last 20 years would not have been possible without sophisticated container handling systems and technology. Since the late 1980s, the industry has been supported by a growing range of expert information systems to co-ordinate and more recently automate the planning and management of container and equipment moves in a complex and demanding business environment. In particular, suppliers of commercial off-the-shelf (COTS) terminal operating systems (TOS), led by Navis, have given the industry access to professional and purpose-built software. Drawing on experience gained from multiple implementations worldwide, the 3rd party software sector has played a critical role in ongoing improvement of TOS functionality and development of associated applications. Today, the TOS is at the heart of an increasingly complex web of programs, systems and devices designed to enhance operating efficiencies, improve management controls and business intelligence, and connect marine terminals with the wider world.

Steel meets software how it all began

In June 1990, the Stevedoring Services of America (SSA) terminal in Seattle, Washington, USA, became the first in the world to go live with Navis Synchronous Planning and Real-time Control System (SPARCS), the industrys original commercial TOS. Shortly afterwards, Argentine operator Exolgan was the first to implement EXPRESS, Navis solution for back-office management of bookings, inventory, billing and EDI. In an era when mainframes and monochrome still dominated the business computing world, and where most container ship stowage and yard planning was done with paper and colored pencils, Navis SPARCS was unlike anything the industry had seen before. Running on full-color, largescreen Apple Macintosh II workstations, SPARCS took advantage of Apples ground-breaking mouse-driven Graphical User Interface (GUI) to provide ship and yard planners with a rich visual representation of their working environment. Planners gained a birds-eye overview of ship and yard layouts, with individual containers represented by brightly colored icons. Behind the front-end GUI lay the computing power to capture all the critical data previously kept in planners heads. The launch of SPARCS was the culmination of many years development work by Navis founders Jon Shields and Erik Tiemroth, including an extensive period of R&D on containership stowage software for leading shipping line APL. Shields and Tiemroth met in the 1970s as undergraduates at the University of California at Berkeley, studying naval architecture under the tutelage of Professor William Webster. Webster, whose pioneering work played an important role in modern containership design, was also intrigued by the prospect of using computer technology to optimize the stowage of containers on ships.
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In the late 1970s, he was hired by APL to research stowage optimization. Shields and Tiemroth were part of the project. But the researchers were quickly humbled by the complexity of the task, recalls Shields. It became clear that computer technology at the time could not deliver an optimization application that matched let alone exceeded the capabilities of a good human planner. One of the key outcomes of the project, however, was to start Shields and Tiemroth down the road of devising a system whose primary function would be to support highly-skilled human ship planners, rather than trying to make the decisions for them. By the early to mid 1980s, the major container shipping and terminal operators (often one and the same) had good in-house mainframe applications for gate control, bookings, inventory management and other back-office functions. But this was not the case at the sharp end of operations. With APL support, Shields and Tiemroth set about s creating a system that would help ship planners manage rapid volume growth by managing and presenting a large amount of data in an easy to use way. The launch of the Apple II in the mid-1980s provided the breakthrough technology to help realize the vision. The first result was TACTICS (Tactical Container Terminal Information Control System), developed for APL, which went live in 1988 at the carriers Kaohsiung, Taiwan container terminal. TACTICS was mainly focused on ship planning, but included some basic yard planning elements. Shields and Tiemroth then set about developing the commercial SPARCS package, with the addition of a full terminal yard planning system to complement ship stowage. Early adopter National Terminals of Australia (later to become Patrick Stevedores), which came on-board while SPARCS was still under development, is particularly credited by Shields with providing valuable knowledge on the discipline of yard planning. With practical industry input from National Terminals and other early customers, including NYK and SSA, the SPARCS team was able to create a fairly universal application for all yard types. From 1990-1999, Navis SPARCS was to notch up 100 installations worldwide. Today, the system has 235 customers in 50 countries and is used to manage 35% of annual global container throughput.

From data capture to smart systems

Traffic growth through the 1990s and 2000s was also accompanied by an exponential increase in complexity, taking planning to a new level and prompting a significant change in market demands. Terminal operators and systems once expected to cope with 50 moves an hour were challenged over this time

If you would understand anything, observe its beginning and its development
Aristotle

to double or triple these volumes (and more) on larger container yards with many tens of thousands of container stacking positions; serving more shipping routes with growing vessel sizes; and with more pieces of handling and transport equipment to allocate at gate, yard and quayside. Enabled by continued advances in technology, the mid-1990s saw the growing use of artificial intelligence (AI) in the TOS to support the changing business dynamics. Increasingly, terminal systems have been expected to crunch the numbers and make optimal decisions for gate planning, equipment control, ground stowage strategies and human resource management, among other elements. This shift from transactional support to decision optimization has certainly yielded benefits in greater operational efficiencies and equipment and labor savings. But it has also come at a price. For systems to make smart decisions, they must factor in parameters that are unique to each implementation. While 80-90% of activities are the same from one terminal to the next, the 10-20% difference - in reporting, processing, yard layout, handling systems, labor practices, customs and other constraints - has driven considerable customization of standard commercial TOS, which can now account for 25% or more of the total cost of ownership.

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Key early benefits and still fundamental today were greater productivity of planning personnel and more efficient use of terminal space and equipment. As US East Coast operator and Navis SPARCS user Georgia Ports Authority quite simply says: Systems have enabled our existing infrastructure to support volume increases.

Time to decouple from platforms

Until recently, delivering commercial software that falls somewhere between a standard package and a custom solution has been a challenging and costly affair. This stems mainly from the proprietary operating and development platforms on which the software has been built. In the early days, the emergence of Mac OS as a reliable, industry-standard operating platform was as important to the creation of SPARCS as the front-end GUI interface. But proprietary platforms do not offer the best environment for fast and cost-effective software customization, which is precisely what the industry wants. And with platforms evolving ever more quickly, the risks of obsolescence for large marine terminal applications have become a growing concern. In 2001-2002, Navis SPARCS developers therefore started work to identify a new architecture that would a) be much easier to customize without hefty reprogramming and b) liberate the application from any specific operating platform or database. Given the need to provide a long product lifecycle, the goal was to find a solution that would support the business for the next 15-20 years. The answer was found in a J2EE architecture supporting a very extensible data model with a very sophisticated presentation layer utilizing a Java rich-thin client (RTC) internet technology, which became the face of the current Navis SPARCS N4 system. First introduced in the early 2000s, RTC provides users with the experience of locally-installed desktop software, but from server-based applications. It operates on similar principles to thin-client computing, which has been around since the early-mid 1990s and launched a generation of HTML browser-based applications. But RTC is far better at handling large amounts of high speed data and providing rich user interfaces both cornerstones of the TOS. For marine terminal applications, RTC offers a number of major benefits:

Ease of deployment: As the software resides on servers, it is easy to deploy, integrate and administer across multiple sites. A sophisticated multi-terminal data model allows customers to deploy across multiple sites in a myriad of ways. Users can access the same real-time, live data from the central server. In addition software maintenance upgrades are automatically dispersed across the network. Designed for growth: The J2EE architecture is inherently designed to scale up. Users can simply acquire a larger server as their business grows, or create a network of servers to provide more computing power. Integrated approach: Open Java standards enable multiple products to be integrated into a single, homogenous system. This includes tighter interface between core TOS modules such as gate, yard and quay planning andquipment control plus integration with other applications. But perhaps the most exciting breakthrough is in the areas of configuration and customization. The data model on which the solutions are built allows for business rules to be determined, set or changed locally and easily, without changing the core software product. From a customization perspective, the software is extremely amenable to multiple levels of customization using techniques such as Java and Groovy based code injection and with the ability to create entirely new business entities further incorporating the individual needs of every terminal. The end result is standard software that users can quickly and inexpensively modify themselves. Best of all, this type of customization is available without departing from the benefits of a standardized product that can be affordably maintained release after release.

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Platform independence: With everything executed on the server except for the user interface, RTC software doesnt really care what kind of computer hardware its displayed on. The supporting architecture is also compatible with multiple databases and operating systems, so users are not forced down one proprietary route.

And now for something completely different

RTCs customization abilities played an important role in Navis decision to invest four years and many thousands of man hours to build SPARCS N4 around Java and RTC technology. Combining all the features of the previous SPARCS and EXPRESS systems in a single integrated product, Navis SPARCS N4 was launched in 2006. By the end of 2009, it had been implemented at more than 20 terminals worldwide. In classic fashion, early adopters have largely been smaller operators and greenfield projects, with less existing technology infrastructure at stake than the major players.

New Zealands Lyttelton Port of Christchurch (LPC) recounts that one particular software change which would have taken 6 weeks programming time (and cost) with its old system was configured in-house on N4 in just 15 minutes. LPC was the first in the world to go live with N4, in April 2006, and its experience is instructive. The port originally selected N4 for its ability to provide integrated real-time gate, yard, ship planning and equipment control, as its existing bespoke supplier was struggling to keep up with changing needs and development costs were rising.

SPARCS N4 is not so much a terminal system as a tool to build a terminal management system on, with all the business rules and operational practices needed to manage single or multiple operations. It provides the flexibility to deal with industry needs for the next 10-15 years

Enabling growth and change

N4 has delivered on original expectations, enabling LPC to grow its business from 180,000TEU to 240,00TEU without the need to increase the terminal footprint. The port says the system has dramatically increased container throughput per hectare/head and enabled higher ship productivity thanks to support for twin-lift ship discharge operations. Navis SPARCS N4 has also helped LPC reduce gate/truck exchange time from 20 to 12 minutes, allowing it to double truck traffic by adding only one extra lane. Beyond the internal productivity gains, LPC has also used the new technology to drive more fundamental change to its business model. In particular, it has exploited N4s rich web interface to give customers and the wider port community access to real-time operational information. External users of the LPC system (there are over 1500 of them compared with about 60 internal users) are now able to define and produce their own reports and set up their own alerts. This has saved considerable administrative time and cost. And in many cases, users now have active ownership of their own business processes. For example, customs and customers are communicating directly over LPCs system to manage clearance without any need for port staff to get involved. LPC has facilitated the dialogue, but effectively removed itself from the process. Shipping line customers are using the system to make EDI bookings, enter pre-advice of container notification and release containers.

Robert Inchausti VP Product Management Zebra Enterprise Solutions

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Customization, flexibility, scalability and cost have so far been the primary implementation drivers. Early feedback indicates that users are already reaping considerable benefits, both expected and otherwise.

Extending further along the logistics chain, LPC is now working with the local container depot, rail shuttle operator and export shippers to provide end-end shipment visibility from initial empty container pick-up through to the point where the loaded container is delivered on vessel. The port says that the basic architecture of Navis SPARCS N4 has made it easy to provide the system across multiple operations from a single central server. This proactive approach has already paid business dividends. A major shipper has recently diverted cargo to LPC away from a nearby competitor port which, while physically closer, cannot offer the same open and integrated information flow across the transport network.

TPT customers now have full access to control their own bookings and releases. In similar vein to LPC, the operator already has three times more customers than staff using the system. Improvements in the quality and visibility of data are noticeable, says TPT. Where it used to take 24 hours to process a booking, now it only takes the time required

for the customer to log on and enter the data. TPT has also been able to reduce documentation staff as a result. Shipping line customer PIL South Africa says it has gained by being able to book or release containers from its own desks, rather than having drivers waiting in queues at the port to collect containers. The new system has also eliminated the booking amendment fees previously levied by TPT to cover administration. TPT is also seeing improvements at its terminal gates, where fewer data errors mean less staff resource and vehicle delays while documentation is processed. The operator has been able to migrate towards exception management and will introduce more gate automation in the future. Shipping line MSC says that TPTs new approach has opened a valuable window into the terminal MSC . employs its own ship planners, who are embedded on the terminal. Navis SPARCS N4 has made their job easier, reducing time previously spent working off stack prints to check container weights and see if boxes were placed in the correct destination stack. The roll-out of Navis SPARCS N4 at City Deep, Johannesburgs major inland container dry port, handling 1-2 million TEU per annum, will extend visibility still further, notes MSC. And as it can currently take up to 10

Making visible gains

A big step forward in customer visibility and access to data was the major goal for another early Navis SPARCS N4 user, Transnet Port Terminals (TPT). As part of Transnet, South Africas national port and rail operator, TPT runs a network of 7 marine and 14 rail terminals across the country. Starting with a clean slate, TPT set out to reassess business processes and customer needs. The outcome was a pioneering decision to deploy a central SPARCS N4 system at TPTs main office in Durban, serving the whole of its terminal network. The aim of the world-first project, due for completion this year, is to provide a single point-of-entry to customers regardless of where they do business in South Africa. The ultimate result, says TPT, will be a single customer invoice for services performance by multiple operating divisions within Transnet. As well as improving visibility across the marine terminal network, in the future TPT plans to use Navis SPARCS N4 for better integration between TPTs operations and those of sister company Transnet Freight Rail.
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Trucking companies are checking real-time container status on the system before coming to the port. Truck productivity has increased, dwell time and demurrage is down and the port is enjoying better utilization of land, assets and staff.

Even while the project is still rolling out, TPT and its customers are seeing the advantages of centralized information and web-based EDI communications.

phone calls to find out where a container is on the South African rail network, MSC is especially interested in future deployment of an integrated port-rail N4 system.

Best practice and business process standardization

Compared with other industries, the maritime sector has been slow to adopt best practice thinking, both within and between enterprises. All too often, technology has been deployed simply to automate existing practices, rather than embraced as a chance to review and improve the fundamental business model. With Navis SPARCS N4 enabling easy reconfiguration of software to changing local conditions and needs, operators have a chance to adopt more standard best practice processes. In retail and manufacturing, where Navis has supplied yard planning systems to major companies such as Wal-Mart and Johnson & Johnson for their distribution centre (DC) operations, the focus is firmly on a standard product. Wal-Mart operates 140 DCs that are identical in all respects right down to the location of water coolers. The companys primary goal is to identify best practice, automate it and replicate processes across the whole network. This is the route now being taken by TPT. Since investing in Navis SPARCS N4, the South African operator has been working to roll out a single business process across all of its sites, while customizing the system to reflect unique physical features at its various facilities. A more standardized approach to common business functions drives improvements in the customer experience, staff training and deployment, IT administrative efficiencies, hardware and software investment and more. The prospects are especially exciting for operators of multiple facilities, but single-site companies will also stand to gain.
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Into a challenging new decade

If the 1990s and 2000s were marked by the scramble for capacity and scale, the next decade will be very different. The global economic and financial crisis has sent a shockwave through the entire maritime container transport system. Growth will resume, eventually, but the scars will take a long time to heal For the terminal sector as a whole, however, the recession could ultimately have a positive outcome. The sharp decline in traffic has already led some industry innovators to start work on addressing entrenched business and operational inefficiencies that crept in during the heady days of growth. When the industry finally emerges from the downturn, it could be in leaner and more cost-effective shape. Technology will play an important part in shaping the industry of the future and a number of key trends stand out for the coming decade.

Optimize the enterprise

Over the coming decade, forward-looking operators will take a more holistic approach to improving their business performance. Enabled by technology, enterprise best practice will become a growing focus and discipline. The larger groups in particular will devote more time and resource to creating an over-arching IT systems strategy to support this process. With the challenge for so many being just to keep up with the growth, addressing sub-optimal performance levels has not really been the major priority, as long as the clients requirements were met. And where faster vessel turnarounds have been achieved, often there have still been problems with yard and gate productivity. In the coming decade, much greater attention will be paid to optimizing the terminal as a whole, not just its constituent parts. Operators will take advantage of the greater visibility and integration provided by new technologies such as Navis SPARCS N4 to define and implement best practice for the business as a whole.

Focus on total cost of ownership

Terminal operators will pay much sharper attention to their equipment and systems spend, looking at the ROI for total cost of ownership (TCO) versus just the up-front investment. The desire to drastically reduce the cost and time expended customizing software will see configurable, open and scalable systems become the de facto standard for most standard business processes. And the commercial suppliers will be challenged to demonstrate the ROI that they can bring to specific clients needs.

Robert Inchausti, VP Product Management, Zebra Enterprise Solutions

Manage the network, not the node

Real-time visibility and control of operations across national or regional terminal networks under the control of a single operator, as in the case of TPT, could transform the landscape of planning, resource management and customer service. Ocean carriers calling at more than one facility can now have a single window into whats happening right across the network. The terminal operator can track and adjust resources from facility to facility, based on an accurate overview of vessel arrival and departure times. The network management concept may be challenging to consider on a global scale. But the implications for improved management of vessel schedules long a thorn in the side for carriers and terminals alike are enormous. In the immediate future, operators seizing the chance to give shipping lines enhanced visibility across networks, rather than just at a single node, should certainly gain a competitive advantage. Technologies such as N4 could also help operators centralize back-office administration and other higher level functions as an internal service to the business. Rather than having to deploy staff at each facility, adoption of the multi-site single-server (MSSS) model could allow the creation of regional or even global centres of expertise for highly skilled functions such as vessel planning, as well as administrative and customer service functions. And all of this can be integrated in real-time with individual terminal operations. Server-based TOS will also deliver benefits to those areas with poor infrastructure, where a data center can be set up remotely and access via the web or Citrix. In the future, software could even be rented and charged for based on usage.

Empower customers and communities

The proliferation of the internet, developments in wireless and satellite connectivity and rapid advances in mobile devices are dramatically changing the global communication landscape. Fast and seamless access to large amounts of data is becoming the new norm. We expect to see whatever we want, whenever we want, wherever we want. And we generally expect it to be free or at least cheap. The trend to 24/7 self-service information will only accelerate over the new decade. As demonstrated at LPC and TPT, terminal operators can reap significant business advantages by incorporating this new reality into their business processes. Why should B2B be any different to B2C? Closer integration of terminals into the whole supply chain has long been seen as a holy grail for the industry and its customers. But many previous attempts have foundered on the rocks of unwieldy and expensive technology. Lack of agreement over who should pay for the privilege of all this data has also been a significant barrier. Terminal operators now have a chance to adopt the Google model and offer their web-based TOS as a tool for shippers, agents, shipping lines, truckers, customs and others to share information, manage processes and communicate. The cost implications are minimal - in fact, getting customers to enter the data will yield savings. Meanwhile, the chance to build customer loyalty and facilitate better community-wide interaction is significant.

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The scars of the recession will be long lasting. Those that survive will be those that embrace best practice and take it to heart. Being able to demonstrate the ROI achievable from adopting best practice, achieving the savings as forecast and building ongoing strategic relationships will differentiate the leaders from the rest.

From information to intelligence

The terminal business generates a huge amount of data. But without analysis, its just a lot of information. Business Intelligence (BI) tools, such as the dashboard provided within Navis SPARCS N4, will become more widely used to provide a high-level overview of whats going on right across the business from operations to human resource management to equipment procurement and maintenance. Better knowledge will allow operators to identify and address sub-optimal processes. Associated business tools, such as the automated yield management system now under development at LPC, will give greater insight into the true profitability of individual clients and jobs.

Manage the exceptions, not the norm

Empowering people to manage processes rather than simply manipulating data will be another hallmark of the coming decade. Supported by new automated business tools, the shift away from transaction management to exception management will continue. It wont be viable to manage the 12 million TEU terminal of the future any other way.

Mind your assets

In this equipment-intensive business, the ability to make operational fleets more productive across the board from quay cranes to yard hostlers will be a major differentiator. Over the coming decade, technology will help extract better utilization and extend the lifespan of expensive assets. Technologies such as radio frequency identification (RFID), optical character recognition (OCR), real time locating systems (RTLS) and position detection systems (PDS) will increasingly be used to provide real-time data streams on asset identity, location and performance. Integrated equipment control systems within the TOS will then deploy high-level algorithms to optimize asset allocation across the gate, yard and quay operation, reducing empty running, idle time and wear and tear. The ability to maintain a real-time inventory overview gives the industry a key to handling more business with existing assets - or reducing the amount of equipment needed to manage existing workloads. A recent Zebra Enterprise Solutions RFID technology trial with an airport client demonstrated that 10% of the airports equipment could be taken out of service for an entire week, during a peak demand period, without any noticeable service issues.

The robots are coming

Ever since 1993, when ECT launched the worlds first automated terminal, the industry has been by turns fascinated and skeptical about the prospects for robotized container handling. Until very recently, automated container handling was the province of the pioneering few with deep pockets to fund big in-house development and implementation teams. Its a similar picture to the early days of IT in the industry. But like IT before it, the robotics industry is maturing. Growing experience (and competition) within the commercial sector is driving down hardware and software costs and the terminal industry is now able to draw a growing skills base within its third party suppliers. Navis now has seven years solid experience with delivery of the highlevel IT needed to support automated operations. The decision to robotize is still a major one and some high profile projects were put on hold in the wake of the global economic crisis. But the genie is out of the bottle. The consistency, reliability, labor and fuel savings and environmental benefits offered by automated facilities will ensure the future of robotic technology.

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Remote monitoring technologies will also support the industry to improve the environmental and energy performance of its equipment, with real-time tracking of operational parameters such as fuel consumption, oil usage and running temperature.

David meets Goliath: IT levels the playing field

The final word goes to the small terminal operator. Lower volume operations make up a significant percentage of the global terminal industry, especially in emerging and niche regional markets. But historically, it has been difficult for these companies to fund the total cost of ownership and IT expertise associated with modern terminal systems. They are therefore at a competitive disadvantage compared to larger counterparts with the means to support a modern TOS. The latest development from the Navis SPARCS N4 camp aims to level the IT playing field. Launched in early

In a rapidly changing world, todays small operations may be the giants of tomorrow. Providing access to many of the same software tools and features that have allowed larger facilities worldwide to expand is therefore helps lay the foundation for the future growth of the industry as a whole.

Zebra Enterprise Solutions, a division of Zebra Technologies Corporation, extends Zebras reach beyond passive RFID by employing state-of-the-art software and hardware solutions to locate, track, manage, and optimize high-value assets, equipment and people across the worlds largest supply chains. Whether tracking containers through a port, optimizing parts for manufacturing, or managing ground support equipment at an airport, the real-time asset management solutions from the combination of Navis, WhereNet, proveo, and Multispectral Solutions provide improved visibility and velocity to gain measurable business improvements. Utilizing products that are based on ISO/IEC 24730-2, Cisco CCX Wi-Fi, precision GPS, and UWB technologies, Zebra Enterprise Solutions offers a wide range of location solutions that are application matched, enabling its customers to put the right asset in the right place at the right time. For more information about Zebra Enterprise Solutions visit http://www.zebra.com/zes

For more information please contact us at 1-510-267-5000 or visit us at www.zebra.com/zes

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2010 ZIH Corp. Navis, Zebra Enterprise Solutions, and all product names and numbers are Zebra trademarks, and Zebra, and the Zebra head graphic are registered trademarks of ZIH Corp. All rights reserved. All other trademarks are the property of their respective owners.

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February 2010, Navis Argo dubbed the TOS in a box offers cost-effective access to professional software. The new product covers all the core operational planning and control requirements for vessel, yard and gate, integrated with equipment control, together with EDI management and reporting tools. Additional modules can be acquired as needed and the Java RTC infrastructure means that Argo will be able to scale up as the business grows.