FSG Blog
May 24, 2012

Global Trade and Logistics Scenarios

Peter Kennedy
Managing Principal

In mid-May 2012, FSG principals facilitated a strategic planning exercise using global logistics scenarios for the Port Commerce Department of the Port Authority of New York & New Jersey. Under the guidance of FSG and our partner, Cargo Velocity, some 60 workshop participants devoted three days to exploring the strategic implications of five alternative future operating environments for maritime trade and logistics. Scenario planning is part of a broader Port Commerce effort known as Project Port Horizon to think proactively about, and begin to prepare for, emerging challenges and opportunities facing the port. 

Nine Outcomes of the Global Trade & Logistics Workshop 

The workshop to explore global trade & logistics scenarios surfaced nine discrete areas requiring PANYNJ Port Commerce strategic attention.  Here are nine primary areas of intended action. 

  1. Logistics – leading the industry as a port fully integrated into the global logistics chain at every level.  To accomplish this, the PANYNJ needs to secure the port’s standing as the East Coast’s leading supply chain platform and as a world-class expert in logistics. It also means raising port requirements around green, sustainable policies across the entire logistics chain.
  2. Finance – relying on the port’s marketable revenue sources for financial support to assure long-term independence and flexibility. This implies ultimately becoming financially self-sustaining, both through new revenue sources and tight cost -control measures.
  3. Partnerships – maintaining strong, dynamic and resilient partnerships that better prepare the port for the future.  New polices are required for expanded participation in existing and emerging trade and professional forums. Innovation, technology integration, and improving efficiency of operations should be ongoing goals of these partnerships.  Scenario planning discussions focused on strengthening existing alliances, as well as exploring new and non-traditional partnerships with other public sector entities, private industry, non-governmental organizations, think tanks and colleges and universities. 
  4. Infrastructure – investing in and maintaining a secure, responsive, sustainable and adaptable infrastructure. This implies better access to and from facilities for ships, rail and trucks, as well as authorities and policies to support logistics infrastructure beyond the PANYNJ’s jurisdiction.  Scenarios prompted discussions are deep challenges such as congestion, the unknown consequences of climate change and harsh weather, and a possible shift to rail and barge use. 
  5. Security – operating innovative security systems that do not inhibit cargo flow. This requires security and risk management systems that are fully integrated into port facilities and operations. The scenario explored a range of security threats to the port, some of which were familiar (terrorism) and others which were novel (pandemics and cyberattacks). The key to future success was achieving the highest levels of security without compromising cargo velocity. 
  6. Organizational Structure – utilizing an organizational structure that requires market-oriented processes and embraces private sector strategies with a long-term strategic perspective. This means a long-range port development strategic planning process that is executable, sustainable and transparent. It means meeting the requirements of the port’s customers, balanced against the need to derive profits in a competitive market environment. 
  7. Physical Resources – controlling or owning physical assets necessary for current or future operations.  This requires both authorities and capital to evaluate, obtain and develop strategically-important physical resources (land, water, air draft). Among other things, for PANYNJ, this means the beginning of a process to identify, secure and develop property for new intermodal facilities, including acquiring land possibly outside “the comfort zone” of the region. 
  8. Marketing/Business Development – developing the support and respect as industry leader from all stakeholders. This need speaks to strong marketing and effective business development, especially elevating broad public awareness contribution to regional development. 
  9. Workforce Development  – possessing a strong, specialized workforce with skills necessary to direct a nimble business.  This means HR policies that enable Port Commerce to recruit, train, and reward entrepreneurially minded individuals. 

This is derived from the 2012 report, Project Port Horizon: Redefining the Port of New York and New Jersey.  Contact FSG if you’d like to receive an electronic copy.  

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