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The age of scope and scaleThe 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 worldslargest 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 ter-

minal 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 partysoftware 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 itall beganIn June 1990, the Stevedoring Services of America (SSA)

terminal in Seattle, Washington, USA, became the first inthe 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 coloredpencils, Navis SPARCS was

unlike anything the industry had

seen before.

Running on full-color, large-

screen 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 ofship 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 undergradu-

ates 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 humbledby 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 shippingand 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 APLs support, Shields and Tiemroth set about

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 valuableknowledge 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.

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 existinginfrastructure to support volume increases.

From data capture to smartsystemsTraffic 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

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, themid-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 factorin 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.

If you would understand anything,observe its beginning and itsdevelopment

Aristotle


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And now for somethingcompletely differentRTCs customization abilities played an important role

in Navis decision to invest four years and manythousands 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.

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.

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.

Enabling growth and changeN4 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 businessprocesses.

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.

SPARCS N4 is not

so much a terminal

system as a tool to

build a terminal man-

agement system on,

with all the businessrules and operational

practices needed to

manage single or

multiple operations. It

provides the flexibility

to deal with industryneeds for the next

10-15 years

Robert Inchausti

VP Product Management

Zebra Enterprise Solutions


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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.

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.

Making visible gainsA 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.

Even while the project is still rolling out, TPT and its

customers are seeing the advantages of centralized

information and web-based EDI communications.

TPT customers now have full access to control theirown 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


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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.

Into a challenging new decadeIf 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 inef-

ficiencies 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 enterpriseOver 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 asthe 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.

Best practice and businessprocess standardizationCompared with other industries, the maritime sector has

been slow to adopt best practice thinking, both withinand between enterprises. All too often, technology hasbeen deployed simply to automate existing practices,rather than embraced as a chance to review and improvethe fundamental business model.

With Navis SPARCS N4 enabling easy reconfiguration ofsoftware to changing local conditions and needs,operators have a chance to adopt more standard bestpractice processes.

In retail and manufacturing, where Navis has suppliedyard planning systems to major companies such asWal-Mart and Johnson & Johnson for their distribution

centre (DC) operations, the focus is firmly on a standardproduct. Wal-Mart operates 140 DCs that are identical inall 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 wholenetwork.

This is the route now being taken by TPT. Since investingin Navis SPARCS N4, the South African operator hasbeen working to roll out a single business process acrossall of its sites, while customizing the system to reflectunique 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 administrativeefficiencies, hardware and software investment andmore. The prospects are especially exciting for operatorsof multiple facilities, but single-site companies will also

stand to gain.

Focus on total cost ofownershipTerminal operators will

pay much sharper atten-

tion 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.


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Manage the network, notthe nodeReal-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 manage-

ment 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 forimproved 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) modelcould 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 andcommunitiesThe proliferation of the internet, developments inwireless and satellite connectivity and rapid advances inmobile devices are dramatically changing the globalcommunication landscape. Fast and seamless access tolarge amounts of data is becoming the new norm. Weexpect 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 onlyaccelerate over the new decade. As demonstrated atLPC and TPT, terminal operators can reap significantbusiness advantages by incorporating this new realityinto their business processes. Why should B2B be any

different to B2C?

Closer integration of terminals into the whole supplychain has long been seen as a holy grail for the industryand its customers. But many previous attempts havefoundered on the rocks of unwieldy and expensivetechnology. Lack of agreement over who should payfor the privilege of all this data has also been asignificant barrier.

Terminal operators now have a chance to adopt theGoogle model and offer their web-based TOS as a toolfor shippers, agents, shipping lines, truckers, customsand 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.

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 achievablefrom adopting best practice, achieving the savings asforecast and building ongoing strategic relationshipswill differentiate the leaders from the rest.

Robert Inchausti, VP Product Management, Zebra Enterprise Solutions


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From information tointelligenceThe 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.

Mind your assetsIn 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) willincreasingly 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.

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.

Manage the exceptions,not the normEmpowering 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.

The robots are comingEver 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, therobotics industry is matur-

ing. 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 high-

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

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

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David meets Goliath: IT levelsthe playing fieldThe final word goes to the small terminal operator. Lower

volume operations make up a significant percentageof 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

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 managementand 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.

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

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