The benefits of a monitoring strategy for firms subject to the Emissions Trading System

This study tests the impact of Internal and External Environmental Management on performance in firms subject to the European Union’s Emissions Trading System (ETS). A conceptual model is drawn up based on the existing literature, and tested on a large sample of Italian firms. The unit of analysis is single firms subject to the ETS that are involved in Green Supply Chain Management (GSCM). The ETS mechanism has been shown to be marginally beneficial for some firms while supply chain relationships are also influenced by such system. Firms need to identify suitable practices to boost the effectiveness of their environmental strategies. We propose the implementation of a monitoring strategy as a useful practice for firms to be environmentally and economically better off. Our results show that firms subject to the ETS should rely on their own (internal) Environmental Management alone for improving environmental performance, as collaboration with suppliers only has a positive impact on economic performance. However, implementation of a monitoring strategy allows a firm subject to the ETS to partially offset the inefficiency created by the system. We show that environmental collaboration does not become more effective when a monitoring practice is put in place.     

Strategic beliefs of port authorities

Over the last decade, insights from the strategic management discipline have increasingly been applied to ports. A review of literature shows that in the analysis of port authority strategy, mainly outside-in approaches are applied. This paper adds to the emerging understanding of the port authority’s strategy by applying a cognitive perspective. Specifically, the strategic cognition of firms’ executives is one of the explanatory variables behind firms’ strategic decisions. Furthermore, cognitions are influenced by the organisational contexts in which port authority executives have worked. As a result, managerial “mental maps’ may vary across industry contexts and over time. This research investigates the strategic cognition of a global set of port authority executives through a survey-based instrument. The results show that, to a large extent, PAs resemble “regular” for-profit companies, but that they possess some specific beliefs that distinguish them from “regular” companies.     

Modal shift from road haulage to short sea shipping: a systematic literature review and research directions

ABSTRACT

Modal shift from road haulage to short sea shipping (SSS) has been advocated by authorities and researchers for more than two decades. This paper provides a review of literature on modal shift and pinpoints paths for future research on topics in six categories: (1) factors influencing SSS competitiveness, (2) the policy-oriented perspective, (3) environmental legislation, (4) SSS performance, (5) port characteristics, and (6) the multi-agent perspective. In particular, we propose first, in evaluating the performance of SSS versus road haulage in different trade corridors, three performance-related dimensions – the economic dimension (e.g. external costs), the environmental dimension, and the dimension of service quality – should be considered. Second, researchers should use rich, real-world, numerical data and operational research techniques to identify the relative importance of individual drivers and barriers for a modal shift from road haulage to SSS. Third proposed direction is related to assessing which groups of actors certain policies should target. In doing so, researchers should extend their policy-related focus beyond the European Union, which has long encompassed the major geopolitical scope of research on the modal shift. Fourth, to moderate the adverse impact of environmental legislation on SSS, strategic solutions need to be identified. Fifth, we also suggest that the influence of contingencies, particularly port strikes and cyberattacks, on SSS operations and approaches for managing them should be investigated. Sixth, the economic and financial advantages of coordination and alliance for each transport chain agent need to be evaluated.     

Private road competition and equilibrium with traffic equilibrium constraints

Toll road competition is one of the important issues under a build-operate-transfer (BOT) scheme, which is being encountered nowadays in many cities. When there are two or more competing firms and each firm operates a competitive toll road, their profits are interrelated due to the competitors' choices and demand inter-dependence in the network. In this paper we develop game-theoretic approaches to the study of the road network, on which multiple toll roads are operated by competitive private firms. The strategic interactions and market equilibria among the private firms are analyzed both in determining their supply (road capacity) and price (toll level) over the network. The toll road competition problems in general traffic equilibrium networks are formulated as an equilibrium program with equilibrium constraints or bi-level variational inequalities. Heuristic solution methods are proposed and their convergences are demonstrated with simple network examples. It is shown that private pricing and competition can be both profitable and welfare-improving.     

Airport management: a strategic approach

In this paper a Dynamic Balanced Scorecard (DBSC) is used for the main purpose of indicating strategy implementation avenues to managers so as to equip them with more efficient decision-making tools. To that end, Fuzzy Multicriteria Decision-Making methodology is used as a source of technical support in formulating a cause and effect system and fuzzy strategic indicators. This methodological instrument brings a strategic vision to performance analysis and is designed to furnish a tool for evaluating the impacts of management action on the BSC fuzzy indicators. The proposed analytical methodology is applied to Brazil’s seven main international airports.     

Devising business strategy for railways

This paper presents a case study which tackles a general problem for railway management, namely the formulation of a strategy to improve business financial performance. This is prefaced, in Section 2, by discussion of general principles - concerning the type of information system required, investigations to be conducted and associated measurement needs. The case study, of Section 3, concerns our investigations of VicRail's total business and its constituents. The task of financial improvement is revealed from an assessment of sectors' current cost-recovery positions and the identification of system joint costs. For freight sectors, future traffic prospects, pricing possibilities and the scope for more efficient operations are then considered, and the implications traced for overall deficit reduction and the development of business strategy. The concluding section draws some general lessons for railway managements.A fuller discussion by the authors of the theoretical framework employed, and particularly of the case study application, is contained in a complimentary publication: Improving Railway Financial Performance, published by Gower in January 1985.Transmark is a subsidiary of the British Railways Board, acting as its international consultancy. The authors, who were respectively study director and manager, wish to thank Bernard Warner (an independent consultant), Richard Eccles (of Transmark) and Adrian Balkyn-Rackowe (of British Rail) for their valuable contributions. The study report, titled Rail Cost — Pricing Options, was released by the Minister in April 1981.     

Survey analysis of supply chain adjustment for Taiwanese information technology firms

Owing to the globalization of industry, the explosion in customer services and product life-cycle compression, most manufacturers have been adjusting the processes and activities of their supply chains to remain competitive and optimize total profit. The aim here was to explore the issues surrounding the changes in manufacturing supply chains and the consequential impact on freight transport demand. A questionnaire to survey Taiwanese information technology (IT) firms was designed and conducted to chart in detail the changes in supply chains of manufacturers, the trends in the international division of labour, and the strategic adjustment of manufacturing and logistics strategies. Surveys and interviews led to the conclusions that (1) vertical integration and international division of labour are very conspicuous among Taiwanese IT firms, (2) there are different strategies of supply chain adjustment at various stages of the product life-cycle, (3) with the transformation of the supply chain, manufacturers require faster transport services, i.e. the demand for air transport may increase and the demand for sea transport may decrease, and (4) once the firms decide on foreign investment, the availability of international transport services becomes one of the considerations for factory offshore relocation. However, transport cost is not a major consideration for firms' supply chain adjustments.     

Considering the financial ratios on the performance evaluation of highway bus industry

This paper tries to construct a performance evaluation procedure for highway buses with the financial ratio taken into consideration. First, a conceptual framework is redeveloped, based on the one created by Fielding et al ., to help form evaluation items and performance indicators involving both transport and finance aspects. Second, the total performance is divided into three major kinds of efficiency?production, marketing, execution?according to the cycle of operation activities. Third, to overcome the problems of small sample size and unknown distribution of samples, the grey relation analysis is used to select the representative indicators, and the TOPSIS method is used for the outranking of highway bus. In addition, a case study is conducted using four highway bus companies as example. The empirical result shows that the performance evaluation for highway buses could become more comprehensive if financial ratios are considered.     

Strategic management of organizational turnarounds in the transit industry

The traditional wisdom that there are increasing returns to scale among bus transit systems has been shaken with recent research findings. The implication from the literature is that unless many transit systems restructure along new organizational lines the financial and service provision difficulties will continue. Very few public transit systems have attempted to strategically manage change and turnaround organizationally.The objectives of this research were to identify the salient factors in organizational turnarounds and to determine whether these factors were evident within transit organizations that have attempted to manage change strategically. The author reviewed the corporate turnaround literature and conducted four case studies of strategic planning/management within the transit industry.All four cases exhibited organizational declines or perceived declines as imminent. They initiated turnarounds through reorganizations and efforts at strategic management. The reorganizations that occurred at all four cases were relatively minor, involving some changes in function. Only minor changes in management occurred and commitment to strategic management varied. Strategic objectives were not quantifiable. All of the cases could have improved their communication below the middle-management levels. The measures of performance in general did not relate a specific strategy and program to a particular turnaround effect. Through management commitment and some minor organizational restructuring two cases achieved some degree of turnaround. Total commitment to strategic management, organizational change, adequate communication, and accurate performance measures are keys to definitive turnarounds.     

Cash flow sensitivities during normal and crisis times: Evidence from shipping

Using a system of equations model, we analyze how cash flow shocks influence the investment and financing decisions of shipping firms in different economic environments. Even financially healthy shipping firms felt strong negative effects on their financing activities during the recent crisis. These firms were nevertheless able to increase long-term debt. Banks internalized the impact of foreclosure decisions on vessel prices and avoided an industry-wide collateral channel effect. Even during benign economic conditions, financially weak shipping firms underinvest because of their inability to raise sufficient external capital. The substitution between long- and short-term debt during the pre-2008 crisis periods shows that the composition of financing sources is more indicative of whether firms face financial constraints than the pure size of the financing-cash flow sensitivities. An analysis of firms’ excess cash holdings confirms the importance of financial flexibility.     

Congestion pricing and roadspace rationing: an application to the San Francisco Bay Bridge corridor

This paper presents an empirical application of a congestion–alleviation strategy that C. Daganzo [Transportation Research B 29 (1995) 139–154] proposed as a “hybrid between rationing and pricing”. This strategy is applied to the San Francisco Bay Bridge corridor, in search of a practical and Pareto-improving solution to the Bridge's congestion. The work relies on a mode-split model for work trips across four different income groups residing in 459 origin zones, and it applies an equilibrium analysis based on Bridge performance. Results indicate that modal utilities (and thus choices) are sensitive to the specific combination of toll and rationing rate, as well as to the Bridge's travel-time (or performance) function, and the length of the congested section. Though no combination of tolls plus rationing rates was found to benefit all groups of travelers studied, further investigations may improve upon these results by refining some of the assumptions made here.     

Measuring supply chain risk: Predicting motor carriers’ ability to withstand disruptive environmental change using conjoint analysis

Supply chain risk measurement is an expanding research stream that considers the ability of networked firms to anticipate and respond to significant environmental risks, including major disruptions and unexpected events. However measuring and quantifying supply chain risk has proved an enormous challenge and this research contributes to this goal by developing a risk assessment scorecard, using conjoint analysis, for motor carrier firms. The resultant motor-carrier scorecard has been scaled from 300 to 900, to resemble the well-known FICO score for assessing consumer creditworthiness. Our scoring model enables motor carriers – and the firms that depend upon them in intermodal supply chains – to assess carriers’ ability to withstand major disruptive events, which are broadly defined as events which might lead to a significant drop in carriers’ income and profitability (e.g., such as that which occurred on September 11, 2001). Carriers with weaker risk scores (<600, on a 300–900 scale) are more likely to experience financial distress (and as a result possibly exit the industry itself); those with scores above 600 are less likely to depart. The model correctly identified 77 percent of motor carriers that ultimately exited the trucking industry following the significant environmental disruption caused by 9/11. Our computational experience indicates that the model accuracy, quantified in terms of Type I and Type II errors, compares favorably to prior results reported in the credit scoring literature.     

Rail policy in Britain — What next?

The 1974 Railways Act set British Rail (BR) the rather vague objective of providing a passenger service broadly comparable with that then existing within a given level of support. For the first few years under the Act, BR succeeded in operating within the financial constraints imposed, but only by considerable increases in charges and by negotiating wage settlements which implied declining real wages. From 1978 on, rising labour costs and reduction in traffic led to a rapidly developing crisis in BR's financial position.The position of each section of BR's business is discussed briefly. It is shown that the designation of some sectors as being purely commercial is inappropriate, since this means that benefits to users and to the community at large are ignored in decision-making. Similarly, the direction to maintain social passenger services at a given level means that finance and investment are concentrated unduly on preservation of the existing pattern of service, rather than on providing value for money. In both sectors, the likelihood is that in general fares are too high and services too frequent.At an operational level, the criterion of maximising the (weighted) volume of traffic carried is advocated as a practical way of choosing between alternative fare and service-level packages. More broadly based strategic studies would be needed to decide on the weights to be adopted, the level of finance to be made available, and the overall strategy.     

Evaluation of travel demand strategies: a microscopic traffic simulation approach

This research investigates the design and impact of a new travel demand management approach, namely the Downtown Space Reservation System (DSRS), using a microscopic traffic simulation approach executed in VISSIM. The DSRS is part of a Travel Demand Management strategy that is designed to mitigate traffic congestion in a downtown urban setting. The simulation is conducted according to an experimental design procedure for a revised road network representing downtown Boise, Idaho. The issues that are tested in the simulation include: (1) whether the DSRS improves traffic performance when compared with the case without the DSRS; (2) how the DSRS performs compared with a reservation system that uses a First Come First Serve principle; and (3) how the specific DSRS parameters (such as, the relative importance of throughput versus revenue generation) influence network system performance. Conclusions and future research recommendations are provided based on the insights from the simulation modeling work.     

A sequential group decision-making approach to strategic planning for the development of commercial vehicle operations systems

This paper explores a new sequential decision methodology which integrates a generalized sequential probability ratio testing approach with a strategy-value matrix analytical tool to determine the developmental priorities of commercial vehicle operations (CVO) technical packages for CVO time-based strategic planning. The proposed method executes a sequential decision algorithm utilizing the strategic elements of strategy-value matrices which are estimated on the basis of the data collected from the survey respondents. In the process of sequential decision making, the identification of a specific CVO value-added technology package can be made once the condition of the minimum group decision-making cost is met. In addition to methodology development, a real case study together with a nation-wide mail survey to aid the estimation of the strategy-value matrix samples which were used as inputs to the proposed sequential decision algorithm was conducted in Taiwan to demonstrate the feasibility of the proposed method. Utilizing the proposed method, we determined efficiently the developmental priorities of CVO technology packages for short-term, mid-term, and long-term strategic plans, respectively. Our analyses results indicated that the CVO package used for fleet management appears to be the most urgently needed in the short-term CVO strategic plan; value-added technology packages including: (1) data warehousing, (2) information technology, (3) integration with the supply chain management (SCM) platform, (4) freight mobility, (5) integration with advanced traffic management systems (ATMS), and (6) extension for intermodal operations are assigned to the mid-term CVO strategic plan; and others including: (1) freight administration, (2) HAZMAT management, (3) on-board safety monitoring, and (4) roadside safety inspections are involved in the long-term CVO strategic plan. We expect that this study can make available the proposed decision-making support method with benefits not only for planning CVO development strategies, but also for re-examining the role of commercial vehicle operations in a comprehensive extent.     

A bi-objective dynamic programming approach for airline green fleet planning

Ensuring a fleet of green aircraft is a basic step in mitigating aviation pollution issues that are expected to be worsen in the coming years due to rapid air traffic growth. This study proposed a novel methodology in green fleet planning in which both profit and green performance of airline are considered simultaneously and explicitly. To do this, a Green Fleet Index (GFI) is derived as an indicator to quantify the green performance of airline’s fleet. It measures the degree of airline compliance with a standard requirement in terms of emission, noise, and fuel consumption. A bi-objective dynamic programming model is then formulated to find optimal aircraft acquisition (lease or purchase) decision by minimizing GFI and maximizing profit. Several interesting results are obtained: (1) considering environmental issue as secondary objective yields a greener fleet; (2) airline’s profit is affected, but could be recovered from environmental cost savings; (3) increasing load factor is an effective operational improvement strategy to enhance airline’s green performance and raise profit level. It is anticipated that the framework developed in this study could assist airlines to make a smart decision when considering the need to be green.     

A Strategic Diagnostic Tool Applied to Iberian Seaports: An Evolutionary Perspective

The highly competitive and rapidly changing environment faced by businesses has greatly increased the need for strategic planning. The importance of formulating strategies to reach competitive advantages with implications in the performance is becoming increasingly evident in the seaport context. Thus, it is relevant and appropriate to apply strategic positioning tools to seaports given the role of competitive strategies in the growth and development of this industry. This research aims to analyse the strategic positioning of the leading Iberian Peninsula seaports (Portuguese and Spanish seaports) using the Boston Consulting Group (BCG) matrix as a strategic tool in an evolutionary perspective. The portfolio analysis developed subsequently focuses on the annual data of eight seaports in a selected period of 18 years (1992–2009) and on five categories of traffic: liquid bulk (LB), dry bulk (DB), containers (CO), ro-ro (roll-on/roll-off) and conventional cargo (CC). This research allows us to compare and analyse different levels of performance and identify which of the seaports have improved their strategic positioning during the considered period. The findings reveal a better positioning of Spanish seaports in relation to total traffic and that most of the seaports in the BCG matrix had changed from the first to the third period. The seaport of Valencia is the only one that has maintained its Star Performer position in all the 18 years analysed. Furthermore, considering container traffic, the results evidence the seaports of Algeciras, Valencia and Barcelona as having attained a remarkable position of leadership.     

Explaining shipping company participation in voluntary vessel emission reduction programs

Ports are under increasing pressures to increase sustainability and reduce the local and global emissions impacts associated with their operations. Due to limits on their jurisdictional authority, ports may design effective voluntary programs and appropriately motivate participation from global shipping companies that visit their ports. This paper investigates the success of the Vessel Speed Reduction Program at the Ports of Los Angeles and Long Beach and uses qualitative methods to analyze the factors that contributed to the success of the program at reducing local air quality pollutants. In particular, why did individual private firms participate in a non-required, voluntary effort? This research found that external pressures such as community concerns about emissions and regulatory threats are important to motivating voluntary behavior and may even be more important than financial incentives. Furthermore, simplicity of program design, clear goals and presence of a monitoring mechanism are important in influencing participation. These findings broaden our understanding of the business strategy behind slow steaming and its applicability as an operational practice as much work to date is focused on how fuel prices and financial incentives influence the choice for shipping companies to slow their speeds. While the VSR program led to significant emission reductions, an additional lesson for voluntary programs is the need for them to evolve and strive for continuous improvement.     

A canonical correlation analysis of carrier financial strategy: The case of airline deregulation

This study investigates U.S. airline managements' perception of deregulation's impact upon the industry's financial risk by analyzing the airlines' risk management behavior. Specifically, canonical correlation analysis is utilized to ascertain key asset-liability/equity interrelationships and to identify changes in airline risk management as indicated by changes in financial structure. A control sample of nonregulated firms in various service industries is used to separate the effects of general economic conditions from those of deregulation. The results indicate that the airline industry adjusted its financial structure to reduce the industry's exposure to risk as the industry became deregulated. The industry decreased its financial leverage through greater use of equity vis-à-vis debt to finance its long-term assets while simultaneously increasing its liquidity. Definitive conclusions concerning the industry's perception of financial risk after deregulation had been in place a few years are precluded by two external events which occurred in 1978—the requirement that leases be capitalized on the balance sheet and the rapid fuel price increases spurred by the Iran-Iraq war. However, the results clearly show the industry perceived greater financial risk during the early years of de facto CAB deregulation.     

An ontology-based framework to support performance monitoring in public transport systems

Managers of public transport systems have been facing for years the strategic challenge of maintaining high quality of transport services to improve the mobility of citizens, while reducing costs and ensuring safety and low environmental impact. A well-established way to evaluate the performance achieved by the system or by specific activities is to monitor Key Performance Indicators (KPI). However, existing management systems, which refer to flexible yet large and complex data models, provide a limited support to define and select relevant KPIs for the objectives at hand, and even the identification of whether and how the data model is capable to achieve a certain informative need is a critical and time-consuming task. This work is aimed to propose a framework to ease the development of a monitoring system in the public transport domain. The approach is based on the ontological representation of all the knowledge regarding indicators and their formulas, business objectives, dimension analysis and their relation with the Transmodel, the European reference data model for public transport information systems. On its top, a reasoning framework provides logic functionalities to interactively support designers in a set of common design tasks: the choice of the most suitable indicators for the performance monitoring needs at hand, the definition of new indicators and the identification of the minimal set of Transmodel modules needed to calculate them. A case study is included to discuss these applications, while an evaluation shows the feasibility of the approach.