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PORT LOGISTICS FROM A NETWORK PERSPECTIVE

A generic model for port terminal optimisation

JONAS WAIDRINGER

Department of Transportation and Logistics


School of Technology Management and Economics
Chalmers University of Technology
Göteborg, Sweden 1999
Thesis for the degree of Licentiate of Engineering

Report 41

PORT LOGISTICS FROM A NETWORK PERSPECTIVE


A generic model for port terminal optimisation

by

Jonas Waidringer

Submitted to the
School of Technology Management and Economics
Chalmers University of Technology
in partial fulfilment of the requirements for the
degree of Licentiate of Engineering

Department of Transportation and Logistics


Chalmers University of Technology
SE 412 96 Göteborg, Sweden

Göteborg 1999
Report 41

PORT LOGISTICS FROM A NETWORK PERSPECTIVE


A generic model for port terminal optimisation

 Jonas Waidringer

ISSN 0283-3611

Published by:
Department of Transportation and Logistics
Chalmers University of Technology
SE 412 96 Göteborg, Sweden

Bibliotekets Reproservice CTHB, Göteborg 1999


THESIS FOR THE DEGREE OF LICENTIATE OF ENGINEERING

This thesis is based on the work contained in the following papers, in the text
referred to by roman numbers, e.g. Paper I etc.

Paper I

Modelling a port terminal from a network perspective

Waidringer, J. & Lumsden, K.R.

Presented at the 13th International Conference on Automatic Control, Chania,


Greece, June 16-18 1997. Published in proceedings.

Paper II

Simulation and optimisation of port terminals using a network


concept

Waidringer, J. & Lumsden, K.R.

Presented at the 8th World Conference on Transport Research, Antwerp, Belgium,


July 12-17, 1998.
Currently considered for publication in the International Journal of Maritime
Economics.

Paper III

Results from the development and use of an optimisation and


simulation tool, NeuComb/Port

Waidringer, J.

Presented at the 22nd Australasia Transport Research Forum, Sydney, Australia,


September 30-October 2, 1998. Published in proceedings.
I

PREFACE

The idea of studying port terminals and their efficiency was introduced to me by my
tutor, associate professor Kenth Lumsden. To assess the necessary knowledge and
expertise in the industry I got involved in two European Union projects:
EUROBORDER and INTERPORT. Throughout my research I have been
reassured about the necessity and importance of this research area both by
professionals and the academic community.

I would like to apologise to the reader for any language and grammatical errors and
the fact that I have used some material that is only available in Swedish.

Acknowledgements

Associate professor Kenth Lumsden who has been my tutor and guided me through
the first steps in the fields of science, and who has always been very helpful.

Dr. Lars Hulthén who has been my support and tutor in the specific field of
maritime transport and management, and who has always had time to discuss my
more or less relevant questions.

Professor Stig I. Andersson for his support and willingness to share his insights
about modelling and network mathematics with me.

Professor Lars Sjöstedt for the help in finalising the report.

All the ports, organisations and companies involved in the EUROBORDER and
INTERPORT projects who let me work with them and shared their knowledge with
me at the same time as providing me with the empirical basis for this thesis.

I would also like to thank all my senior colleagues at the Department of


Transportation and Logistics, thanks to their extensive work and publications my
work has been so much easier.

Finally I would like to express my deepest gratitude to my wife Amina, for her
support and that she has been able to put up with the inevitable frustration that this
kind of work creates.

This thesis was made possible by the financial support of the Center at Eriksberg for
Communication, Information and Logistics (CECIL). Their support is highly
appreciated.

Göteborg, May 1999

Jonas Waidringer
II

Man is limited not so much by his tools as by his visions


C. Columbus
III

PORT LOGISTICS FROM A NETWORK PERSPECTIVE


Jonas Waidringer
Department of Transportation and Logistics
Chalmers University of Technology
SE 412 96 Göteborg, Sweden
jowa@mot.chalmers.se

ABSTRACT

Ports have always been the gateway to extended markets and have in that sense
always been an important part of the global logistics chain. This is particularly true
for Europe where also Shortsea shipping plays an important role in connecting the
different European countries. Therefore it is important and necessary to investigate
possibilities to enhance the efficiency of ports, especially since the ports currently
are regarded as the bottleneck in the total supply chain.

This thesis addresses the problem of port terminal efficiency in the European
context, specifically the small and medium sized ports. Building a functional port
terminal model from a network perspective has assessed this problem. This model
has thereafter been implemented into a computerised port terminal tool, called
NeuComb/Port. To test the theories, models and tool some cases were constructed
and run in the tool to get empirical data. The model and tool as well as the tests
have been performed within two, three-year European Union projects including 6
different ports in Europe.

The problem was applied to a maritime environment but the concept is applicable to
any kind of terminal, since the basic principles, e.g. functions, are general enough as
well as the level of aggregation chosen. The thesis is based on two different but
complementary theories, the theory of networks and systems theory. These theories
have contributed with insights that have helped developing the thesis into its present
shape. The bearing idea behind the work was to study whether it is possible to
enhance terminal efficiency with the new technology at hand together with new
theories and knowledge about logistics.

The main results of the thesis are twofold.

• A port terminal model from a network perspective has been developed and
tested. It is based on network theory and systems science and has been received
positively by users in the ports participating in the project.
• A port terminal tool has also been built and tested in the same environment. The
tool can be used for simulation and optimisation of internal resources in a port
terminal.

KEYWORDS: Terminal, Port, Optimisation, Simulation, Network,


Complexity, Freight transportation
IV
V

TABLE OF CONTENTS
PREFACE ..........................................................................................................................................................I

ABSTRACT.....................................................................................................................................................III

TABLE OF CONTENTS ................................................................................................................................. V

LIST OF ABBREVIATIONS ..........................................................................................................................VI

TABLE OF FIGURES .................................................................................................................................. VII

1 INTRODUCTION .................................................................................................................................... 1
1.1 PROBLEM BACKGROUND AND RELEVANCE ........................................................................................... 1
1.2 PREVIOUS RESEARCH ........................................................................................................................... 2
1.3 PROBLEM DESCRIPTION AND LIMITATIONS ............................................................................................ 3
1.4 PURPOSE AND SCOPE .......................................................................................................................... 5
2 METHODOLOGY ................................................................................................................................... 6
2.1 THEORY OF SCIENCE - METHODOLOGY ............................................................................................... 6
2.2 RESEARCH APPROACH – METHOD USED .............................................................................................. 8
2.3 METHOD AND VALIDATION OF SIMULATION AND OPTIMISATION ............................................................ 13
2.4 SYSTEM BOUNDARIES - CRITICISM ...................................................................................................... 14
3 FRAME OF REFERENCE .................................................................................................................... 15
3.1 TRANSPORT NETWORKS AND TERMINALS ........................................................................................... 15
4 SYSTEMS SCIENCE AND CYBERNETICS...................................................................................... 23
4.1 SYSTEMS SCIENCE ............................................................................................................................. 23
4.2 CYBERNETICS .................................................................................................................................... 25
5 SUMMARY OF APPENDED PAPERS ............................................................................................... 27
5.1 RESEARCH BASIS FOR THE PAPERS .................................................................................................... 27
5.2 THE PORT TERMINAL FROM A NETWORK PERSPECTIVE ........................................................................ 27
5.3 SIMULATION AND OPTIMISATION OF A PORT TERMINAL ........................................................................ 28
5.4 RESULTS FROM USING THE NEUCOMB/PORT TOOL ........................................................................... 29
5.5 OPTIMISATION CRITERIA AND FREEDOM OF CHOICE ............................................................................ 32
6 CONCLUSIONS & FUTURE RESEARCH......................................................................................... 33
6.1 NETWORK AS A METAPHOR ................................................................................................................ 33
6.2 THE MODEL ........................................................................................................................................ 33
6.3 RESULTS ............................................................................................................................................ 34
6.4 FUTURE RESEARCH - COMPLEX DYNAMIC LOGISTICS SYSTEMS .......................................................... 36
REFERENCES ............................................................................................................................................... 39
VI

LIST OF ABBREVIATIONS

C – Cycle time
Cl – Link time
Cn – Node time
Cna – Active node time
Cnp – Passive node time
Ceteris paribus – all things the same, meaning that the entity can be studied out of
its context
DG VII – Directorate General VII, EU transport directorate
DG XIII – Directorate General XIII, EU telematics directorate
EC – European Commission
ECMT - European Conference of Ministers of Transport
EU – European Union
IAHP – International Association of Harbours and Ports
Lo/Lo – Lift-on Lift-off
NeuComb – Name of tool, abbreviation of Neural Graphs & Combinatorial Graph
Theory
OR – Operational Research
Ro/Ro – Roll-on Roll-off
SME – Small and medium sized companies
TEN – Trans European Networks
TEU – Twenty foot Equivalent Unit, standard measurement unit for containers
VII

TABLE OF FIGURES
Figure 1 Ultimate Presumptions → Paradigm →Methodological Approach ...............6
Figure 2 Methodological Approach → Operative Paradigm → Study Area ................7
Figure 3 Research approach ...................................................................................................9
Figure 4 Reality – Model – Tool, interest area for Thesis ............................................. 10
Figure 5 Research workflow diagram................................................................................ 10
Figure 6 Phase I in the research work................................................................................ 11
Figure 7 Phase II in the research work.............................................................................. 11
Figure 8 Phase III in the research work ............................................................................ 12
Figure 9 The transport network, resources and infrastructure ..................................... 16
Figure 10 Network components.......................................................................................... 17
Figure 11 The network model ............................................................................................. 18
Figure 12 The logistics systems and its three subsystems............................................... 21
Figure 13 The port terminal as a network......................................................................... 22
Figure 14 Classification of systems..................................................................................... 25
Figure 15 The port terminal’s three foliated networks................................................... 27
Figure 16 Flow scheme for the optimisation .................................................................... 28
Figure 17 Efficiency figures for the current scenario...................................................... 30
Figure 18 Efficiency figures for the future scenario........................................................ 31
Figure 19 Complex dynamic logistics systems.................................................................. 37
VIII
1

1 INTRODUCTION

This thesis is based on three years of research in close co-operation with ports
and users in Europe within two EU projects EUROBORDER, sponsored by
DG VII and INTERPORT sponsored by DG XIII. Five papers have been
written three of, which are included, and constitute the thesis. The final result
of the research is an optimisation and simulation tool called NeuComb/Port,
which in all essential parts is built on information about the port terminals
accumulated within the project and in close co-operation with the users. The
main source of input comes from the analysis of problems and bottlenecks in
the project and the definition of a functional port model. The name NeuComb
is an abbreviation of Neural Networks and Combinatorial Graphs, on which the
model/tool in some parts is based.

1.1 Problem background and relevance

Short sea shipping plays a significant role in the European transport network.
However, there is still much to be done to make it more competitive. (EC
Green paper on Ports, 1998). The search for improvements is focusing on the
ports as the interface between land and sea transport. The ports have been and
still are an important but weak link in the transport chain, which gives great
value to new ideas on how it is possible to change the port operations (Frankel,
1987).

The traditional approach to enhance the efficiency of ports and port terminals
has been to make large capital investments, either by new machines, expanding
the area available for operation or hiring more labour. Currently there is a
large pressure and competition among ports all around the world to become
hubs for the different large shipping lines. The overall global trend in logistics is
that there is a consolidation of goods in all different transport chains, but this is
especially visible in the maritime sector. The European Commission among
others has acknowledged this in their recent Green paper on Ports (EC, 1998)

Another problem especially for the large hub ports, as for example Rotterdam
and Hamburg, are heavy congestions and in particular there are problems
getting the goods in and out of the ports. This is above all an infrastructure-
related problem at the landside, creating bottlenecks and congestions in and
around the larger ports. There are also problems with dwell times for vessels
offshore but it is so far a smaller problem at least in Europe. In Southeast Asia
e.g. Hongkong, Singapore and Shanghai this already is a problem. The small
and medium sized ports on the other hand lack the operational efficiency of the
large ports and are often situated at somewhat remote places with bad
infrastructure connections to the main markets in Europe.

The ports are currently the bottleneck in the international transport system,
due to primarily two facts; firstly port management is a very traditional business
2

that adapts slowly to changes. The reason for this being the large costs
associated with changes in the port terminal. There is also a basic difference in
size between the trailers or trains feeding the port and the ships. This creates a
necessary dwell time for the goods, simply because it takes time to accumulate
the volumes necessary.1 The leading idea behind this thesis is that if the
consolidation is continuing and there will be more and more goods exchanged
at each port and each call, the throughput has to be enhanced. The other
possibility is of course to expand the port terminal area, but this is not a
realistic option in most cities since the port by tradition is located near the
centre of the city. Some cities, like Helsinki, Bilbao, Hongkong, Los Angeles,
to mention a few, are actually building completely new terminals outside the
city to get rid of the problem. This is of course a very good solution, since it also
handles the other problem namely the heavy traffic load through the city
centres. It is, however, a very expensive solution and it takes a long time to
build a port terminal from scratch. Therefore, the first option of trying to
enhance the throughput is seen as a cheaper and more efficient solution
especially in the short run. The relation between throughput time and land area
needed is about linear, which means that if the throughput time can be halved,
the land area needed can be halved too. This is ultimately the reason for the
interest in advanced methods and tools for assessing the problem of terminal
efficiency.

There is a large potential of applying intelligent models and tools to the


particular problems of designing the port terminal structure and use of the
resources in the port terminal, some of which have been described above. This
thesis concentrate on the problem of managing the port resources in a long-
range view, e.g. the tactical and strategic level. Currently there exist few, if any
models describing the port terminal from a pure network perspective (Ojala
1992, and references therein). In this thesis an optimisation and simulation tool
is built that works with three foliated networks: an information flow network, a
physical flow network and a set of resources constituting these networks. This
relates closely to a conceptual framework developed for resources (Manheim,
1979).

1.2 Previous research

This is a very brief recollection of some of the work done about simulation and
optimisation of terminals and transport networks.

This field has been quite extensively researched mainly in the context of
Operations Research (OR). The most extensive research has probably been
done at the Université de Quebec a Montréal, Centre de recherche sur les

1
To give a short example; a post-panamamax vessel carries around 6000 TEUs. To accumulate
that volume in the terminal with a frequency of one trailer a minute takes 100 hours
corresponding to circa 4 days and nights of an unbroken chain of trailers. To unload and load
the vessel with a turnover rate of 160 TEU/hour which means 4 cranes working simultaneously,
takes 75 hours corresponding to 3 days and nights of unbroken work. This totals 11 days of
constant work to accumulate, load, unload and dispatch the containers.
3

transports. There a number of papers describing OR-algorithms for


optimisation purposes and terminal and fleet management have been issued,
the most prominent researchers being Crainic, Dejax and Gendrau. The group
suggests that the container fleet management problem should be divided into
two hierarchical levels – strategical/tactical and operational. The second level
should be further divided into allocation, according to known and forecasted
demand and routing of the transports of the containers (Crainic, Dejax and
Delorme, 1989). They have worked with a lot of different approaches spanning
from rolling horizon algorithms to using game theory and simulation
techniques.

In the area of simulation of seaport terminals Kondratowicz has done some


interesting research (Kondratowicz, 1990, 1993). His work is concentrated to
the area of simulation regarding terminals in general, for which he has
developed a methodology. He has also developed a simulation tool called
MULTIMOD, with which it is possible to simulate a seaport terminal.

The problems of stochasticity in demand and system performance as well as the


dynamics of network structures have been researched by Beaujon and
Turnquist, acknowledging the difficulty with creating robust models as well as
predicting demand (Hulthén, 1997).

In a paper from 1992 Ojala describes different modelling approaches in port


planning and analysis. He classifies them as three different approaches:
econometric, analytic and simulation (Ojala, 1992). This classification was used
in Paper I.

In his book from 1987 about port planning, Frankel discusses and gives some
valid thoughts about the importance of advanced methods, models and tools in
order to, in an efficient way, assess the problem of planning and development
of ports (Frankel, 1987).

One of my senior colleagues at the department has also looked into the
problem of simulation and optimisation of transport and logistic problems. In
his dissertation Hulthén gives a broad view of the concept of container logistics
and its management. He discusses the advantages and disadvantages of OR and
more qualitative approaches. For a deeper insight is referred to his work
(Hulthén, 1997).

1.3 Problem description and limitations

In all sorts of terminal systems the resources operate on a network, sometimes


according to a time schedule and on other occasions triggered by the arrival of
a carrier of some sort e.g. a vessel or trailer. In any case there exists a problem
in managing the resources, labour, machines etc. in the most efficient way. This
thesis addresses the particular problem of optimising the use of resources
within a port terminal, e.g. a Lo/Lo or Ro/Ro terminal.
4

From a logistic point of view the change or break of transport mode in a port,
e.g. from rail or road to sea, causes substantial problems. These modes are at
the same time quite different when it comes to capacity, which makes them
even harder to integrate. This is especially true when the intermodal change is
between sea transport and other modes. There is by default a waiting time (or
build-up time) for goods that are to be transported by sea. This has been
described more in detail in section 1.1 above. Every mode of transport and
every large player, especially the large carriers, have their specific requirements
on physical handling and information exchange facilities, which creates
demands for true intermodality in the ports. There are a lot of definitions of
intermodal, bimodal etc. The definition used here is the definition issued by the
European Conference of Ministers of Transport (ECMT) since it is regarded as
the most straightforward and useful of the definitions available (ECMT, 1993).

“The movement of goods in one and the same loading unit or vehicle
which uses successively several modes of transport without handling the
goods themselves in changing modes”

The ports are in the true sense integrated in the international transport chain,
i.e. they are the main interface in international transport. Small and medium
sized ports are particularly sensitive to changes and the new harder
competition, since they have limited resources to implement the necessary
developments and to go beyond their traditional role.

This thesis assesses whether it is possible for small and medium sized ports to
enhance their efficiency, without any large investments. There are a lot of
terminals that work in a similar way as a port terminal when looking at the
basic functions of the goods handling. The reason for choosing the port
terminal as the object of study was twofold. The first being a very convenient
opportunity to participate in a project aiming at enhancing port terminal
efficiency for small and medium sized ports in Europe, and the other a personal
interest in everything related to the maritime area.

To assess the problem, three papers were written alongside the work in the
project. The first paper (Paper I) outlines the basic framework for a model
describing a terminal in general and a port terminal in specific. The second
paper (Paper II) describes the functions and particular entities of the port
terminal model, as being the drawing for the port terminal tool. The third and
last paper (Paper III) describes the computerised port terminal tool,
NeuComb/Port, that was built and some of the results from using the tool. For
more detailed reading about the tool and the results, the reader is referred to
the EUROBORDER project documents (EUROBORDER, 1998a, b).

The limitations to this thesis are twofold. The first limitation is in the system
studied, which has been limited to a single port terminal and its functions. The
other limitations are that a quantitative perspective on modelling has been
taken, when constructing the tool.
5

1.4 Purpose and scope

The purpose of this thesis is fairly straightforward:

Is it possible to enhance terminal efficiency without large capital investments?

As it turned out this was a more complex and not that straightforward question
after all, which will be obvious to the well-informed reader.

The purpose can be further divided into three research questions:

• Can a port by modelling be treated like a generic terminal?


• What tools are needed to expand the flow in existing ports?
• What limitations exist for this expansion and is there an upper limit?

These short questions have to be elaborated. The first question is basically


assessing the possibility of treating a port as any terminal, because it would then
be possible not only to model it but also to use ideas and other researchers’
results in that field. The second question is based on the need for further
enhancements and increase of the flow (throughput of goods) through the
terminals. The background is that currently the ports are the major bottlenecks
in the intermodal chain, which has been described above. All ideas, models and
tools that help us enhance the flow through the terminals will therefore be of
great value. The third question is a consequence of the second one, and assesses
the possible optimum and the absolute limit of these kinds of enhancements.

To assess the purpose of the thesis, a theoretical model of a generic port


terminal was built based on system and network theory together with
Combinatorial Graph theory. This was then used as a base for a tool, called
NeuComb/Port that was used to test several interesting cases relevant to the
problem at hand. It should be pointed out that my personal knowledge of
Combinatorial Graph theory is limited and there are others that have
contributed to this part, which can be read in other papers (Jansen, 1998). The
interested reader is also referred to the very extensive book on the subject
written by Jungnickel (Jungnickel, 1994). The model was then developed into a
computerised tool to be able to test different strategies and cases about port
terminal efficiency.
6

2 METHODOLOGY

This chapter addresses the issue of methodology, which consists of two parts;
one addresses the presumptions about reality that this thesis is based on, which
can be traced back to theoretical science. One addresses the actual handicraft
of research, i.e. how the work was done. The chapter begins with a background
presentation giving the reader the theories and the view of science on which
this thesis is built. The end of the chapter has a more straightforward approach
of giving the actual approach taken. The approach followed is a very pragmatic
one, concentrated on understanding and applying the theories as described in
different books about methodology. The in-depth penetration of methodology
and theory of science has to be postponed to my doctoral thesis.

2.1 Theory of Science - Methodology

A lot of factors, such as history of the field, basic assumptions about the reality,
language etc. influence the way a researcher remains true to the subject of
study. The importance of this is pointed out by Arbnor and Bjerke (1997)
saying that we can hardly understand the data collected and try to understand
and explain anything, if the researcher has not considered how the particular
approach will shape the observations, understandings and explanations. Hence
it is also clear that to be able to say anything at all about anything we have to
take a stand on something, a platform of believes. These presumptions will
affect everything that the researcher will do from choosing the subject to the
recommendations made. This can be illustrated as in Figure 1 and Figure 2.

Ultimate
Presumptions

Paradigm Theory of Science

Methodological
Approach

Figure 1 Ultimate Presumptions → Paradigm →Methodological Approach (Arbnor&Bjerke,


1997)
The ultimate presumptions are our basic view on the world, for example that it
is round and not flat. This has to do with philosophical ideas about our
conception of the reality is actually constructed, and is foremost studied in the
theory of science. Already Plato elaborated on this in his discussion about the
world. However any deeper discussion about this is out of the scope of this
thesis, but two more things have to be added since they constitute the idea. The
7

first is the concept of science that has to do with the way we have been taught
and gained knowledge in our education. This obviously has an impact on how
we approach problems in science. The second thing is scientific ideals that also
influence the researcher, especially in choosing the area of study. The concept
of paradigm was originally minted by Kuhn (1970)2 and describes the “ruling”
view within a certain branch of science or the whole community, as the example
with the world mentioned above. Kuhn argued that paradigms only shifted
“violently” by a “revolution” of the young paradigm against the old ruling one.
Finally there is the methodological approach which basically means the concept
of how mankind builds knowledge.

Methodological
Approach

Operative
Paradigm Methodology

Study
Area

Figure 2 Methodological Approach → Operative Paradigm → Study Area (Arbnor&Bjerke,


1997)
The methodological approach is then transferred to an operative paradigm,
which is actually the working method and approach used in the specific
research. The operative paradigm is influenced by the methodology “tool-box”,
e.g. the different methodologies possible to use regarding the specifications of
the studied area of the reality. Most often there are methods more or less
suitable for a specific research question and study area.

There are three different methodological approaches, the Analytical approach,


the Systems approach and the Actors approach (Arbnor&Bjerke, 1997). These
approaches will be briefly described as a background to the basic approach
taken in this thesis and as a link to the paradigm and method used which will
end this chapter.

The Analytical approach is what can be called the classical natural science
approach. The reality is seen as independent from the observer, scientist, and
conformable to “laws of nature”. The science is based on the assumption that
the parts make up the whole and as long as the parts are described well enough
the scientist merely has to put them together to get the whole picture. The
knowledge is not dependent on individuals and parts can be explained by
verified facts. The aim and the results the scientists strive for are causal
relationships and ultimately laws of nature.

2
Here cited from Arbnor and Bjerke
8

The Systems approach was a reaction to the analytical approach and emphasises
that the reality consists of mutually dependent systems. The best-known
systems approach word is probably “synergy”, which means that the sum is not
equivalent to the parts. This approach is dominating in social science today. All
knowledge is according to this approach system-dependent or if preferable
context-dependent. This means that the systems approach explains the parts
out of a holistic approach. The aim and result the scientist strives for is to create
logic models and representative cases. To build models of the systems as a way
of explaining and understanding the reality is a basic feature in this approach.

The Actors approach was in its turn a reaction to both the others and
emphasises that the reality is a social construction, which does not exist
independently of the scientist. As soon as we want to study something we
interact with the studied object and in that sense influence the results. The
actors approach, as opposed to the two others, has not as a main objective to
explain how something works, instead the main issue is to understand social
constructions. All knowledge is individual-dependent and both the scientist and
the “object” will interact and learn something new. The whole is understood via
the actors’ images of the reality. In this approach the scientists search for
typical, descriptive cases for a class of systems. The scientists try to develop a
descriptive language so as to be able to discuss different specific situations and
to transfer knowledge in the whole community. A common technique is the
dialectical interview.

This thesis is built upon the systems approach and systems science together with
the views of Cybernetics. (Cybernetics is, in short, the theory of automatic
control please refer to chapter 4 for a more detailed discussion). The reason for
this approach is the firm conviction that the various parts of reality are linked
together and can only be understood by a holistic approach. It is also a
consequence of a preference for using models of different kinds as a way of
explaining thoughts and ideas. The approach taken is though not “classic” in
the sense that the reality necessarily by itself is considered as being a system,
but that it is a very convenient and strong metaphor. The notion of inevitable
interaction between the scientist and the area of study is also taken into
consideration, since this thesis in itself is proof of that. The handicraft of science
is cyclic and therefor the moment of interaction and mutual dependence is
inevitable. The knowledgeable reader will notice influences from all the
different approaches by the language used. As a result there is a mix of
analytical, systems and actor “words”. However the basic view is consistent
with the systems approach.

2.2 Research approach – method used

Since this thesis is based on three years of work with European ports it has
been possible to test ideas and models continuously against what is contained in
the triangle in Figure 3 below. The collective knowledge and industrial
applications in this specific case consists of the knowledge of the member ports
in the project, Helsinki and Rauma in Finland, Piraeus and Thessaloniki in
9

Greece, Oslo in Norway, Bilbao in Spain and Gothenburg in Sweden. These


ports have provided the main influences but also other ports in Europe
(Rotterdam, Antwerp), North America (Port of Los Angeles) and Southeast
Asia (Singapore, Hongkong) have given inputs and shared their thoughts on
the issue. By interacting with these ports the research has been redefined and
refined several times, although the basic approach and research problem has
been consistent. The systems context describes the knowledge of the senior
colleagues of the department and all the literature in systems science,
methodology, networks theory and articles that have helped defining the area
of research. The analytical contribution (that should not be regarded as being
based on the analytical approach) is the 5 papers written about port terminal
efficiency and how to model port terminals in an adequate way.

Collective knowledge

Visible to industry
Ind
A ppl

Systems
Sight depth
context

A nalytic contribution
Individual knowledge

Figure 3 Research approach (Applied from Sjöstedt)

A note about research in different context can be in its place here. Re and
search stands for recreating something, which goes back on the analytical
approach. The reality is of God created and our work as scientists is to try to
recreate how this was done, and if we succeed we can add another law of nature
to the pile that already exists. This is all well in the classical sciences of physics
and so on, but in social science where transport and logistics in the broader
sense has to have its place as a genuine interdisciplinary science, this is
somewhat difficult. Applied sciences try to create something new to add to our
basic knowledge rather than to recreate something that already exists. It is out
of the scope of this thesis to discuss this at length but one should notice that this
has a major impact on the notion of validity and validation of theories. If
something new is created, against what are we then supposed to validate it?
What is then our point of reference?
10

2.2.1 Method

The method is based on the research area that has been the focus of the project
and this thesis which considers the interface between the reality, that had to be
described, and the tool describing the reality as well as possible. This is shown
in Figure 4.

Area of study

Reality Model Tool

Figure 4 Reality – Model – Tool, interest area for Thesis


The figure tries to describe the difference and interaction between the reality,
the theoretic model and the computerised tool. It also shows the area of study,
correspondent to the interest area of this thesis.

The approach has as mentioned before been pragmatic, which is described in


Figure 5 below that, in a more formal way, tries to describe the workflow of this
thesis.

Phase I Phase II Phase III

Feedback Feedback

Literature Case Case Literature


Model Tool Results Thesis
research study study research

Feed forward Feed forward

Figure 5 Research workflow diagram


The research as such went through three phases as described in Figure 5 above:
Phase I, which was explorative, Phase II which was descriptive and designing
the tool, and finally Phase III that was deriving the results. The approach in this
thesis has been holistic in the sense that an attempt has been made to give the
whole picture of which the three different papers (see paper I-III) only give
parts of the information.
11

2.2.2 Explorative phase

The explorative phase began immediately after the project had been started, by
doing a quite extensive desk research the area of study was scanned for valid
information. The methodology is schematically described in Figure 6 below.

Phase I

Feedback

Literature Case
Model Tool
research study

Feed forward

Figure 6 Phase I in the research work


This was done by assessing different databases at the libraries and by using
Internet to search for references to articles and other interesting publications.
Databases searched were among others COMPENDEX (Science &
Engineering), ABI/INFORM (Business and Industry) for articles and CHANS
(Chalmers University Library database) and GUNDA (Gothenburg University
Library database) for books. This can be referred to as a literature survey,
which is done just to establish a frame of reference (Hellevik, 1977). Together
with this, a case study and a mail survey, where made in the project, from which
results and issues were extracted. For more information about the mail survey
is referred to the EUROBORDER project (EUROBORDER, 1997). This
resulted in Paper I, describing the basis and thoughts behind using the network
concept for modelling a port terminal.

2.2.3 Descriptive and design phase

The descriptive phase was strongly interrelated with the explorative phase as
shown by the feedback and feed forward loops in Figure 7.
Phase II

Feedback

Tool Case
Results
study

Feed forward Feed forward

Figure 7 Phase II in the research work


12

Since the model was the base for the actual computerised tool, this phase had to
be more descriptive giving the different interrelations and parameters that
could be used for implementing the theoretic model into a working tool. The
main work in this phase was to define and describe the actual parameters that
could transfer the reality to a model, actually valid to use as a base for a
computerised tool. This was done as a case study, assessing the problems and
special structures of the different port terminals participating in the project.
The goal was to have such a good view of the different terminals, so as to be
able to assess what parameters were especially sensitive, and therefore had to
be included, and which were expandable. These kinds of tools are purely
quantitative why choosing relevant parameters and design of the tool is very
essential (Kondratowicz, 1990). This work resulted in Paper II, which is a fairly
comprehensive paper describing the tool, the working interface as well as how
to work with the tool.

2.2.4 Result phase

The last phase consisted of the practical work of adjusting and readjusting the
tool together with the final users, i.e. planning managers of the port terminals.
This was an extensive work since the port terminals differed quite a bit
regarding their organisation and the handling of the goods. The iterative work
is shown by the second feedback and feed forward loops in Figure 8, since the
results implicated changes in the tool repeatedly.

Phase III

Literature Thesis
Results
research

Feed forward

Figure 8 Phase III in the research work


At the same time a few representative and interesting cases were created to test
the potential of the tool and this kind of approach to modelling and assessing
the problem. This work resulted in Paper III describing some of the results
from running the tool, primarily at the port terminal of Ormsund, Port of Oslo,
Norway. Finally, in this phase, a second literature survey was made to assess the
latest articles and publications in the field.
13

2.3 Method and validation of simulation and optimisation

In this section a short description of the method used for the simulation and
optimisation together with the validation of the actual tool is included. The
reason is that it is seen as an integrated part of the thesis although not central.

2.3.1 Method

The method used for the development of the NeuComb/Port tool was
straightforward containing 4 steps.

• Development of a theoretical model as base for the tool


• Development of a mathematical model
• Implementation of the model into a computerised tool
• Testing, validation and reiteration

This approach is comparable to the process of quantitative analysis described in


“Principles of Operations Research” (Wagner, 1975) The approach is divided
into four stages. Formulating the problem, which contains which variables that
are controllable and which are not, the basic structure of the problem etc.
Building the model, which is to decide in detail what simplifications to make
and identify the dynamic as well as the static structural elements. Performing
the analyses, in this part the mathematical solution to the problem is calculated.
As pointed out by Wagner there is always a risk of formulating the model to
complex or to simplistic, why the approach is iterative in its implementation.
The final phase is implementing the findings and updating the model, this part
is very essential since it is highly unrealistic to believe in a step-to-step solution
where nothing is going wrong or simply has to be redone due to
misinterpretations of the formulated problem

2.3.2 Validation

This short introduction outlines the rationale behind the validation approach.
The work done validating the soundness of the NeuComb/Port tool was based
on the principle of simplicity. The rationale behind the approach was to build a
simple model with a supposedly simple and predictable behaviour, and to check
that this model behaved as expected. This test was a matching of behaviour
against the intuition of the domain expertise within the group, in particular the
Oslo Port Authority. The model used to check was a model of the Ormsund
terminal of the Oslo Port. (EUROBORDER, 1998d)

The validation considered only time simulation and optimisation, as cost data
were at best crude approximations. as a consequence only ordinary cargo types,
and no special handling of reefer or dangerous goods were used. A more formal
approach could start out by showing the correctness of the algorithm, by
deducing an invariant for the algorithm, proving that the algorithm preserves
14

the invariant, and then to show that the invariant leads to a fix point, in which
the solution is reached. Another, possibly complementary approach, could be
to generate a representative selection of models samples, and then, by statistical
means, showing that the expected behaviour correspond to the actual
behaviour, i.e., that hypotheses predicting specific results were confirmed. The
problem of delineating the borderline between testing the tool and testing the
actual models would then have to be addressed. The issues mentioned above
concerns all formal verification of software systems, and particularly simulation
software. (EUROBORDER, 1998d)

Due to the highly complex technical nature of these approaches, compared to


the relatively modest resources this more down-to-earth approach was chosen.

2.4 System boundaries - criticism

The system boundaries were more or less automatically decided to be the port
terminal since that is the most suitable entity in the port for building a model
around. In most ports the port terminals are very self-dependent, especially
when talking about Lo/Lo and Ro/Ro terminals handling container and trailer
traffic. They are normally seen as an entity of their own, dating back to the
formation of the ECT terminal in Rotterdam in the mid-sixties, which was set
up by a number of Rotterdam stevedores at the instigation of the Municipal
Port Management, as a dedicated container terminal.

It was decided to include the physical handling, the resources in the system as
well as the information systems and administrative routines in the model. This
was due to the fact that the project was aiming at enhancing port terminal
efficiency by assessing organisational, administrational and information issues.
In retrospective this was perhaps a little too much and we had to rethink the
original design in a couple of steps.

One of the shortcomings of this thesis was the ambition to place my own
research in a context of all other research done in this area, methodological as
well as from the practical research perspective. There is no option but to admit
that this goal has not been possible to reach and that it has to be deferred to the
doctoral thesis. Since most of the work has been performed during the last
three years and published in papers along the way, a certain redundancy
between especially chapters 3 and 5, and the papers is inevitable but hopefully
this does not disturb the reader more than necessary.
15

3 FRAME OF REFERENCE

This chapter is an extension of the frame of reference that is primarily


described in Paper I-III. It was considered necessary to extend and enhance the
frame of reference that this thesis is built on after the second literature review
in phase 3, described in section 2.2.4.

3.1 Transport networks and terminals

The work in this thesis is based on two fields of science, one being the theory of
networks, which describes transport systems as being networks. The other field
is systems science that is described in chapter 4. The network as a metaphor is
widely used and has because of its extensive use also become less precise in its
definition. Therefore this chapter begins with a description of three different
ways of using the network metaphor: the network as a transport metaphor, the
Network approach according to the Uppsala school and mathematical
networks.

3.1.1 The network as a transport systems metaphor

A network basically exists of nodes and links describing an interconnected web


which is a very good metaphor for both transport networks and terminals. This
is a common theory base that is used at the Department of Transportation and
Logistics. Wandel and Ruijgrok make the basic notion of networks and the
correlation between the description of the transport industry as a network very
clear in their paper (Wandel & Ruijgrok, 1995). The correlation between the
infrastructure, the resources that move on the infrastructure and constitute the
transportation network is shown in Figure 9.

The figure describes the correlation between the aggregation level and the
components of the system and the markets. The traffic is regarded as a market
for infrastructure services, e.g. the trade of space and time. Transport is the
market for the movement of vehicles on the infrastructure. The accessibility
market are the market for flows (or slots) made available by the service
providers operating on the transport market. Finally there is a market for
functionality that is derived from the producer and consumer relations. The
consumers buys (with money or equivalent) articles that gives the users a
certain kind of functionality. The model could possibly be expanded to include
the financial market including the macro economic scale but it was not
regarded as useful to expand the model that far in this context.
16

AGGREGATION COMPONENT MARKETS

$ $ $
$
Money $
$ $
$

FUNCTIONALITY

P P P
Articles P
P
P
P P

ACCESSIBILITY

Flows

M
TRANSPORT
I
C
R
O
Vehicles

TRAFFIC

M
A
C
R Infrastructure
O

Figure 9 The transport network, resources and infrastructure (Wandel & Ruijgrok, 1995),
(Here adapted and modified from Lumsden 1999)

A network consists of nodes and links and there are at least two ways of
describing networks. One is that the network consists of nodes and links, where
the nodes correspond to an activity performed and a halt of the flow in the
network and all movements are represented by links (Lumsden, 1998). The
other describes the nodes as just being intersections or states and all movement
and handling is done in the links. The main difference between these two ways
of describing a network is that in the first case the activity creates an added
value, which does not exist in the second case.
17

Node
A B
Link

C Cycle time

Figure 10 Network components


On the network, described in Figure 10 above, the goods and resources are
moved according to specified routes. The time or capacity for a node or a link
can be different which means that the network has to be configured with the
parameters constituting it. One way of doing this is to describe the network by
the cycle time as shown in Figure 10. The cycle time ( c ) can be divided into
link time ( c l ) and node time ( c n ), the link time describing the part of the time
necessary to perform the transport or movement of goods from one address to
another. The node time can in its turn be divided further into active node time
( c na ) and passive node time ( c np ). The active node time consists of the time it
takes for handling the goods in the node and the passive node time is the time
the goods are stored without any handling. (Lumsden, 1995). A network can
also be described as a physical network or an abstract network. The physical
network is the actual infrastructure where the goods and vehicles are moving.
The abstract network is the “trade network” meaning the O/D matrices
building up the connections between for example suppliers and retailers, which
is shown by the O/D pair A and B in Figure 10 above (Lumsden, 1995). There
are other definitions of the same concept referred to as a cycle in this thesis, but
the definition above is regarded as a straightforward and easy to convey one,
why it has been chosen.

The different topics captured by the network model are another way of
describing it (Magnanti and Wong, 1984).

“Indeed, network design issues pervade the full hierarchy of strategic,


tactical and operational decision-making situations that arise in
transportation.”

3.1.2 The network approach according to the Uppsala school

The Network Approach to studies of market structures was developed at the


University of Uppsala and the Stockholm School of Economics together with
researchers from other countries within the framework of the Industrial
Marketing and Purchasing group (IMP). Key researchers in the development of
18

this theory were Håkansson, Mattsson, Johansson and Gadde (Woxenius,


1998). This approach was the first to acknowledge what has become the
relationship marketing within industrial marketing. The school emphasises the
importance of relations between the actors in industrial markets as opposed to
the consumer goods markets. These actors, e.g. organisations, producers etc.
and the relations between them are described as a network and the network can
be described as in Figure 11.

Actors
At different levels – from
individuals to groups of
companies – actors aim to
increase their control of the
network

Actors control resources; Actors perform activities.


some alone and others Actors have a certain
jointly. Actors have a certain knowledge of activities
knowledge of resources
NETWORK

Resources Activities
Resources are Activities include the
heterogeneous human transformation act, the
and physical, and transaction act, activity
mutually dependent cycles and transaction
chains.

Activities link resources to


each other. Activities change
or exchange resources
through the use of other
resources.

Figure 11 The network model (Håkansson, 1989)

The figure describes the relations that constitute the network or web according
to the Uppsala school. The actors are organisations, companies and other
parties involved in the industrial market. The resources can be both human e.g.
knowledge and manpower, and physical as natural resources or, in the transport
case, vehicles of different kinds. The activities are transactions between the
different actors as well as the transformation of resources etc. One can easily
see the resemblance to Porter’s model of industry structure and competition
(Porter, 1999), but it is out of the scope of this thesis to discuss this approach in
depth. This approach is described as a part of the wider frame of reference
about networks used in this thesis.

3.1.3 Mathematical networks

This part is kept concentrated since this is not one of the main focus of this
thesis and the work done in mathematical networks and combinatorial graph
theory is given elsewhere. It is although seen as important to incorporate this
19

part as a complement to the other definitions. Network theory is a very efficient


tool to be used as a base for describing a port terminal. In this section the ideas
and theory of networks coupled to the frame of reference is given. A network
can be defined as nothing more (or less) than a system (Casti, 1995):

network = objects + connections = system

Such a network can mathematically be described as a graph. A graph is simply a


set of nodes V together with a set of edges E (links). These are the relevant
mathematical descriptions of the nodes and links in Figure 10 above. This part
describes shortly the mathematical theories around networks on which the
research also is based on. Such networks are powerful models to describe a
large variety of systems, and it is often of great interest to be able to measure
any kind of complexity for these systems. There are some different possibilities
for this. The most important feature of a network is the connectivity, i.e. if the
nodes and edges are connected through the network, and permit interactions
(Casti, 1995). The only graphs and networks discussed in this thesis are
connected graphs and networks. This relates to the fact that the port terminal is
related to as a system, and this system has to correlate to work properly.

The definition of networks, and some related concepts is described in the


paragraphs below (Based on Batten et al, 1995, Kalman and DeClaris, 1971 and
Magnanti and Wong, 1981).

Let G = (V , E ) be a graph with V = a set of nodes and E = a set of links. At the


same time a weight function is introduced, w = E → R on the graph, which to
each link, e, attaches a weight w( e) ∈R . The couple ( G , w) is called a network.

w( e)could here be any relevant quantity for the link, e.g. time needed to
traverse the link, its capacity, the cost for traversing the link, probability for
success in trying to traverse the link etc.

Let G be connected, i.e. for any pair of nodes there exists a walk (succession of
links) connecting the nodes.

For any path (i.e. a walk with all nodes and links different):

e e e
P: v 0 1 → v1 2 → v 2 
→... 
n
→ vn
, where ei denotes links and v i denotes nodes,
the weight is defined as c( P ): = 1min
≤i ≤ n w( e i )

As for nodes and link, they are of course mostly a consequence of our way of
visualising graphs in two dimensions.

Somewhat more formal, given any set of V elements of some kind ( e.g. points
in R n ) and let E be a subset of V × V , then by definition the pair (V , E ) is a graph
with nodes being the elements in V and links being pairs of elements in V , i.e.
e ∈ E means e = { a , b} for some elements a , b in V .
20

Drawing the graph (V , E ) , e = { a , b} is of course identified as the straight line,


”link”, between a and b.

3.1.4 Summary and approach taken in the thesis

The approach to networks taken in this thesis is clearly correspondent with the
network as a transport systems model, described above. Some parts of the other
approaches are used as a frame of references and as a complement to the main
approach. The Uppsala school network approach is very useful to describe the
qualitative effects in a transportation system, and the definition of a network by
Casti is regarded as very elegant and to the point why it is used as the base
definition of a network. Here repeated.

network = objects + connections = system

The objects are regarded as the nodes in the transport system, e.g. terminals in
the large system and storage areas in the context of terminals, as used in this
thesis. The connections are the links/roads between the terminals or within the
terminals between the different storage and transfer areas etc.

There is still a problem of assessing the different networks, information,


physical and resource, in the same model and tool. One of my senior colleagues
at the department a model has developed a model that is coping with this
problem in an elegant way that is described in Figure 12 below. In this model,
which resembles Figure 9, there are three levels. The higher levels always
containing the lower levels. The general level is called the abstract system and
contains all activities seen as economic activities. This corresponds to the OD
networks in Figure 9 and Figure 10. This flow is abstract in the sense that the
flow is not physical, rather it is economic and legal transactions. It is also
mapping the relations described in Figure 11, since this level is purely
descriptive. This system is then transformed down to the information, or virtual
system, which transforms the relations and transactions into a virtual network
describing the actual components of the system. The physical system is
contained in the virtual system, since the physical components, the resources
etc. are seen as parts of information building the virtual system. The lowest
level is the physical level which contains the infrastructure and the resources as
seen in most models.
21

Logistics System

Accessibility System
Abstract System Abstract Flow
Economic Activities

“Information”
(transaction)

Information System
Virtual System Information Flow
Physical System

(transaction) Indicators/criteria for (transaction)

economic efficiency

Physical System

Physical Flow

Transportation System
Figure 12 The logistics systems and its three subsystems (Carlsson, 1999)

It is possible to expand this model to include the traffic system with the
resources and then connect it tighter to the model shown in Figure 9. This is
though out of the scope for this thesis. The approach taken in Figure 12
corresponds to the approach taken in this thesis and the approach that was
taken in the project as a base for the NeuComb/Port tool. The reason being that
all parts of a system, infrastructure, resources information etc. are described by
parameters enabling us to build a computerised tool of the network and
mathematical models used. As a consequence the computerised tool will handle
all networks at the virtual level, and they will all be transferred to the same
level avoiding the problems of handling information and physical networks in
the same model or tool.

The network design is very important for the actual model, and what it is
supposed to be modelling. The model serves as a base for both a vehicle routing
problem, i.e. how the flow is going through the network, and a facility location
problem, i.e. the network lay-out. There are possible interactions in both the
links and the nodes. This means that a combination of the two most common
ways of describing a network is done. A network is described as a combination
of nodes connected by links. Either the nodes are characterised by parameters
or the links are only connecting them, or the nodes are only expressing the
22

topology of the network and all other characteristics are associated with the
links as described above.

LANDSIDE PORT TERMINAL SEASIDE

I1 I2 R1

T T

Cargo Cargo
R/D
Type 1 IN Type 1 OUT

T T S L/U

Cargo
Cargo Type 2 OUT
R/D
Type 2 IN

T T

Nodes Areas Functions


= Cargo T = Transfer L/U = Load/Unload

= Information S = Storage R/D = Receive/Delivery

= Resource

Figure 13 The port terminal as a network (Waidringer & Lumsden, 1997)


Figure 13 shows an example of how to describe a port terminal, with a network
model. It serves as an applied example to the theory described above. It is of
course possible to make this model much more complex, but to make it fairly
easy to describe and discuss, no other nodes, links and resources have been
added than those described above.
23

4 SYSTEMS SCIENCE AND CYBERNETICS

Systems science and cybernetics have strongly influenced this thesis’ view of
reality and therefore the two interrelated science fields have been given a
separate chapter. Research about transportation and logistics is a truly
interdisciplinary subject why it is often useful, not so say necessary, to search
for theories from other fields. Working with the project and this thesis led to
contact with systems science and the notion of cybernetics, which both were
perceived as good complements to network theory to complete the structure of
this thesis. By using networks to explain and model port terminals, the work is
already headed in the direction of systems science, since an interconnected
network by definition is a system.

4.1 Systems science

Systems science is based on the notion of the reality being possible to describe
as a system, and that it is possible to understand the parts from studying the
whole system. It is systems science that has given us words and expressions as
“synergy” “2+2 ≠ 4 (Arbnor and Bjerke, 1997). It was originally an attempt to
go beyond the analytical approach, which was and still is the dominating
approach in all natural sciences, as for example Physics. To give an example of
the power of systems science, think about Ohm’s law “U=RI”. This law is not
applicable at the atomic level but instead its strength is just that it studies the
problem from an aggregated systems level and therefore can provide accurate
answers for a whole set. This example originates from mathematical statistics
and is therefore not primarily connected to systems science, but all the same a
good example of what systems science is all about. Analytical findings at
various levels of resolution in for example physics can only be understood
simultaneously in a systems context. This approach corresponds in all important
parts with the earlier stated view of how the reality is constructed.3 The
importance of taking a holistic approach cannot be emphasised enough when
dealing with complex dynamic systems like terminals and transportation and
logistic systems.

Even though the notion of systems science is not new, there have been
references to the old Greeks as being the first. It is commonly considered that
von Bertalanffy with his research in the 1940’s is the father of modern systems
science. He was using the systems context in his biological area and developed a
theory based on this research (von Bertalanffy, 1968). Otherwise there are two
scientists that are both intimately connected with the systems science,
Checkland and Churchman have both contributed to the context of systems
science. Checkland is discussing systems science out of the basic structure used
by von Bertalanffy, but he concentrates on how to create a common language
and understanding about what the systems science approach is really signifying
and how it can be used in everyday practice by the scientists (Checkland, 1981).
3
See discussion in the preceding chapters
24

Churchman has contributed, among other things, with a five basic beliefs that
the scientist keeps in mind when thinking about the meaning of a system
(Churchman, 1981) He made this list as a help in defining and thinking about
systems and what constitutes them.

• The total system objectives and, more specifically, the performance


measures of the whole system
• The system’s environment, the fixed constraints
• the resources of the system
• the components of the system, their activities, goals and measures of
performance
• the management of the system

One may distinguish between two aspects of the systems approach: efficiency
and necessity. Efficiency meaning that in the analysis of complex systems the
systems approach is more efficient than reductionistic, necessity meaning that
the approach is necessary because reductionistic analysis is incorrect, no matter
how detailed the analysis (Hulthén, 1997).

One of the main problems when performing research on large transport


systems is the complexity of the industry. If the research efforts are too specific
it easily leads to suboptimisation since a ceteris paribus approach is not suitable
for analysing the individual components. An aggregated systems approach is
thus a prerequisite, together with a profound knowledge of the industry at
study, for researchers who want to achieve scientifically reliable results.
(Woxenius, 1998)

One of the cornerstones of the systems science approach is models and how to
construct them in a meaningful way. Often the reality we want to describe is of
such magnitude or connected in so many ways that we cannot map it by just
transferring the reality directly, and thus it is most useful to create a model of
the real system. The model is by default a simplification of the real system
(otherwise it would be the real system in itself and we would have gained
nothing) and the main skill and purpose is to make the transcription to a model
as well as possible. It is therefore important to identify the main characteristics
of the real systems so as to incorporate them into the model. It is also crucial to
test the model for sensitivity since it is a well-known fact that there are always
some aspects (parameters) of the reality that will influence the model more
than others.

It is possible to distinguish between isomorphic and homomorphic models. An


isomorphic model from the real system is a one-to-one transformation, e.g.
each characteristic in the real system is transferred to the model. When dealing
with complex or large systems it is often necessary to simplify the model and
make a many-to-one transformation, meaning that characteristics from the real
systems are grouped together and being represented by a single parameter in
the model. The last model is a homomorphic model (Hulthén, 1997). This is
often the case when dealing with any real system of some magnitude.
25

4.2 Cybernetics

The field of cybernetics was in a sense born with the interdisciplinary group of
scientists that gathered around Wiener, just after World War II. They were all
interested in control theory but from different perspectives, and fields of
research, but they acknowledged the similarities in their problems. This section
though starts with two cites from Beer (Beer, 1959)

“Cybernetics is the science of communication and control”

“Cybernetic systems are exceedingly complex, and their controls cannot be


defined in specific detail”

These cites are seen as essential as a definition of cybernetics and an


explanation of why the science of cybernetics, is regarded as so interesting as a
frame of reference in this thesis. The approach taken is perfectly in line with the
thoughts of cybernetics (although this was not fully understood at the time the
subject was chosen). The research problem considers if it is possible to use
advanced methods and tools for solving management and control problems.
Beer also classifies systems according to if they are deterministic or
probabilistic and their level of complexity as shown in Figure 14.

SYSTEMS Simple Complex Exceedingly


complex
Deterministic Window catch Computer Empty
Billiards Planetary systems
Machine-shop lay-out Automation
Probabilistic Penny tossing Stockholding The economy
Jellyfish movements Conditioned reflexes The brain
Statistical quality control Industrial profitability The Company
Figure 14 Classification of systems (Beer, 1959)

In Wieners book about cybernetics (Wiener, 1948) he describes the work and
findings that he and the group of scientists around him had completed so far. It
gives insights into several fields of science, since the group was very
heterogeneous and only used cybernetics as a tool for research in their
respective area of research. It should though be read with the history in mind,
since a lot of their hopes have exceeded their wildest expectations and others
have proven not to hold. The reader might think that it is a waste of time trying
to use “old” knowledge since a lot of the expectations, after all, have been put
to rest indefinitely. The latest advances in mathematics methods and computer
science, though, imply differently. With today’s enhanced tools and methods,
cybernetics offers an interesting field of thoughts to investigate.

Another prominent scientist in the field is Ashby that in one of his publications
provides a very good introduction to cybernetics (Ashby, 1956). In this book he
gives a very thorough survey of cybernetics, but his major contribution is the
“law of Requisite Variety”, which says that in order to control a system the
control mechanism must mirror the variety of the real system. This is a very
26

useful law to classify systems and for building control and regulating systems.
The chapter about systems science and cybernetics is intentionally kept short
but is regarded as essential to the thesis, since it presents the fundamental
thought behind the research, on which this thesis is built.
27

5 SUMMARY OF APPENDED PAPERS

5.1 Research basis for the papers

Here a citation, a shared favourite by a senior colleague of mine and myself,


has to be included, since I feel that it is most appropriate to quote Stafford Beer
in (Beer, 1985):

“A model is neither true or false, it is more or less useful”

5.2 The port terminal from a network perspective

Paper I describes the port terminal from a network perspective. It was


considered a very useful and powerful model for this kind of research. The
paper first gives the frame of reference that was used throughout the whole
project and work with the thesis. It also gives the theoretical model used as a
basis for the work and as a description of the ideas behind this concept. The
model developed in this paper describes the port terminal as two foliated
networks, the information flow network and the physical flow network, and a
set of resources constituting these networks. The main model describing the
port is shown in Figure 15 below.

INFORMATION
NETWORK

Border for
Information exchange

CARGO
NETWORK

Border for Resource


allocation

RESOURCES = Physical link

= Information exchange

= Resource allocation

Figure 15 The port terminal’s three foliated networks (Waidringer & Lumsden, 1997)
The links between the different nodes are not a fixed set of links that are always
connecting all the different nodes continuously. Instead the link between two
nodes appears when there is a need for a link. The links are induced by a need,
detected by the information network, which is transferred to the resource
28

network. After that a resource, i.e. a machine, personnel etc., is assigned to


solve that need, by creating the desired link.

The status from the physical network is transferred to the information network.
This network detects the need and assigns a resource, creating the link, for that
need. In the information network information is also sent to the next node
corresponding to the physical node receiving the goods.

5.3 Simulation and optimisation of a port terminal

Given in Paper II is the basis for the NeuComb/Port model and tool. The
program is an implementation of mathematical algorithms adjusted to a port
terminal environment. The NeuComb/Port tool is a theoretical research tool
ready to use and adjust to the situations in different port terminals.

Paper II is in all essential parts built on the first paper and shares the same
frame of reference and view of reality. This paper describes the decision made
when designing the tool and gives a detailed description of the tool. All the
different functions and possibilities with the tool are described as well as the
limitations that necessarily are connected to these kinds of tools.

The model works as follows:

• Simulation of the physical and information flows


• Optimisation of the physical and information flows
• Optimal matching of the resources under the boundary constraints

Scanning the Free flow Scanning the Optimal Resource


system optimisation system assignment allocation

Figure 16 Flow scheme for the optimisation (Waidringer & Lumsden, 1998)
To show the principle method of the optimisation Figure 16 is incorporated.
The tool works in the following way; first the system is scanned for input about
the status of the system, and after that the free flow optimisation part is
performed. When this is done a new scan of the system is done for the
assignments to be performed and after an optimal assignment and resource
allocation the cycle is completed.

The approach taken above is seen as a very useful one, since it creates a way
around a both, practically and theoretically, unsolvable problem. The notion of
optimising a dynamic and unlinear system is known as being an NP hard
problem in network mathematics, which means that it is not even theoretically
possible to solve! By linearising the problem in time steps and dividing it into a
flow optimisation and an optimal assignment problem it is possible to actually
optimise the flow throughput or the resource utilisation.
29

5.4 Results from using the NeuComb/Port tool

Paper III is also tightly connected to the other two, sharing the same frame of
reference. This paper describes the different cases run in the tool and some of
the results from running the tool with the Ormsund terminal (Oslo, Norway) as
a test case.

5.4.1 The cases

The cases were chosen by discussing the most relevant issues to be investigated
to assess the original problem. One of the main goals was to assess the results of
future scenarios, e.g. changes in the port terminal organisation in a wide
perspective and changes in the amount of goods going through the terminal.

The cases chosen were:

• Case 1: Reference scenario: (No changes)


= two operators and no advanced yard management system
• Case 2: Pooled resources
= a single operator
• Case 3: Pooled resources and goods
= a single operator and an advanced yard management

5.4.2 Main strategies – Pooling of resources

The reference scenario is the current situation with no changes to the resources
or the goods. This means that there are external resources (trucks) coming in
with the goods, which then are transferred to internal resources (straddle
carriers). In the Ormsund terminal there are currently two different companies
working and the internal resources are divided into two separate areas. The
goods are divided by shipper, e.g. Maersk, Greenship etc. Case 2 is a test of the
possibility of using a single operator for the internal resources (straddle carrier)
in the terminal. The idea is that it should be more efficient and less expensive to
pool the resources in the terminal. In practice this means that the internal
resources are allowed in the whole terminal. Case 3 is a development of case 2.
The idea is that the goods can be placed anywhere in the terminal. In that way
it should be possible to cut down the number of internal resources. To be able
to do this an advanced yard management system is required. This kind of
system keeps track, in detail, of each container/trailer in the terminal.

The pooling of resources only involves the internal resources (straddle carriers)
and not the trucks or cranes. These two cases, number 2 and 3, were seen by the
users/operators as the most interesting cases to investigate in more detail. For
the Ormsund terminal this is especially true, since they are situated in the
middle of Oslo and therefore have a space problem, simply not enough storage
capacity in the terminal. They have no opportunities to expand, instead other
alternatives have to be considered that enhance the terminal’s efficiency.
30

5.4.3 Definition of efficiency

This section is included to explain how the efficiency for the resources is
defined in the tool. Efficiency as a measure is very hard to define in an exact
meaning, but in this tool the efficiency of the resources is defined as:

Lt + N t + Qt
Reff =
Tt

Reff is the occupied time divided by the total time. Lt is the time in link, N t is
the time in node and Qt is the time in queue, all counted when the resource is
occupied with cargo. All the resources have the same measure. It could be
argued that other measures can be used and that different measure should be
used for different resources, but this was the measure chosen.

5.4.4 Results

Included here are two of the diagrams and the discussions about the results
shown in Paper III to give the essence of the results from the use of the tool.
The model/tool as such is a tactical/strategic tool that can be used for long term
reorganisation issues in the port terminal. There are two ways of using the tool.
The first is to use it as an optimisation tool for an already existing port terminal.
The second is to use it as a simulation tool, where it is possible to simulate any
given set of parameters in the port terminal.

Figure 17 gives the efficiency figures for the current situation as described in
section 5.4.1, the efficiency figures calculated as described in section 5.4.3
above. Figure 18 corresponds in its construction to Figure 17. The reason for
including also figures without queues was that the users regarded it as useful to
see the difference.

Current situation - Efficiency

120
100 100,0 100 100,0 96,2
100 86,2
80
Reference
60 Pooled resources

40 Pooled resources & cargo

20

0
Efficiency with queues Efficiency without
queues

Figure 17 Efficiency figures for the current scenario


31

The figures are indexed and related to the reference case (business as usual)
terminal efficiency, which has been given the index of 100. The reason for this
marginal cost reasoning is that if the basic figures for the cases, throughput
volume, available resources etc. are the same, the system deviation will be
marginal if only the changes are compared. This is a way of compensating for
the eventual systematic deviations caused by errors in the figures used for
building the models.

Future scenario - Efficiency

140
111,4 118,9118,9
120
100 100,0 100 Reference
100
80 Pooled resources
60
40 Pooled resources &
cargo
20
0
Efficiency with queues Efficiency without
queues

Figure 18 Efficiency figures for the future scenario


When analysing the results some general remarks can be done. For the in-depth
discussion is referred to Paper III. In the current situation where the
throughput is fairly low, there is almost no difference between the cases except
that there are substantially more queues in case 3, the pooled resources and
cargo case. This is not intuitively clear. The reason is that when the cargo is
pooled the tool will use the basic strategy that is a first come first serve basis.
This means that the cargo chose the shortest path and therefor queues will be
created. The small difference in efficiency without queues is due to more
transhipments of the cargo.

For the future scenario, with a much larger throughput, there are queues in all
the cases. Here the highest efficiency is reached in the pooled resources case,
which is expected since the queues and resource utilisation, is more evenly
spread in a basically overloaded system. The pooled resources case gives less
efficiency and considerable more queues. The reason is the same that was
explained above. The interesting thing is that the efficiency without queues is
almost the same. The explanation is that the cargo is more evenly spread in this
case, and therefore the internal resources can be utilised better when pooled.

The current situation is a sparse system that does not possess any large
potentials for optimisation. For an elaboration of the issue see 5.5 below. The
future scenario on the other hand is a much more dense system why the effect
of an optimisations is larger.
32

5.5 Optimisation criteria and freedom of choice

This part describes how the model is optimising the port terminal and what
features/functions it is optimising. The reason for including this part is to create
a base for understanding the choices that have to be made during the
development of this kind of tool.

The optimisation is divided into two parts: First there is one algorithm seeking
out the maximum possible physical flow through the terminal. Secondly there is
an algorithm optimising the resource utilisation on the boundary condition that
the resources should interfere as little as possible with the principle of
maintaining the maximum flow. This is a so-called optimal assignment problem.
The problem to solve is that of performing a number of missions with a limited
set of resources. After going through these two phases of optimisation the
result is an optimal use of the available resources in the system.

As mentioned above these optimisations are done according to the boundary


conditions determined by the actual situation in the port terminal. A very
crucial point when working with optimisation models, in contrast to simulation,
is that there has to be certain numbers of degrees of freedom. This means that if
everything is set to a specific value in the model, there will be no optimisation
potential. This might be the reason why these kinds of models/tools are
perceived as somewhat hard to follow, since it makes them less specific and
more general. A large part of the work for this thesis has been dedicated to
gather enough information to be able to understand what kind of decision rules
are the most important to implement in this type of tool.

Another consequence of this is that there have to be approximations about


each port terminal and the functions within it. The result is that all the access
control functions, corresponding to the gate, are considered equivalent, i.e. it is
inessential, through which gate the goods pass. This is applicable to all the
functions in the model/tool. It will of course always be possible to specify the
model more, but then it will also be fewer possibilities to optimise the port
terminal.
33

6 CONCLUSIONS & FUTURE RESEARCH

This chapter gives the conclusions divided into two parts, the first about using
the network approach as a base for assessing this kind of problem and the
second one about the model and tool assessing the outcome of the project. The
chapter ends with a short discussion about future research.

6.1 Network as a metaphor

This way of describing a port terminal is seen as very useful, and actually any
terminal or enterprise functioning in a similar way can be described. It has been
presented within the EUROBORDER project and at several conferences and
seminars and been positively received by both users in port terminals and
academics. The model has been used to describe 6 different ports within this
project.

By using the network approach, that is a very common metaphor in the society
(Casti, 1995), the port terminal model used in the project and in this thesis is
easy to understand and use as base for discussions. Yet it is very useful from a
pure modelling view, as in programming where it has been used in this project.

The network approach allows us to break down the model from the aggregated
level all the way down to the parameter level. This makes it very transparent
and it is easy to choose the level of abstraction or detail needed. The model is
flow oriented which makes it close to reality.

6.2 The model

The results from working with the model and ultimately the tool is somewhat
divided. On one hand some very interesting results have been extracted from
runs with the tool, and it is clear that this approach is valid as abase for
developing tools like this. It is also clear that it is a very useful way of assessing
these kinds of problems. Port terminals, or e.g. any infrastructure dependent
entity (which practically means all transport related activities) with large fixed
costs and high barriers to change in the sense of capital investments can in an
easy and cost efficient way evaluate different scenarios.

On the other hand it is (and has been) a limitation to work with models and
tools that are dependent on a quantitative approach. There exists a quite
extensive research on optimisation and simulation, but few if any can handle a
pure dynamic situation and none as far as the author is aware of can handle
qualitative aspects. Despite the developments of both mathematical and
computer science it is still hard to find a way to create a tool to assess the issue
of the full complexity of an organisation that is dynamically changing. This was
34

one of the reasons why cybernetics was investigated, since it is a science that
deals with automatic control and the notion of the black box theory.

There are, in the author’s opinion a lot more to do in the field of optimisation
as opposed to simulation, for instance incorporating qualitative aspects. There
exist today a lot of good and well working simulation systems, e.g. Arena, etc.
that can handle almost any type of systems in an acceptable way. The
development here is only a difference in degree. In optimisation the situation is
a bit different. There exist few, if any, really good working optimisation tools
on the market today. The reason for this being the problem of incorporating
the dynamic features of almost any system that is viable. Here a waste area of
research is open, where knowledge from logistics, network theory and
mathematics as well as computer science has to be incorporated.

The conclusion can be summarised by stating that the value of the network
approach and tools for assessing complex problems is confirmed to a certain
degree. The project and thesis though also confirms that there is still quite a
long way to go before we can handle truly dynamic systems.

6.3 Results

The results can be divided in two parts, the first and most obvious results are
those from the project and then primarily the use of the NeuComb/Port tool.
The other part is coupled to the purpose and scope of this Thesis.

The more tangible results from the use of the tool have been described in
section 5.4 above and in Paper III. These results are not very detailed and deep,
but what was shown was that this tool is suitable for pointing out areas suitable
for changes and also to show these changes in a more general sense. It is also
possible to show tendencies as answers to both theoretical and practical
problems. An explanation may be in its place. It is of course possible to get
answers like: The resource efficiency is 12,76% better, but due to rough input
data and the constraints of quantitative tools, this is only a tendency that the
system tested is better than the original one. The actual figure stated is false in
its numeric value. This is also one of the major setbacks of quantitative tools
like the one developed. It is necessary to develop these kinds of tools so that
both qualitative and quantitative aspects can be incorporated in future models
and tools. The NeuComb/Port tool is at least a first good step towards these
kind of new tools made possible by advances in both Mathematical and
Computer science.
35

The overall research question and the three more detailed questions are
repeated below.

Is it possible to enhance terminal efficiency without large capital investments?

• Can a port by modelling be treated like a generic terminal?


• What tools is needed to expand the flow in existing ports?
• What limitations exist for this expansion and are there an upper limit?

The answer to the overall research question is yes it is possible but it is hard to
say how much, and it is highly dependent on which kind of terminal it is. As a
general statement it is possible to say that the effect of changes in organisation,
resource allocation etc. are better in more dense systems than better in more
dense than sparse systems. This unfortunately corresponds to the effects of
capital investments, it is a combination of economies of scale and scope, which
also have an effect on more unorthodox methods. There is most probably an
optimum between sparse and dense systems defining when those kind of
enhancements have most effect, but that optimum has not been able to assess in
this thesis.

The project and Paper I-III describes the port as a terminal and it was used as a
base for the port terminal model as well as the tool. It was seen as a very useful
metaphor to describe both the structures in the port as well as the qualitative
aspects. The terminal approach also made it possible to divide the port in
separate areas that could be modelled together.

The question about tools was actually aimed at the possibilities to enhance port
terminal efficiency and as a consequence their throughput. It is an essential
question since most ports are currently the bottleneck in the intermodal chain.
One very simple answer to this is that the ship-to-shore cranes are the
bottleneck in most cases. They decide the overall throughput for the port
terminal, since the interface between the ship and the port is the crucial one of
the simple reason that it takes up the most time. Other tools are of course
terminal layout planning, advanced operative tools for allocation of resources
in the terminals. The small and medium sized port against should take a
benchmark process and best practice approach. The Southeast Asian ports have
already implemented a lot of these kinds of systems and tools with Singapore as
the leader. It is also possible to transfer knowledge from other areas as
production simulation and optimisation in among others the car manufacturing
industry. Other interesting industries are the aviation and railway industries
tools for resource allocation, especially the crew scheduling models.

The last question is actually quite easy to both assess and answer. Yes there is
an optimum and it depends on the physical infrastructure and the resources
available. This optimum can be calculated quite easily with the NeuComb/tool.
It is called the theoretical optimum. The economical optimum is though a
completely different thing. It is a well known fact that when the optimum is
approached the cost groves exponentially.
36

6.4 Future research - Complex dynamic logistics systems

During these years of my research I have become more and more aware of the
effects the dynamic dimension of systems has on the complexity they possess. It
is therefore not very hard to define my future research, which has actually
already begun with an article written together with two of my senior colleagues
at the department (Lumsden et al, 1998). This thesis can be seen as a specific
case of what is to be the future research for me; complex dynamic systems.
While working on this thesis and the papers constituting it, I became aware of
the surprisingly complex structures and interactions that these kinds of systems
contain. Therefore my intention is to develop these thoughts by concentrate
upon complex dynamic systems trying to apply the knowledge from other
research fields, e.g. Systems science, Cybernetics, Network Theory and
Automatic control to Logistic systems.

Especially cybernetics is seen as a promising field. The initiated reader can


object that this is an old science that has not solved the problem either. This is
true so far, but since cybernetics was born and developed the computer and
mathematical sciences have made great progresses, which gives us the
possibility to further research the possibilities of assessing that kind of very
hard questions. It is though not very probable that it will be possible to include
all the qualitative aspects necessary to correctly describe and control highly
complex systems, but perhaps it is possible to get closer and closer in course of
time.

To be a bit more explicit the future research will be focused on assessing the
problem of the increasingly complex systems and solutions that exist within the
transport and logistics field. With a worldwide consolidation going on and more
and more companies merging into larger corporations this field of research will
be highly interesting. The research will be based on the concept of complexity
applied to the transport and logistics context. Especially interesting to study is
the possibilities of information systems and the possibility of using them to
either make the systems less complex or as a possibility to actually handle the
full complexity of real world systems. It is in today’s science seen as the very
edge of science to study the effects of advanced information systems and their
impact on decisions, profitability etc.4. A lot has been written about complexity
and there are already definitions of complexity in other fields as for example
very exact definitions in mathematics and Ashby’s definition belonging to
systems science and cybernetics (Ashby, 1956). This research will be the base

4
To give some perspective on the concept of the value of information, especially information
that can be given in advance, a short story told by Aristotle is cited (Aristotle, 1993). There was
a man called Thales from Miletos who was known to be very sage, but living his life in peace
and not much wealth to his name. When people asked him why he as being so wise was so poor,
he answered that wealth was not his ultimate goal. However he decided to give them an
example, and since he knew a lot about the nature and the weather he could in the winter see
that it would be a rich harvest of olives that year. He then signed up all available capacity for
pressing the olives in the valley where he lived. When the autumn came he rented them for
twice the sum he had hired them for. An ancient example of the value of information.
37

for developing the concept for the transport and logistics case, including
network theory and qualitative aspects.
INTERFACES (Node-Link)

STRATEGY DECOMPOSITION INTEGRATION

CONSEQUENCES SIMPLICITY COMPLEXITY

SYSTEM SURPLUS CAPACITY SURPLUS TRANSPORT HORIZONTAL


VERTICAL
INFORMATION INFORMATION

Figure 19 Complex dynamic logistics systems (Adapted from Lumsden et al, 1998)
To give a context to the future area of research, Figure 19 has been included. It
describes 3 different levels of the logistics system (the original figure consists of
4 different levels, but the lowest level tools has been cut out since it does not
refer to the same “tools” as referred to in this thesis). The highest level is the
strategy level, where the basic decision is whether to choose disintegration or
an integration strategy. The traditional approach has been to choose the
disintegration strategy, which gives the next level, a simple system. We have not
had knowledge or tools to handle the problems arising in complex systems why
this strategy is the predominating in the transport industry today. The lowest
level is the systems level showing the two dominating ways of creating simple
enough systems to handle a complex demand or environment, surplus capacity
or surplus transport e.g. frequency. The right hand side describes the other
choice, which considers the area of interest for future research, complex
solutions to match the complex problem. This is in line with Ashby’s Law of
Requisite Variety mentioned earlier. This is currently handle by a combination
of horizontal and vertical information and the extensive use of information
systems. There is though very little research done about the reasons for
transport systems being so complex and hard to handle efficiently. Most people
conceive transport and logistics as something basically very simple, which is
true on the basic level of getting a package from A to B, but as soon as the
system grows and the connectivity in the network expands it soon gets out of
our hands. 5 The main issue with future research must be to try to explain the
underlying reasons and to define complexity in the transport and logistics
context.
5
To prove my point I want the reader to consider the Box mentioned by Bowman (Here cited
from Beer, 1959) The box has only 8 inputs and 1 output: a sufficiently simple system or
machine as it is referred to in the original text. Adopting the constraint that the input and
output can only take on one of only two values, (compare with binary states in today’s
computers) how many possible machines can the Box represent? There are 2 8 input states.
Now with an output of two possible states, the number of possible machines which the Box can
simulate is 2 n , where n is the number of distinguishable input states. So the number of
8
distinguishable states are 2 2 or 2 256 ! Just how large a number this is becomes fully apparent
when it is compared with Eddington’s Cosmical Number; for according to Eddington, the total
number of protons and electrons in the universe is 3/2.136. 2 256 . Thus so simple-looking a Box
has sufficient variety in its distinct manifest to parallel the variety of the universe (Beer, 1959).
38

The research will be divided into three stages most probably resulting in three
papers. Firstly there will be a theoretical assessment of how complexity in
transport and logistics systems can be described, aiming at a first attempt to
give a “working” definition of complexity applied to the area of transportation
and logistics. Secondly, a case study on a large enough system will be performed
to test the ideas and concepts developed in the first phase. Finally the results
will be analysed and a second refined assessment of the concept of complexity
in dynamic logistics systems will be done.
39

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APPENDIX I

Modelling a port terminal from a network perspective

Waidringer, J. & Lumsden, K.R.

Presented at the 13th International Conference on Automatic Control, Chania, Greece,


June 16-18 1997. Published in proceedings.
MODELLING A PORT TERMINAL FROM A NETWORK
PERSPECTIVE

Jonas Waidringer*, **, M.Sc. & Kenth Lumsden*, PhD.


* Department of Transportation and Logistics, Chalmers University of Technology,
412 96 Göteborg, Sweden

** Center at Eriksberg for Communication, Information and Logistics,


Blå Hallen, Eriksberg, 417 64 Göteborg, Sweden

Abstract: This paper gives an efficient way of describing a Port terminal at a micro level, where it uses two
foliated networks, an information flow network and a cargo flow network. The model works with nodes and
links that both are characterised by a set of parameters, the real characteristics of a Port terminal as a base for
mathematical functions. There is a strong need for theoretical, and practical, tools to simulate and optimise the
operations in a Port terminal. The ports are today an important link, which gives great value to knew ideas how
to change the port operations. The model is tested against port operators and scientist within an EU research
project.

Keywords: Network theory, Simulation, Optimisation, Port terminals

1 INTRODUCTION

The ports are an important but week link in the transport chain, which gives great value to
knew ideas how it is possible to change the port operations (Frankel, 1987). Currently there
exist few, if any, models describing the Port terminal from a pure network perspective (Ojala
1992, and references therein). This paper derives from the need for a model of a Port terminal,
described out of a network concept. The model is used in an EU research project;
EUROBORDER. In this project an optimisation tool will be built that works with two foliated
networks; an information flow network, a cargo flow network and a set of resources
constituting these networks. This relates closely to a conceptual framework developed for
resources (Manheim, 1979).

The core of the model is the cargo flow and the corresponding network, since this is seen as
the Port terminal’s main function, and the essence of its activities. This generic model of a
Port terminal has also an academic interest since it is a different and structured way of
describing the interrelations within the Port terminal system.

1
2 FRAME OF REFERENCE: THE PORT

The port environment is described first to define the port as a part of an overall transport
chain.

Regulation
Market system Stimulation Political system

Transport system Regulation


Stimulation Services
Supply
Demand Port system
Regulation
Demand
Products Stimulation
Services
Industrial system
Products
Services Supplier system

Fig. 1: The environment of the port (Hulthén and IAHP, 1996)

How the environment influences the port system can be described with activity relations
(figure 1). No detailed description about the port system and how the environment and the
port system interacts will be done. Instead this should be seen as a way of defining the
reference system for this paper.
Port models used as a base for planning and analysis may be classified in the following way
(Ojala, 1992 and references therein):

• Models with an econometric approach


• Models with an analytic approach
• Models using simulation technique

Econometric models deals normally with the macro-level aspects, and are widely used in
research problems related to demand and supply. A system is described as a casual network of
relationships between a set of variables.

Analytic models are created within the framework of Operations Research (OR). The basic
idea is to develop a mathematical function which can be solved by an algorithm under certain
constraints.

Simulation models use a numerical technique for specific mathematical models to analyse
time-bound flows of events within a system, consisting of a large number of variables and
constraints.

To give a background to our model some examples of how to describe a Port terminal is
given, beginning with the Port terminal as a "black box" , as shown in figure 2.

2
INFORMATION
IN/OUT

CARGO
CARGO TYPE 1 OUT
TYPE 1 IN
PORT
TERMINAL
CARGO
TYPE 2 OUT
CARGO
TYPE 2 IN

RESOURCES
IN/OUT

Fig. 2. Different flows through the Port terminal

The description above is the simplest possible way of describing a Port terminal, in terms of
logistical flows. The Port terminal is seen as a "black box" with cargo, information and
resources going in and out of the box. What happens with the different flows is not taken into
account, instead focus is on the results, i.e. what is actually going in and out of the model.
This is in line with the systems approach (Churchman, 1981):

“The way to describe an automobile is first by thinking about what it is for, about its
function, and not the list of items that make up its structure”

Within this frame the Port terminal is described with 3 main functions, receive/delivery,
load/unload and transfer as shown in figure 3 below.

L a n d s id e P o rt te rm in a l S e a s id e

R e c e iv e / T ra n s fe r L oad/
D e liv e ry U n lo a d

Fig. 3: The Port terminal described by its functions

The analytical approach described above is used as a frame of reference for this paper, since
the model developed is created as a base and as a tool for simulation and optimisation.

3
3 NETWORK THEORY

Network theory is used in this paper as a base for describing a Port terminal and to build the
model. In this chapter the ideas and theory of networks coupled to the frame of reference is
given. A network can be defined as nothing more (or less) than a system (Casti, 1995).

network = objects + connections = system

Such a network can mathematically be described as a graph. A graph is simply a set of nodes
V together with a set of edges E . The most important feature of a network is the connectivity,
i.e. if the nodes and edges are connected through the network, and permits interactions (Casti,
1995). This paper only discusses graphs and networks that are connected. This relates to the
fact that the Port terminal is related to as a system, and this system has to correlate, to work
properly.

The different topics captured by the network model are another way of describing it
(Magnanti and Wong, 1984).

“Indeed, network design issues pervade the full hierarchy of strategic, tactical and
operational decision-making situations that arise in transportation.”

The network design is very important for the actual model, and what it is supposed to be
modelling. Our model serves as a base for both a vehicle routing problem, i.e. how the flow is
going through the network, and a facility location problem, i.e. the network lay-out. Another
crucial point in the model is based on Neural Networks and Combinatorial Graph theory.
There are possible interactions in both the links and the nodes. A combination of the two most
common ways of describing a network is done. Either as a network of nodes connected by
links, where only the nodes are characterised by parameters, or with the nodes only
expressing the topology of the network and all other characteristics are associated with the
links.
I2 R1
I1

T T
Cargo
R/D Type 1 OUT

Cargo
Type 1 IN
T S S L/U

R/D Cargo
Type 2 OUT
Cargo T T
Type 1 IN

=Cargo node =Information node

=Resource node

Fig 4. The Port terminal as a combination of different nodes and links

4
Figure 4 shows an example of how to describe a Port terminal, with a network model. It
serves as an applied example to the theory described above. It is of course possible to make
this model much more complex by adding all different kinds of nodes, links and resources,
but to make it fairly easy to describe and discuss no other nodes, links and resources have
been added than those described above.

4 THE PORT TERMINAL FROM A NETWORK PERSPECTIVE

As mentioned before, the model describes the Port terminal as two foliated networks, the
information flow network and the cargo flow network, and a set of resources constituting
these networks. Figure 5 below shows a few selected nodes and possible links within and
between these networks.

IN F O R M A T IO N
NETW ORK

Inform a tion excha nge→

L ink →
C ARG O
N ETW ORK

R esou rce a llocation→

R E SO U R C E S

Fig. 5. The Port terminal’s two foliated networks, and set of resources.

The links between the different nodes are not a fixed set of links that are always connecting
all the different nodes continuously. Instead the links between two nodes appears when there
is a need for a link. In this sense it is possible to talk about links as spontaneous. The links are
induced by a need, detected by the information network, which is transferred to the resource
network. After that a resource, i.e. a machine, personnel etc., is assigned to solve that need,
creating the desired link.

The information, status, from the cargo network is transferred to the information network. The
information network detects the need and assigns a resource, creating the link, for that need. It
can for example be a need for transportation of the cargo from one node to another. In the
information network information is also sent to the next information node corresponding to
the cargo node receiving the cargo. The resources are limited to use the links available in the
cargo network, and when free, placed at a parking area.

5
Realised links
Realisable links

Desired links

Fig. 6. Different sets of links

Figure 6 above explains the way different types of links used in this modelling process are
defined. The realisable links are all links between all nodes in the network, that are realisable
defined by some kind of criteria such as cost etc. Desired links are links one would like to use
if there were no constraints on the network. Realised (physical) links are the links finally
realised, by the set of resources, when all constraints have been imposed to the network. The
total set of links in the network, called abstract (AL) or theoretical links, are the union of the
realisable (RL) and desired (DL) links.

AL = RL  DL

Cargo flow network - Cargo nodes

The type of node is defined by the network it belongs to. A cargo node is therefore a node
belonging to the cargo network. 4 different types of nodes describe the cargo network, in line
with the reference model described in chapter 2 and related to the four terminal functions
described by Chadwin et al. (1990)

Receive/Delivery (Land side), this is the Port terminal’s interface with the land side, i.e. road
and rail. This node contains functions like id-control, physical entrance etc.

Load/Unload (Sea side), this is the Port terminal’s interface with the seaside, i.e. all
waterborne transport. This node is the mirror node to the receive/delivery node. Due to the
difference in functions between these two, there are different nodes.

Transfer, this is where all the transfer between different transport modes is taking place. On
an aggregated level it is the essence of a Port terminal, the transfer between land based and
sea based transportation modes.

Storage, this is where the cargo is stored in between the different transportation modes. A
more correct name would be “waiting” node, since the cargo does not necessary has to be
stored in the common sense. Instead the cargo has to be accumulated in the Port terminal
because of the difference in size between the cargo carriers, which creates a necessary waiting
time.

Information flow network - Information nodes

There are also a number of information nodes, but only two different types are needed in this
network model.

6
External system information node, which causes constraints on the cargo flow. This
information comes from outside the system modelled, outside the Port terminal. For example
all the documents needed for customs clearance are, if they are not available causing a
constraint on the cargo flow.

Internal system information node, which supports the cargo flow and allows us to optimise.
This information is generated within the system. For example information about a storage
area being full, gives us the opportunity to redirect the cargo flow.

A note on external and internal information on a given network external information can not
give a faster throughput, but internal information can. The external information is though
capable of changing the whole network.

Set of resources - Resource nodes

The third and last kind of node is the resource node, and it is sufficient with one kind. This
node contains a resource, for example machines, personnel etc., which can be used to handle
the cargo and/or information flow.

All these different nodes are in the next level divided into several subnodes, that together give
the full description of the node. The nodes can also be described with parameters as described
in figure 7 below.

I2 R
I1

IN OUT

A B C D E F

Node border

Fig. 7. A node described as a combination of parameters

Our model is based on an analytical model approach, and it is hence necessary to be able to
quantify the functions. This is done by describing the node, links and resources with
parameters. Figure 7 above shows the parameters for a node that belongs to the cargo flow
network. It is a convenient and sufficient way to describe a node. The parameters describe the
flow through the node, whether it is cargo or information. For example; the speed parameter
describes the speed of the flow through the node. The parameters are:

A. Cargo type Ct], dangerous, reefer etc.


B. Time [t]
C. Length [s], length of the transportation of the cargo within the node
D. Speed [v], the speed which the cargo moves through the node
E. Cost [c], the cost of handling the cargo in the node
F. Transformation [St - St’], the status of the cargo, i.e. entered, finished etc.

7
The function describing the node is realised by the parameters given above:

f = f ( A, B , C , D, E , F )

It is possible to use more parameters, but since this is only an introduction to this idea of
describing a node there are no more parameters added than those described. The information
and resource nodes correspond to the cargo nodes described above, and are in the same way
described by similar parameters.

In this model the nodes are described and defined in the following way:

• Type of node, defined by which network it belongs to, i.e. the cargo-, information or set of
resources.
• The parameters constituting the node
• Description of the node in words, and subnodes

A link can be defined in a way similar to the definition of nodes. A link is defined by its type,
parameters, a description, and by its start and end nodes.

The definition of a link:


• Type of link, defined by which network it belongs to
• Parameters constituting the link
• Description of the link in words
• The start and the end nodes of the link

The difference though, from the nodes, is that the links are dynamic, only appearing for short
time periods when they are actually needed. There are no static connections in the form of
links between the different nodes. The nodes however are static in the sense that even if there
is no activity in the node it still exists, as are the resources. Hence the total network per se,
does not exist the resources are assigned to establish the links and thereby constitute the
network. This means that the cargo network can not exist without the information network
and the set of resources, which creates the links in the cargo network.

In a similar way, the information network does not exist without resources creating the links
in it. The resources are of course different from the resources in the cargo network. These
links are constituted by their parameters in the same way as described for the links above.
There are also links between the information network and the two other networks as shown in
figure 5 above.

In the model the terms functions and subfunctions are used to describe the cargo network and
the term process to describe the information network. Figure 8 below illustrates this.

8
Process
Information flow Action

Function
Cargo flow

Resources

Time

Fig. 8. Information processes and cargo functions, and the interaction between the
information processes, cargo functions and resources

It also describes the interaction between the cargo flow, information flow and the resources.
Both the information flow and the resources (availability) put constraints on the cargo flow.
When the cargo flow reaches a node it stops. There is no cargo flow within the node, at the
current level of abstraction, but a flow through it. When the cargo flow stops in the node, an
information process is activated. When this process is finished, the cargo flow continues. If a
resource is available at the time needed the transport assignment is performed, otherwise the
cargo flow is stopped until a resource is available.

The graph describing the cargo network above can be expressed mathematically in the
following way:

G = (V , E )

V = the set of nodes


E ⊂ R 2 ,a set of links within the set of resources

E is also defined by the information that is assigning the resource to the cargo network. (For
further definitions and explanations, please see the appendix)

5 CONCLUSIONS

In this paper the frame of reference; the Port terminal and the network theory has been
described and finally these two were combined into a network model of a Port terminal.

This way of describing a Port terminal is seen as very useful, and actually any terminal or
enterprise functioning in a similar way can be described. It has been presented within the
EUROBORDER project, and received positively by users in Port terminals, and those users
are Port terminal planners and others that work with planning and organisation of ports. The
model has been used to describe 6 different ports within this project.

By using the network approach, that is a very common metaphor in the society (Casti, 1995)
our Port terminal model is easy to understand and use as base for discussions. Yet it is very

9
useful from a pure modelling view, as in programming where it has been used in the
EUROBORDER project.

The network approach allows us to break down the model from the aggregated level all the
way down to the parameter level. This makes it very transparent and it is easy to chose the
level of abstraction or detail needed. The model is flow oriented which makes it close to
reality.

There remain things to do within this area, such as look deeper into the connections, and
interactions between the networks and the set of resources. There is also still a need for a
good description of a pure information network, and its possible utilisation as the
management tool for networks.

6 REFERENCES

Casti, J. (1995). The Theory of Networks. In: Networks in Action , (Batten D. Casti J. and
Thord R. Ed.) Springer-Verlag, Berlin

Chadwin M.L. Pope J.A. Talley W.K. (1990). Ocean container transportation: an operations
perspective. Taylor & Francis, New York

Churchman W.C. (1981). The Systems Approach. Dell Publishing Co. Inc., New York

Frankel E.G. (1987). Port Planning and Development. John Wiley & Sons, New York

IAHP. (1996). Future Role of Ports in Combined Transport (Hulthén. L. Ed.) IAHP Head
Office, Japan.

Kalman R.E and DeClaris N. (1971). Aspects of Network and System Theory. Holt, Rinehart
and Winston, Inc., New York

Magnanti T.L. and Wong T.R. (1984). Network Design and Transportation Planning: Models
and Algorithms. Transportation Science, 18, 1-55

Manheim M.L. (1984). Fundamentals of Transportation Systems Analysis; Volume 1: Basic


Concepts, The MIT Press, Cambridge

Ojala L. (1992). Modelling approaches in port planning and analysis, Publications of the
Turkuu school of economics and business administration, Series A-4:1992, Turkuu

10
A. MATHEMATICAL DEFINITIONS

Networks, and some related concepts (Based on Batten et al, 1995, Kalman and
DeClaris, 1971 and Magnanti and Wong, 1981).

Let G = (V , E ) be a graph with V = a set of nodes and E = a set of links. At the same
time a weight function is introduced, w = E → R on the graph, which to each link, e,
attaches a weight w( e) ∈R . The couple ( G , w) is called a network.

w( e) could here be any relevant quantity for the link, e.g. time needed to traverse the
link, its capacity, the cost for traversing the link, probability for success in trying to
traverse the link etc.

Let G be connected, i.e. for any pair of nodes there exist a walk (succession of links)
connecting the nodes.

For any path (i.e. a walk with all nodes and links different):

e e e
P: v 0 1 → v1 2 → v 2 
→... 
n
→ vn
, where ei denotes links and v i denotes nodes,
the weight is defined as c( P): = 1≤min
i ≤n w(ei )

As for nodes and link, they are of course mostly a consequence of our way of
visualising graphs in two dimensions.

Somewhat more formal, given any set of V elements of some kind ( e.g. points in R n )
and let E be a subset of V × V then by definition the pair (V , E ) is a graph with nodes
being the elements in V and links being pairs of elements in V , i.e. e ∈ E means
e = { a , b} for some elements a , b in V .

Drawing the graph (V , E ) , e = { a , b} is of course identified as the straight line, ”link”,


between a and b.

11
Paper II

Simulation and optimisation of port terminals using a network concept

Waidringer, J. & Lumsden, K.R.

Presented at the 8th World Conference on Transport Research, Antwerp, Belgium,


July 12-17, 1998.
Considered for publication in the International Journal of Maritime Economics.
SIMULATION AND OPTIMISATION OF PORT
TERMINALS, USING A NETWORK CONCEPT

Jonas Waidringer*, **, M.Sc. & Kenth Lumsden*, PhD.


* Department of Transportation and Logistics, Chalmers University of Technology,
412 96 Göteborg, Sweden

** Center at Eriksberg for Communication, Information and Logistics,


Blå Hallen, Eriksberg, 417 64 Göteborg, Sweden

Abstract: This paper describes the theoretical basis for a newly develop tool, NeuComb/Port, as well
as the actual tool itself. The basis for this tool is neural networks and combinatorial graph theory.

In the paper some results from a set of runs on a real case, the Oslo port, are given. A short discussion
about the implications of possible changes of a port terminal out of the results from an optimisation of
the Port terminal is also given. The results are derived from a set of simulations and optimisations done
in co-operation with a number of European ports, within the EU project, EUROBORDER

1. INTRODUCTION

There exist a number of ways of describing a port, e.g. any terminal, but few from the
network perspective. This paper addresses the issue of evaluating and choosing
different parameters to describe the port out of a network perspective, and as a result
proposes a model, NeuComb/Port. The need for this kind of description and model
derives from the need to create a simulation and optimisation tool at a micro level.
Since the network is a set of nodes and links, the parameters have to be consistent.
The model, which is the result of this paper, is built on network theory in general and
neural1 networks and combinatorial graph theory in specific. Another restriction is
that the parameters have to be quantitative, since the network model is based on
mathematical operations.

The model as such is a tactical/strategic tool that can be used for long term
reorganisation issues in a Port terminal, since the model is developed into a PC based
optimisation and simulation tool. This means either to simulate physical
reconstruction, with corresponding changes in the terminal flow, or reorganisation of
the work in the Port terminal e.g. changes in the resource distribution. There are two
ways of using the tool. The first is to use it as an optimisation tool for an already
existing Port terminal. The second is to use it as a simulation tool, where it is possible
to simulate any given set of parameters in a Port terminal. The simulation is also used
as a way of validating the model.

The cargo throughput and the resource utilisation are the main issues for optimisation,
under the consideration of the constraints implied by the information, administration
and legal factors. The networks are just a way of explaining abstract interactions and
interrelations in the model.

1
The part of neural nets that is used in this paper is the possibility to have information in both nodes and links

1
The optimisations are done according to the boundary conditions determined by the
information, organisation and legal conditions in the Port terminal. The model works
with a superposition of three networks, which is though only a way of describing it
graphically and in words. In the model/tool boundary conditions are used to be able to
take information, organisation and legal constraints into consideration when
optimising, as well as simulating the Port terminal.

The NeuComb/Port tool makes it possible to build a model of any Port terminal with
its specific characteristics. The result from the model is either an optimal use of the
resources according to a given flow or an optimal flow according to a given set of
resources. There is also a result from the simulation part that shows the flow and the
resource utilisation according to the parameters set in the model. The result is
displayed graphically as well as numerically. The tool is made with a generic2 Port
terminal model as a demo and with default values on all the parameters involved.

2. FRAME OF REFERENCE

In this chapter the port environment is described to define the port as a part of an
overall transport chain. A short description of different possible models that can be
used is also included, as well as the main parts of a Port terminal.

Regulation
Market system Stimulation
Political system

Transport system Regulation


Stimulation Services
Supply
Demand Port system
Regulation
Demand
Products Stimulation
Services
Industrial system
Products
Services Supplier system

Figure 1 The environment of the port (Hulthén and IAHP, 1996)

How the environment influences the port system can be described with activity
relations as shown in figure 1. No detailed description about the port system and how
the environment and the port system interact will be done. Instead this should be seen
as a way of defining the reference system for this paper. Port models used as a base
for planning and analysis may be classified in the following way (Ojala, 1992 and
references therein):

• Models with an econometric approach


• Models with an analytic approach
• Models using simulation technique

2
Generic is used in the sense of an aggregated, non-specific, model

2
Econometric models normally deal with the macro-level aspects, and are widely used
in research problems related to demand and supply. A system is described as a casual
network of relationships between a set of variables. Analytic models are created
within the framework of Operations Research (OR). The basic idea is to develop a
mathematical function, which can be solved by an algorithm under certain constraints.
Simulation models use a numerical technique for specific mathematical models to
analyse time-bound flows of events within a system, consisting of a large number of
variables and constraints.

To give a background to the model some examples of how to describe a Port terminal
is given, beginning with the Port terminal as a "black box", as shown in figure 2
below.

INFORMATION
IN/OUT

CARGO
CARGO TYPE 1 OUT
TYPE 1 IN
PORT
TERMINAL
CARGO
TYPE 2 OUT
CARGO
TYPE 2 IN

RESOURCES
IN/OUT

Figure 2 Different flows through the Port terminal


The description above is the simplest possible way of describing a Port terminal, in
terms of logistical flows. The Port terminal is seen as a "black box" with cargo,
information and resources going in and out of the box. What happens with the
different flows is not taken into account, instead focus is on the results, i.e. what is
actually going in and out of the model. This is in line with the systems approach
(Churchman, 1981):

“The way to describe an automobile is first by thinking about what it is for, about its
function, and not the list of items that make up its structure”

Within this frame the Port terminal is described with 3 main functions,
receive/deliver, transfer and load/unload as shown in figure 3 below.

3
La n d sid e P o rt term in a l S ea sid e

R ec eive/ T ra n sfer Lo a d /
D eliv er U n loa d

Figure 3 The Port terminal described by its functions


The analytical approach described above is used as a frame of reference for this paper,
since the model developed is created as a base and as a tool for simulation and
optimisation.

3. THE MODEL

The NeuComb/Port model is developed to support the analysis of how the efficiency
of a Port terminal as a part of the transport chain can be improved and thereby
improving the competitive position of shipping in relation to the other transport
modes. The boundary for the model is the Port terminal since it would not be feasible
to model a larger environment within a quantitative model as this. The complexity of
the Port terminal is also enough to make it impossible to model without making
approximations about the environment. The NeuComb/Port model has a pure research
dimension to it, since it is the first model developed with the aim to give, in an
absolute sense, an optimal solution to the flows through a Port terminal. Given here is
a description of the NeuComb/Port model. The program is an implementation of
strong mathematical algorithms adjusted to a port environment.

The optimisation is divided into two parts: First there is one algorithm seeking out the
maximum possible physical flow through the terminal. Secondly there is an algorithm
optimising the resource utilisation under the boundary condition that the resources
should interfere as little as possible with the principle of maintaining the maximum
flow. This is a so-called optimal assignment problem. The problem to solve, is that of
performing a number of missions with a limited set of resources. The result after
going through these two phases of optimisation is an optimal use of the available
resources in the system. As mentioned above these optimisations are done according
to the boundary conditions determined by the information, organisation and legal
conditions in the Port terminal. This is in line with what has been described in a paper
about distribution planning of containers in the Port of Singapore (W.S. Shen & C.M.
Khoong, 1995).

Scanning Free flow Scanning Optimal Resource


the system optimisation the system assignment allocation

Figure 4 Flow scheme for the optimisation

4
A crucial point when working with optimisation models, in contrast to simulation, is
that there has to be a certain degree of freedom. This means that if everything is set to
a specific value in the model, there will be no optimisation potential. This might make
users perceive the model/tool as somewhat rough to follow, since it makes it less
specific and more general. A large part of the work with the model has been dedicated
to gather enough information as a base for a decision about what is possible to
optimise within a Port terminal. Another consequence of this is that there have to be
approximations about each Port terminal and the functions within it. The result is for
example that all the access control functions, corresponding to the gate, are
considered equivalent, i.e. it is inessential, which gate the cargo passes through. This
is applicable to all the functions in the model. It will of course always be possible to
specify the model more, but then it will also be fewer possibilities to optimise the Port
terminal.

The model basically works as follows:

• Simulation of the physical and information flows


• Optimisation of the physical and information flows
• Optimal matching of the resources under the boundary constraints

The data input will be made in three steps:

• “Static” configuration, i.e. the infrastructure of the Port terminal. All nodes and
links possible, with associated capacities, costs, times, types etc.
• “Dynamic” configuration, i.e. all constraints, put on the static configuration, such
as boundary conditions associated with the information. Here will also the
distributions of different flows be put in.
• “Operative” configuration, i.e. the specific conditions associated with the scenario
that is going to be implemented. It can be cargo throughput, changes in resource
allocation etc.

The parameters keyed into the static configuration will be more or less static
parameters that are describing the specific port. In short, this phase is creating a model
of that specific port. When this is done the model/tool will also be calibrated to that
specific port, since the parameters keyed in is specific for that port and not the generic
ones. This part is crucial, since the validity of the model/tool is directly depending on
the accuracy of the parameters keyed in. If the values of these parameters are
inaccurate then the model will be false.

This is of course true for any model; no model is better than the quality of the
numerical values of the appropriate parameters.

Before describing the program more in detail the concepts of the model are described.
The first thing to note is that the model only works with unit loads, secondly the port
functions, have to be broken down into smaller elements in order to be able to
simulate and optimise the Port terminal operations. In the model there are four
elements which in different combinations constitute the port functions. These four
elements, which describe the infrastructure of the physical flow, are action nodes,
queue nodes, wait nodes and links. In the NeuComb/Port model nodes are instances
where the cargo is not undergoing physical transition or instances where the cargo

5
change transportation mode. Links are connections between nodes. In a link the cargo
undergoes physical transition. Information is added on to the system as boundary
constraints.

In an action node some kind of action, which takes a specified amount of time is
carried out. There is only one kind of action node regardless of what the action is. In
the model an action node only has place for one cargo unit at the same time. Queue
and wait nodes have place for more than one cargo unit, and the time in the node
depends on the following nodes and not on the node itself. In queue nodes cargo units
are accessed based on first come first served basis, FIFO. In wait nodes any cargo unit
can be accessed at all time. The links in the physical network are described by the
same parameters as the nodes, i.e. capacity, time and cost for that specific link. The
links in the information network are just connecting the information nodes and the
physical nodes, since the capacity is regarded as unlimited, time very short and almost
no costs.

The nodes correspond to the actions performed in a port terminal, such as ID-control,
gates, storage areas and so on. Each node in the model is represented by a
combination of the model specific nodes to be able to describe it as exact as possible.
For example, three model specific nodes describe a transfer node. First a queue node
to handle the possibility of a queue in to the node. Then an action node where the
actual handling is performed, and finally another queue node that makes it possible to
handle the possibility of a queue out of the node, if there are no available resources at
that time. For a complete description and names of these nodes, see (J. Waidringer &
K. Lumsden, 1997) for further descriptions.

To handle the constraints imposed by lack of information, other administrative and


legal issues the information network is constructed as a delay function. Each node can
be assigned a delay in form of an exponential distribution. The actual information
delay is then randomly distributed within the limits given by the specific exponential
distribution, determined by the maximum value and lambda value. The limits are
decided and entered into the model in the initiation phase of the modelling. To give a
concrete example; if a Port terminal in average experience a delay of about 5 minutes
and a maximum delay of about 10 minutes in the gate function the user will enter the
maximum value and a constant corresponding to the shape of the distribution. Then
the model is randomly giving delays within these frames.
To be more exact the delay and distribution is done in the following way: The delay
can vary between 0 and τ max .

τ = τ + τ max f (ξ )

Where τ is the time in the node, τ is the average time in the node without the
information delay, τ max is the maximum time delay imposed by the information and
f (ξ ) is a random distribution described as 0 ≤ f (ξ ) ≤ 1 . For the exponential
distribution the following applies:
e −λξ
f (ξ ) = 1 −
f min

6
Where ξ is a random figure between 0 and 1, λ is a constant giving the shape of the
distribution i.e. the shape of the curve.

4. THE PROGRAM DESCRIPTION

This chapter gives an extensive description of the program that was developed with
the NeuComb/Port model and methodology as a base. There are a lot of definitions of
nodes and links in the cargo network, as well as for the information network and the
set of resources.

Figure 5 The generic model lay-out


To create a new model, the user has to chose New under the file menu in the program,
if another model is open at that time it will take a while since the program has to save
all the data connected to that model. In figure 5 a generic model layout is shown to
giver the reader an idea of what the program interface looks like. Choosing Save
under the file menu saves changes in a model, or a new model. This will also save
everything except the current traffic situation in the program i.e., the system
characteristics such as nodes and links and the parameters associated with them. The
whole infrastructure of the model built. Also the initial cargo and the land and seaside
distributions will be saved.

The editing and building of the model is done in 5 different editing modules, which
are chosen with the buttons on the left hand side of the interface, Move, Add, Delete,
Cargo and Resources. These can be seen in figure 5 above.

7
Figure 6 The cargo node editor
To add a node the user has to choose the Add button (entering Add mode), and then
place the node in the interface by using the left mouse button in the interface. When
the node is geographically placed the node editor appears on the screen, see figure 6
above, and has to be filled in correctly otherwise it is not possible to exit it and to get
a new node. Observe that the type is selected with the Type button, where a list of
available types will appear. Cancel will exit the node editor and cancel the node that
has been placed in the interface. There is also possible to add a delay to a specific
node to simulate delays caused by for example lack of information, ineffective
organisation and management etc. This is described more in detail in chapter 3 above.

To add a link in the Add mode a node is chosen with the left mouse button and then
the pointer is pulled from that node to the node a link is supposed to be created to,
while holding down the left mouse button all the time. The link is temporary and can
be moved until the left mouse button is released. When releasing the left mouse
button the link is geographically fixed and the link editor appears on the screen, see
figure 7 below. The link editor has to be filled in correctly, observe that the links is
doubly directed, why there has to be values entered in both directions.

Figure 7 The link editor for the physical network


To delete a node the delete mode has to be entered with the Delete button. To delete a
node or link just click on it with the left mouse button, and it will disappear. This will
take some time, since the system has to check all the configurations before deleting.

To get an overview of the edited values it is possible to enter the Edit menu and
choose distance/time, cost or capacity and then all the nodes and links can be viewed,
and the values can be edited in an overview matrix.
To enter the cargo type edit mode the Cargo type button has to be selected. The cargo
type editor appears on the screen, see figure 8 below, and will stay there until another

8
mode is chosen, and it will look like the figure below. Filling in a name and choosing
the Add button gives the cargo type. To delete a cargotype select it from the list and
click on the Delete button.

Figure 8 The cargo type editor


When a cargotype is chosen it is possible to edit the nodes where this cargotype is
supposed to be allowed, i.e. define its working area, by selecting the node with the left
mouse button. The end node is chosen with the right mouse button.
A short example: A cargotype can be imported reefer cargo. This is allowed to come
in to any of the ship nodes, to the reefer storage area and to the exit gate, which will
be its end node.
The resources are handled in the same way as the of cargo types with a similar
interface
Land side arrivals: The land side distributions, e.g. how the cargo flow is varying
over time in and out of the terminal has to be entered before running the program. The
editor for this is chosen under the Edit menu and looks like figure 9 below. The editor
runs over 2 weeks, 14 days. The green field is the first week and the yellow field is
the second week. In the editor the amount of cargo of each type has to be entered for a
full 2-week period. The resource type is chosen with the button in the below left-hand
side corner.

Figure 9 The land side arrivals editor

Sea side arrivals: For the seaside a similar editor as the land side editor has to be
filled in, as shown in figure 10 below. Here for each ship the arrival time as

9
day_hh:mm, departure time in the same way, quay number corresponding to the node
assigned, ship identity, and the import and export of the different cargo types that the
ship will load and unload, has to be entered.

Figure 10 The sea side arrivals editor


Initial cargo: There is also a possibility to enter the initial values for the cargo already
in the system when starting it, if no initial cargo is entered the system will start empty.
This editor is also chosen from the Edit menu, and it looks like in figure 11 below.

Figure 11 The initial cargo editor


The cargo types are automatically up-dated when choosing them in the resource
editor. To run the program one of the program options in the Execution menu has to
be chosen. A calculation window will appear on the screen on top of the graphical
interface of the model/terminal, looking like figure 12 below.

Figure 12 The calculation window at start-up


In this window a start time and a stop time has to be entered, where it should be
observed that the day could have a value between 1 and 14. It is possible to change
the break points for the occupation during run time (default value 0-30 green, 30-80
yellow, 80-100 red). It is also possible to chose to check the File dump button and
then it is possible to get 4 different Result files:

10
1. A detailed result file of the run
2. A file showing the arrival and departure times of the ships
3. A file showing the resource movements in the run
4. A file showing the cargo movements in the run

If the Show map button is checked the graphic interface is updated continuously
during the run. The initiation phase takes about 5 minutes for the generic model and
when it is finished the nodes and links of the model will be updated with the initial
data on the screen.

When the program has finished the results are shown in three different ways. It is
printed to an aggregated result file, to the result files chosen in the calculation window
as described above and it is also possible to look at the results for a specific node or
link by selecting it when the program is finished or temporarily stopped. Then a
screen as shown in figure 12 below, will appear. This will also be done whenever the
program is stopped during a run. To access this just click on the Result button.

Figure 12 The result window for a specific node


The results for each node and link are divided in two main categories, the queues on
each side of the node/link, i.e. the queue from the landside and the queue from the
seaside. The second main result is the occupation over time in the node, i.e. the
bottlenecks in the system. The results are divided in maximum, average and minimum
values. The aggregated results give the total figures for the whole system, port
terminal. The time and cost efficiency for the resources is given in % of the absolute
optimum possible in the system. It also gives the total costs for all the activities in the
system during the run, and the total costs for the resources.

11
5. RESULTS

The project is currently in its final phase and all the runs and subsequently all the
results can not be displayed here. Instead a short summary of what kind of cases that
have been run so far and what results they implicate will be done in this chapter. So
far most of the simulation and optimisation runs have been done for the port of Oslo,
which is involved strongly in the project. The simulations and optimisations are made
from real data combined with good estimates for those values that have not yet been
able to get. The results s displayed here are all based on simulations and optimisations
done with time as the main parameter. This out of two reasons: firstly there is very
hard to get hold of real life statistics regarding the costs in a port terminal, and
secondly out of a strategic issue, the ports are somewhat reluctant to hand out theses
figures since they regard it as strategic information.

Basically 2 cases have been run so far: Resource utilisation and different capacities in
the system.

The first test: How resource utilisation and queues are affected when more resources
are assigned to the system shows that the resource utilisation goes done when more
resources are assigned to the system, but the queues and throughput times are better.
This is an expected result of course, but the interesting thing is that if an intelligent
strategy (algorithm) for resource allocation is used together with some other measures
as described in the chapters above, what is called optimisation of the resources, the
resource utilisation can be increased dramatically. Since these are just preliminary
results from a limited set of runs in one port the exact figures are not displayed here.

The second test: How capacities in the nodes effect queues and service times in the
system shows that the service times are cut if a larger capacity is assigned to the
nodes, which also was expected. The interesting part here is that instead of increasing
the capacity in the nodes, which actually corresponds to capital investments, it is
possible to use the optimisation feature instead and get a better result or at least the
same. This is of particular interest for small and medium sized ports that do not have
the capital power to expand and also for ports like Oslo that out of physical and
political reason can not expand. Of course it is interesting for all ports to enhance their
operation instead of having to invest heavily, but it can be crucial to have this
alternative for a small or medium sized port.

12
6. CONCLUSIONS

In this paper the frame of reference; the Port terminal and the bases for the model has
been shortly described and finally the actual program has been described more in
detail together with some preliminary results from working with some real life cases.
This way of describing a Port terminal is seen as very useful, and actually any
terminal or enterprise functioning in a similar way can be described. The model and
program has been presented and used within the EUROBORDER project, and
received positively by users in Port terminals, and those users are Port terminal
planners and others that work with planning and organisation of ports. The model and
the program are now used for building customised models of each of the 6 Ports that
are involved in the project. The results of the program are optimisation and simulation
of resource utilisation at a given throughput (flow) and optimisation and simulation of
throughput at given resources, and all different ways of combining the utilities into
relevant questions as describe briefly in chapter 5 above.

The possibilities for future developments within the framework set out in this paper
can be divided in three parts. The first possibility is to use what is called network
synthesis, which will make it possible to use the NeuComb/Port tool for new
constructions. This can be done either in an existing Port terminal or in a completely
new terminal, to get the optimal layout for that specific terminal. The network
synthesis is basically a way of optimally assigning the different functions that have to
be performed according to some given criteria. These criteria can be the desired flow
through the terminal, a given cost etc.

The second possibility is to look deeper into the connections, and interactions
between the networks and the set of resources. There is especially a need for a good
description of a pure information network, and its possible utilisation as the
management tool for networks. This is so far an area where little work has been done,
especially in the Port and marine environment.

The third possibility is to develop a common economic system for the Port terminal
operations and the information, administrative and legal issues in a Port. One of the
obstacles within this workpackage has been to define the costs for different functions
in the Port terminal, and especially for the information processes. This would be a
good way of enhancing the competition among the Ports and between the shipping
business and the other transport modes.

13
7 REFERENCES

Chen, W-K. (1990) Theory of Nets: Flows in Networks, John Wiley & Sons Inc.

Churchman W.C. (1981). The Systems Approach. Dell Publishing Co. Inc., New York

IAHP. (1996). Future Role of Ports in Combined Transport (Hulthén. L. Ed.) IAHP
Head Office, Japan.

Jungnickel, D. (1994), Graphen, Netzwerke und Algorithmen, BI


Wissenschaftsverlag, Mannheim

Ojala L. (1992). Modelling approaches in port planning and analysis, Publications of


the Turkuu school of economics and business administration, Series A-4:1992,
Turkuu

Shen, W.S. & Khoong, C.M. (1995), A DSS for empty container distribution
planning, Decision Support Systems, 15, 75-82

Waidringer J. & Lumsden K. (1997), Modelling a Port terminal from a Network


perspective, Department of Transportation and Logistics, Göteborg

14
A MATHEMATICAL DESCRIPTIONS AND DEFINITIONS

Let G = (V , E ) be a graph with V = a set of nodes and E = a set of links. On the graph
a weight function is introduced, w = E → R , which to each link, e, attaches a weight
w( e) ∈ R . The couple ( G , w) is called a network.

w( e) could here be any relevant quantity for the link, e.g. time needed to traverse the
link, its capacity, the cost for traversing the link, probability for success in trying to
traverse the link etc.

Let G be connected, i.e. for any pair of nodes there exist a walk (succession of links)
connecting the nodes.

For any path (i.e. a walk with all nodes and links different):

e e e
P: v 0 1 → v1 
2
→ v2 
→... 
n
→ v n , where ei denotes links and v i denotes nodes,

the weight is defined as c( P): = 1≤min


i ≤ n w( ei )

As for nodes and link, they are of course mostly a consequence of our way of
visualising graphs in two dimensions.

Somewhat more formal, given any set of V elements of some kind ( e.g. points in R n )
and let E be a subset of V × V then by definition the pair (V , E ) is a graph with nodes
being the elements in V and links being pairs of elements in V , i.e. e ∈ E means
e = { a , b} for some elements a , b in V .

Drawing the graph (V , E ) , e = { a, b} is of course identified as the straight line, ”link”,


between a and b.

The two main algorithms are also shortly described to give the reader a hint of what
kind of mathematics that has been applied in this model. These algorithms are used as
a base for the modelling and have been adjusted to match the requirements of the
model. The interested reader can get more information through the reference list.
The Hungarian algorithm
This algorithm is used to solve the optimal assignment problem and is here given as a
procedure (Jungnickel, 1995).

Procedure HUNGARIAN (n,w; mate)

(1) for ν∈V do mate (ν) ← 0 od;

(2) for i = 1 to n do
i ij{ }
u ← max w : j = 1,  , n ; ν ← 0
i
od

(3) nrex ← n;
(4) while nrex ≠ 0 do

15
(5) for i = 1 to n do m(i ) ← false; p (i ) ← 0; δ ← ∞ od;
i

(6) {
aug ← false; Q ← i ∈ S : mate(i ) = 0 ; }
(7) repeat
(8) remove an arbitrary point i from Q; m(i ) ← true; j ← 1;
(9) while aug = false and j≤n do
(10) if mate(i) ≠ j′

(11) then if ui + v j − wij < δ j

(12) then δ j ← ui + v j − wij ; p (i ) ← i;

(13) if δj = 0

(14) then if mate(j′ ) = 0

(15) then AUGMENT ( mate, p, j′ ; mate);


(16) aug ← true; nrex ← nrex − 1

(17) else {
Q ← Q ∪ mate(j′ ) }
(18) fi
(19) fi
(20) fi
(21) fi;
(22) j ← j+1

(23) od;
(24) if aug=false and Q=∅

(25) then {
J ← i ∈ S:m(i) = true ;K ← } { j′ ∈ T:d j = 0};
(26) {
δ ← min δ j : j′ ∈ T \ K ; }
(27) for i∈J do ui ← ui − δ od;

(28) for j′ ∈ K do vj ← vj +δ od;

(29) for j ′ ∈ T \ K do δj ←δj −δ od

(30) X ← { j ′ ∈ T \ K: δ j = 0 };
(31) if mate(j′ ) ≠ 0 for all j′ ∈ X

16
(32) then for j′ ∈ X do {
Q ← Q ∪ mate(j′ ) } od

(33) else choose j′ ∈ X with mate ( j ′ ) = 0;

(34) AUGMENT ( mate, p,j ′;mate);


(35) aug ← true; nrex ← nrex - 1

(36) fi
(37) fi
(38) until aug = true
(39) od.
(40)

Procedure AUGMENT ( mate, p , j′ , mate )

(1) repeat
(2) i ← p ( j ); mate( j ′ ) ← i ; next ← mate (i ); mate (i ) ← j ′;

(3) if next ≠ 0 then j ′ ← next fi


(4) until next=0
This algorithm has been used for this kind of problems before, and has proven to be
efficient.

Minaddition of matrixes

This idea is used to solve the problem of finding the least distances and costs, i.e. the
weights in the networks. (Chen, 1990) The first thing to do is to define a special
matrix binary operation denoted by the symbol ⊗ , called the minaddition. Given two
square matrices of order n

[ ]
A = a ij
B = [b ij ]

the minaddition of A and B is a matrix

W = A ⊗ B = w ij [ ]
of the same order whose ith row and jth column element wij is determined by the
equation

wij =min (aik +bkj ) (1.1)


k

In an ordinary matrix product the element wij is defined by

17
wij = ∑ aik bkj (1.2)
k
If in (1.2) the summation is replaced by the minimum operation, and the product
aik bkj is changed to addition, the minaddition operation (1.1) is obtained. The
minaddition is associative, but not commutative which is fairly straightforward to
verify but it is not done here. This two algorithms, mathematical operations is, as said
earlier, just showed here to give the reader some sense about what kind of
mathematical operations that are used in the model.

18
Paper III

Results from the development and use of an optimisation and simulation


tool, NeuComb/Port

Waidringer, J.

Presented at the 22nd Australasia Transport Research Forum, Sydney, Australia,


September 30-October 2, 1998. Published in proceedings.
RESULTS FROM THE DEVELOPMENT AND USE
OF AN OPTIMISATION AND SIMULATION TOOL,
NEUCOMB/PORT
Jonas Waidringer*, **

* Department of Transportation and Logistics, Chalmers University of Technology,


412 96 Göteborg, Sweden

** Center at Eriksberg for Communication, Information and Logistics,


Blå Hallen, Eriksberg, 417 64 Göteborg, Sweden

Abstract: This paper describes possible changes of a port terminal from an optimisation of the Port
terminal, and the impacts derived from these changes. The optimisation is made with a specially
developed theoretical tool, based on practical findings, the NeuComb/Port tool. The basis for this tool
is neural networks and combinatorial graph theory. Since the tool works with advanced mathematics
methods it is developed as a strategic model on an aggregated level.

In the paper some results from a set of runs on a real case, the Oslo port, are given. A short discussion
about the implications of possible changes of a port terminal out of the results from an optimisation of
the Port terminal is also given. The results are derived from a set of simulations and optimisations done
in co-operation with a number of European ports, within the EU project, EUROBORDER. The results
are roughly divided into three main categories, derived from three cases run in the tool. The results
show that in a terminal with a fairly low throughput, there is little or no difference between pooling the
resources and/or cargo compared to the reference case. A terminal with a fairly high throughput
reaches the highest efficiency by pooling the resources

1 INTRODUCTION

The ports are an important but weak link in the transport chain, which gives great
value to new ideas as to how it is possible to change the port operations (Frankel,
1987). Currently there exist few, if any models describing the Port terminal from a
pure network perspective (Ojala 1992, and references therein). This paper derives
from the need for a model of a Port terminal, described from a network concept. The
model is used in an EU research project, EUROBORDER. In this project an
optimisation tool will be built that works with two foliated networks; an information
flow network, a cargo flow network and a set of resources constituting these
networks. This relates closely to a conceptual framework developed for resources
(Manheim, 1979).

The core of the model is the cargo flow and the corresponding network, since this is
seen as the Port terminal’s main function, and the essence of its activities. This
generic model of a Port terminal is also of an academic interest since it is a different
and structured way of describing the interrelations within the Port terminal system.
There are a number of different ways of describing a port, e.g. any terminal, but only
a few from the network perspective. This paper addresses the issue of evaluating and
choosing different parameters to describe the port from a network perspective, and as
a result proposes a model, NeuComb/Port. The need for this kind of description and
model derives from the demand to create a simulation and optimisation tool at a micro
level. Since the network is a set of nodes and links, the parameters have to be

1
consistent. The model, which is the result of this paper, is built upon network theory
in general and neural3 networks and combinatorial graph theory in particular. Another
restriction is that the parameters have to be quantitative, since the network model is
based upon mathematical operations.

The model as such is a tactical/strategic tool that can be used for long-term
reorganisation issues in a Port terminal, since the model is a PC-based optimisation
and simulation tool. This means either simulation of physical reconstruction, with
corresponding changes in the terminal flow or reorganisation of the work in the Port
terminal e.g. changes in the resource distribution. There are two ways of using the
tool. The first is to utilise it as an optimisation tool for an already existing Port
terminal. The second is to use it as a simulation tool, where it is possible to simulate
any given set of parameters in a Port terminal. The simulation is also used as a way of
validating the model.

The cargo throughput and the resource utilisation are the main issues for optimisation,
considering however the constraints implied by information, administration and legal
factors. The networks are just a way of explaining abstract interactions and
interrelations in the model.

The optimisations are done according to the boundary conditions determined by the
information, organisation and legal conditions in the Port terminal. The model works
with a superposition of three networks, which is though only a way of describing it
graphically and in words. In the model/tool, boundary conditions are used to be able
to take information, organisation and legal constraints into consideration when
optimising, as well as simulating, the Port terminal.

The NeuComb/Port tool makes it possible to build a model of any Port terminal with
its specific characteristics. The result from the model is either an optimal use of the
resources according to a given flow or an optimal flow according to a given set of
resources. The utilisation of the resources is also shown. The result is displayed
graphically as well as numerically. The tool is made with a generic4 Port terminal
model as a demonstration and with default values on all the parameters involved.

3
The part of neural nets that is used in this paper concerns the possibility to store information in both nodes and links
4
Generic is used in the sense of an aggregated, non-specific, model

2
2 FRAME OF REFERENCE - THE PORT

First the port environment is described in order to define the port as a part of an
overall transport and logistical chain.

Regulation
Market system Stimulation Political system

Transport system Regulation


Stimulation Services
Supply
Demand Port system
Regulation
Demand
Products Stimulation
Services
Industrial system
Products
Services Supplier system

Figure 1 The environment of the port (Hulthén and IAHP, 1996)


The environmental influence on the port system can be described with activity
relations (Figure 1). No detailed description about the port system and how the
environment and the port system interact will be done. Instead Figure 1 should be
seen as a way of defining the reference system for this paper.
Port models used as a base for planning and analysis may be classified in the
following way (Ojala, 1992):

• Models with an econometric approach


• Models with an analytical approach
• Models using simulation technique

Econometric models normally deal with the macro-level aspects, and are widely used
in research problems related to demand and supply. A system is described as a casual
network of relationships between a set of variables.

Analytic models are created within the framework of Operations Research (OR). The
basic idea is to develop a mathematical function, which can be solved by an algorithm
under certain constraints.

Simulation models use a numerical technique for specific mathematical models to


analyse time-bound flows of events within a system, consisting of a large number of
variables and constraints.

To provide our model with a background, some examples of how to describe a Port
terminal are given, beginning with the terminal as a "black box”, as shown in Figure
2.

3
INFORMATION
IN/OUT

CARGO
CARGO TYPE 1 OUT
TYPE 1 IN
PORT
TERMINAL
CARGO
TYPE 2 OUT
CARGO
TYPE 2 IN

RESOURCES
IN/OUT

Figure 2 Different flows through the Port terminal


The description above is the simplest possible way of describing a Port terminal, in
terms of logistical flows. The terminal is seen as a "black box" with cargo,
information and resources going in and out of the box. The different flows and their
future fate is not taken into account, instead the focus is on the results, i.e. what is
actually going in and out of the model. This is in line with the systems approach
(Churchman, 1981):

“The way to describe an automobile is first by thinking about what it is for, about its
function, and not the list of items that make up its structure”

Within this frame the Port terminal is described with three main functions,
receive/deliver, load/unload and transfer as shown in Figure 3 below.

L a n d s id e P o rt te rm in a l S e a s id e

R e ce iv e/ T r a n s fe r L oad/
D e liv e r U n lo a d

Figure 3 The Port terminal described by its functions

The analytical approach described above is used as a frame of reference for this paper,
since the model developed is created as a base and as a tool for simulation and
optimisation.

4
3 THE PORT TERMINAL FROM A NETWORK PERSPECTIVE

As mentioned before, the model describes the Port terminal as two foliated networks,
the information flow network and the cargo flow network, and a set of resources
constituting these networks. Figure 4 below shows a few selected nodes and possible
links within and between these networks.

INFO RM AT IO N
N ET W ORK

Information exchange→

Link→
CARG O
NET W ORK

Resource allocation→

RESO URCES

Figure 4 The Port terminal’s two foliated networks, and set of resources.
The links between the different nodes are not a fixed set of links constantly
connecting all the different nodes continuously. Instead the links between two nodes
appear when there is a need for a link. In this sense it is possible to talk about links as
spontaneous. The links are induced by a need, detected by the information network,
which is transferred to the resource network. According to that a resource, i.e. a
machine, personnel etc., is assigned to solve that need, creating the desired link.

The information, status, from the cargo network is transferred to the information
network. It can for example be a need for transportation of the cargo from one node to
another. In the information network data is also sent to the next node corresponding to
the cargo node receiving the cargo. The resources are limited to use the links available
in the cargo network, and when free, placed at a parking area.

Realised links
Realisable links

Desired links

Figure 5 Different sets of links

5
Figure 5 above explains the way different types of links used in this modelling
process are defined. The realisable links are all the links between all nodes in the
network that are realisable defined by some kinds of criteria such as cost etc. Desired
links are links one would like to use if there were no constraints on the network.
Realised (physical) links are the links finally realised, by the set of resources, when all
constraints have been imposed on the network. The total set of links in the network,
called abstract (AL) or theoretical links, is the union of the realisable (RL) and desired
(DL) links. AL = RL  DL

4 RESULTS

The results given here are from a series of runs in the NeuComb tool (Waidringer &
Lumsden, 1998) with the terminal of Ormsund in Norway as the actual case. All
figures are authentic and the simulations are verified against real data for the current,
unchanged, scenario. Two cases have been run for the current and future scenarios.
The figures used, the actual screen shots from the tool and the cases are described
below.

4.1 The model and inputs used


The Ormsund terminal is shown in Figure 6 below, with the nodes and links
constructing the port terminal network. Node number one is for example the check-in,
node number three is the entrance etc. Since the tool is designed for an aggregated
level, the model of the terminal has been properly adjusted. There are, for example,
more storage areas and more links in the real case, but the users have done the
estimates themselves. The reason for this is that the tool is supposed to be used on an
aggregated level for tactic and strategic decisions in the port terminal. Therefore the
models should not be too detailed, instead the main flows and categories should be
modelled as accurate as possible.
3

7
10
1

12
11

1 Chec k-in 5
3 E nt rance 9
5 S ea-ex it 1
6 S ea-ex it 2
13
7 S outh-exit
8 S toring -area-1
9 S toring -area-2
6
10 Transfer-L-1
11 Transfer-L-2
12 Transfer-S -1
13 Transfer-S -2

Figure 6 The Ormsund terminal

6
The basic model, called “current”, is the Ormsund model and the model looks like
Figure 7, when it is implemented in the NeuComb tool. The actual tool and its
specifications are not described here. (Waidringer & Lumsden, 1998)

Figure 7 The NeuComb tool with the Ormsund terminal lay-out, current
situation
Figure 7 shows the layout of the terminal, with the check-in at the upper left-hand side
corner, corresponding to the layout in Figure 6 above.
To give the reader a possibility to follow the construction of the model and cases, the
actual inputs are shown in tables below. It also gives an understanding of the size of
the model and cases. The landside distribution for different cargo types in the current
and future situations are shown in Table 1 below. Landside distribution means
truckloads coming in and out of the terminal over a specified day. Import is going out
of the terminal and export is coming in to the terminal from the landside. The tool
works with different cargo types, for example imp.-1, imp.-2 etc. to distinguish
between cargo destined to different ships, and as a way of determining directions of
the flows.

7
Current Future
Time imp.-1 imp.-2 exp.-1 exp.-2 Time imp.-1 imp.-2 exp.-1 exp.-2
07-08 5 10 1 2 07-08 8 17 6 7
08-09 5 9 3 7 08-09 8 16 6 12
09-10 3 7 4 6 09-10 5 14 7 11
10-11 6 12 4 11 10-11 10 21 11 20
11-12 8 16 4 9 11-12 14 28 7 15
12-13 5 10 3 5 12-13 8 17 6 8
13-14 7 14 3 4 13-14 13 24 14 26
14-15 7 14 8 15 14-15 12 24 6 10
15-16 3 5 3 6 15-16 6 9 4 7
16-17 1 1 2 4 16-17 1 3 1 2
Table 1 The landside distributions of container-trucks for both scenarios
To make the cases as realistic as possible the runs were started with cargo that were
already in the terminal. Storage area 1 has a capacity of 300 containers and storage
area 2 has a capacity of 600 containers. Imp.-1 is import cargo at storage area 1 and so
on. The capacities of the storage areas and the starting amounts were the same for
both scenarios.

imp.-1 imp.-2 exp.-1 exp.-2


100 180 85 90

The Seaside distribution for both scenarios is given in Table 2 below. The first
column shows the ship’s arrival number, the next two columns shows the arrival and
departure time of the ship, the columns for Exp. and Imp. shows the amount of cargo
of each type that is supposed to be unloaded and loaded onto the ship, and the Quay
column shows the appropriate quay.

Current Future
Ship Arr. Dep. Exp. Imp. Quay Ship Arr. Dep. Exp. Imp. Quay
1 07.00 10.00 30 50 Kai 1 1 07.00 14.00 53 88 Kai 1
2 07.00 13.30 40 110 Kai 2 2 07.00 17.00 70 190 Kai 2
3 10.30 14.00 15 60 Kai 1 3 14.00 19.00 27 105 Kai 1
4 14.00 16.00 00 25 Kai 2

Table 2 The seaside distributions of containers and ships for both scenarios
The future scenario model is simply called “future”, and it looks like Figure 8 when
implemented in the NeuComb tool.

8
Figure 8 The NeuComb tool with the Ormsund terminal lay-out, future scenario
There are two main differences between the current situation and the future scenario.
The first is that the amount of cargo of all types is more than double in the future
scenario. The second is that there are 4 ships calling at the terminal in the current case
and 3 ships in the future scenario. The extra blue lines (links) in figure 3 compared to
figure 1 and 2 are links that allow the pooling of resources and cargo.

4.2 The cases run in the model

The two models, the current and the future scenario, have been run in the tool with 3
cases in each model:

• Case 1, Reference scenario: No changes = two operators and no advanced yard


management system
• Case 2: Pooled resources = a single operator
• Case 3: Pooled resources and cargo = a single operator and an advanced yard
management

A short clarification

The reference scenario is the current situation with no changes to the resources or the
cargo. This means that there are external resources (trucks) coming in with the cargo,
the cargo is then transferred to internal resources (straddle carriers). Since there are
two different companies working in the terminal today the internal resources are
divided into two separate areas. The cargo is divided by shipper, Maersk, Greenship
etc. Case 2 is a test of the possibility of using a single operator for the internal

9
resources (straddle carrier) in the terminal. The idea is that it should be more efficient
and less expensive to pool the resources in the terminal. In practice this means that the
internal resources are allowed in the whole terminal. Case 3 is a development of case
2. The idea is that the cargo can be placed anywhere in the terminal. In that way it
should be possible to cut down the number of internal resources. To be able to do this
an advanced yard management system is required. This kind of system keeps track, in
detail, of each container/trailer in the terminal.
The pooling of resources only involves the internal resources (straddle carriers) and
not the trucks or cranes. These two cases, number 2 and 3, were seen by the
users/operators as the most interesting cases to investigate in more detail. For the
Ormsund terminal this is especially true, since they are situated in the middle of Oslo
and therefore have a space problem, simply not enough storage capacity in the
terminal. They have no opportunities to expand, instead other alternatives have to be
considered that enhance the terminals efficiency. The results based on an evaluation
of the efficiency figures and queues for the internal resources (straddle carriers) are
displayed in a couple of diagrams shown below.
In the EUROBORDER project the resource utilisation was chosen as the main
measure, calculated as occupied time/total time, where occupied time means all time
the resource (Straddle carrier) is carrying cargo, including the queue time. This
measure was agreed on at an early stage of the project and has been kept. The
efficiency given in Figure 9 below is a slightly different measure that gives the
efficient utilisation of resources at a given throughput and a given set of resources. To
be more specific, if we have an identical system regarding throughput volume,
available resources and elapsed time, this means that the most efficient solution will
carry out the assignments in the shortest time. This gives, bearing in mind the measure
above (occupied time/total time), that if the occupied time decreases the utilisation
figure as defined above will decline. The most efficient system will therefore have the
lowest utilisation figure. This is the basis for the calculations of the efficiency figures
given in this document.
To give an example: The resource utilisation figure for case 1 (Unchanged) is 0,25
and the same figure for case 3 (Pooled resources and cargo) is 0,29. This gives a less
efficient use of the resource in case 3. As stated above, this discussion is valid for all
the figures about efficiency that are given in this paper.

10
Current situation - Efficiency

120
100 100,0 100 100,0 96,2
100 86,2
80
Reference
60 Pooled resources
Pooled resources & cargo
40

20

0
Efficiency with queues Efficiency without
queues

Figure 9 Efficiency figures for the current scenario


The figures are indexed and related to the reference (business as usual) terminal
efficiency, which has been given the index of 100.

The reason for this marginal cost reasoning is that if the basic figures for the cases,
throughput volume, available resources etc. are the same, the system deviation will be
marginal if only the changes are compared. This is a way of compensating for the
eventual systematic deviations caused by errors in the figures used for building the
models.

Current situation - Queues


%

12,0
10,3
10,0

8,0
Reference
6,0 Pooled resources
Pooled resources & cargo
4,0

2,0
0,0 0,0
0,0
Time in queue

Figure 10 Queues for the different cases in the current scenario


The percentage in figure 10 shows the percentage of the total time that the resources
are standing in queue related to the total occupied time of that resource. As can be
seen in the figure, only case 3 causes queues in the system.

11
Some general comments to the current situation:

• It is a sparse system with little overall activity, which gives less room for
improvements
• Case 2, the pooled resources case and case 1, the reference case give the same
efficiency of resources
• Case 3, the pooled resources and cargo case gives less efficient utilisation of
resources and also creates queues
• The efficiency figures without queues are almost identical
• There are two main bottlenecks in the system, the check-in function and the
container cranes

Future scenario - Efficiency

140
111,4 118,9118,9
120
100 100,0 100 Reference
100
80 Pooled resources
60
40 Pooled resources &
cargo
20
0
Efficiency with queues Efficiency without
queues

Figure 11 Efficiency figures for the future scenario


This figure corresponds to Figure 9 for the current situation, which means that it has
the same basis for its construction. The reference case is set to 100 and the other cases
are compared to this case. The future scenario’s throughput volume is about double
the current situation for all the cargo types.

Future scenario - Queues


%
30,0
24,5
25,0

20,0
15,9 Reference
15,0 Pooled resources
10,2
10,0 Pooled resources & cargo

5,0

0,0
Time in queue

Figure 12 Queues for the different cases in the future scenario

12
This figure corresponds to Figure 10 for the current situation, which means that it has
the same basis for its construction.

Some general comments to the future scenario:

• This is a much more dense system with more overall activity, which gives more
room for improvements (and mistakes)
• Case 2, the pooled resource case gives better efficiency than unpooled.
• Case 3, the pooled resource and cargo case gives the same efficiency as the
reference case, but create more queues than the other two
• The efficiency figures without queue show that the two, pooled cases are about
20% more efficient than the reference case for the actual transfers in the system
• The two bottlenecks remain, check-in and container cranes and there are overall
more queues in the system
• None of the cases can handle all the goods, so the ships can not leave in time. This
is mostly an affect caused by the capacity of the cranes.

To conclude, some comments about the results have to be made. In the current
situation where the throughput is fairly low, there is almost no difference between the
cases except that there are substantially more queues in case 3, the pooled resources
and cargo case. This is not intuitively clear. The reason is that when the cargo is
pooled the tool will use the basic strategy that is a first come first serve basis. This
means that the cargo chose the shortest path and therefor queues will be created. The
small difference in efficiency without queues is due to more transhipments of the
cargo.

For the future scenario, with a much larger throughput, there are queues in all the
cases. Here the highest efficiency is reached in the pooled resources case, which is
expected since the queues and resource utilisation, is more evenly spread in a
basically overloaded system. The pooled resources case gives less efficiency and
considerable more queues. The reason is the same that was explained above. The
interesting thing is that the efficiency without queues is almost the same. The
explanation is that the cargo is more evenly spread in this case, and therefore the
internal resources can be utilised better when pooled.

13
5 CONCLUSIONS - FURTHER RESEARCH

In this paper the frame of reference, the Port terminal and network theory has been
described and finally these two were combined into a network model of a Port
terminal. This way of describing a terminal is seen as very useful, and actually any
terminal or enterprise functioning in a similar way can be described. It has been
presented within the EUROBORDER project, and received positively by users in Port
terminals, since they are Port terminal planners and management that work with
planning and organisation of ports.

By using the network approach, which is a very common metaphor in the society
(Casti, 1995), our Port terminal model is easy to understand and useful as basis for
discussions. The network approach allows us to break down the model from the
aggregated level all the way down to the parameter level. This makes it very
transparent and it is easy to choose the level of abstraction or detail needed. The
model is flow-oriented which brings it close to reality. Yet, it is very useful from a
pure modelling view, as in e.g. programming, where it has been used in the
EUROBORDER project.

6 REFERENCES

Casti, J. (1995). The Theory of Networks. In: Networks in Action , (Batten D. Casti J.
and Thord R. Ed.) Springer-Verlag, Berlin

Churchman W.C. (1981). The Systems Approach. Dell Publishing Co. Inc., New York

Frankel E.G. (1987). Port Planning and Development. John Wiley & Sons, New York

IAHP. (1996). Future Role of Ports in Combined Transport (Hulthén. L. Ed.) IAHP
Head Office, Japan.

Manheim M.L. (1984). Fundamentals of Transportation Systems Analysis; Volume 1:


Basic Concepts, The MIT Press, Cambridge

Ojala L. (1992). Modelling approaches in port planning and analysis, Publications of


the Turkuu school of economics and business administration, Series A-4:1992,
Turkuu

Waidringer, J. & Lumsden, K. (1998), Simulation and optimisation of Port terminals,


using a network concept, presented, WCTR8, Antwerp

14
A. RESULTS FROM THE RAUMA CASE
This appendix is essentially a compilation of an internal report from the
EUROBORDER project. It is included as an extension of Paper III giving the results
from another of the cases run in the tool, the Rauma port terminal in Finland.
Unfortunately no more complete models were possible to test that extensively in the
project and the others will therefore be excluded. All figures are authentic and the
simulations are verified against real data for the current, unchanged, scenario. Two
cases have been run for the current and future scenarios. The figures used, the actual
screen shots from the tool and the cases are described below.

The results given here are from a series of runs of the tool with the terminal of Rauma
as the actual case. Two cases have been run for the current and future scenarios. The
figures used, the actual screen shots from the tool and the cases are described and
presented below. The Rauma terminal is shown in Figure 1 below, with the nodes and
links constructing the port terminal network. The model of the Rauma terminal has
been properly adjusted. There are, for example, more storage areas and more links in
the real case, but the idea was to have one entire part of terminal for simulation. The
reason for this, as already mentioned in the Ormsund case, is that the tool is supposed
to be used on an aggregated level for tactic and strategic decisions in the port
terminal. Therefore the models should not be too detailed, instead the main flows and
categories should be modelled as accurately as possible.

1 Entrance
2 Check-in
3 Land transfer 1
4 Land transfer 2
5 Land transfer 3
6 Storing area 1
7 Storing area 2
8 Storing area 3
9 Sea transfer 1
10 Sea transfer 2
11 Sea transfer 3
12 Sea exit 1
13 Sea exit 2
14 Sea exit 3
15 Land exit
15

2
1
4 5
3
8
6 7

10 11
9

12 13 14

Figure 1 The Rauma terminal

1
The basic model for the current situation in the Rauma case looks like Figure 2 below,
when implemented in the NeuComb tool.

Figure 2 The Rauma terminal lay-out, current situation

The figure above shows the lay-out of the terminal, with the entrance at the right-hand
side, corresponding to the lay-out in Figure 2 above.

The landside distribution for the different cargo types in the current and future
situations are the same. Those are shown in table 1 below. The Rauma case is actually
the export case of paper rolls transported to the terminal by train (unit is in tons).
There are three different cargo types in the terminal. Each of those has their own
“line” for the cargo flow. There is also some import cargo, which has not been taken
into account in this case, since the amount of import is sufficiently less than the
export. The import and export cases also have different processes for handling cargo,
because of major differences in cargo type. It is, in other words, a highly imbalanced
cargo flow.

Table 1 The landside distributions for both scenarios

Current / Future
Time Exp_1 Exp_2
07-08 200 200
08-09 200 200
09-10 200 200
10-11 200 200
11-12 200 200
12-13 200
13-14 200

2
Storage area 1 has a capacity of 3500 paper tons and storage area 2 has a capacity of
4500 paper tons for the examined type of cargo. In the future case the capacity is
about 25 % of the current capacity, because of the different method for storing. Exp.-1
is export cargo at storage area 1 and so on. The initial cargo amounts in storing areas
1 and 2 are the same for both scenarios.

Exp.-1 Exp.-2
300 610

The seaside distribution for both scenarios is given in table 2 below. The first column
shows the ship’s arrival number, the next two columns show the arrival and departure
time of the ship, the columns for Exp. and Imp. show the amount of cargo of each
type that is supposed to be unloaded and loaded onto the ship, and the Quay column
shows the appropriate quay.

Table 2 The seaside distributions for both scenarios

Current / Future
Ship Arr. Dep. Exp1 Exp2 Imp Quay
1 07.30 10.30 1000 0 0 Exit 1
2 08.00 13.35 0 2010 0 Exit 2

The future pooled scenario model looks like Figure 3 below when implemented in the
NeuComb tool.

Figure 3 The Rauma terminal lay-out, future pooled cases

3
A.1 The cases run in the Rauma model

The test case in the Port of Rauma focuses on the reorganisation of methods for
exporting rolls of paper. Rolls of paper are generally easily damaged in cargo
handling. For this reason all unnecessary shifting in the terminal should be minimised.

There is one main difference between the current situation and the future scenario. In
the future scenario the paper rolls are stored and shipped in cassettes (used for
transportation inside the terminal) in order to avoid damage. This causes lack of
capacity in warehouses, because the rolls cannot be stored in high stacks.

The two models, the current and the future scenario, have been run in the tool with 2
cases in each model:

• Case 1, Reference scenario: No changes = the two cargo streams have their
own resources
• Case 2: Pooled resources = all internal resources are used for both cargo
streams

The reference scenario is the current situation with no changes to the resources or the
cargo. This means that there are external resources (railway cars) coming in with the
cargo; then the cargo is transferred to internal resources (cassettes with tug-masters).
The internal resources are dedicated to separate streams for each cargo and the cargo
is divided by the target country, England, Germany, etc.

Case 2 is a test of the possibility of using the internal resources (cassettes with tug-
masters) in the terminal, not depending on cargo streams. The intention is to make it
more efficient and less expensive to pool the resources in the terminal.

The pooling of resources only involves the internal resources (cassettes with tug-
masters). The users have regarded the future case as the most interesting case to
investigate in more detail. As a result case 2, with pooled internal resources, caused
queues in the system and queues occurred in the transfer (land) between train and
cassettes. Somehow the resources were not able to serve both streams 1 and 2
impartially. Stream 1 was more efficient (+34 % in loading time) in case 2 than it was
in case 1, but stream 2 was not (-44 %).

Some general comments on the current situation:

• In Case 2, the pooled resources case and in case 1, the reference case, the
efficiency of resources differs quite a lot
• Case 2, the pooled resources case, gives less efficient utilisation of resources
and also creates queues.
• There is one main bottleneck in the system, the land transfer, mostly because
of different type of transportation (volumes between terminal and rail
transportation are different)
• The efficiency without queues is identical between the two cases.

4
Future case - Efficiency

160
140
120
100
80
60
40
20
0
Reference Pooled resources

Figure 4 Efficiency figures for the future scenario


The reference case is set to 100 and the other case is compared to this case. In the
future case the efficiency is higher in the pooled case than in the reference case.

% Future case - Queues


25
20
15
10
5
0
Reference Pooled resources
Time in queues

Figure 5 Queues for the different cases in the future scenario


Some general comments on the future scenario:

• Case 2, the pooled resource case, gives better efficiency than not pooled, but
create more queues than the pooled
• The same main bottleneck remains in the system as in the current case, the
land transfer, mostly because the different types of transportation (volumes
between terminal and rail transportation are different)

In the future scenario the time in queues is a little less than in the current reference
case. This is mostly due to the different method of storing. The time for shifting cargo
decreases by changing method of storing. Also the differences between pooled and

5
not pooled cases are smaller in the future cases than in the current cases. The reason
for this is probably that the terminal processes are not so complicated as in the current
situation. In the future cases the cargo can be considered as a special load unit
(cassette).