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Nanyang Technological University, Singapore.
The role of ports in supply chain disruption

management
Loh, Hui Shan
2015
Loh, H. S. (2015). The role of ports in supply chain disruption management. Doctoral thesis,
Nanyang Technological University, Singapore.
https://hdl.handle.net/10356/65266
https://doi.org/10.32657/10356/65266
Downloaded on 09 Jun 2023 23:32:05 SGT

THE ROLE OF PORTS IN SUPPLY CHAIN DISRUPTION
MANAGEMENT
LOH HUI SHAN
SCHOOL OF CIVIL AND ENVIRONMENTAL ENGINEERING
2015
THE ROLE OF PORTS IN SUPPLY CHAIN DISRUPTION
MANAGEMENT
LOH HUI SHAN
SCHOOL OF CIVIL AND ENVIRONMENTAL ENGINEERING
A thesis submitted to the Nanyang Technological University

in partial fulfilment of the requirement for the degree of
Doctor of Philosophy
2015
ACKNOWLEDGEMENTS
I would like to express my gratitude towards my supervisor, Dr. Thai Van Vinh,
whose expertise and persistent guidance contributed considerably to my research
journey. Through his inexhaustible patience and kindness, I have found a sense of
purpose and his genuine care for all his students is at times all that kept me going. I
would also like to thank all anonymous reviewers for their valuable comments that
have helped to improve the quality of this research.
A very special thanks goes out to my friend, Lee Taehwee, without whose
unwavering support I would not have been able to ride out this research, particularly
during the data collection process. Sincere gratitude extends to Yuen Kum Fai who
was always there to help me and who never failed to offer constructive suggestions
and advice in times of critical need. I would also like to thank my friend, Melvin
Soong, whose encouragement and selfless assistance made the completion of the
research possible.
I must also thank my colleagues with whom I have fostered trusted friendships,
Xiaoyu, Elena, Guizhen, Zhang Wei and Beverly, for their support, exchanges of
knowledge and perspectives which have all enriched my research experience.
Thanks to all participants of this research and supportive friends; I owe each of
them a debt of gratitude.
I am also eternally grateful to my parents for all that they have sacrificed for me.
i
TABLE OF CONTENTS
ACKNOWLEDGEMENTS ........................................................................................ i
TABLE OF CONTENTS ........................................................................................... ii
ABSTRACT ............................................................................................................. vii
LIST OF TABLES .................................................................................................... ix
LIST OF FIGURES ................................................................................................. xii
LIST OF ABBREVIATIONS .................................................................................. xv
CHAPTER 1. INTRODUCTION .............................................................................. 1
1.1. Background ................................................................................................. 1
1.2. The Potential Impact of Ports on Supply Chains ........................................ 1
1.3. Research Questions ..................................................................................... 3
1.4. Research Purpose ........................................................................................ 4
1.5. Structure of the Thesis................................................................................. 6
CHAPTER 2. LITERATURE REVIEW ................................................................... 8
2.1. Introduction ..................................................................................................... 8
2.2. Supply Chain Disruption Management ........................................................... 8
2.2.1. Disruptions in Supply Chains ................................................................... 8
2.2.2. Strategies for Supply Chain Disruptions ................................................ 15
2.3. Ports as Part of Supply Chains ...................................................................... 23
2.3.1. The Changing Role of Ports ................................................................... 23
2.3.2. Integration of Ports With Supply Chains ................................................ 26
2.3.3. Challenges in Coordination and Integration ........................................... 29
2.3.4. Implications of Port’s Integration into Supply Chains ........................... 33
2.3.4.1. Multimodal Connectivity ................................................................. 37
ii
2.3.4.2. Integration Initiatives ....................................................................... 37
2.3.4.3. Value-Added Services ..................................................................... 37
2.3.4.4. Adaptability...................................................................................... 37
2.3.4.5. Efficiency ......................................................................................... 38
2.3.4.6. Information Exchange and Communication .................................... 38
2.3.4.7. Charges and Costs ............................................................................ 38
2.3.4.8. Diversification into Logistics Service Provision ............................. 39
2.3.4.9. Agility .............................................................................................. 39
2.3.4.10. Training of Port Workers ............................................................... 39
2.3.4.11. Port Networking ............................................................................. 40
2.3.4.12. Port Security................................................................................... 40
2.4. Port-related Drivers of Disruptions ............................................................... 41
2.4.1. Drivers from the Peripheral Environment .............................................. 45
2.4.2. Operational Drivers ................................................................................ 45
2.4.3. Human Factors ........................................................................................ 46
2.5. Strategies for Port-Related Disruptions......................................................... 48
2.5.1. Disruption Prevention Mechanisms........................................................ 48
2.5.2. Disruption Mitigation Mechanisms ........................................................ 50
2.5.3. Contemporary Concepts as Disruption Mitigation Strategies ................ 52
2.6. Literature Gaps .............................................................................................. 57
CHAPTER 3. THEORETICAL CORNERSTONES OF THE RESEARCH MODEL

.................................................................................................................................. 59
3.1. Introduction ................................................................................................... 59
3.2. Development of PSCD Threats ..................................................................... 59
3.3. PSCD Indicators ............................................................................................ 62
3.4. Development of the Management Model for PSCD Threats (PDM) ............ 67
iii
3.5. Components of the Proposed Management Model ....................................... 68
3.5.1. PSCD Threats Defense Mechanisms ...................................................... 70
3.5.2. Discrete PSCD Deviators ....................................................................... 71
3.5.3. Collaborative PSCD Defense and Deviators .......................................... 72
3.5.4. Port’s Holism Towards PSCD Reduction .............................................. 73
3.5.5. Monitor and Review of PSCD Management Process ............................. 74
CHAPTER 4. RESEARCH METHODOLOGY ..................................................... 75
4.1. Introduction ................................................................................................... 75
4.2. Research Process ........................................................................................... 75
4.3. Research Design ............................................................................................ 77
4.4. Research Approach ....................................................................................... 81
4.5. Research Hypotheses Development .............................................................. 85
4.6. Population and Sampling .............................................................................. 91
4.6.1. Population Frame .................................................................................... 92
4.6.2. Sampling Frame ...................................................................................... 94
4.7. Primary Data Collection ................................................................................ 97
4.7.1. In-depth Interviews ................................................................................. 97
4.7.2. Objectives of Survey ............................................................................ 100
4.7.3. Design of Questionnaire ....................................................................... 101
4.7.4. Pre-testing of Questionnaire ................................................................. 106
4.7.5. Administration of Questionnaire Distribution ...................................... 108
4.7.6. Data Preparation ................................................................................... 111
4.8. Statistical Analysis ...................................................................................... 113
4.9. Error Control Measures ............................................................................... 113
4.10. Summary ................................................................................................... 115
iv
CHAPTER 5. RESULTS – PERCEPTION OF PSCD THREATS AND
CONSEQUENCES ................................................................................................ 116
5.1. Demographics of Respondents .................................................................... 116
5.2. Results ......................................................................................................... 125
5.2.1. Descriptive Statistics ............................................................................ 125
5.2.2. Risk Scores ........................................................................................... 129
5.2.3. Risk Matrices ........................................................................................ 136
5.3. Discussion of Results .................................................................................. 143
5.3.1. The role of ports in supply chain disruptions ....................................... 143
5.3.2. Factors affecting occurrences of PSCD threats .................................... 145
CHAPTER 6. RESULTS – MANAGEMENT MODEL ....................................... 150
6.1. Demographics of Respondents .................................................................... 150
6.2. Results ......................................................................................................... 156
6.2.1. Descriptive Statistics ............................................................................ 156
6.2.2. Use of Item Parceling ........................................................................... 158
6.2.3. Measurement Model Fit........................................................................ 159
6.2.4. Reliability and Validity of Measurement Model .................................. 164
6.2.5. Model Comparison ............................................................................... 169
6.2.6. The Structural Model ............................................................................ 170
6.2.7. Testing of Hypotheses .......................................................................... 171
6.3. Discussion of Results .................................................................................. 174
6.3.1. Findings from Hypothesis Testing ....................................................... 174
6.3.2. Implementation of the management model .......................................... 175
CHAPTER 7. CONCLUSION............................................................................... 182
7.1. Summary of Results .................................................................................... 182
7.2. Academic Implications ................................................................................ 184
v
7.3. Managerial Implications .............................................................................. 185
7.4. Research Limitations and Future Research Directions ............................... 187
REFERENCES ...................................................................................................... 189
APPENDICES ....................................................................................................... 199
Appendix A: Interview Questionnaire for Port Users ........................................ 199
Appendix B: Interview Questionnaire for Port Operators ................................. 200
Appendix C: Cover Letter for Port Users........................................................... 201
Appendix D: Cover Letter for Port Operators and Authorities .......................... 202
Appendix E: Questionnaire for Port Users ......................................................... 203
Appendix F: Questionnaire for Port Operators and Authorities ........................ 205
Appendix G: Feedback Form Used in Pre-testing ............................................. 210
Appendix H: Reminder Letter Sent to Port Users .............................................. 211
Appendix I: Reminder Letter Sent to Port Operators and Authorities ............... 212
Appendix J: Numerical Simulation .................................................................... 213
J.1. Introduction .............................................................................................. 213
J.2. Background of Singapore Plastic Manufacturer (SPM) .......................... 213
J.3. The SPM Supply Chain............................................................................ 215
J.4. Simulation ................................................................................................ 219
vi
ABSTRACT
The function of a port has evolved from a platform providing simple loading and
unloading activities to a gateway that opens up numerous opportunities that
proliferate economic benefits. Despite recognising the fact that ports have increased
their significance in supply chains, little is known about the deficiencies in port
operations or events originating from ports that threaten supply chain continuity.
Addressing the vulnerability of ports helps to ensure ports’ functionality and
enhance supply chain resilience. This calls for contemporary studies on supply
chain management to address the management of supply chain disruptions that
originate from port operations. Therefore, this study has two main purposes: to
study the magnitude of port-related supply chain disruption (PSCD) threats; and to
examine the application of a management model which could minimize the
disruptive potential of ports on supply chains.
This research has identified PSCD threats and synthesized the current literature into
a management model that seeks to target operational deficiencies at ports. The
management model is operationalized in three tiers, from the top management level
to the front-line employees, with characteristics from risk management, business
continuity management and quality management theories. The management model
serves as a universal guide in assisting port management in managing port-related
disruptions and seeks to reduce the occurrences of PSCD threats.
In-depth interviews have been conducted with senior managers from port operators
and port users’ entities to preliminarily substantiate the 19 identified disruptive
port-related events and management model. Through the interviews with the
management of industry players, the factors affecting the occcurrences of the PSCD
threats as well as the implementation of the management model were analyzed.
Subsequently, two surveys were conducted. The first survey collected primary data
vii
from port users, port operators and port authorities on the frequencies and
consequences of PSCD threats. The purpose of the second survey was to gather
primary data from port operators and port authorities to provide empirical evidence
of the effects of the mangement model on port performance. From the first survey,
risk matrices were generated to compare the perspectives of port operators and port
users. Data collected from the second survey was analyzed using structural equation
modeling (SEM) with AMOS 22.0.
The main conclusions of this research are that threats which require a higher level
of attention are those related to the planning of port resources while threats that
require a lower level of attention are those related to port security. The SEM results
indicate that managing PSCD using the proposed model contributes positively to
the identification of internal and external opportunities and, through that, to port’s
resilience of internal operations. This, in turn, positively influences the port’s
financial health and market reputation. This research fills the literature gaps by
providing a risk assessment of port-related threats that have adverse effects on
supply chain continuity from the perspectives of port operators and port users. Its
findings highlight the areas that port management should focus on as well as the
measures of managing PSCD holistically through strategic internal and external
collaborative efforts.
viii
LIST OF TABLES
Table 1.1: Results of West Coast Port Strike’s Impact Assessment Survey ............. 2
Table 2.1: Global Sourcing Amplifiers of Disruptions ............................................ 10
Table 2.2: Causes of Failure Modes in a Supply Chain ........................................... 12
Table 2.3: Different Types of Supply Chain Disruption Categorization ................. 14
Table 2.4: Supply Chain Disruptions Response Strategies ...................................... 19
Table 2.5: Challenges of Coordination and Integration ........................................... 30
Table 2.6: Evolved Area of Research on the Port’s Role in Supply Chains ............ 35
Table 2.7: Port-Related Disruption Examples ......................................................... 43
Table 2.8: Related Theoretical Approach Reflected in Research ............................ 56
Table 3.1: PSCD Threats ......................................................................................... 61
Table 3.2: PSCD Indicators for Infrastructure Threats ............................................ 63
Table 3.3: PSCD Indicators for Planning Threats ................................................... 64
Table 3.4: PSCD Indicators for Manpower Threats ................................................ 64
Table 3.5: PSCD Indicators for Security Threats .................................................... 65
Table 4.1: Quantitative versus Qualitative Research ............................................... 82
Table 4.2: Examples of What can be Observed ....................................................... 84
Table 4.3: Relationship between The Three Theories and Measurement Items ...... 86
Table 4.4: Relationship between Balanced Scorecard Constructs and Measurement

Items ......................................................................................................................... 87
Table 4.5: Participants of In-depth Interviews ......................................................... 99
Table 5.1: Response Rates for Both Samples ........................................................ 116
Table 5.2: Demographics of Port Operators for Risk Matrix ................................ 122
Table 5.3: Demographics of Port Users for Risk Matrix ....................................... 123
ix
Table 5.4: Demographics of all Respondents for Risk Matrix .............................. 124
Table 5.5: Scores Assigned to PSCD Threats Categories ...................................... 127
Table 5.6: Scores Assigned to PSCD Categories by Different Types of Ports...... 128
Table 5.7: Scores Assigned to PSCD Categories by Different Types of Ports Users
................................................................................................................................ 129
Table 5.8: Scores Assigned to Each PSCD Threats by the Different Groups of
Respondents ........................................................................................................... 131
Table 5.9: Scores Assigned to Each PSCD Threats by the Different Types of Port
Operators ................................................................................................................ 132
Table 5.10: Scores Assigned to Each PSCD Threats by the Different Types of Port
Users ...................................................................................................................... 133
Table 5.11: Descriptive Statistics for Both Groups for Likelihood Scores ........... 134
Table 5.12: T-test for Equality of Means for Likelihood Scores ........................... 134
Table 5.13: Descriptive Statistics of Both Groups for Consequence Scores ......... 135
Table 5.14: T-test for Equality of Means for Consequence Scores ....................... 135
Table 5.15: Summary of Mean and Risk Scores – Individual PSCD Threats ....... 142
Table 6.1: Number of Completed Questionnaires Received and Used ................. 150
Table 6.2: Demographics of Respondents for Management Model ...................... 152
Table 6.3: Descriptive Statistics of Functional Area and Designation on Scores

Assigned to Management and Port Performance Sections .................................... 153
Table 6.4: ANOVA test on the Functional Area and Designation ........................ 154
Table 6.5: Descriptive Statistics for Involvement in Disruption Management Group

................................................................................................................................ 154
Table 6.6: T-test for Equality of Means for Respondent’s Involvement in Disruption
Management Group ............................................................................................... 155
Table 6.7: Descriptive Statistics of Scores Assigned to Management and Port

Performance Measures ........................................................................................... 157
Table 6.8: Comparison of Fit Indices .................................................................... 163
x
Table 6.9: Standardized Loadings Estimates, Average Variance Extracted and
Reliability Estimates of Measurement Model ........................................................ 165
Table 6.10: Chi-square test difference ................................................................... 167
Table 6.11: Covariances Table of Measurement Model ........................................ 168
Table 6.12: Correlations Table of Measurement Model ........................................ 169
Table 6.13: Correlation Matrix of Measurement Model ........................................ 169
Table 6.14: Standardized Residuals Covariances of Theoretical Model ............... 173
Table 6.15: Standardized Direct and Indirect Effects between Latent Constructs 173
Table 6.16: Estimates of structural model ............................................................. 174
Table J.1: Costs Involved in Simulation ................................................................ 221
Table J.2: Summary of Costs ................................................................................. 228
Table J.3: Warehousing Costs for Case 2 .............................................................. 229
xi
LIST OF FIGURES
Figure 1.1: Structure of Thesis................................................................................... 7
Figure 2.1: Risk Reduction Mechanisms ................................................................. 21
Figure 2.2: The Role of Ports in International Supply Chains ................................. 25
Figure 2.3: Modal and Temporal Separation at Freight Transport Terminals ......... 27
Figure 2.4: Elements of Evolution into the Future Ports ......................................... 33
Figure 2.5: Trends in Supply Chain Management ................................................... 34
Figure 2.6: Relationship Between the Port-related Drivers of Disruptions ............. 47
Figure 2.7: Strategies for Different Types of Port-related Drivers of Disruptions .. 54
Figure 3.1: Development of PSCD Threats and Indicators ..................................... 60
Figure 3.2 Application of Theories to the Management Model............................... 69
Figure 3.3: Overview of the Management Model .................................................... 70
Figure 4.1: Research Overview................................................................................ 77
Figure 4.2: Classification of Research Designs ....................................................... 78
Figure 4.3: Research Design of Study ..................................................................... 79
Figure 4.4: Theoretical model .................................................................................. 91
Figure 4.5: Target Population .................................................................................. 94
Figure 4.6: Sampling Frame .................................................................................... 96
Figure 4.7: The Translation Process ...................................................................... 105
Figure 5.1: Proportion of Respondents from Each Sample ................................... 117
Figure 5.2: Types of Cargo Handled by Respondents who are Port Managers from
Port Operators and Port Authorities ....................................................................... 118
Figure 5.3: Types of Port Users ............................................................................. 119
Figure 5.4: Locations of Headquarters of Port Users ............................................ 119
xii
Figure 5.5: Proportion of Port Users who Conduct Disruption Management ....... 120
Figure 5.6: Proportion of Port Users who Conduct Disruption Management Jointly
with Ports ............................................................................................................... 120
Figure 5.7: Risk Matrix Based on Responses Collected from Port Operators....... 136
Figure 5.8: Risk Matrix Based on Responses Collected from Port Users ............. 137
Figure 5.9: Risk Matrix Based on Responses Collected from Port Operators and
Users ...................................................................................................................... 137
Figure 5.10: Risk Matrix Based on Responses Collected from Ports that Handle
Only Containers ..................................................................................................... 138
Figure 5.11: Risk Matrix Based on Responses Collected from Ports that do not
Handle Containers .................................................................................................. 139
Containers and Other Types of Cargo ................................................................... 139
Figure 5.13: Risk Matrix Based on Responses Collected from Port Users who are
Shipping Lines, Ship Owners or Ship Management Companies ........................... 140
Non-vessel-related Organizations .......................................................................... 141
Figure 6.1: Respondent’s Involvement in Disruption Management at Respective

Ports ....................................................................................................................... 151
Figure 6.2: The Measurement Model – M1 ........................................................... 161
Figure 6.3: Theoretical Model of Research – M2 .................................................. 161
Figure 6.4: Alternative Model – M3 ...................................................................... 161
Figure 6.7: Path coefficients of structural model ................................................... 172
Figure 7.1: Summary of findings ........................................................................... 182
Figure J.1: Order Fulfilment Process at SPM ........................................................ 216
Figure J.2: SPM Supply Chain............................................................................... 217
xiii
Figure J.3: Flow of Materials from Suppliers to Consumers ................................. 218
Figure J.4: Processes that Incur Costs.................................................................... 222
Figure J.5: Total Costs of Each Case ..................................................................... 225
Figure J.6: Warehousing Costs of Each Case ........................................................ 226
Figure J.7: Transportation Costs of Each Case ...................................................... 226
xiv
LIST OF ABBREVIATIONS
PSCD Port-related Supply Chain Disruption
RQs Research Questions
SRQs Sub Research Questions
PDM Management Model for PSCD Threats
C-TPAT Customs-Trade Partnership Against Terrorism
DHS US Department of Homeland Security
MTSA US Maritime Transportation Security Act
DA_NET Disruption Analysis Network
TSCD Transshipment, Storage, Collection and Distribution of freight
VMT Vehicle-miles Travelled
RM Risk Management
BCM Business Continuity Management
QM Quality Management
TQM Total Quality Management
FH Financial Health
MR Market Reputation
RIO Resilience of Internal Operations
IEO Internal and external opportunities
IAPH International Association of Ports and Harbors
AAPA American Association of Port Authorities
APP Association of Pacific Ports
xv
PMAESA Port Management Association of Eastern and Southern Africa
SLA Singapore Logistics Association
SSA Singapore Shipping Association
ISPS code International Ship and Port Facility Security code
CSI Container Security Initiative
C-TPAT 24-Hour Advance Manifest Rule, Customer-Trade Partnership

Against Terrorism
AEO Authorized Economic Operator of the World Customs Organization
SEM Structural Equation Modeling
CFA Confirmatory Factor Analysis
RMR Root Mean Square Residual
SRMR Standardized Root Mean Square Residual
TLI Tucker-Lewis Index
IFI Bollen’s Incremental Fit Index
CFI Comparative Fit Index
RMSEA Root Mean Square Error of Approximation
PNFI Parsimony Normed-Fit Index
AVE Average Variance Extracted
SPM Singapore Plastic Manufacturer
xvi
CHAPTER 1. INTRODUCTION
1.1. Background
In global supply chains, seaports are critical transport nodes where value adding and
logistics-related activities take place. However, as processes and operations in the
ports increase in their complexities and range, the integration of ports into supply
chain management creates a higher level of uncertainties for downstream planning
product movement as well as information exchange. For that reason, deficiencies in
the ports are capable of developing into augmented unsought effects in supply
chains and these deficiencies can arise from operational inefficiencies, demand and
supply imbalances and miscommunication between dyadic contracting parties.
Especially since disruptions in current supply chain settings are already seeing
adverse effects on most companies’ profitability and reliability (Blanchard, 2006),
ports should initiate a facilitating role in maintaining the efficient and effective
management of product and information flow throughout the supply chains. Among
the various causes of supply chain disruptions, deficiencies at the ports need to be
defined as they are capable of disrupting webs of supply chains. To make matters
worse, supply chain trends and practices increase the likelihood of a disruption
occurring and exacerbate the effects of disruptions (Handfield et al., 2007,
Kleindorfer and Saad, 2005). Hence, the potentiality of ports to administer seamless
services, operations and transfer of cargo is obviously very much aspired by port
users.
1.2. The Potential Impact of Ports on Supply Chains
The evolution of ports has witnessed the ports’ increasing integration into global
supply chains and the increasing assimilation and amalgamation of ports into supply
chains (Pettit and Beresford, 2009) has amplified the potential of ports in supply
chain disruptions. In 2011, the Great East Japan earthquake crippled Japanese
north-eastern ports and caused damage to port facilities, warehouses and factories in
the port areas, and has also affected many worldwide industries (Takahashi et al.,
2011, Jolly, 2011). Not only were containers scattered or destroyed, port operations
at six major ports could not resume for months while the equipment underwent
1
repairs. The shutdown of Sendai-Shiogama port proved to be difficult for even the
big players in the electronics industry (Jolly, 2011). One of those affected is Sony
which, in particular, subsequently reported a 10% decrease of sales on a year-on-
year comparison partly due to the negative effects of the earthquake (Sony Global,
2011). Even though this paper will not explore natural catastrophe, since it does not
originate from ports and neither is it part of port operations, this real world example
illustrates the impact a malfunctioned port can have on the industries.
An instance of port-related cause of supply chain disruptions is the West Coast port
strike in 2002. To assess the impact of the strike, Institute for Supply Management
(ISM) conducted a survey involving 1,500 purchasing and supply management
personnel (Institute for Supply Management, 2002) and the survey results are
shown in Table 1.1. With almost half of all the respondents’ supply chain activities
being disrupted due to the port’s shutdown, the results suggest evidence of ports
playing a potentially significant role in disrupting supply chain activities.
Furthermore, 21% of the respondents indicated that their businesses suffered huge
expenses and another 20% suffered modest expenses when alternatives were used in
response to the shutdown of West Coast.
Table 1.1: Results of West Coast Port Strike’s Impact Assessment Survey
Effect on Normal Supply Chain Activity % of Respondents

Harmed 41
No Impact 57
Benefitted ≤2
Source: Institute for Supply Management (2002)
An existing network may be mature enough to stabilize itself in events of

disruptions and shocks, but this may not be the case in every network and this has
been evidenced in the aforementioned examples. There is also a likelihood that
2
some smaller firms, though positioned in a stabilized network, may still have to be
sacrificed as they may not have the adequate power or resources to overcome the
crisis. While it is undeniable that not all disruptive events in the ports are capable of
upsetting the rest of a supply chain as the existing supply chain network may be
adequately competent to attenuate the disruptive impact stemmed from the ports,
the intention of preventing such a situation reduces frustration for parties whose
cargo are lodged in the delays or in complete port closures, and also avoids chaos in
the anticipation of thwarting of plans.
Yet, since the introduction of containerization, the focus of research within the
maritime industry revolved around improving internal operational efficiencies
which does not reflect the actuality of port’s integration with its peripherals. A
handful of research studying the relationship and coordination of ports with its
community (Notteboom, 2008, Van Der Horst and De Langen, 2008) is starting to
appear.
1.3. Research Questions
In general, the objectives of this research are: (1) to perform an analysis of port-
related supply chain disruption (PSCD) threats immanent in a port and (2) to design
measures to contain and reduce PSCD consequences. PSCD threats are defined as
operational risks inherent in port processes that are capable of disrupting the
continuity of upstream and/or downstream supply chains. Hence, natural disasters
and weather conditions that also result in disruptions are not in the scope of this
research. The research questions (RQs) and sub research questions (SRQs) are as
follows:
RQ1: How is the role of ports in inducing supply chain disruptions determined?
SRQ1: What are the implications of ports increasingly being integrated into
supply chains?
3
SRQ2: What are the most commonly observed and perceived PSCD threats
and consequences?
SRQ3: How severe are the PSCD consequences?
SRQ4: How can PSCD threats be detected?
RQ2: How can ports mitigate port-related supply chain disruptions effectively?
SRQ5: What are the mechanisms which the port should initiate to minimize
port-related supply chain disruptions?
SRQ6: How should a holistic approach towards PSCD management be

operationalized by the participants involved in port transport chains?
1.4. Research Purpose
There are two main objectives of this research: (1) to map out the risk profiles of
PSCD threats and (2) to develop a management model for PSCD threats,
abbreviated as “PDM”.
PSCD threats that affect supply chain continuity will be studied from the
perspective of port operators and port users. The purpose of this is to ensure that the
risk assessment reflects a more realistic and prudent view. As port users are directly
affected by port disruptions, depending on the severities of the disruptions, their
evaluation of the threats offers a valuable analysis of the extent that these threats
pose to the supply chains. Therefore, this study aims to study the magnitude of
PSCD threats on supply chain disruptions through examining the frequency and
consequence of these threats.
4
This research also seeks to address the research questions by way of a management
model that reflects a holistic management approach for port management to
implement. While there have been several studies exploring risks in port operations,
there has been no studies addressing a full set of operational risks from a holistic
perspective, especially in connection with supply chain disruptions. Since the
introduction of containerization, the focus of research within the maritime industry
revolved around improving internal operational efficiencies which does not reflect
the actuality of port’s integration with its peripherals. Elaborate research on general
supply chain disruption strategies emerged only in recent years, while studies on
port disruption strategies concentrate on discrete disruption causes. These
collectively epitomize the paucity of a port-wide holistic approach towards the
management of port-related supply chain disruptions. The implementation of the
management model aims to ensure supply chain resilience with the application of
risk management, business continuity management and quality management
principles.
The discussion of ports encompasses those that handle containers and non-
containerized cargo such as vehicles, liquid and dry bulk. Passenger ports will not
be analyzed as the research scope covers only the dire effects on cargo. The
applicability of the proposed management model is confined neither to cargo
handling types, nor to certain regions, nor to stages of maturity in its development.
The generic relevance of the model renders a concrete basis for future studies that
are expected to more specifically address the differences in port characteristics with
regards to the resulted outcomes of the management model.
Hence, this research contributes to the development of a resilient port and supply
chain continuity through describing the factors affecting the occurrences of PSCD
threats and issues to consider in the implementation of the model. Collectively, the
effects are reduced frequencies of PSCD threats, avoided and/or mitigated dire
consequences as well as increased port resilience.
5
1.5. Structure of the Thesis
This opening chapter has provided the contextual background to this research and
underlined the reasons for minimizing the supply chain disruption potential of ports
through exploring the inherent PSCD threats. In this introductory chapter, the two
objectives of this research are identified, namely the risk profiles of PSCD threats
and the development of an effective PDM. Chapter 2 reviews selected literature
which is organized into two main portions covering past studies related to supply
chain disruption risk management and the changing role of ports as part of supply
chains. Chapter 3 explains the conceptual framework in the identification of PSCD
threats and the development of PDM. Chapter 4 describes the methodology
employed by explaining the research process and approach, population and
sampling frame and survey design. Chapter 5 and 6 discuss the results of the risk
profiles of PSCD threats (RQ1) and management model (RQ2) respectively. The
thesis ends with Chapter 7 which summarizes the results, discusses the academic
and managerial implications of this research and identifies research limitations as
well as areas for future research possibilities. Figure 1.1 shows an overview of the
structure of this thesis.
6
Figure 1.1: Structure of Thesis
Source: Author
7
CHAPTER 2. LITERATURE REVIEW
2.1. Introduction
This chapter investigates past research which explored supply chain disruption
management, port risks and mechanisms addressing port disruptions. To provide a
relevant and generic perspective, the essential features of supply chain disruptions
and strategies to minimize or avoid supply chain disruptions will be reviewed first.
Next, in order to ascertain the implication of a port’s integration into supply chains,
the evolved role of a port needs to be established by way of addressing the changing
role of ports in global supply chains and the integration of ports with supply chains.
These will be followed by a review of commonly discussed operational port risks
and corrective actions as these will shed some light on the requirements of a well-
performing port. By considering the generic disruptions and strategies together with
the parameters local to the port environment, a variety of PSCD threats and
respective plan of actions can then be ameliorated.
2.2. Supply Chain Disruption Management
The recent rise in the number of calamities and terrorist acts has brought much
attention to the vulnerabilities of supply chains. Having passed through many hands
that span continents and cultures, the reliability and timeliness of freight delivery
becomes increasingly difficult to be assessed. With a growing interest in
minimizing supply chain risks, research in risk analysis of supply chains has been
on the rise.
2.2.1. Disruptions in Supply Chains
Natural and man-made disruptions may induce undesired effects across the supply
chains entailing an aggregated network of interconnected organisations. Supply
chain disruptions frequently studied include the inability of transporting goods and
8
services to the end customer on time and/or in the right condition and the complete
failure to move goods and services across to the end customers.
The effectiveness of integrated transportation entails the reliable movement of the

right items in accurate amounts to the intended destination in good conditions
(Morash and Clinton, 1997). As such, the impact that transportation capabilities can
have on the effectiveness of supply chains cannot be underrated. The effects
transportation capabilities have on supply chain operations are echoed in Stecke and
Kumar (2009), who, like Morash and Clinton (1997), also considered both internal
and external aspects of supply chains. Two of the factors inducing vulnerabilities
identified by Stecke and Kumar (2009) pertain to transportation capabilities and
they are the number of exposure points and increase in distance or time. Primarily,
there are six basic failure modes in performance within a supply chain (Sheffi et al.,
2003) and these are (a) disruptions at facilities, (b) disruptions in supply, (c)
disruptions in transportation, (d) disruptions in communications, (e) disruptions in
demand as well as (f) freight breaches. Port disruptions specifically belong to
disruptions at facilities and are thus a category of supply chain failures as they are
capable of contributing to supply chain disruptions.
Generally, deviations and disruptions can occur at the strategic, tactical and
operational stages of planning, with variables during transportation or transhipment
of goods conjointly acknowledged as possible forms of disruptions (Gaonkar and
Viswanadham, 2004). Fundamental differences in business models of supply chain
entities are likely to put a strain on the chain, making it more inclined to be
disintegrated (Robinson, 2007), which can escalate into supply chain disruptions.
The severity of these disruptions are likely to be attributed to factors such as density,
complexity and node criticality of the supply chains (Craighead et al., 2007), while
the varying degrees of supply chain failure impact is normally a consequence of
weaknesses in different supply chain practices (Stecke and Kumar, 2009). At the
same time, there are supply chain parameters which can increase the likelihood of a
9
disruption occuring (Handfield et al., 2007) and these amplifiers are stated in Table
2.1. Several of the parameters in Table 2.1 are commonly reported bottlenecks at
ports as shown in Section 2.4 and this reiterates ports’ contribution to supply chain
disruptions. For instance, the instability of workforce, scarcity of qualified labour,
poor communication, channel overload, strain on port infrastructure and lack of
visibility of entire system are applicable to a port and are possible PSCD threats.
Table 2.1: Global Sourcing Amplifiers of Disruptions
Supply Chain Parameters Port-related

1 Instability of supplier’s environment
2 Number of brokers
3 Length of lead-time
4 Concentration or clustering of suppliers
5 Scarcity of qualified labor 
6 Instability of workforce 
7 Degree of customs regulations
8 Level of specialization of storage requirements
9 Level of security requirements
10 Level of demand for product (volume and variability)
11 Level of legislative actions related to importing/exporting
12 Poor communication 
13 Level of regional/country political instability
14 Number of transfer points
15 Lack of vessel capacity and channel overload 
16 Strain on port infrastructure 
17 Potential for terrorism 
18 Level of natural disasters 
19 Lack of visibility of entire system/supply chain 
Source: Author, adapted from Handfield et al. (2007)
10
On a same note, Netherlands Organisation for Applied Scientific Research has
identified causes for each failure mode in supply chains (INTEGRITY and
SMART-CM, 2008) as shown in Table 2.2. These modes are equally pertinent in
the port environment. In this manner, the supply of stevedores and port workers,
transportation of cargo through the port, deliverability of port service,
communication network and infrastructure, and human resource issues regarding
staff well-being and employment satisfaction, are rudiments where the list of PSCD
threats can be expanded from.
There are qualitative and quantitative ways of determining impacts of risks. Impacts
can be analyzed qualitatively using tools such as scenario building, likelihood-
impact matrix, attribute analysis and Delphi forecasting while quantitative
techniques include principles of probability, simulation and probability distributions
(Frame, 2003). The qualitative and quantitative tools help determine the likely
consequences with the occurrence of each risk when there is sufficient historical
data for accurate analysis and when the management is seasoned in its business and
disruption management.
While the qualitative tools offer opportunities to examine routine processes and
operations from novel and creative perspectives (Frame, 2003), the consequences
concluded would require categorization such that it would be clear which specific
corresponding risks should be eliminated, avoided or reduced. It is not to say that
qualitative techniques in impact analysis are less relevant as qualitative and
quantitative tools address different aspects ultimately. Frame (2003) explained that
good judgment and experiences would be essential to increase the accuracy of
qualitative analysis of the impacts and these insights would be hampered when the
individuals involved are constrained by the quantitative requirements.
11
Table 2.2: Causes of Failure Modes in a Supply Chain
Failure Modes Port-related

Causes of Disruption in Supply:
Sabotage of raw material inputs (e.g. food industry)
Customs control delays
Fire, explosion or natural disaster at plant of a supplier
Blocked main transport infrastructure nodes 
Supply disruption because of bad product quality and unclear product origin
Strikes 
Theft of goods at supplier DC, or at infrastructure node 
Supply disruption due to manipulated/destroyed information systems 
Causes of Disruption in Transport:
Theft of trucks or cargo from trucks during transportation 
On purpose manipulation of goods during transportation 
Physical blocking of transportation (borders, road/rail blockage, etc.) 
Sabotage of transport equipment / vehicles 
Bombing or other planned destruction of vehicle, train, plane, etc. 
Weather or other natural events causing delays 
Smuggling of illegal goods together with normal freight flows 
Manipulation of goods during transport (e.g. cold chain disruption) 
Causes of Disruption in production (internal):
Bombing or other planned destruction of production facility
Sabotage of production equipment
Fire or other natural disaster at plant
Energy supply shortage
Theft of goods from production plant
Production disruption due to manipulated/destroyed information systems
Causes of Disruption in communication:
Systems failure of ERP, WMS, TMS, etc. systems 
Cyber-attack aiming at theft or manipulation of data 
Cyber-attack aiming at destruction of system 
Causes of Disruption in human resource:
Strikes 
Direct attack at personnel at a facility 
Personnel suffering from attack or disaster in a region (e.g. SARS) 
Source: Author, adapted from INTEGRITY and SMART-CM (2008)
12
Disruptions are generally categorized according to their financial losses, disruption
causes, levels of supply chain entities affected, whether the external market is
affected and the duration of the disruption (Macdonald, 2008). A common way of
segregating disruptions according to their severity is through the impact of the
disruption in terms of dollars and cents (Waters, 2007). As can be seen, in
identifying the types of supply chain disruptions, a typical way is segregation by the
severity of the disruptions. However, the drawbacks are that not all consequences
are quantifiable and a monetary range of consequence may be severe for a small
enterprise but meagre for a large organization. Another problem encountered in the
process of disruption quantification is that the consequences are usually perceived
differently in different organizations (Waters, 2007).
Severity of the consequences can also be reflected through the length of time
required before equilibrium is restored. Following this principle, the broad types of
supply chain disruptions that Gaonkar and Viswanadham (2004) observed are
deviation, disruption and disaster, each reflecting the nature of the supply chain
uncertainty and are then quantified to determine the cost of each impact. Applying
these three types of disruptions to the various nodes of supply, transportation,
demand, facilities and communications would render delays and failure of
deliverability in them. Similarly, a subsequent study on maritime transportation
system by Berle et al. (2011) examines disruptions in the form of loss of supplies,
interruption of own internal operations, sudden drop in customer demands,
communication failure with external parties, inability to deliver product, running
out of cash and unavailability of own people. Berle et al. (2011) then grouped these
disruptions according to their frequency determined from surveys. Gurning et al.
(2011) categorized the types of disruptions into delay, deviation, stoppage and the
loss of service platform. A summary of the different types of supply chain
disruption categorizations is presented in Table 2.3. The presentation of disruptions
is determined to a great extent by the objective of the study, intended depth of the
study, scope of the study and available data. Thus, it is not possible to list all
13
possible supply chain disruptions as they tend to be industry and organization-
specific.
Table 2.3: Different Types of Supply Chain Disruption Categorization
Categorization of the Types of

Supply Chain Disruptions Discussed Studies
- Financial Losses
- Disruption Causes
- Echelons of Supply Chains Affected Macdonald (2008)
- Association with External Environment
Change
- Duration of Disruptions
- Financial Losses Waters (2007)
- Deviation, disruption or disaster Gaonkar and Viswanadham (2004)
- Frequency of Disruption Occurrences

Berle et al. (2011)
- Losses, interruption or unavailability
- Delay, deviation, stoppage or loss of

Gurning et al. (2011)
service platform
Source: Author, synthesized from various literature
Section 2.2.1 has characterised supply chain disruptions and provided the essence in
defining PSCD threats in the supply chain context. Section 2.2.2 investigates
strategies for these supply chain disruptions. The identification of supply chain
disruptions causes and corrective actions would be able to shed some light on the
requirements of a well-performing port as well as applicable strategies which ports
can administer due to the port’s enmeshment in global supply chains.
14
2.2.2. Strategies for Supply Chain Disruptions
As supply chain disruptions may give rise to undesirable economic aftermath, many
scholars are prompted to explore various methods of coping with uncertainties in
the current supply chain environment. As catastrophic world events heighten
awareness of supply chain uncertainties in recent years, numerous studies have
identified various mitigating and contingency strategies to minimise risks in global
supply chains.
Risk analysis in supply chain disruption management observes two dimensions of

strategies: reducing the prevalence and severity of risks, and increasing the chain’s
ability to sustain risks (Kleindorfer and Saad, 2005). The minimisation of supply
chain risks requires effective and sustainable partnerships from which the parties
can derive benefits (Kleindorfer and Saad, 2005). This is in line with the idea that
supply chain firms should no longer compete individually; the firms need to
understand the importance of establishing strong alliances with each other, while
not losing focus on enhancing performance at both local and aggregate levels
(Green et al., 2006). However, the fundamental characteristics of an organisation
should be incorporated in the selection of these strategies (Stecke and Kumar, 2009),
since the performance and effectiveness of the strategies implemented are
dependent on operational complexities and inter-organisational learning (Manuj and
Mentzer, 2008). Besides considering the above general characteristics, mitigation
strategies and contingency planning also tend to be more adequate when industry-
specific parameters are incorporated.
In the context of global supply chains, the drawing up of contingency plans

comprises of examining current and alternative possible collaborations as well as
suppliers, appraising the effects of existing strategies and assigning responsibility to
an identified personnel for the execution of the plan (Pieri, 2010). The mapping of
contingency strategies to enhance a firm’s responsiveness requires appropriate
15
intra-oragnisational structuring and support as well as external collaboration
(Skipper and Hanna, 2009).
Strategies to combat supply chain disruptions are related to product and supply
flexibility, product availability, transportation flexibility and control of product
demand (Tang, 2006). However, as Tang (2006) mentioned, challenges that come
along with such strategies include costs and benefits trade-offs, presence of a
strategic fit and the initiatives of an organisation in its execution of the strategies.
There are two programming models developed by Gaonkar and Viswanadham
(2004) to assist decision making in global manufacturers and suppliers selection so
as to achieve supply chain robustness. One model has the objectives of minimising
operating costs and the variability of total operating costs involved, while the other
was formulated to minimise shortages in supplies in the event of a disruption.
Continuous improvement on the implemented contingency plans enables the supply
chain to tackle challenges more readily. As aforementioned, contingency planning
does not end at interaction within a firm; cooperation between firms are just as
imperative.
Supply chain visibility and agility coupled with a proactive management approach,
increase a supply chain’s capacity in dealing with risks (Pieri, 2010). The
importance of visibility and accurate real-time information sharing between nodes
is emphasised in Blackhurst et al. (2005b) as they play an indispensable role in
ensuring supply chain flexibility and responsiveness. This sentiment is shared by
most respondents in a survey which saw 70% of them agreeing that a higher level of
communication and information sharing between supply chain participants are
important when having to manage undesirable consequences following disruptions
(Figliozzi and Zhang, 2010). The case of West Coast port, which caught many
companies unprepared when talks of a likely strike went neglected, clearly illusrates
the need for research in disruption related information and the existence of
disruption triggers (Blackhurst et al., 2005b). Therefore, the importance of instilling
16
awareness of supply chain risk in the entire supply chain is apparent and has also
been brought up by many personnel coming from multiple industries (Blackhurst et
al., 2005b).
Alternatively, measures such as restructuring of supply chains can be adopted.

When considering supply chain structures, firms should decide on the size of
supplier base, extent of product diversification and coordination, depending on
whether the firms are competing on cost, quality, flexibility or reliability
(Neureuther and Kenyon, 2009). The importance of planning and selecting a facility
and its network is reflected by Snyder et al. (2006) when they constructed an
optimization model to measure the risks in the form of related costs involved. This
model is formed based on facility location and network design and it takes into
account the threat of disruptions, so that it serves to better plan for a more reliable
supply chain. Leanness, resilience and flexibility are the usual typical desired
objectives of restructuring or selection of supply chain networks.
It is not surprising that studies on supply chain resilience and flexibility have
quickly gained attention. Evidence from simulation shows that recovery from
supply chain disruptions can be enhanced by having more flexibility in batch sizes
and schedules, while the severity of the disruption can be abated by increasing
responsiveness and capacity of contingency plans (Schmitt and Singh, 2009). As
available inventory plays an important part in maintaining customer service, the
leanness of an organisation is capable of increasing the organization’s exposure to
risks when disruption strikes, though lean operations do provide savings on the
other hand (Schmitt and Singh, 2009). As a resilient system has diversity, efficiency,
adaptability and cohesion as its characteristics (Fiksel, 2003), Falasca et al. (2008)
explains that resilience in supply chain is capable of lowering chances of disruptive
events occurrences and reducing the impact of unanticipated outcomes. However,
resilience comes at a price which will be determined by the framework proposed by
Falasca et al. (2008) which provides a quantitative measure showing the
17
relationship between the factors of supply chain resilience while keeping in mind
the practical tradeoffs present in the decision to increase resilience. The tradeoffs
are elaborated from the three supply chain design characteristics addressed by
Craighead et al. (2007), which have been mentioned in Section 2.2.1. Incorporating
resilience hones the ability to deal with the possible repercussions of disruptions,
such that it takes a shorter time before the supply chain regains its undisturbed
momentum and performance (Falasca et al., 2008).
Notable cases of well-managed supply chain disruptions by organisations are

explored and compared in Table 2.4 which implied that plausible essential traits in
effective management of supply chain disruptions include responsiveness,
flexibility, strong supplier relationships, organisation’s ability to influence demand,
commitment to organisation and uniformity in processes and procedures.
Specifically, Handfield et al. (2007) presented a list of responses in reducing impact
of disruptive events from the results of their interview and this is shown in Figure
2.1. In their study, the ability to identify a disruption and establishing continuity
plans is emphasised. It is apparent that in order to achieve these, commitment
within the organisation and collaboration with the organisation’s peripherals will be
required and this is reflected from the mechanisms in Figure 2.1. However, this
thesis shall go a step further by introducing the relevant PSCD indicators for early
detection of disruption and the PDM seeks to operationalise the mechanisms
proposed by scholars.
18
Table 2.4: Supply Chain Disruptions Response Strategies
Firm
Year Disruptive Event Responses Reference(s) Approach
Affected
Lightning struck Philips' Stuck with single-source supplier
semiconductor plant in Ericsson strategy, failed to make rapid
Responsive,
New Mexico, causing fire response Liu (2009), Flexible Product
2000 in which thousands of
Reconfigured their phone designs so Tang (2006) Design, Multiple
mobile phone chips
Nokia that production could be shifted Supplier Base
perished. The plant was
shut down for weeks. quickly to alternative suppliers
Many Indonesian suppliers

Shifted some production to
could not fulfil orders as
alternative suppliers in Asia,
they had troubles paying for
provided financial assistance to Multiple Supplier
1997 components and materials Li and Fung Tang (2006)
affected Indonesian suppliers so that Base
due to the devaluation of
orders can be received by the US
Rupiah during the currency
customers on time.
crisis.
All Toyota's Japanese

plants stopped production
after a fire broke out at Firms and suppliers from Aisin Seiki
Strong Relationship
main supplier Aisin Seiki and Toyota's keiretsu helped produce Sheffi (2005),
1997 Toyota with Suppliers,
Co. which produces 99% of p-valves. Toyota resumed its full Liu (2009)
Flexible Process
Toyota's p-valves, an production in 9 days
essential in all its cars'
braking systems.
19
Firm
Year Disruptive Event Responses Reference(s) Approach
Affected
Struggled to satisfy thousands of
customer's orders. Attempted to ship
Earthquake in Taiwan Apple slower version of G4 computers as it
disrupted flow of could not modify configurations Sheffi (2005),
1999 contracted and paid for Pricing Strategy
semiconductors for a few Tang (2006)
weeks Used attractive pricing to influence
Dell demand so that other available
components could be utilized instead
UPS took advantage of its

A severe blizzard in
interchangeable sorting machines Uniformity in
Kentucky caused air hub
1994 UPS and processes as it meant employees Sheffi (2005) Process, Procedures
for UPS and roads to be
from other parts of the country can and Practices
closed, travel ban imposed.
operate at other facilities.
SARS outbreak resulted in Continued serving clients in

Focused and
most business meetings, DHL protective gear and convinced many
Passionate about
2003 conferences and flights to International conference organizers to send Sheffi (2005)
upholding
and from Southeast Asia to Ltd materials around the world as
company's mission
be cancelled. substitutes to the cancelled meetings
20
Figure 2.1: Risk Reduction Mechanisms
Source: Handfield et al. (2007)
21
As summarised by Chopra and Sodhi (2004), the characteristics of mitigation
approaches typically take the following seven forms: (a) increase capacity, (b)
acquire abundant suppliers, (c) increase responsiveness, (d) increase inventory, (e)
increase flexibility, (f) pool or aggregate demand and (g) increase capability. These
approaches are able to target supply chain risks and disruptions by decreasing the
risks, though there may lie disadvantages in implementing the strategies. Ultimately,
mitigation strategies are dependent on the setting and nature of the chains, therefore,
ways of mitigating disruption risks need to be tailored for different supply chain
environments to be effective (Kleindorfer and Saad, 2005).
The understanding of the extent a disruption has is beneficial to supply chains

(Blackhurst et al., 2005b). Supply chain members need to bear in mind the proven
fact that efficacy of a supply chain strategy ultimately lies in whether or not it can
satiate the needs of the chain’s end customers (Green et al., 2006). Mitigation
strategies and contingency planning take many forms, and the effectiveness of these
strategies boils down to eliminating root causes of the disruptions, which differ
across organisations and industries. The strategies that ports utilise can be as
extensive as to minimise supply chain disruptions that span across a variety of
industries. After exploring risk management in supply chain disruptions, the
boundaries of this research has been defined and this section has provided insights
as to what is expected of a supply chain during disruptive events for it to return to
equilibrium.
22
2.3. Ports as Part of Supply Chains
The role of ports in global supply chains has undergone drastic changes in the past few
decades. These transformations that have taken place have redefined the significance of
ports in supply chain networks. Hence, the changing role of ports will be reviewed to
determine their role in inducing supply chain disruptions.
2.3.1. The Changing Role of Ports
The changing global trade patterns inevitably have an effect on ports. The growing
attention on ports can be attributed to the importance in coordinating material flows and
information exchanges, cost minimization and cargo handling (Ng, 2009). Lately, some
studies have indicated a close relationship between the performance of ports and
efficiency of logistical chains. This relationship is built up through many decades and
established due to the change in port’s role in supply chains.
Ports have transformed from a site for cargo and documentation transit, to an
indispensable interface that, among the many factors, determines the efficacy of supply
chain performance. The traditional ports were less engaged in hinterland integration and
cooperating with the port community. The focus conventional ports engaged in was
more on the port’s stability and sustainability (Ng, 2009) in their context at that time.
However, the post containerization era witnessed marked progress in value-addedness
and increasing integration into supply chains (Pettit and Beresford, 2009). With the
increased complexities in port operations (Carbone and De Martino, 2003), the
evolution of ports has resulted in a “port regionalization” phase in port development
(Notteboom and Rodrigue, 2005). With new value pools being identified in landside
logistics (Robinson, 2006), research has explored how ports utilize value migration to
enhance their attractiveness, create new functionalities and profit pools within the
landside logistics community, and has also highlighted the benefits of having a well-
connected integrator in delivering value to the end-customer (Weston and Robinson,
23
2008). With port centric logistics already emerging (Pettit and Beresford, 2009,
Beresford et al., 2011), this phenomenon is expected to move towards agility (Paixao
and Marlow, 2003, Lun et al., 2010b).
Comparing the changes since the transformation from traditional ports, UNESCAP
(2002) presented its investigation of the evolutionary developments in port functions
through three generations. The concept of classifying ports into different generations
was initiated by UNCTAD in the 1990s (UNCTAD, 1990, UNCTAD, 1999). Ports once
provided the convenience of cargo storage but this was eventually deemed insufficient
in subsequent generations. Services such as cargo distribution, packing and processing,
became important port functions for conventional and bulk cargo in ports of the second
generation. The phenomenon of third generation ports saw emerging concepts of
cooperation and information sharing with ports acting as the facilitator, and with
technology playing a key role in information exchanges between the different
stakeholders. Changes in port ownership, port development strategy and scope of port
activities are apparent throughout the three generations.
In summary, Figure 2.2 depicts an overview of the evolutionary role of ports in different
era. Pettit and Beresford (2011) have clearly identified the different roles ports played in
supply chains since 1960s. One conspicuous direction especially since this new century,
which port management has embarked on, is the task of encompassing a logistical
perspective. Inevitably, port functions have become much more complex today,
considering that the role of facilitating coordination has been conferred to the ports as
more supply chain participants interact at this platform and a conservative approach is
no longer sufficient for port business sustainability.
24
Figure 2.2: The Role of Ports in International Supply Chains
Source: Author, adapted from Pettit and Beresford (2011)
Consequently, the objectives of ports have deviated much; from being a region’s
gateway to a system that provides value-adding and facilitation services (Ng, 2009).
Ports serve as the prime candidate for being facilitators as they provide locations at
which the stakeholders come into contact. It is precisely because of the port’s capacity
in administering the connection of logistics functions throughout the supply chains that
renders its influence in cargo flow along supply chains. Ports have been defined as
critical links which deliver and capture value in value-driven chain systems, thereby
changing their positions in business environments (Robinson, 2002). With ports being
urged to adopt agility in their current processes to create better value (Paixao and
Marlow, 2003), the features of agile ports have been defined and steps towards an agile
approach for ports to undertake have been recommended (Lun et al., 2010b). Similarly,
research has been done on studying port strategies from supply chain perspectives,
emphasizing on responsiveness, agility and efficiency (Zhang et al., 2014). The need for
25
ports to be more agile is compelled by repercussions of port inefficiencies, which
include unnecessary additional operating and transportation costs.
By examining the changing role of ports in supply chains, it is apparent that agility and
resilience, being the common characteristics of effective and efficient supply chains, are
expected deliveries of the port from now on. However, there are only a few studies on
the features of ports of the future generations, and research on the mechanisms of
working towards them is absent. An assessment of the level of integration of ports in
supply chains will likely reveal areas of possible cooperation with port users and
improvement for implementation of specific strategies.
2.3.2. Integration of Ports With Supply Chains
The convenience of modal transfer that comes with containerisation, increasing

customer demands for door-to-door transportation accompanied by the flourish of trade
and the benefits from global sourcing has collectively fuelled the integration of ports
into supply chains. Generally, integration is divided mainly into horizontal and vertical
integration, with horizontal integration heading towards monopoly of the same market
or product, while vertical integration usually works towards gaining control over
preceeding or subsequent nodes of a specific supply chain.
Research has shown that infusing supply chain management practices into building
capabilities in ports shall produce beneficial impact (Song and Panayides, 2008). From a
supply chain perspective, the benefits of internal and external integration or
collaboration are the ability to produce feasible strategies that improve performance
outcomes of the chains (Stank et al., 2001). The close relationship between integration
diversity and port performance has been proven empirically, demonstrating that
transport integration has become a crucial constituent of port performance (Ducruet and
Van Der Horst, 2009). Likewise, port competitiveness is a function of competencies in
26
supply chain integration by the ports (Song and Panayides, 2008). Thus, though it has
been proven that the restructuring of port ownership over the last two decades has an
impact on port efficiency (Cheon et al., 2010), port performance has already taken on a
different dimension that extends beyond efficiency within the port itself. However, very
few port performance measurement techniques are related to supply chain concepts and
studies have concluded a need and relevance to include the perspective of supply chain
management in regulating port performance (Bichou and Gray, 2004).
The trend towards increased compulsion in integration arises from the realisation of the
need to have holistic container terminal operations due to outsourcing and globalised
trade (Tan, 2006). Figure 2.3 illustrates the movement of cargo once unloaded from
liner vessels and the intimate relationship between maritime and inland transport
systems. In most cases, ports integrate into supply chains for the sake of gaining
competitive edge and reaping diversification benefits (Beresford et al., 2011). The port
selection process for shippers comprises the degree of integration with supply chains as
one of the determinants (Magala and Sammons, 2008). Dubai serves as a good example
which takes advantage of its favourable location in the east-west routes, its facilities,
ability to mobilise resources and governance structure in its integration (Jacobs and Hall,
2007).
Figure 2.3: Modal and Temporal Separation at Freight Transport Terminals
Source: Rodrigue and Notteboom (2009)
27
Considering the impact of inland cargo distribution on port development, a port’s
integration into hinterland is strengthened (Notteboom and Rodrigue, 2005). With the
growing significance of port hinterland, coordination and cooperation with other
transport nodes are anticipated means of creating synergies (Notteboom, 2008). The
issue of globalization in liner business has resulted in some major players integrating
their activities in ports by managing container port facilities and creating intermodal
companies (Midoro et al., 2005).
In addition to more anticipated strategic alliances between liners and stevedores

(Midoro et al., 2005), terminal operators are also expected to take on an active role in
order to support the emergence of inland terminals in supply chains as it offers a
solution to congested ports and unoptimised usage of storage time at deep sea terminals
(Rodrigue and Notteboom, 2009). Suggestions for port operators also include
introducing agility in horizontal and vertical integrations in logistics chains, as a manner
to administer a dynamic port network (Paixao and Marlow, 2003). Furthermore, the
degree of integration with other transportation providers involves the operational and
commercial aspects before efficient delivery of value can be brought about (Robinson,
2006).
In order to create an environment for participants to integrate harmoniously, ports face

the tough task of managing conflicts in business objectives, differences in business
behaviours and incorporation of practices from other fields such as supply chain
management. For example, the changes in perception and initiatives by Port Metro
Vancouver through the last decade has provided valuable insights to measures which
redefined its traditional functions (Heaver, 2011). The measures discussed by Heaver
(2011) are mainly promotional, operational, regulatory, contractual roles and also
intelligence. These evolved roles require a high level of cooperation from members of
the port community, in addition to the port authority’s receptiveness to alternatives and
28
realization that it has to reassess its role to better exercise its control. The Vancouver
port community has been able to cope with the changes in market environment as Port
Metro Vancouver was gradually willing to fulfill its leadership role in undertaking
leadership initiatives, technologies development and gateway activities (Heaver, 2011).
In summary, the changing role of ports, importance of information sharing and close
coordination between terminal operators, shippers, forwarders and shipping lines have
also been emphasized in recent research (Rodrigue and Notteboom, 2009). Most
importantly, ports have to embrace strategies that extend to encompass concepts of
flexibility and performance of transport chains in the modeling of core competence on
top of adopting new roles (Notteboom and Winkelmans, 2001). Creating a competent
hinterland community requires close coordination within the cluster and the forms of
integration recommended tend towards the formation of alliances and partnerships.
Different ports have varying improvement alternatives, the success of which depends on
the capabilities of participants of the alliances (De Langen and Chouly, 2004). It is
therefore worthwhile to determine the problems involved and requirements for
synergetic integration to thrive.
2.3.3. Challenges in Coordination and Integration
While shipping lines and logistics providers are caught up in a race to offer a full
spectrum of transportation solutions, ports struggle to facilitate overall coordination and
communication between the parties within the port community. There are challenges to
overcome in consummating a port’s integration into supply chains and a summary of the
challenges is presented in Table 2.5.
29
Table 2.5: Challenges of Coordination and Integration
Challenges Studies
 Fear of Losing Power in Service Provision Notteboom (2008)
 Absence of Synergies Bichou and Gray

(2004)
 Unwillingness to Foster Partnerships Van Der Horst and De

Langen (2008),
Notteboom (2008)
 Differences between Organizations and at Heaver (2011)

Intersections
 Amount of Visibility in Information Sharing
 Conflicting Interests
 Coping with the Growth of Trade
 Support from Local Government and Community
 Allocation of Gains Van Der Horst and De

Langen (2008)
 Market Competition
 Risk Threshold
 Lack of a Figure Assuming Responsibility
 Absence of Contractual Relationships Pallis and Vitsounis

(2011), Robinson
(2007)
 Discrepancies in Expectations of Port Authorities Pallis and Vitsounis

and Their Customers (2011)
With the integration of ports into supply chains, coordination problems arise as there is
unwillingness in cooperative efforts with the hinterland community (Van Der Horst and
De Langen, 2008). This unwillingness of ports in engaging partnerships or cooperation
30
is most likely due to the fear of losing port activties (Notteboom, 2008). In general, the
level of coordination within a port community can be influenced by the following
problematic areas (Heaver, 2011): the differences in planning, the capacities and
operating procedures that take place in organisations. Unfortunately, these are inevitable
in intersections where the ownership and responsibility of goods change hands. Besides,
the flourishing trade growth further exacerbates the imbalances between different
transport modes and discourages local government from cooperating as the local
community becomes more vulnerable to congestion. The situation is made complex
when intersecting parties have conflicting interests and when there is insufficient
visibility on necessary information. Applying to the port environment, one example
would be that difficulties in integration arise when shipping lines and ports both
isolatedly attempt to optimise their own assets (Bichou and Gray, 2004).
On the same note, Van Der Horst and De Langen (2008) have also identified problems
in hinterland coordination and these are pointed out in the remainder of this paragaph.
Disparate allocation of gains allows the existence of free-riders in coordination.
Competitiveness in the market is likely to deter disposition to cooperate; similarly, the
absence of capability and willingness in active participation, especially in the case of
smaller firms, hinder the coordination process. Risk averse practices with a narrow
perspective has to be overcome before effort is committed throughout the entire chain.
This attitude is aggravated by the presumption that results from cooperating for
coordination is not guaranteed, yet the process is time-consuming. All these, coupled
with a lack of an individual taking charge and responsibility, give rise to challenges in
coordination (Van Der Horst and De Langen, 2008).
To complicate matters, some dyadic players in a port supply chain have operational
relationships but not contractual relationships. Similarly, in a port terminal setting,
regardless of whether it is a dedicated or non-dedicated terminal, the parties that have a
commercial relationship might engage in a third party for the operational aspect of their
31
agreement (Pallis and Vitsounis, 2011). Pallis and Vitsounis (2011) named this kind of
interaction as hybrid relations. The degree of integration of the chain will be reduced
due to the lack of contractual relationships between dyadic parties (Robinson, 2007).
Besides, the lack of contractual relationship can also cause variabilities and
uncertainties in the port supply chain system. As there already exist conflicts in the
intermodal channels (Taylor and Jackson, 2000), the above problems reiterate the need
for adopting holistic cooperation within the port and its peripherals.
By employing Magala and Sammons’ modeling framework which generates port choice
as an element of the supply chain, taking into consideration the various attributes for
different factors of supply chains and finally narrowing down to an ‘actual choice’
(Magala and Sammons, 2008), the relationship between or irrelevance of certain
existing partnerships in ports would likely be revealed. For instance, when one of the
final choices consists of Port A and 3PL X and minimal interaction is found between
these two parties, then a deeper mutual connection should be established, in order to
reduce possible chances of disruptions or problems. When port security is quantified in
the port selection process, a feasible solution to avoid risks can be proposed (Norbis and
Meixell, 2010). However, it has been discovered that the same type of port users
identifies a diverse and even contradicting list of value drivers (Pallis and Vitsounis,
2011). Moreover, it was found that there are discrepancies between the expectations of
port users have on port authorities and the concerns of the port authorities themselves
(Pallis and Vitsounis, 2011). This calls for a more genuine mutual understanding
between the port users and port authorities as, with that, the responsibility of
coordinating port activities and information exchange can be better communicated and
facilitated when assigned. The importance of information exchange has been affirmed
by Lee et al. (2003). Simulation was used to analyse the impact of adopting partnership
and information sharing as determinants in port operation strategies and it has been
proven that strong partnerships and a higher level of information sharing at the terminal
are favourable as they enhance port operation performance, which was measured in
terms of container handling time for partnership as the factor and the number of vessels
32
served, time spent at berth and berth utilisation for information sharing (Lee et al.,
2003). These results reinforce the importance of information sharing and
interdependences within the port community.
The different forms of cooperation and coordination initiatives which ports can engage
in would facilitate its integrative role in supply chains and evolution towards agility and
resilience. In the process, the challenges of coordination would arise, affecting the level
of willingness and degree of integration. The interaction between these aspects are
displayed in Figure 2.4. As the PDM has the objective of reducing a port’s potential in
inducing supply chain disruptions, the challenges in integration would be relevant since
a high level of internal and external communication and cooperation ought to be present
for the actions in the framework to actualise.
Figure 2.4: Elements of Evolution into the Future Ports
Source: Author
2.3.4. Implications of Port’s Integration into Supply Chains
Exploring the implications of a port’s adoption of new roles and objectives in supply
chains would assist in the identification of PSCD threats and define the context of PDM,
such that the actions in the framework remain relevant to its peripheral setting.
33
Fundamentally, the changes in supply chain trends and practices would compel the
necessity of a port’s integration into the supply chain. Therefore, prominent changes in
supply chain trends and practices shown in Figure 2.5 have an impact on ports. These
trends would collectively result in larger vessel sizes and capacities, port traffic growth,
cargo growth and expose the ports to greater vulnerabilities. The implications of a port’s
new role in supply chains are evident in recent research work as they are increasingly
acknowledged and explored by researchers. Table 2.6 indicates the implications of a
port’s integration derived from past literature work.
Figure 2.5: Trends in Supply Chain Management
Source: Waters (2007)
34
Table 2.6: Evolved Area of Research on the Port’s Role in Supply Chains
Related Theoretical Approach

Reflected in:
(Implications addressed)
Multimodal Connectivity Robinson (2002), Marlow and Paixão
(2003), Paixão and Marlow (2003), Bichou
and Gray (2004), De Langen and Chouly
(2004), Lirn et al. (2004), Notteboom and
Rodrigue (2005), Chang et al. (2008),
Notteboom (2008), Song and Panayides
(2008), Panayides and Song (2009)
Integration Initiatives Notteboom and Winkelmans (2001), Bichou

and Gray (2004), De Langen and Chouly
(2004), Notteboom (2004), Notteboom and
Rodrigue (2005), De Martino and Morvillo
(2008), Notteboom (2008), Song and
Panayides (2008), Panayides and Song
(2009), Lun et al. (2010b), Heaver (2011)
Value-Added Services Notteboom and Winkelmans (2001),

UNESCAP (2002), Carbone and De
Martino (2003), Paixão and Marlow (2003),
Bichou and Gray (2004), Chang et al.
(2008), Song and Panayides (2008),
Panayides and Song (2009)
Adaptability Notteboom and Winkelmans (2001), Paixão

and Marlow (2003), Marlow and Paixão
(2003), Tongzon and Heng (2005), Tongzon
(2009), Lun et al. (2010b)
Efficiency Estache et al. (2002), Tongzon (2002), Park

and De (2004), Tongzon and Heng (2005),
Mennis et al. (2008), Tongzon (2009)
35
Reflected in:
Information Exchange and Communication Paixão and Marlow (2003), Song and
Panayides (2008), Panayides and Song
(2009), Lun et al. (2010b)
Charges and Costs Notteboom and Winkelmans (2001), Lirn et

al. (2004), Tongzon and Heng (2005),
Chang et al. (2008), Tongzon (2009)
Diversification into Logistics Service Notteboom and Rodrigue (2005),

Provision
Notteboom (2008), Rodrigue and
Notteboom (2009), Beresford et al. (2011)
Agility Paixão and Marlow (2003), Bichou et al.

(2007), Lun et al. (2010b),
Training of Port Workers World Bank (2000), Lun et al. (2010b),

Heaver (2011)
Port Networking Notteboom and Winkelmans (2001), Paixão

and Marlow (2003)
Security Bichou (2004), Pinto and Talley (2006),

Bichou (2008)
36
2.3.4.1. Multimodal Connectivity
The integration into supply chains certainly requires the necessary infrastructure for the
cargo transfer. This aspect includes hinterland accessibility and intermodal transport
connectivity which can include feeder connections. It is not surprising that this area of
research will expect to receive even more attention as more ports expand their business
into landside logistics.
2.3.4.2. Integration Initiatives
The existence of seamless multimodal connectivity has to be accompanied with

effective integration plans and practices with supply chain members. These include
interactive relationships in the form of strategic alliances and partnerships to enhance
the port’s collaboration with the supply chains. A high level of coordination and
cooperative spirit will be required in such integrative initiatives.
2.3.4.3. Value-Added Services
The most prevalent sign of integration into supply chains is the provision of value-
added services. However, the extent of value-added services provided by ports today
has far exceeded that of the past. This is due to the increase in demand of value-adding
services to ships and cargo especially in terms of port facilities and their ability in cargo
handling and transfer. Some common examples are packaging and manufacturing.
Nonetheless, the ability of ports to provide comprehensive services does not necessarily
translate into seamless cargo flow.
2.3.4.4. Adaptability
As the concept of flexibility becomes popular in supply chains, being adaptable to

customer needs and the changing market environment begin to gain attention in the
dynamic maritime field. The new generation of ports is expected to be agile and this
37
requires adaptability and a great level of flexibility. The proximate relationship between
ports and supply chains fuelled by the increased integration would require ports to adapt
to the supply chain trends and practices in order to remain efficacious.
2.3.4.5. Efficiency
Port efficiency explored by most scholars revolves around equipment efficiency which
is mainly about the hardware of ports, port layout and movement of cargo. Examples of
measures are berth capacity, turnaround time, cargo handling rate, cargo throughput, etc.
These usually form part of port performance, thus port efficiency is highly valued by
port users and contributes to supply chain performance due to the increased presence of
ports felt by supply chains.
2.3.4.6. Information Exchange and Communication
The prevalence of E-business in supply chains implies that the integration into supply
chain is closely connected to information and communication as interoperability is
required to ensure the exchange of information between entities before and during port
operations. Seamless communication flow and useful information exchanges are thus
highly valued as it ensures interoperability within the port and with the port’s external
parties. Moreover, the quality of information exchange and communication exchange
establishes the level of agility and coordination of the port and affects port efficiency.
This is due to the significance of information exchange and communication in business
continuity planning and daily port operations. As a result, many studies have stressed
the importance and value of effective communication and information exchanges in
collaborations and integration.
2.3.4.7. Charges and Costs
38
Port charges and costs are inevitably a concern to port users, especially when ports are
presently providing more than the traditional cargo transfer services due to its adoption
of new role in supply chains. Tongzon and Heng (2005) explained that port charges
contributed to a large portion of overall transportation costs, so ports with lower charges
are preferred, ceteris paribus. Thus, ports are not considered as a standalone node with a
basic charge, but rather, port charges are weighted as logistics costs and are capable of
affecting port selection, though there can be other overriding factors in port selection
which can justify higher port charges.
2.3.4.8. Diversification into Logistics Service Provision
Diversification into the logistics arm was driven by the demand for door-to-door
transport, one-stop shipping and increasingly comprehensive services by either direct
port clients or downstream customers, whose demand will eventually be pushed
upstream. As a result of integration, logistics services which ports have diversified into
include developing warehouses near ports but moving cargo distribution function inland
and further away from port areas, developing inland rail freight terminals and port-
centric logistics.
2.3.4.9. Agility
Agility is highly valued in supply chains, of which a port is always a part of. However,
the application of agility in ports is rather novel. As ports are now part of the supply
chains and become more susceptible to uncertainties of the supply chains they serve,
agility would ensure the swift action of ports in avoiding the impacts of disruptive
events.
2.3.4.10. Training of Port Workers
39
It is widely agreed that many accidents could have been avoided should there have been
more focus on education of workers. Moreover, the integration of ports into supply
chains has resulted in an expansion of services and transformation of processes. Hence,
the efficient operation of new innovations, communication systems, processes and
equipment would require appropriate training of the worker.
2.3.4.11. Port Networking
With growing vessel traffic and cargo volumes, port networking is imperative in
business continuity planning of the port and in deriving synergies from cooperation with
competing ports. The benefits of port networking include better cooperation with other
transport nodes, complementarities and more efficient utilization of resources. These
would in turn facilitate the port’s integration into supply chains and the implementation
of policies to incorporate agility and flexibility in the port.
2.3.4.12. Port Security
As mentioned, ports are exposed to more vulnerability in their integration into the
supply chain. As a large number of entities and individuals interact within the port
community and due to the embeddedness of ports in supply chains, ports begin to
assume the responsibility of ensuring port operations are protected against potential
risks and security threats.
New roles and responsibilities adopted by ports demonstrate the proximity between
ports and supply chains. Thus, present ports are capable of generating supply chain
disruptions and the implications of the port’s new roles in supply chains explain the
probable impact of the port-related drivers of disruptions.
40
2.4. Port-related Drivers of Disruptions
Past research, which have explored port bottlenecks and operational risks at ports, are
able to identify the drivers of port-related disruptions and these drivers can be
interconnected. For instance, a breach of security may cause the shutdown of a port,
resulting in vessels to be re-routed to another nearby port and this may cause port
congestion at the second port if it does not have adequate excess capacity to receive the
extra cargo volumes.
Similarly, collisions in the port waters can also propagate disruptions by blocking water
channels with the sunken ruins (Pinto and Talley, 2006), directly causing damage to
port structures and shorelines or resulting in the closure of an implicated terminal.
Collisions within the port waters can have more implications than a mere collision,
especially when an oil spill or port closure is a result of the collision. Things are
complicated when there are injuries or fatalities involved as investigations have to be
carried out before debris are allowed to be removed and operations can resume.
Moreover, some causes may be the consequences of a preceeding cause. For example,
port congestion may be the consequence of improper planning on the port’s side, and
port congestion will in turn exacerbate the impact of the disruption.
Gurning (2011) has provided a comprehensive list of maritime disruptions causes,

nonetheless, those that are port-related need not necessarily result in supply chain
disruptions. Factors such as security level, infrastructure development, hinterland
connectivity, demand and supply imbalances, port congestion and employment
relationships make up common instances of maritime disruptive events (Gurning and
Cahoon, 2009a).
41
As mentioned earlier, it is difficult to assess different port-related causes of supply chain
disruptions individually as one apparent cause might be the result of another; the root
cause of the disruption should be mitigated instead. To provide an overview of possible
causes occurring in the ports, Table 2.7 shows the port-related causes of several
disruptions and it provides a background for the development of PSCD threats in
Section 3.1.1. One has to note that these might not be the primary or the only causes of
the resulted supply chain disruptions; all these causes, when connected with one another,
can increase the severity of disruptions. An investigation of these port-related disruption
causes identifies the risks present inherently in port operations, management and
communication with the periphery entities. The drivers are classified in this manner so
that the ports will know which aspects to focus on, for instance, either internal
productivity or relationship with the port community, to reduce disruptions.
42
Table 2.7: Port-Related Disruption Examples
No. Port-related Disruptive Events Effects on Supply Chains
1 Australian port strikes (Burgess, 2011) Inability to fill orders; breach of contractual obligations
2 West Coast port strikes (Blackhurst et al., 2005b, Institute for Supply Delayed, duplicated or lost shipments of supplies, delayed shipments
Management, 2002) to customers, inventory build-up
3 Damaged wharf at Port Lincoln after a ship collision (Pedler, 2010) Wharf closed to contain oil spill
4 MSC Chitra’s collision in Mumbai (NDTV Correspondent, 2010) Missing containers, shutdown of Mumbai Port and Jawaharlal Nehru
Port Trust due to oil spill
5 Pipeline explosion in Dalian Port (Chow, 2010) Shut down of port
6 Introduction of new customs clearance system in Tanzania (Crown Clearance times increased by threefold
Worldwide Moving & Storage, 2010)
7 Over-aged, defective or inadequate cargo handling equipment at the Low productivity, inefficiency and damage or loss of cargo, cargo
ports (Esq., 2001) discharge processes and stacking of cargo at Nigerian ports are slowed
down
8 Port congestion in Thailand (Suwannakij and Javier, 2011) Sugar prices driven up
9 Nigeria’s port systems failed to change to adapt to high volume Serious “bunching” problem, whereby cargo are not cleared in time
growth (Esq., 2001) for new incoming ones
10 Ports in Sub-Saharan Africa do not have the necessary rail and road Movement of cargo and rate of clearance hampered, shipment delays
links, making them unable to reap the benefits of containerization and
multi-modal transport corridors as containers have to go through
packing in the ports (Esq., 2001, Ocean Shipping Consultants, 2008).
43
No. Port-related Disruptive Events Effects on Supply Chains
11 Miscommunication between Trade Daring and port/terminal Vessel broke into two
personnel at Ponta da Madeira Brazil (Horck, 2008)
12 Labor and severe container shortages at Chittagong (The Journal of Delays in cargo handling
Commerce Online, 2010)
13 Some major ports in Sub-Saharan Africa still lack modern port Productivity suffered severely
equipment (Ocean Shipping Consultants, 2008)
14 Terrorist attacks in Port of Mumbai in 2008 (World Port Source, Undeclared

2011)
15 The ownership and leasing structures of Dalrymple Bay Terminal in Conflicts of interests, decision making processes hindered,
Australia (Robinson, 2007) disintegration of the coal supply chain
16 The 100% physical inspection regulation imposed by Federal Serious delays of vessel berthing
Government of Nigeria (Esq., 2001)
17 Labor standoff at West Coast ports (Layne, 2015, DePillis, 2015) Retailers, such as Wal-Mart Stores Inc, experience delays in
merchandise supplies
44
2.4.1. Drivers from the Peripheral Environment
The importance of incorporating resilience in a port and other supply chain members
has been emphasized in many studies since the September 11 attacks which brought
attention to the exposed vulnerabilites apparent in many systems, and urged enterprises
to strengthen their cognitive abilities. It has been discussed how an adequate cognitive
architecture and process, when applied appropriately to a terminal, are able to prevent
waterborne attacks, thereby improving the resilience of the port (Andalibi et al., 2008).
The expansion of port capacity in certain regions of the world has yet to catch up with
the growth of sea-traded cargo volumes (Paul and Maloni, 2010). Without regulating
this imbalance, re-directed cargo to another port due to disruptions would likely result in
serious congestion problems at already congested ports that belong to the same network
(Paul and Maloni, 2010).
2.4.2. Operational Drivers
The rate of loading and unloading process at the ports depends largely on the
availability and status of the equipment. Mechanical failures in port equipment such as
gantry cranes can decrease berthing and terminal availabilities and can result in a loss of
income to both the users and terminal (Mennis et al., 2008). Unfortunately, port-related
equipment problems are usually not seen as risks in a supply chain (Gurning, 2011),
resulting in an absence of a comprehensive approach when addressing bottlenecks in the
ports.
In addition, an analysis of accidents in ports found that there are four main causes of
such accidents, namely (a) impact or collisions, (b) mechanical failures, (c) external and
(d) human factors (Darbra and Casal, 2004). In the same study, the accidents are found
to have most frequently occurred during the transportation process in the ports. The
45
range of activities the authors included during the transportation process are moving
goods around in transportation vehicles and in vessels that enter and leave ports. In
other words, the goods are more susceptible to accidents when in movement than in
storage.
The handling of dangerous cargo deserves attention as accidents and fatalities involving
dangerous goods can have serious repercussions which are capable of halting an entire
supply chain. According to past events, activities in ports ranging from packaging,
container stuffing and loading processes are discovered to be the main aspects
responsible for releasing dangerous goods onboard vessels (Ellis, 2011). An analysis of
port-related accidents involving hazardous substances revealed the sequence of events
leading to a specific type of accidents, as well as a way to calculate probabilities of the
accident (Ronza et al., 2003). It seems that there is much room for improvements in the
port-side operations as it has been discovered that 91% of the contributing factors of
dangerous goods release were generated before the loading takes place, while very few
cases were the result of severe weather conditions and ship motions (Ellis, 2011). An
example of a factor of accidents would be cargo self-ignition which sometimes is a
result of misdeclaration of the cargo (Ellis, 2011).
2.4.3. Human Factors
On the other hand, human factors also play a role in port accidents and examples of
these factors are a lack of work experience, which has been suggested that it cannot be
resolved simply by staff training, and the ability to adapt to new skills and technologies
(Fabiano et al., 2010). The inability to adapt is related to age as the older the staff, the
less able he/she can utilise new technologies and this will in turn affect the severity of
the accidents. Fabiano et al (2010) have also observed that the peak period of accidents
occuring is during the summer months. This finding indicates that the frequency of
accidents is associated with workload and productivity increase borne by the workers.
Thus, the employment satisfaction of staff cannot be disregarded when looking for
46
means to reduce accidents. As clear instructions have to be given to ensure accurate
procedures are being executed, effective communication is imperative between seamen
and port workers.
At the port where individuals and entities interact at different levels, communication
becomes an attribute of human factors and an ability of individuals which can affect the
safety and quality of work accomplished in port areas as miscommunication would
render an operation inappropriately executed or introduce unnecessary risks in the
operations. At the ship-port interface, communication inevitably encounters challenges
due to the intersection of multicultural diversities and gender differences (Horck, 2008).
An example is the total loss of the bulk carrier named “Trade Daring”. The
miscommunication between the port terminal manager and chief officer, together with
existing structural failures, stresses, mishandling and inappropriately planned operations,
Trade Daring broke into two pieces (Horck, 2008).
In essence, the port-related drivers of disruptions can come from the peripheral
environment, internal operations and through communication during interaction
between the internal and external parties. Hence, human factors are present and affect
both the external and internal operations. The relationships between these drivers are
displayed in Figure 2.6.
Figure 2.6: Relationship Between the Port-related Drivers of Disruptions
Source: Author
47
The bottlenecks in ports and port-related drivers of disruptions can be identified through
combining findings and results of relevant past research. However, the port-related
disruption causes explored in existing literature need not necessarily result in supply
chain disruptions as the effects of the disruptions may be diminished as the cargo is
transported out of the port, or the disruptive aftermath may not be powerful enough to
result in a supply chain disruption. These port-related drivers of supply chain
disruptions or PSCD threats should be determined to ascertain the mechanisms in
reducing or eliminating occurences of the threats.
2.5. Strategies for Port-Related Disruptions
In this subsection, strategies proposed for disruptions which occurred at the port will be
discussed. There are several approaches to do so: by means of disruption occurrence
prevention, disruption mitigation and incorporating contemporary concepts in the port
management and movement of cargo along the port transport chains.
2.5.1. Disruption Prevention Mechanisms
The more favoured way in disruption management is preventing disruptions which

usually denote increasing security and detecting potential risks as the objective is to
eliminate the occurrence of disruptions. Analytical tools from the engineering and
supply chain fields can be adopted in assessing port risks and security (Bichou, 2008).
Amid approaching port security from the logistics and supply chain management
perspective, one way to increase security standards in the maritime network is to have
ports and their stakeholders predict outcomes of detected vulnerabilities across the
ports’ internal and external systems, in an integrated collaborative effort (Bichou, 2004).
48
The effectiveness and level of security within a supply chain affect characteristics such
as direct and indirect costs, timeliness, conditions of goods and uncertainties, all of
which make up the competitiveness of the supply chain (Banomyong, 2005).
Furthermore, participation in security initiatives prevents cargo from being subjected to
additional scrutiny. An example would be joining the Customs-Trade Partnership
Against Terrorism (C-TPAT). It is only through complete cooperation that security can
be infused and ensured throughout the chain. Otherwise, firms which opt out of such
initiatives might end up hindering cargo processing. On the other hand, the negative
aspects of C-TPAT are that applications are not dealt with promptly and the participants
could not be appraised appropriately, thus the benefits of implementing it cannot be
brought out (Brooks and Button, 2007).
Specifically, an empirical analysis of the impact of ISPS Code, CSI and 24-hour
manifest rule on container terminal operations efficiencies has been carried out (Bichou,
2011). The results show that terminals implementing 24-hour manifest rule generally
have lower efficiency than those without the 24-hour manifest rule, though there is
higher efficiency gains in terms of technological change for those with the rule, and, the
implementation of CSI has experienced a gain in terminal efficiency while terminals
without CSI implementation have experienced a loss (Bichou, 2011). This may be due
to CSI’s “fast lane treatment” granted to containers that have already gained approval
from the 24-hour manifest rule process which requires on-time, detailed and specific
cargo information from the ocean carriers as well as risk analysis from the US
authorities (Bichou, 2011). On the other hand, as interpretations of the ISPS Code vary
across ports, an assessment of productivity gains or losses relating to the
implementation of ISPS Code is tricky (Bichou, 2011).
Measures for ports have been introduced to maintain security standards within the ports
and for the safe handling of dangerous cargo. Hence, it has been suggested that accurate
declaration of cargo and its packaging should be maintained throughout the transport
49
chain (Darbra and Casal, 2004). The irony in implementing certain lengthy reporting
procedures is that errors may be made or overlooked in the process of complying,
increasing the potential dangers in port activities. Nevertheless, the long term effect and
benefits may justify the costs of security measures. Ultimately, a well-performing
supply chain requires connection and sychronisation for the contiuous flow of goods
between each point to occur. This in turn demands for security measures to be fulfilled
at all the links in the supply chains.
The United States has been particularly active in its intiatives to counter security
incidents. These range from establishing the US Department of Homeland Security
(DHS), utilising radiation detectors in ports, implementation of the US Maritime
Transportation Security Act (MTSA) and the ISPS Code to revised port security plans
which involve having extra defense layers in preventing threats (Pinto and Talley, 2006).
The existing strategies focus more on the threat prevention and detection phases,
leaving responses to threats and recovery phases from threats less explored. These last
two phases deserve attention as financial losses from an extended or even avoidable port
shutdown due to insufficient viable response or recovery strategies can exceed the
effects resulted from the security incident itself (Pinto and Talley, 2006).
2.5.2. Disruption Mitigation Mechanisms
Arrangements to mitigate disruptive effects of undesirable events require the efforts of

internal port management as well as collaboration or involvement from external parties.
Otherwise, the scope of actions and extent of relief to disruptions will be restricted.
The application of complex network theory has been proposed in the examination and
modeling of shipping networks such that an undesirable event at a port can be simulated
to show the global effect it has (Angeloudis et al., 2007). Alternatively, the Disruption
Analysis Network (DA_NET) is another quantitative approach which can be used to
50
show propagation of attributes while measuring the impact on the system (Wu et al.,
2007). By allowing each supply chain component and key attributes to be pre-set, this
model offers an overview of those affected in its analysis, such that the users can
acquire a better understanding of the radius of disruptive events in a supply chain. In
modeling simulation, a useful tool to quantify disruption probabilities especially in the
transportation processes is Markov chain, which has been applied to the wheat supply
chain to evaluate the risks in the chain when maritime disruptive events occur (Gurning
and Cahoon, 2009b). Incorporating disruption possibilities will facilitate planning and
development of supply chains.
On the other hand, optimization models can be used to compare different scenarios and
severities of disruptions that caused a redirection of vessels to other ports in a network
(Paul and Maloni, 2010). These ocean-focused models can be integrated with those that
study landside capacities for a more inclusive analysis. Such models are useful only in
cases where actual disruptions occur as they provide an analysis of the extent and
effects of disruptions that take place at ports.
To mitigate the impacts of collisions within port waters, a multi-level model of collision
risk has been proposed by Chin and Debnath (2009). The purpose of this system is to
act as a real-time system that allows pilots to carry out countermeasures according to the
different severities of dangers worked out by the system (Chin and Debnath, 2009). In
the event of a large US port closure due to terrorist attacks and natural catastrophe, a
restoration model has been developed to restore vessels by rerouting them to other ports
(Guerrero et al., 2008). However, a higher level of communication in the form of data
sharing is required for the development of an adequately robust vessel restoration model.
The implications of the model on intermodal firms are also of great concern to them.
Thus, though the model offers an alternative when an event strikes, it only provides a
preliminary stage of measure. Correspondence with international shipping and
intermodal firms has to be present in the later part of model building.
51
2.5.3. Contemporary Concepts as Disruption Mitigation Strategies
In light of changing role of ports and increasing scope of intermodal transportation

services at ports, the concept of using integrated centres for Transshipment, Storage,
Collection and Distribution (TSCD) of freight has been suggested to improve cargo
handling efficiency within the ports (Konings, 1996). Besides easing threats of port
congestion, business accessibility will also be enhanced with the use of TSCD concept
as benefits can be derived from the physical proximity. Satellite terminals involve a
concept whereby part of cargo storage and consolidation functions are moved out of
seaports (Slack, 1999). This raises hope of easing congested containter berths and
improving throughput performance within the seaports. The concepts of TSCD and
satellite terminals illustrate one element of supply chain mitigation strategies, which is
having strategic stock (Tang, 2006) since inventories are placed strategically in
distribution centres and/or warehouses near ports.
The call for similar “port-centric logistics” approach is apparent in the United Kingdom
through several significant partnerships under the pressure of thriving cargo volumes
(Beresford et al., 2011). Examples of such partnerships are the ones between Tesco and
Teesport, and DP World with London Gateway. However concerns such as operating
costs, risks and reponsibilities involved in transferring freight to satellite sites have to be
addressed. On the other hand, alternative approaches to prevent port congestions are
identifying substitute ports and creating proper forecasts that help generate supply
balances while overseeing transiting demand and supply (Blanchard, 2007). There are
yet to be suggestions available for these approaches to be combined or executed through
specific actions.
Besides locating the distribution centres near the port of entry, they can be concentrated
along a transportation corridor and each cluster is referred to as an ‘inland port’ which,
52
by allowing logistics integration, can reduce port congestion and provide better supply
chain efficiencies (Rahimi et al., 2008). It has been proven mathematically that vehicle-
miles travelled (VMT) will be greatly reduced with the introduction of a central inland
port for a region (Rahimi et al., 2008). A location-allocation model, using VMT as a
measure, when applied to a number of ports enables the user to identify exactly which is
the inland port that has the most significant impact on transportation costs (Rahimi et al.,
2008).
As insufficient containers are probable causes of delayed operations, the concept of

foldable containers, for instances the SIO and Fallpac containers, has opened up new
perspectives on reducing transhipment costs and container handling, as well as freeing
up empty container storage space that can otherwise be used for conventional containers
and port operations (Konings, 2005). Similarly, the Tworty container, allows huge cost
savings even with the additional handling costs (Transport Research Institute, 2014).
In addition, facilitating any policies and strategies would require effective

communication and acceptance within the community which require incorporating
knowledge and understanding of the human resource field. Addressing the soft
attributes of individuals in the port, Horck (2008) proposed that maritime education
should be enforced and focus on ‘cultural awareness’, seeking to motivate, creating
understanding between each other and a sense of belonging (Horck, 2008). Human
resource management skills are essential competencies in shipping as expertise in
technical knowledge fail to be actualised when precise instructions cannot be accurately
given or received.
There are fundamentally three aspects in combating disruptions and they are preventing
the disruption from occuring, mitigating the effects of disruptions and administering
concepts which target disruptions. Contemporary concepts are more tailored due to the
53
peripheral market trends and practices as the concepts tend to introduce new
perspectives which are able to alleviate disruption effects instead of in the form of
specific actions which eliminate or mitigate corresponding disruption drivers. On the
other hand, preventing and mitigating disruptions have the objectives of reducing and
eliminating the occurences of specific disruption drivers and thus these mechanisms will
eventually ease the peripheral imbalances and drivers. Figure 2.7 matches the strategies
to their respective drivers.
Figure 2.7: Strategies for Different Types of Port-related Drivers of Disruptions
Source: Author
According to the current literary work, three theoretical approaches can be identified.
Particularly, preventive measures are related to risk management (RM), mitigation plans
indicate the presence of business continuity management (BCM) and contemporary
concepts have the objective of improving effiency and quality of port services, hence
quality management (QM) is the third approach. In disruption management, RM is an
important process as it identifies risks which need to be reduced, eliminated and
transferred as well as those that can be retained so that appropriate measures specifically
for each type of risks can be formulated. BCM will address mitigative and contingency
54
plans for the organisation’s recovery and risk prevention in the event of a disruption.
Thus, risks that cannot be avoided in RM can be mitigated in BCM. QM will serve to
facilitate the disruption management process, such that the objectives of the process are
ensured, remain relevant and continuously improved. Hence, the inclusion of RM, BCM
and QM will provide an aggregated protection from disruptions. Applying the
triangulation of theories will then address the efficiency and effectiveness of this
research by managing the PSCD threats, developing mitigation and contingency plans
as well as ensuring the deliverability of the PSCD management process. Collectively,
the three theories will be able to exercise an influence on PSCD consequences such that
the supply chain disruption potential of the port is controlled.
As there exists a close relationship between ports and supply chains efficiencies, a better
understanding of the changing trends in the roles ports play in supply chains would help
to develop strategies that fit more appropriately in recent settings and practices. Thus,
exploring the implications of port’s integrative role in supply chains together with the
theoretical approaches will be useful to investigate the practical requirements of
reducing supply chain disruption potential of ports while addressing these implications.
The bottom line is to address these implications in the process of managing the
disruptions. Hence, Table 2.8 shows the implications of port’s increasing integration
into supply chains that will be addressed in the application of theoretical approaches and
the related theoretical approach reflected in studies. A comparison with the theoretical
approaches behind existing strategies will reveal the literature gaps.
55
Table 2.8: Related Theoretical Approach Reflected in Research

Reflected in:
Risk Management Bichou (2008), Pinto and Talley (2006),

(Port Security) Darbra and Casal (2004), Bichou (2004),
Brooks and Button (2007), Chin and
Debnath (2009), Wu et al. (2007),
Gurning and Cahoon (2009b)
Business Continuity Management Paul and Maloni (2010), Angeloudis et

(Agility, Port Networking) al. (2007), Wu et al. (2007), Guerrero et
al. (2008), Blanchard (2007), Paixao and
Marlow (2003), Rahimi et al. (2008)
Quality Management Konings (1996), Slack (1999), Beresford

(Multimodal Connectivity, Integration et al. (2011), Konings (2005), Horck
Initiatives, Value-added Services, (2008)
Efficiency, Charges and Costs,
Diversification into Logistics Serivce
Provision, Training of Port Workers)
Firstly, strategies reflecting information exchange and communication and adaptability

to manage port-related disruptions are absent. Secondly, the theoretical approaches
might have been reflected from the research, however, the principles of the theoretical
approaches were not applied. Thirdly, the research spectrum on strategies tends to be
disintegrated. For instance, risk management applied in past research tends to focus on
port security while risks at ports also comprise of workplace safety and intentional
attacks. Lastly, no recommendations are present on how the strategies can be
operationalised through specific actions. The responsibilities which different levels of
the port should assume are also missing.
56
2.6. Literature Gaps
The review of literature reveals several key findings and limitations. Firstly, ports have
increased their importance and integration in supply chains. The changing role of ports
introduces implications from which port-related drivers of disruptions can be identified.
The more commonly discussed port risks are port accidents, port-equipment failures,
mishandling of dangerous goods, port congestion, inadequacy of labour skills,
hinterland inaccessibility, breach of security and labor strikes. Human factors such as a
lack of work experience and inadaptability to new skills and technologies also form part
of port risks. However, what is uncertain is the consequences of these bottlenecks and
risk areas on supply chains in light of changing roles of ports. This gap gives rise to
SRQ1, SRQ2 and SRQ3. The absence of triggers for PSCD threat detection so that
actions can be in place to avoid or reduce disruptions results in SRQ4. Collectively,
SRQ1, SRQ2, SRQ3 and SRQ4 (see page 4) shall determine port’s role in inducing
supply chain disruptions and thus address RQ1 (PSCD threats).
Secondly, the investigations of disruptions by previous researchers are confined to

actions and consequences within the port and not linked well to potential disruption in
the supply chains. Thirdly, there are fundamentally three aspects in combating
disruptions, namely, preventing the disruption from occurring, mitigating the effects of
disruptions and administering concepts which target disruptions. What is absent in prior
research is to recognize that disruptions can originate from the port itself and be
propagated to supply chain entities despite acknowledging the increasing integration of
ports. Very few studies have investigated the management of port disruptions from the
supply chain perspective. This is an area of research deserving attention as the users and
customers of the ports constitute global supply chains. These result in the formation of
SRQ5 and SRQ6 (see page 4). Hence, SRQ5 and SRQ6 will be able to demonstrate how
ports can mitigate PSCD, answering RQ2 (PDM).
57
The closest topic in the current literature is research on port agility. However, research
on port agility is scant at this stage and studies on similar topics do not provide a
comprehensive framework for implementation at ports. An integration of the relevant
theories from the supply chain perspective would be meaningful as it would offer an
universal approach to guide port management on the areas which they should focus on
to effectively manage disruptions that originate from the port operations. Therefore, this
research shall fill the literature gaps by determining how ports can manage port-related
disruptive events, i.e. the PSCD Threats, which affect supply chain resilience. This
research aims to integrate disruption strategies in a framework and the application of
principles of RM, BCM and QM (Risk Management, Business Continuity Management
and Quality Management) is to ensure that the objectives of the framework can be
achieved. Hence, this research aims to provide recommendations based on academic
work as well as suggestions from management from ports and port users, such that a
more well-balanced and better-informed consensus can be reached in deciding strategies
to implement while addressing conflicts of objectives in the port at the same time.
58
CHAPTER 3. THEORETICAL CORNERSTONES OF THE RESEARCH MODEL
3.1. Introduction
Chapter 3 explores the development of PSCD Indicators and the management model for
PSCD threats through the conceptual framework concluded from previous literary work
in Chapter 2.1 The PSCD threats are identified and the components of the management
model are developed through filling the literature gaps and an analysis of secondary
data.
3.2. Development of PSCD Threats
Supply chain disruptions can be generated by port-related disruptions which are driven
by risk areas in ports. Traditionally, as ports were rather simplistic in their service
provision, the bottlenecks and risks in the port setting were more constrained to their
immediate environment such that the productivity of each port operation was typically
the main focus. However, the present trend of port’s increasing integrative role into
supply chains has altered the range and complexities of port service. Thus, with new
areas of deficiencies arising, port’s integration into supply chains generates implications
which influence how PSCD threats can result in a disruption. Figure 3.1 displays how
the connection between the risks in ports, port-related disruptions and implications of
ports into supply chains relate to supply chain disruptions. The disruption potential of
the port can be minimized by reducing or eliminating the PSCD Threats and this will be
1
The following publications from the author are based on part of this chapter:
LOH, H. S. & THAI, V. V. 2014. Managing Port-related Supply Chain Disruptions: A Conceptual Paper.
The Asian Journal of Shipping and Logistics, 30 (1), 97-116.
LOH, H. S. & THAI, V. V. 2015a. Management of Disruptions by Seaports: Preliminary Findings. Asia
Pacific Journal of Marketing and Logistics, 27 (1), 146 - 162.
59
achieved through detection by the PSCD Indicators for the port to execute its respective
actions and plans. Section 3.3 discusses PSCD Indicators in greater detail.
Figure 3.1: Development of PSCD Threats and Indicators
Source: Author
Based on reported accidents and past research in Section 2.4, several PSCD threats can
be deduced. However, the literature is not complete in the identification of PSCD
threats; for instance, equipment failure is a common threat resulting in shipment delays
yet the event is usually not reported unless the consequence is severe. The more studied
threats are port accidents, labor strikes, congestion and security. Therefore, the list of
PSCD threats compiled in Table 3.1 shows both observed and deduced threats. They are
organized into four main categories: (1) infrastructure threats, (2) planning threats, (3)
manpower threats and (4) security threats. There are seven infrastructure threats related
to the efficiency and adequacy of port equipment and infrastructure; four planning
threats associated with congestions and shortages which arise mainly due to inadequate
planning; three manpower threats related to human factors such as strikes and
miscommunication; and five security threats.
60
Table 3.1: PSCD Threats
Infrastructure Threats Planning Threats

Port Equipment Breakdown Congestion in Waterway
Inadequate Port Cargo-Handling
Congestion within Terminals
Equipment
Occupational Accidents Congestion at Hinterland Transfer
Shortage of Facilities or
Power Outage
Equipment
Breakdown of Vessel Traffic
Security Threats
Management System
Breakdown of Port Information
Trafficking
System
Collisions in Waterway Smuggling/Contraband
Manpower Threats Stowaway
Port Labor Strikes Breaking in/Theft
Misinterpretation of Instructions
Terrorist Attacks
at Workplace
Shortage of Manpower (not due
to labor strikes)
Source: Author
The purpose of this classification of PSCD threats is to draw immediate attention to the
nature of the threat in terms of level of control the port has and to define the scope of
actions that can be executed. In other words, threats under infrastructure are most likely
related to maintenance or technology advancement in the port and are therefore closely
connected to productivity of port operations. Actions at the local level will usually be
sufficient to curb these problems. Thus, the initiative of the port in improving these
areas is imperative. Next, congestions and insufficiency of resources are typical results
of improper planning and forecasting. To remedy these threats, interaction and
cooperation with external entities will offer much assistance. The PSCD threats
presented under manpower are related to soft skills of workers throughout the port and
are also susceptible to governmental pressures. The port is unlikely to reduce these
threats by working alone. Finally, intentional terrorist attacks and other criminal acts are
closely related to the strictness of surveillance and level of security defined by the port.
61
However, the port has least control in managing these PSCD threats as it has to work
closely with relevant bodies and authorities.
The implications of port’s integrative role into supply chains have increased the
significance of the PSCD threats related to planning, manpower and security. The
increasing integration has exposed ports to greater vulnerabilities reflected by the
threats under planning, manpower and security. Due to closer working ties with external
entities, uncommunicated adjustments in upstream or downstream supply chain nodes
will result in imbalance of demand and supply within the port. In addition, the
integration of ports sets a larger interactive environment which increases difficulties
with the differences of more individuals coming into play. On the other hand, the
increasing embeddedness of ports into supply chains breeds opportunities for
disruptions as more loopholes and bottlenecks are revealed in its operations to
accommodate the integration. Thus, planning actitivities are made more complex,
greater reliance on manpower is developed and closer scrutiny is required in
maintaining the port’s security.
3.3. PSCD Indicators
The PSCD Indicators demonstrate an increase in the port’s susceptibility to PSCD

threats and seek to raise awareness on areas in the port operations and also act as early
detection signs to prevent the escalation of PSCD threats into supply chain disruptions.
In the development of the PSCD indicators, the direct causes of the PSCD threats are
considered such that the indicators reflect factors affecting the occurences of PSCD
threats. Tables 3.2, 3.3, 3.4 and 3.5 list the PSCD Indicators for infrastructure, planning,
manpower and security PSCD threats. It is suggested that the PSCD indicators be
computed annually for year-on-year comparison and also monitored at regular time
periods for decision making and timely execution of contingency plans. Indicators are
usually compared year-on-year as seasons affect demand and introduce risks especially
due to weather. Indicators that should be monitored at regular periods would be those
62
are on-going and related to safety, such as level of atmospheric pollution, level of soil
pollution and safety margins. However, it is suggested to study the values of the
indicators collectively since PSCD threats can be interconnected. It has to be noted that
these indicators do not directly imply the possibility of a PSCD threat. For instance, the
presence or absence of equipment substitutes do not affect the probability of port
equipment failure, but the absence of equipment substitutes can affect the severity of
equipment failure threat when no other contingency plans are in place. Another example
is that minimal involvement of government or regulatory bodies increase the port’s
vulnerability to intentional attacks as information on criminal activities and terrorism is
not something a port can obtain on its part.
Table 3.2: PSCD Indicators for Infrastructure Threats
Infrastructure Threats PSCD Indicators

- Large amount of time lapsed after last maintenance
Port Equipment
- Long equipment downtime
Breakdown
- Absence of equipment substitutes
- Low productivity of critical port equipment
Inadequate Port Cargo-
- Large amount of time the equipment spent on maintenance
Handling Equipment
- Obsolescence of equipment
- Increased level of atmospheric pollution
- Increased level of soil pollution
- Unconformities raised at audits
Occupational Accidents - Low employee participation rate at safety drills
- Minimal support from management in improving safety
across port
- Increased frequency of wrong instructions carried out
Power Outage - Absence of power substitutes
Breakdown of Vessel
Traffic Management
- Loopholes revealed in test attacks
System
- High reliance of operations on main communication network
Breakdown of Port
Information System
- Highly utilized berths
- Low margins for safe execution of operations at berths
Collisions in Waterway - Frustration experienced by port and vessels during berthing
- Frequent wrong instructions carried out
- Presence of vessels under Flag of Convenience
Source: Author
63
Table 3.3: PSCD Indicators for Planning Threats
Planning Threats PSCD Indicators

- High proportion of waterway occupied
- Port is a region's gateway or transshipment hub
Congestion in
- Closure of neighboring ports
Waterway
- Disruptions or congestions at neighboring ports
- Outdated development plans
- Highly utilized yard and/or warehouse areas

- Low margins for safe execution of operations at yard and/or
warehouse areas
Congestion within
- Long dwell time of cargo in port
Terminals
- Frequent breakdown of cargo-handling equipment
- Outdated development plans
- High number of delayed service provision by operators
- High reliance on single operator
Congestion at
Hinterland Transfer
- Frequent breakdown of hinterland infrastructure
- Inadequate hinterland infrastructure
Shortage of Facilities - Facilities and/or equipment are highly utilized
or Equipment - Outdated development plans
Source: Author
Table 3.4: PSCD Indicators for Manpower Threats
Manpower Threats PSCD Indicators

- Employees’ complaints with union’s involvement
- High percentage of outsourced workers
- High employee turnover rate
Port Labor Strikes - Employees’ complaints on unfavorable working conditions
and/or wage
- High influence power of unions
- Growing tension in labor conflicts and negotiations
- Increasing cost of labor
- Policies that cause hinder employment process
Shortage of Manpower
- Insufficient upgrading programs and courses for employees
(not due to strikes)
- Festive seasons
- Presence of pandemic outbreak
Misinterpretation of - Frequent errors in execution of operations
Instructions at - Frustration experienced by port workers during operations
Workplace due to miscommunication of instructions
Source: Author
64
Table 3.5: PSCD Indicators for Security Threats
Security Threats PSCD Indicators

Trafficking
Smuggling/ - Presence of security breaches
Contraband - Minimal involvement of government agencies or port
Stowaway authorities in port operations and business
Breaking in/Theft
- Presence of terrorist attacks in adjacent areas
- Presence of disputes related to questions of sovereignty
Terrorist Attacks - Minimal involvement of government agencies or port
authorities in port operations and business
- Growing tension with extremists
Source: Author
There are two distinct features of the PSCD Indicators. Firstly, the main perception is
that the port is no longer considered as a whole; the indicators which were once applied
to the port system as a whole are now applied to the port’s disintegrated operations. For
instance, the computation of productivity is extended in its application to each type of
critical port equipment in the determination of equipment adequacy. Similarly,
utilisation rate is computed for resources, warehouses and yard areas and this will
reflect chances of the imminent congestion at each space.
Secondly, the indicators are computed on a discrete basis for each functional entity.
This is to prevent the chances of making up deficiencies at certain areas by efficiencies
at another of the same function. For instance, the performance of each hinterland
transport operator should be computed instead of obtaining an average rate for each
mode or the port as a whole. Computing discrete results will reveal discrepancies of
results between the operators. An indication of inefficient operator will then call for
additional adequate hinterland infrastructure to be constructed or the scraping of
obsolete equipment. On the same note, when all the operators are operating above
optimal rates, development plans need to be revisited to ensure their relevance. The
65
same applies to the computation of productivity of critical port equipment and
utilisation of facilities and/or equipment as the results are obtained for each type of
equipment and resource.
In the development of PSCD Indicators, the significance of several areas have been
identified. These areas include the availability of substitutes, backup plans, safety drills,
support from management on safety projects as well as the presence of cooperation with
employees, hinterland transport service operators and the government. Thus, the
strategies for managing PSCD threats have been reflected through PSCD Indicators.
The following section further discusses the development of the management model for
PSCD threats.
66
3.4. Development of the Management Model for PSCD Threats (PDM)
From the review of literature, it is apparent that the significance of ports in supply
chains has increased and port functions have become much more complex today. These
changes affect the ports’ ability in minimizing disruptions. With the network proximity
between ports and their users, ports are expected to be engaged in a higher level of
interaction with the external parties, especially those within the port community. Thus,
conducting RM and planning for contingency together with the external parties are
deemed to be necessary actions to combat disruptions. The PSCD threats are analyzed
in RM process to assess the consequences and probability of the threats. On the other
hand, BCM allows the impact of the PSCD threats to be analyzed in order to determine
the necessary recovery and mitigation plans that are to be in place. Therefore, RM will
identify PSCD threats that affect the core deliverability of the port and assess the
suitability of existing and additional controls, while BCM drives the ability to recover
from the disruptions.
Though there exists established risk management frameworks such as the RIMS Risk
Maturity Model and COSO ERM framework, the applicability of PDM makes it
superior to the existing frameworks. While the earlier frameworks focus largely on risk
management, the PDM integrates principles from BCM and QM while at the same time
allows the participation of the port’s stakeholders. The PDM is able to offer a wider
coverage and broader scope of applicability, therefore making it more comprehensive
than existing frameworks.
With this background in mind, the business environment that ports are embedded in has
generally become riskier as they are more vulnerable to uncertainties attributed to global
inter-connected supply chain entities, which in turn are more reliant on the ports in
ensuring the delivery of their customers’ requirements. Therefore, the application of
RM theories and the presence of business continuity plans are critical. RM approach is
essential to identify, analyze and manage PSCD risks and is useful in raising risk
67
awareness within the port. On the other hand, the development of business continuity
plans will enable the port management to maintain port operations in the event of a
disruption. RM, together with BCM, will reduce the likelihood of disruption causes and
also ensure the continuity of port operations during adversity. In other words, an
application of both approaches provides a more holistic protection and view for port
management in disruptions.
Global challenges need to be addressed so that the port management is able to adjust to
increasing changes. Among the changes and trends in the industry, there arise
opportunities which the management can make use of to address the challenges and
boundaries faced. The ever-changing market environment which the port is situated in
also leads to the need to examine the criteria of working towards minimization of its
disruptive potential. Thus, the relevancy of any proposed changes at the port must be
ensured and this is the reason for regular monitoring and review of practices and
policies at the port. The complexities of different organizations vary in extent.
Similarly, in the port industry, not every port is at an identical stage of maturity and
establishment. This emphasizes the importance of identifying the requirements which
the ports should work on internally to ensure the deliverability of action plans. In
essence, it is similar to the theories of QM and a holistic approach adopted by the
leadership will facilitate changes in operations, cultures or practices at the port.
3.5. Components of the Proposed Management Model
The management model is presented in three tiers for the directives to be

operationalized. The first tier starts at the top management and is referred to as
Institutional Bearings in the management model as the focus is on the level at which
decision making takes place and these strategic directions will go on to affect the course
of actions to be taken by the port to work towards the objectives. There are five
Institutional Bearings and each of them constitutes the first tier of the management
model. The Institutional Bearings are developed with the objective of minimizing
68
supply chain disruption potential of ports. The deliverability, supply chain dynamism
and the new role of ports in supply chains were considered in the development of
measures that increase port resilience. These five Institutional Bearings address the
external challenges through a committed internal support throughout the port, with
theories of RM, BCM and QM being applied. Specifically, risks should be reduced or
eliminated through RM process. Alternatives and recovery plans have to be in place for
emergencies and unavoidable risks and this is achievable through BCM process. Finally,
akin to Kleindorfer and Saad (2005) who applied total quality management (TQM)
principles in their implementation of risk mitigating tasks, QM ensures that the port is
able to maintain its delivery of services.
Extending from the first tier, management policies will then be formed at the second tier
and front-line actions will be implemented at the third tier. Consequently, the second
and third tiers of the management model are named Management Policies and
Operational Actions respectively as shown in Figure 3.2. The arrows in Figure 3.2
demonstrate the direction in which the Institutional Bearings will be enforced to manage
the disruptive potential at the port and the application of RM, BCM and QM principles
to the management model.
Figure 3.2 Application of Theories to the Management Model
Source: Author
69
Each institutional bearing is responsible for taking the port towards a certain directive.
As can be seen in Figure 3.3, beneath each Institutional Bearing are two related
Management Policies which help steer the port towards that particular direction
stipulated by the Institutional Bearing. The Management Policies then expand into
Operational Actions for detailed front-line actions.
Figure 3.3: Overview of the Management Model
Source: Author
3.5.1. PSCD Threats Defense Mechanisms
The first Institutional Bearing, PSCD Threats Defense Mechanisms, relates mainly to
managing PSCD threats within the port and is addressed by Internal Risk Management
and Mandatory Controls. Applying the principles of RM and BCM, the third tier
translates Internal Risk Management into actions that ensure the employees acquire and
share the necessary RM knowledge internally and carry out the fundamental risk
70
procedures diligently, such as conducting risk assessment and ensuring that risk levels
are monitored. These enhance the ability to identify and prevent the occurrence of
PSCD threats. On the same note, Mandatory Controls specifies that buffers and
alternatives should be created in port equipment, systems and transportation solutions;
port should ensure that it is sufficiently insured against damages and losses; and
mitigation strategies should be well-documented, closely adhered to and catered for
different types of risks. By doing these, the port prepares itself for expected and
unanticipated incidents. Considering the changing market trends and business
environment, these strategies are to be regularly evaluated to ensure their relevance and
effectiveness. There are also existing mandatory safety and security rules and
regulations that the port has to comply with as these initiatives contribute to mitigating
risks in ports when effectively implemented.
3.5.2. Discrete PSCD Deviators
PSCD Impact Analysis and Disruption Recovery Planning are the Management Policies
associated with Discrete PSCD Deviators, whose main aim is to reduce the impact of
disruptions caused by PSCD threats. The key processes and operations at a port are
dependent on the types of cargo handled. Relating them to a detailed record of incidents
which previously resulted in disruptions helps reveal critical business functions where
due regard should be given. Simulating scenarios of these areas and the occurrence of
PSCD threats would then expose the extent of disruptions. With that information, port
management is suggested to plan for disruption recovery through documenting detailed
emergency response plans for each functional department; implementing systems that
allow prompt contact with and response from internal management and employees; and
conducting emergency drills that mandate the participation of all employees. These
Operational Actions reflect the essence of planning ahead for contingency and
sustainability. Implementing PSCD Threats Defense Mechanisms together with Discrete
PSCD Deviators allow a more comprehensive protection from PSCD threats. This is
because Discrete PSCD Deviators complements PSCD Threats Defense Mechanisms
with recovery capabilities.
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3.5.3. Collaborative PSCD Defense and Deviators
The third Institutional Bearing, Collaborative PSCD Defense and Deviators, reflects the
port’s efforts in managing PSCD threats and planning for contingency together with
external parties comprising of supply chain parties and relevant agencies. Supply chain
parties, who are port customers and port users, are the ones who feel the immediate
impact of disruptions propagated from ports. It is therefore important to handle risks
with them and involve them in measures that increase port resilience. Hence,
Collaborative Working Relationships with Supply Chain Parties is suggested.
Operational Actions corresponding to this Management Policy include information
exchange with port users on the status of their cargo and port’s berths in an accurate and
timely manner; ensuring that contractors’ default do not affect port’s operations;
collaborative risk management; involvement of external parties in port’s emergency
drills; implementation of communication systems that enable prompt contact with and
response from external parties; agreement on labor welfare; and coordinated provision
of alternative transportation for port’s customers in times of disruptions.
Also placed under the third Institutional Bearing is another management policy named
Collaborative Relationships with Relevant Agencies. The aim of this Management
Policy is to tap on influential parties with resources that enable continuous improvement
in the process of managing PSCD threats. Operational Actions include having
agreements with government agencies, employees and management on employee
welfare; collaborating with government agencies in risk and disruption management;
adopting relevant guidelines or framework established by local industry professional
standards or alike; and regularly conducting research and development with higher
education institutions to improve on port operations. The purpose of these actions is to
ensure that the capabilities of managing PSCD threats are being updated and
continuously improved on and refined.
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3.5.4. Port’s Holism Towards PSCD Reduction
The above three Institutional Bearings administer the management of PSCD threats by
increasing organizational resilience and mitigating consequences through a series of
measures that require internal and external cooperation. Naturally, these concerted
efforts can materialize when there is approval and support to do so. As the name
suggests, Port’s Holism towards PSCD Reduction is associated with the port’s holistic
attitude towards management of PSCD threats. Stemming from this Institutional
Bearing are two Management Policies – Service Objectives Enhancement and
Employee Involvement and Empowerment. Service Objectives Enhancement can be
described as a pro-service attitude that ensures quality of PSCD management through its
Operational Actions. Appropriate actions are ensuring commitment from all functional
departments to provide quality port services; upgrading of employees’ professional
skills; identifying customers’ thresholds for delays; understanding customers’ current
and future needs; soliciting views from customers and users as well as re-evaluating
workflow processes to improve efficiency.
Furthermore, it is suggested that leadership should involve and empower the employees
so that the employees feel valued and respected. Leadership is recommended to
motivate employees to offer constructive feedback on process improvement through
giving incentives and have their opinion collected through internal portals. The port
management is also advised to delegate authority to front-line employees who can make
wise decisions in a timely manner. This shall help prevent and mitigate disruptions.
When there are policy changes, the port management is encouraged to communicate
issues brought about by the changes through small group meetings with the employees.
Therefore, the objective of the fourth Institutional Bearing is to ensure the deliverables
of the PSCD management process while business profitability and cooperativeness in
corporate culture are not compromised.
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3.5.5. Monitor and Review of PSCD Management Process
Lastly, Monitor and Review of PSCD Management Process seeks to ensure the
relevance of the PSCD management process and improvements on it. This is essential
due to the dynamism of the industry that is filled with changing business trends. Hence,
one action for Relevance Evaluation is to review disruption management strategies
regularly. Not forgetting the importance of involvement of external parties, the port is
encouraged to communicate regularly with them and other stakeholders on issues
pertaining to disruption management as well as conduct post drill evaluation together
with its users and customers. The purpose is to identify ways to cooperate and adapt to
the changing landscape. Similarly, Recommendations for Improvement is a plan to
continuously improve on existing practices in disruption management. It is proposed
that this can be achieved by conducting thorough post drill and disruption analysis,
adopting feedback and suggestions gathered from customers and employees wherever
deemed useful and also apply previous lessons learnt. These lessons when shared with
other industry players can help prevent same mistakes by another party and hence are
also encouraged.
In summary, the management model for port-related supply chain disruptions consists
of Institutional Bearings, Management Policies and Operational Actions derived from
the theoretical approaches discussed in the previous subsections. The PSCD
management model proposes actions which are applicable to all types of ports. The
main objective of this management model is to target operational deficiencies at ports
such that supply chain continuity can be enhanced through reduced port-related
disruptive risks. As ports are now more embedded in supply chains than ever before, it
is important to enhance the functionality of ports and the PSCD management model
proposed in this paper is the first step to make this happen. As such, this model is of
relevant contribution to both theory building and practical management of port-related
supply chain disruption.
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CHAPTER 4. RESEARCH METHODOLOGY
4.1. Introduction
This chapter presents the research design and approach of this study. An overview of
the research process of this study will first be presented. Next, a conceptual framework
showing the overall relationships between the constructs will be identified. After which,
the research design will show how the data collection and analysis stages will be
planned and research approach will address and justify the application of research
methods.
4.2. Research Process
Throughout literature, the term research process has been given many definitions. Collis
and Hussey (2009) has summarized a research to take on the following characteristics:
(a) process of enquiry and investigation; (b) systematic and methodical; (c) increases
knowledge; (d) thorough and rigorous methodology. Lussier (2011) has defined
research as the “systematic process through which new knowledge is discovered through
answering questions”.
The research topic and research questions of this study were selected based on the
discussion by Lussier (2011) in his identification of six considerations in the selection
of research questions. This study thus corresponds to them and they are related to the
level of interest in the topic by the author, willingness to acquire expertise in the
research area, value to the academia and industry of the study, sufficiency of literature,
feasibility of conducting the research and openness to change. As discussed in the
beginning chapter, this research seeks to explore how port-related disruptive events
affect supply chain continuity and this is answered by addressing the first research
question and its sub-research questions:
RQ1: How is the role of ports in inducing supply chain disruptions determined?
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SRQ1: What are the implications of ports increasingly being integrated into
supply chains?
SRQ2: What are the most commonly observed and perceived PSCD threats and
consequences?
SRQ3: How severe are the PSCD consequences?
SRQ4: How can PSCD threats be detected?
The second research question and its sub-research questions help us understand how
ports can manage these disruptions in an effective manner:
RQ2: How can ports mitigate port-related supply chain disruptions effectively?
SRQ5: What are the mechanisms which the port should initiate to minimize
port-related supply chain disruptions?
SRQ6: How should a holistic approach towards PSCD management be

operationalized by the participants involved in port transport chains?
Besides the stages of problem formulation, the research process also involves planning
for data collection and selecting the most appropriate methodology for data analysis. As
stated by Collis and Hussey (2009), the purpose of a research includes (a) to review and
synthesize existing knowledge; (b) to investigate existing situations or problems; (c) to
provide solutions to problems; (d) to explore and analyze more general issues; (e) to
construct or create new procedures or systems; (f) to explain new phenomenon; (g) to
generate new knowledge; (h) or a combination of any of the above.
In order to answer the research questions of this study, three management theories were
applied in the research process and they were risk management, business continuity
management and quality management principles. The application of these theories was
76
justified as it was attributed to literature gaps, discussion with the author’s supervisor
and other industry experts as well as the author’s observation in this research area. The
industry experts are management from port operating companies and their demographic
data are provided in Table 4.5 in sub-section 4.7.1. The development of measurement
items of each construct thus followed the principles of the three management theories.
The general research process followed by this study to answer the two research
questions is shown in Figure 4.1.
Figure 4.1: Research Overview
Source: Author
4.3. Research Design
After stating clearly the research questions, the study must be designed in such a way
that the questions will be answered. In general, the research design is the planning of
data collection and selection of data analysis methods which include indicating the
sample, variables and measures in relation to the research objectives, such that the
research questions can be answered (Lussier, 2011, Jarzemskiene, 2009, Ketchen et al.,
77
2008). There are many forms of research processes discussed in literature. A research
can possess the nature of an exploratory or conclusive study, fieldwork, case study,
desk-bound or laboratory work, qualitative or quantitative methods, cross-sectional or
longitudinal and descriptive or causal type of analysis (Lussier, 2011, Zikmund, 2007,
Gable, 1994). Lussier (2011) has summarized and presented eight dimensions of a
research as shown in Figure 4.2.
Figure 4.2: Classification of Research Designs
Source: Author, adapted from Lussier (2011)
The research design of this study used both qualitative and quantitative nature in the
data collection and analysis processes. An overview of the research design of this study
is provided by Figure 4.3. Primary data were collected through interviews and surveys,
while the results were analyzed statistically. In this manner, the qualitative analysis
from interviews and secondary data assisted in the development of questionnaires and
inferences were then made and supported through a quantitative method.
78
Figure 4.3: Research Design of Study
Source: Author
At the first step of the research design, the topic was selected, research questions were
clearly stated and the research purpose and objectives underlay the value of this study.
The process of the operations from upstream supplier to the port and then from port to
downstream entities were considered and overseen right at the beginning to define the
research scope. SRQ1 is regarding the implications of port’s integration into supply
79
chain and thus was answered through a review of related literature. By doing so, all
port-related operations and processes were recognized and this research maintained its
relevance. The secondary data was then looked into in order to identify reported cases
of port-related supply chain disruptions. In this way, a list of PSCD threats and
consequences was determined and deduced. On the same note, literature on disruption
management was studied and the applicable mitigation and prevention strategies were
analyzed. Coupled with the principles of risk management, business continuity
management and quality management, a framework for managing port-related supply
chain disruptions was proposed for port management.
Hypotheses were then developed, specifying the variables and measurement items
enabling the research questions to be answered. In addition to establishing the risk
matrix for port-related supply chain disruptions, the other purpose of conducting the
survey was to ensure that the proposed management model conforms to a practical
framework that is relevant in its applicability. Thus the management model was revised
wherever deemed necessary after analyzing the interview results. The management
model contains measurement items that reflect the three pronged approach – risk
management, business continuity management and quality management theories –
which built it. These measurement items were grouped under constructs according to
the theories that developed them and were included in the questionnaires distributed to
the port operators who then indicated how well they have done in terms of the
measurement items and port performance related to disruption management.
The next step of the research design for this study was the process of primary data
collection. Interviews were conducted with industry professionals to facilitate
discussion of PSCD threats, their respective consequences and the course of actions
taken at their individual ports. Professionals from the port operators and port user
entities were selected to provide different perspectives and concerns from different sides
in a port community. Their comments and any additional risks and consequences were
80
compiled with the one derived from secondary data. The selection of the professionals,
population and sampling frames will be discussed in more details in Section 4.6. The
survey methodology required careful design of questionnaires, and pre-test and piloting
of questionnaires which identified areas for revision. After the responses were received,
the responses needed to be carefully edited, coded and entered, and measures were in
place to control errors to prepare the data for analysis. As such, the qualitative results
from the interviews were incorporated into the questionnaires. Therefore, SRQ2 and
SRQ3 were answered. The understanding of the origin of the threats will enable the
development of PSCD indicators which detect a PSCD threat. In other words, the results
for SRQ2 and SRQ3 allowed SRQ4 to be answered together with a review of related
literature.
SRQ5 and SRQ6 were answered through the survey results by showing the relationships
between the proposed management model and port performance in terms of port-related
disruption management through Structural Equation Modeling (SEM). The simulation
exercise in Appendix J aims to complement the SEM results through a practical
illustration of figures related to time, costs and volumes. Hence, the outcome of this
research is that the two research questions are answered with both qualitative and
quantitative perspectives.
4.4. Research Approach
Qualitative and quantitative methods are the primary options for research methods. A
qualitative research differs from a quantitative one in terms of the size of sample, its
focus, the methods of analysis used and objectives, among other things. The nature of a
quantitative research is that it is more focused on presenting information in a scientific
and numerical way (Page and Meyer, 2000), while that of a qualitative research is
related to observations, descriptions and explanations (Lussier, 2011). Table 4.1
illustrates the main differences between a qualitative and quantitative research. It is
81
helpful to first pay attention to the goal of the study when selecting the type of method
to use so that the research objectives can be fulfilled.
Table 4.1: Quantitative versus Qualitative Research
Quantitative Research Qualitative Research

1. Seeks to explain phenomena. 1. Seeks to understand phenomena.
2. Tests research questions 2. Uses critical thinking to
(hypotheses). understand, rather than test.
3. Uses closed-ended, brief 3. Uses open-ended, in-depth
questions. questions.
4. Uses a large sample size. 4. Uses a small sample size.
5. Data are collected, then analyzed 5. Data are collected and analyzed as
once (questionnaire completed an ongoing process (may include
once). multiple interviews with the same
person).
6. There is a clear end to the data- 6. There is no clear end to the data-
collection process. collection process.
7. Uses statistics to analyze data. 7. Does not use statistics to analyze
data.
8. Results are objectively 8. Results are subjectively
determined. determined.
9. Conclusions are reported to be 9. Conclusions are reported to help
generalized to population. understand phenomena.
Source: Lussier (2011)
The goal of this study is to identify ways which port management can adopt to
effectively manage port-related supply chain disruptions. There is hence an implied
causal relationship, between disruption management performance and the proposed
actions that make up the management model, which needs to be tested and validated in
the data analysis process. Methods such as tests of difference, tests of interaction, tests
of association, tests of prediction and tests of interrelationship are research designs
which will help achieve the objectives of this study. These are statistical designs and
belong to quantitative methods. As there was an absence of port-related supply chain
disruptions studies in literature, interviews were useful in the data collection stage prior
82
to the development of a questionnaire. The use of interviews will allow the researcher to
probe for details and ensure that the measurement items in the questionnaire, which are
to be developed at the next stage, remain relevant and suitable. Such interviews tend to
be open-ended and in-depth in order to serve its purpose of understanding the field of
study. In other words, this study used both quantitative and qualitative methods – data
triangulation. Both the perspectives of port operators and port users were considered in
the data collection process. In addition, a simulation involving a port user was added
after the statistical analysis to support the results of data analyzed and thus, a between-
method, which is a triangulation of both quantitative and qualitative methods, was
employed. This methodology adds a stronger validity to the conclusions by using
different methods to support the results (Lussier, 2011).
With regards to data collection, there are three methods: (1) secondary, (2) observation
and (3) survey (Lussier, 2011). Secondary data are those that are found in published
work and historical statistical records. Observation is related to qualitative research
design and requires effort in observing behaviors and patterns of people and objects
(Zikmund, 2007). According to Zikmund (2007), researchers often use two kinds of
observation methods, human and mechanical observation to gather information on
human behavior or action, verbal behavior, spatial relations, temporal patterns, physical
objects, verbal and pictorial records and expressive behavior. Examples of what can be
observed are shown in Table 4.2.
Survey method involves asking respondents for information either verbally or through a
questionnaire (Zikmund, 2007). Surveys are also a primary data collection method and
can take the form of face-to-face interviews, telephone interviews, online questionnaires
and written questionnaires (Ketchen et al., 2008, Zikmund, 2007). The purpose of these
procedures is to collect facts or information from the target respondents. The data
collected enables the identification of the inherent trends and patterns, provision of a
measurement of attitudes or an explanation to behavioral characteristics. Surveys
83
provide a flexible and efficient way of collecting data about a population, especially
when the sample is geographically wide-spread.
Table 4.2: Examples of What can be Observed
Phenomenon Example
Human behavior or action Workers’ movement patterns in a factory

Verbal behavior Statements made by airline travelers
waiting line
Spatial relations Proximity of middle managers’ offices to
the president’s office
Temporal patterns How long workers take to perform a task
Physical objects How much paper office workers recycle
Verbal and pictorial records How many illustrations appear in a training
booklet
Expressive behavior Facial expressions, tone of voice, and other
forms of body language
Source: Zikmund (2007)
Inevitably, with every method used, whether quantitative or qualitative, there would be
disadvantages. Thus, what is important is to minimize the errors and to increase the
accuracy of any selected method. The errors affect the accuracy of surveys but can be
minimized by an appropriate selection of the samples and proper administration of the
survey. The accuracy of surveys can be increased with the use of well-constructed
questions with proper instructions. Before the questionnaires are distributed, pre-tests
and pilot-testing will ensure improvements on the questionnaires, hence reducing the
chances of misinterpreting the questions. Specific measures undertaken to address errors
and accuracy will be explained in later sections of this chapter.
84
Weighing the merits and shortcomings of each technique, the most appropriate research
design and methods can then be selected. Participants of this research were located
around the world, hence the method used to collect data from the above participants
needed to provide geographical flexibility and at the same time should not compromise
on the depth of information collected. In-depth interviews have high response rates and
allow opportunities for feedback and confirmation of information. Surveys in the form
of questionnaires allow respondents who are geographically dispersed to participate in
the study at a time of their convenience. Using electronic mail, time and cost to collect
data from the respondents through questionnaires will not be an issue. As the data
intended to be collected involved information regarding organizational strategies and
security, participants might be reluctant or uncomfortable in the presence of the
researcher when probed. On the other hand, if questionnaires are sent to them instead,
the respondents can remain anonymous. When the respondents are not able to provide
accurate information for this study, the respondents can approach colleagues who are
more suitable to give answers. Hence, the use of survey methodology was justified.
4.5. Research Hypotheses Development
The previous chapter discussing the development of conceptual framework has

presented the reasons for the dimensions of the management model. Specifically, the
management model for PSCD threats (PDM) consists of 10 groups which further
expand into 45 measurement items. The measurement items collectively reflect the
triangulated application of risk management, business continuity management and
quality management. Table 4.3 shows the relationship between the principles of RM,
BCM and QM and the 45 measurement items.
85
Table 4.3: Relationship between The Three Theories and Measurement Items
Related Theoretical Approach Reflected in:

(Relevant sections in
questionnaire)
Risk Management Joint Standards Australia/Standards New

(B1, B2, B7, B9) Zealand Committee OB-007 (2004b), Bichou
(2008), Pinto and Talley (2006), Darbra and
Casal (2004), Bichou (2004), Brooks and
Button (2007), Chin and Debnath (2009), Wu
et al. (2007), Gurning and Cahoon (2009b),
Handfield et al. (2007), Pinto and Talley
(2006), Blackhurst et al. (2005a), Christopher
and Peck (2004), Ronza et al. (2003)
Business Continuity Management Joint Standards Australia/Standards New

(B3, B4, B7, B9) Zealand Committee OB-007 (2004a), Paul and
Maloni (2010), Angeloudis et al. (2007), Wu et
al. (2007), Guerrero et al. (2008), Blanchard
(2007), Paixao and Marlow (2003), Rahimi et
al. (2008)
Quality Management Coetzee (2005), Konings (1996), Slack (1999),

(B5, B6, B7, B8, B9, B10) Beresford et al. (2011), Konings (2005), Horck
(2008), Greening and Rutherford (2011),
Fabiano et al. (2010), Kleindorfer and Saad
(2005)
The essential purpose of PDM is to minimize the disruptive potential of the port, and
hence it seeks to improve port performance in terms of financial and non-financial
metrics. It can be seen from Table 1 that several variables are extracted and classified
according to their effects on four main aspects of port performance. These aspects are
86
associated with the dimensions of the balanced scorecard used by numerous private,
public and non-profit organizations around the world (Kaplan 2010). The balanced
scorecard is primarily concerned with measuring performance from financial
perspective, customer perspective, process perspective and learning perspective as
elaborated in various studies (Kaplan 2010, Perlman, 2013, Huang et al., 2009, Logman,
2004). To address these dimensions, the port performance in this research will be
measured by four constructs, namely financial health (FH), market reputation (MR),
resilience of internal operations (RIO) and internal and external opportunities (IEO).
Table 4.4 shows the linkage between the four constructs and the measurement items
(Appendix F, Part C) in the questionnaire.
Table 4.4: Relationship between Balanced Scorecard Constructs and Measurement

Items
Balance Card Variables in Questionnaire Related studies

Constructs
Financial (Financial Health)
perspective
Presence of financial difficulties, Zhang et al. (2014), Lun et
financial growth, financial al. (2010b), Christopher
benefits, fines and penalties and Peck (2004), Mason
received, financial ratios and and Nair (2013), Paul and
profits Maloni (2010), Chin and
Debnath (2009), Guerrero
et al. (2008), Mennis et al.
(2008), Handfield et al.
(2007), Tang (2006),
Paixao and Marlow (2003)
Customer (Market reputation)

perspective
Ability to redesign and resume
internal operations, improvement Mennis et al. (2008)
in operational efficiencies, an Tongzon and Heng (2005),
experience of disruptions Lirn et al. (2004)
Process (Resilience of Internal
87
Balance Card Variables in Questionnaire Related studies
Constructs
perspective Operations)
Market share, customer retention, Ellis (2011), Ponomarov
customers’ complaints, attraction and Holcomb (2009),
of new customers, customers’ Bichou (2008), Handfield
satisfaction et al. (2007), Pinto and
Talley (2006), Blackhurst
et al. (2005a), Christopher
and Peck (2004), Ronza et
al. (2003)
Learning (Internal and External

perspective Opportunities)
Skills and knowledge of Beresford et al. (2011),
employees, engagement in Greening and Rutherford
technology and acquirement of (2011), Fabiano et al.
capabilities, intensity and (2010), Rodrigue and
frequency of training and learning Notteboom (2009),
opportunities, improvement in Skipper and Hanna (2009),
disruption management process, Horck (2008), Handfield
improvement in employee et al. (2007), Kleindorfer
turnover rates and Saad (2005), Bichou
and Gray (2004), Baum et
al. (2003), Heide and
Stump (1995)
These perspectives are sufficiently wide-ranged to address port performance from the
financial, customer, process and learning and growth of the effects from the
implementation of the PDM (Kaplan and Norton, 1992).
The PDM was derived from the principles of RM, BCM and QM. The predominant
purpose of PDM was to reduce supply chain disruptions that originate from port
operations. A resilient system has diversity, efficiency, adaptability and cohesion as its
characteristics (Fiksel, 2003) and Falasca et al. (2008) explains that resilience in supply
88
chain is capable of lowering chances of disruptive events occurrences and reducing the
impact of unanticipated outcomes. With higher flexibilities, adaptability and efficiencies,
the severity of the disruption can be abated by increasing responsiveness and capacity of
contingency plans (Schmitt and Singh, 2009, Craighead et al., 2007), resulting in better
performance. The measures that constitute PDM therefore seek to enhance port’s
disruption management by increasing the resilience of port operations, giving rise to:
H1: PDM has a direct and positive effect on RIO.
Port performance has already taken on a different dimension that extends beyond
efficiency within the port itself (Song and Panayides, 2008, Lun et al., 2010a, Ducruet
and Van Der Horst, 2009). The idea that supply chain firms should no longer compete
individually leads to the understanding that firms need to recognize the importance of
establishing strong alliances with each other, while not losing focus on enhancing
performance at both local and aggregate levels (Green et al., 2006). The application of
RM, BCM and QM principles highlights the importance of continuous improvement
and assessment through cooperation within the port and collaboration with external
parties. In addition, PDM seeks to result in effective and sustainable partnerships from
which the parties can derive benefits (Kleindorfer and Saad, 2005). When conducted
effectively, the innovation and growth perspective experienced by the port would be
facilitated. Therefore, the resulting outcome of PDM would have an effect on internal
and external opportunities:
H2: PDM has a direct and positive effect on IEO.
Internal and external opportunities are particularly related to the growth and learning
opportunities of the port employees to better assess, identify and handle threats.
Through such opportunities, professional skills of employees can enhanced and areas to
be improved can be identified, collectively resulting in increased capability which will
result in other effects. The different forms of cooperation and coordination initiatives
89
which ports can engage in would facilitate its integrative role in supply chains and
evolution towards agility and resilience (De Langen and Chouly, 2004, Lun et al.,
2010a). Thus, internal and external opportunities are expected to have a direct and
positive effect on reliable operations:
H3: IEO has a direct and positive effect on RIO.
Furthermore, the increased resilience of internal operations will inevitably reinforce the
trust that port users have on the port as well as bringing about higher and repeated
earnings for the services and value provided. Value proposition at the port depends on
its internal processes which, when improved, reduce costs (Kaplan and Norton, 2004).
Financial health is a lagging indicator of the performance-driving measures (Kaplan and
Norton, 2004, Huang et al., 2009) which, in this study, are represented by the constructs
of “Resilience of Internal Operations”. Impacts of port-related disruptions, e.g., route
diversion, port lockout, accidents, cargo loss, are usual consequences of low quality in
RIO. On the other hand, seamless cargo flow through the port would understandably
result in reduced compensation, revenue increases and build up customers’ confidence.
Hence, PDM is expected to improve disruption management at the port in the form of
increased port resilience which will consequently produce healthy financial outlook and
better market reputation. The above leads to the following hypotheses:
H4: RIO has a direct and positive effect on FH.
H5: RIO has a direct and positive effect on MR.
As explained above, the relationship between PDM and market reputation is not direct.
Business reputation depends on the quality of value proposition and good customers’
perception of port management which in turns translate into better finances due to
repeated existing port customers and new businesses. Hence, financial health is a
derived effect or a lagging measure (Perlman, 2013) as the development of customers’
90
trust and confidence is fundamental to the profitability and relevance of businesses.
Thus, this connection leads to the development of:
H6: MR has a direct and positive effect on FH.
The theoretical model is presented in Figure 4.4.
Figure 4.4: Theoretical model
Source: Author
4.6. Population and Sampling
The decision on the population to be selected is determined by the scope of research and
other practical considerations. Depending on the areas intended to be covered by the
research and the research objectives, data collection can be carried out locally or
involving respondents from more than one nation. Practical concerns include time and
cost required for the data collection process. In this case, the extent of involvement in
port supply chains was the focal point in determining the suitable candidates in data
collection.
91
4.6.1. Population Frame
According to the research questions, participants were not restricted to the types of
cargo handled, size of organization or market orientation. In fact a composition of
respondents with those differences allowed an investigation on a variation of response
characteristics. However, the respondents were narrowed down to two groups – port
operators and port users. Ports are the ones playing the vital role in any port-related
supply chain disruption and naturally they will be involved in the data collection
process. Port users, on the other hand, are the ones directly impacted by consequences
of those disruptions and are thus included as well. There were two objectives of the
survey, the first objective was to establish a risk matrix and the second objective was to
explore the relationship between the proposed management model and disruption
performance. Different groups of respondents were suitable for the two objectives as the
concerned parties involved differ.
The first research question was addressed by developing a risk matrix. When
considering the participants to be included in the population frame for the risk matrix, it
was necessary that they are familiar with the likelihood and consequences for each
PSCD threat, which are the two axes that make up the risk matrix. In addition, they
should be part of supply chains in which ports are used and have felt the impact of a
port-related supply chain disruption. Clearly, the involvement of the port operators and
port authorities was indispensable as they were the subjects of this study. They were
able to comment on the appropriateness of the findings as well as provide instances of
relevant past cases or data. Ports that handle containers and non-containerized cargo
such as vehicles, liquid and dry bulk were included in the analysis. Passenger ports were
not analyzed as the research scope covered only the consequences of PSCD threats on
cargo. After the collection of data, an analysis was also made for prevailing differences
among categories of participants to investigate if the differences have attributed to
variation in responses.
92
The ports’ stance on PSCD threats offers only a one-sided viewpoint of the risk matrix
as other supply chain entities would have felt the impact differently. Therefore, besides
the port, these participants also comprised of the stakeholders of the port. The
stakeholders were limited to entities that have a proximate relationship with ports and
those with direct interest in the cargo transported through ports to ensure the accuracy of
data collected and their knowledge in the data required. Therefore, cargo owners, freight
forwarders, shipping owners and ship management companies were included in the
population frame. Cargo owners who were approached comprised mainly of sea freight
forwarders and/or logistics companies since they were usually the representatives of the
real cargo owners. However, the geographic location of these companies should not
influence the results as the import and export ports used by these entities vary widely
and are located all over the world. Hence, there were no restrictions on the geographical
locations of port users’ entities.
The second research question was about the management model. For the management
model, as it involves the familiarity of operations and practices within the port, port
operators and port authorities were appropriate participants. For this research, it was
decided that ports of all sizes and regions be among the participants as there had been
no previous studies that offered a general framework for ports of all types to adhere to.
This study seeks to provide that as groundwork for future progression into specific
guidelines tailored for different categories of subjects. Port authorities were involved as
they hold regulatory powers over policies and investments which can affect the
effectiveness of implemented strategies. The target population for the survey and the
intended objectives are shown in Figure 4.5.
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Figure 4.5: Target Population
Source: Author
4.6.2. Sampling Frame
From the populations decided in previous section, samples were selected. This study
undertook two distinct stages of primary data collection, the first stage was to conduct
in-depth interviews and the second was the distribution of questionnaires to the samples.
In-depth interviews
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In selecting participants for in-depth interviews, convenience sampling was used for
samples of both port management and port users as these participants were likely to
show greater willingness to participate in the study.
Questionnaire
As there are two objectives of the survey, there were two versions of questionnaires –
one for the ports and the other for the port users. The first objective is to build the risk
matrix and this involved two target population, the port management and port users. For
port management samples, port operators and port authorities who are members of
International Assoication of Ports and Harbors (IAPH) (2013), American Association of
Port Authorities (AAPA) (2013), Association of Pacific Ports (APP) (2013), and Port
Management Association of Eastern and Southern Africa (PMAESA) (2013) were
approached as there were member directories on their websites. The author had also
written to other major port associations that had no members listed on their website for
help in distributing the questionnaires, but received replies that it was not allowed. To
ensure sufficient information was yielded about the population, smaller ports which
were not listed in the abovementioned databases had also been reached out to. Hence,
the sample also comprised of ports found in the directory of World Port Source (2013).
The World Port Source provided a large and comprehensive database of existing ports
worldwide.
On the other hand, for the sampling of port users, local entities who are members of
Singapore Logistics Association (SLA) (2013) and Singapore Shipping Association
(SSA) (2013) were written to. Global shipping lines found in Alphaliner (2013) and
international freight forwarders from the directory of The International Federation of
Freight Forwarders Associations (FIATA) (2013) were approached as well. In addition
to the abovementioned databases, participants whom the author met at seminars and
conferences also made up the sample.
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The second objective of the survey is to validate the management model and the same
samples of port management selected for the development of risk matrix were
approached. Figure 4.6 summarizes the sampling frame of this study.
Figure 4.6: Sampling Frame
Source: Author
For the distribution of questionnaire, total sampling was performed on the samples
selected for port management and port users to collect as much information as possible.
The intended recipients of the questionnaires were those of managerial positions or
above as responses required were related to the operations, policies and strategies at the
organization. When contact information of these recipients was not accessible in the
directories named above, the websites of the ports and port users were accessed
individually and contact information of top-level executives or senior management were
retrieved wherever available.
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In total, eleven in-depth interviews were carried out and the questionnaires were
distributed to 845 ports and 1519 port users. The sampling frames were justified as they
provided a good mix of multi-national organizations that collectively provided valuable
insights on the influence of the PSCD threats on global supply chains and perspectives
for the proposed management model.
4.7. Primary Data Collection
There were no existing questionnaires suitable for use to answer the research questions,
therefore the questionnaires needed to be developed first. For that to be done, secondary
data and literary works were examined and this enabled the list of PSCD threats and the
measurement items in the management model to be conceived. Then in-depth interviews
were conducted with port management and port users. The main objectives of the
interviews with the port operators and port users were to identify how port-related
events affect supply chain continuity, to obtain comprehensive insights on the existing
practices and to assess the practicality and requirements for the implementation of the
management model for PSCD threats. The interviews together with pre-testing and
pilot-testing enabled the questionnaire to be finalized and upon finalizing, the
questionnaire were distributed to the samples.
4.7.1. In-depth Interviews
Interviews can take the form of face-to-face interviews or telephone interviews.

Telephone interviewing includes central location interviewing, computer-assisted
telephone interviewing and computerized, voice-activated telephone interviews
(Zikmund, 2007). Face-to-face interviews take place in the presence of the researcher
and offer a channel for feedback and to gather information through asking questions and
for opinions as well as probing into the interviewees’ memory for related information.
Telephone interviews have the same function but the researcher is not physically at the
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interview scene and hence visual medium cannot be transmitted. Central location
interviewing is a method of conducting telephone interviews from a central location and
is typically used by research agencies. A computer-assisted telephone interview utilizes
computer technology and is a type of interviewing in which the interviewer sits in front
of a computer and enters responses from interviewees. This is a form of highly
structured interview and responses that do not correspond to pre-coded answers will be
rejected. Computerized, voice-activated telephone interviews are more suitable for short
and simple questionnaires as the system reads questions to the interviewees whose
single-word responses will be registered by the computer.
For this research, face-to-face interviews were conducted with interviewees who were
based in Singapore and telephone interviews were conducted with two interviewees
who were based in Australia and Vietnam. Face-to-face interviews have high
participation rates, enable the researcher to probe and can last longer. Telephone
interviewing was selected for interviewees who were overseas because of speed and the
low cost it incurs. It has been mentioned that convenience sampling was the method
used in selecting interviewees as there will be higher willingness to share information
and their insights with people they know. As shown in Table 4.5, six in-depth face-to-
face interviews were conducted with port management in Singapore and one telephone
interview each with port management from an Australian and a Vietnamese port
operator. From port users’ sample, a tanker management company, shipping line
company and a cargo owner from the petrochemical industry were interviewed face-to-
face. All interviewees were of managerial positions and the interviews took place
between late January 2013 and mid-March 2013.
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Table 4.5: Participants of In-depth Interviews
Location Port Management Port Users Total

Singapore 6 3 9
Australia 1 0 1
Vietnam 1 0 1
Total 8 3 11
Source: Author
In designing the structure and questions for the in-depth interviews, the four stages of
interviews proposed by Gillham (2000) were adopted. At the start of the interviews, an
introduction of the author and this research was given. The work on the research and
developments till its current stage was explained to the interviewees to bring in the
themes of the research. The interviewees were then asked questions related to the
themes before the author brought the interviews to an end. The interviewees were of
managerial positions, with one of them as a top-level executive, and all of them had
many years of experience in their industries. Hence, the interviews were semi-structured
but in-depth, such that the interviewees could elaborate more instead of being led to
short responses by the interviewer. With their background, the interviewees could share
more information based on their extensive knowledge and experience in this way as
compared to a more formal and highly structured questionnaire-based interviews. Due
to the structure of the interviews, the questions asked did not follow the same sequence
from one interview to another. See Appendix A for interview questionnaires for port
users. Additional questions were probed whenever clarification was needed during the
interviews. Therefore, after the introductory phase, general questions were asked first
followed by more specific questions and questions of similar themes were grouped
together. This helped the interviewees to focus on a theme and recall events relevant to
the theme before moving on to the next. After these stages, the interviewees would have
a better understanding of the research and they were asked for their feedback on the
study at the closing phase.
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The interviews with port management focused on the likelihood and consequences of
PSCD threats and the appropriateness of the management model. The interviews started
with the interviewees’ views of ports’ role in supply chains. The questions were then
narrowed down to the challenges experienced at their ports presently and in the past and
if there were measures to counter them. See Appendix B for interview questionnaires
for port operators. Tabulated information on the management model was presented to
the interviewees with whom the author conducted face-to-face interviews as the
components were explained to them. For interviewees in Australia and Vietnam, the
information was sent to them through electronic mail. Then, the port management were
asked to comment on the management model after it was explained to them and any
feedback or opportunities for improvement on the model and study was recorded.
Similarly, the interviews with port users began with their perception on the role ports
play in their supply chains. The interviewees were then asked about the occurrences and
impact of the PSCD threats that affected their organization, effectiveness of existing and
past collaborations with the ports and their attitudes towards how the port have handled
disruptions. At the end of the interviews, the interviewees were asked for their opinions
on the research and demographic questions related to their organizations and their
experiences in their respective industries. Notes were taken throughout the interviews
and voice recordings were done whenever it was allowed and possible. The topics
covered by the interviews are related to the conceptual framework and thus include
internal and external risk management, contingency measures, disruption recovery,
quality enhancement, collaboration relationships with external parties and government
agencies and continuous improvement.
4.7.2. Objectives of Survey
This research utilized surveys as its primary data collection method. The purposes of the
surveys were to provide generalizable measurement of the likelihood and consequences
of PSCD threats and to explore the relationship between the management model and
port performance in disruption management. Currently, such data does not exist. There
are no statistical data or historical data on the frequency and impact of each PSCD
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threat by the port industry or their customers. There is also no existing framework that
stipulates recommended actions or useful reminders for port management to implement.
Thus, surveys were used to provide such information and reveal underlying trends,
which will be discussed and the analysis will be useful for future studies.
4.7.3. Design of Questionnaire
The purpose of distributing questionnaire is to gather information from the respondents.

According to Cooper and Schindler (2013), there are three phases in the process of
instrument design. Phase 1 involves selecting scale type, communication approach and
process structure according to the research questions, ensuring that the research scope
will be covered sufficiently. Phase 2 constructs and refines measurement questions such
that the questionnaire meets five goals: (1) accuracy in responses, (2) sufficient amount
of information is gathered, (3) avoidance in answering specific questions is discouraged,
(4) completion of questionnaire and (5) leaving respondents with a positive attitude
about participating in the survey. Phase 3 further refines the instrument and a pre-test is
conducted. The design of questionnaire in this research fulfills these three phases. For
this research, the objective of the questionnaire developed for the risk matrix is to
collect data on the frequency of occurrences of each PSCD threat and their extent of
impact on supply chains, while the questionnaire for the management model seeks to
establish the relationship between the measurement items and the disruption
performance indicators which would then validate the management model. These two
objectives provide answers to the two research questions of this research.
To meet these objectives, two sets of questionnaires were distributed. Both

questionnaires were kept as short as possible to increase response rate (Judd et al., 1991).
Both sets of questionnaires shared the same title “Study of Port-Related Supply Chain
Disruption Management” but the first questionnaire was two pages long and comprised
of two parts, while the second questionnaire was five pages long and consisted of four
parts. In the process of constructing the questionnaires, attention was given to the
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phrasing of questions, the way questions were asked, the sequence or questions asked
and the layout of the questionnaire to accomplish the criteria of designing a relevant and
accurate questionnaire (Zikmund, 2007). A majority of the questions in both
questionnaires asked were fixed-alternative questions and questions that asked for
feedback and input to share relevant measurement items not stated in the questionnaires
were open-ended. These open-ended questions sought to capture relevant and additional
comments, thus enhancing the content validity of the questionnaire. The questions were
specific and were phrased using simple language that made understanding easier to keep
the interest of respondents and increased the chances of receiving completed
questionnaires. To ensure that the relevancy and accuracy of the questionnaire was
achieved as much as possible, questions and items that were leading, loaded, ambiguous
or double-barreled were avoided. Like personal interviews, an introduction of the author
and study were given. Hence, a cover letter was developed and since the questionnaires
were distributed using email due to the geographical flexibility, low cost and
convenience this channel of communication provides, the cover letter made up the
content of the email. See Appendices C and D for cover letters. The cover letter
contained a brief introduction of the author, research purpose, an appeal to respondents
for their participation as their contribution would be valuable, general instructions on
participating, time frame set for return of questionnaires, guarantee of confidentiality,
author’s contact and appreciation for their participation by offering to share with the
respondents the research findings. These will be explained in more detail in Section
4.7.5.
The first set of questionnaire attached in Appendix E was distributed only to port users
as its main aim was to collect data for the purpose of a risk matrix. As mentioned, there
were two parts in this questionnaire – Part A and Part B. The first question in Part A
was an open-ended question asking respondents to name a port frequently used by their
organization. The respondents were then asked to indicate the frequency of occurrences
and the extent of impact of 19 PSCD threats in the second question. This question also
provided some spaces for respondents to include any additional PSCD threats that were
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not listed in the questionnaire as well as their likelihood and consequences. The second
question in Part A used a five-point ordinal measurement scale which ranged from 1
(least frequent and negligible impact) to 5 (most frequent and worst impact). The
purpose of the first question was to ensure that the respondents would answer the
second question based on a port that their organizations were familiar with so that their
responses would then offer a fairer and more accurate impression of the PSCD threats.
Part B consisted of questions asking respondents about their organizations, their
functional areas and designations in their organizations and experience in the industry.
Checklist and simple-dichotomy questions were the format used in the nine questions
wherever appropriate.
The second questionnaire was distributed to port management. See Appendix F for this
set of questionnaire. Its purpose was to gather information for the risk matrix and on the
validation of the management model. There were four parts in the questionnaire. In Part
A, respondents were asked to indicate the likelihood and consequences of the 19 PSCD
threats using the same measurement scale as the one used in the first questionnaire
administered to the port users. Similarly, sufficient spaces were provided for
respondents to state other PSCD threats, their likelihood and consequences. Part B
collected the respondents’ attitude on mitigating approaches at their ports. There were
45 measurement items which respondents were asked to rate using the 5-point Likert
scale, with 1 indicating ‘strongly disagree’ and 5 as ‘strongly agree’. Respondents were
also asked to input other relevant and feasible approaches or measures that had not been
mentioned in the questionnaire. The 20 items in Part C collected information on port
performance, particularly in disruption performance, using the similar 5-point Likert
scale. Therefore, Part A sought to gather data for the development of the risk matrix
while responses to Parts B and C were analyzed to establish relationships between the
management model and disruption performance at the ports. The final part, Part D,
asked questions for classification purposes and was similar to Part B in the
questionnaire distributed to port users.
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Both sets of questionnaires ended with two open-ended questions, one asking for
feedback to improve on this research and the other for the contact details of respondents
should they wish to receive an executive summary of this research. The last line in the
questionnaires then thanked the respondents for their participation.
The samples used for the questionnaire comprised of respondents belonging to

organizations from around the globe. However, as the sampling frame of port
management was smaller than that of port users, it comprised of more organizations
from around the globe and the questionnaire designed for them was much longer than
that for the port users, the questionnaire for the port management were translated into
Chinese, Korean and Vietnamese in a bid to increase the participation rate and were
distributed to ports in China, South Korea and Vietnam respectively. The remaining
ports from all other countries received the questionnaire in English. To reduce
inaccuracies in translation due to the differences that exist when multiple cultures are
involved, back translation is the extra step in designing questionnaires to respondents
from those three countries (Zikmund, 2007). The translation process is displayed in
Figure 4.7.
At the first stage, the English version of the questionnaire was sent to pre-test
respondents through email to seek their comments on the overall structure, wording and
phrasing. The results of pre-test are discussed in the following section. The feedback
collected from the pre-test stage was considered in the decision of modifying the
questionnaire. Modified questionnaires were then sent back to the participants of the
pre-test group for further comments and the final versions of questionnaires were then
developed when all participants agreed on the changes. Then, the modified
questionnaire was translated into Chinese by the author. The Korean version was
provided by a professional translation service provider based in Korea and the
Vietnamese version was provided by a Vietnamese native who is a professional in the
maritime research industry working in Singapore. The layout of the questionnaire was
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kept the same in translation to facilitate data coding and entering as the author was not
familiar with Korean and Vietnamese languages. After which, a backward translation
from Chinese, Korean and Vietnamese to English was performed to ensure that
inconsistencies and errors in the translation process can be identified. The back
translation for each language was done by the author’s colleagues. They were selected
as those languages are their native language and they are researchers in the maritime
industry so they can ensure that there is consistency in the technical and conceptual
terms. The last step was the finalization of the translated versions which were then
developed and distributed.
Figure 4.7: The Translation Process
Source: Author, adapted from Thai (2006)
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4.7.4. Pre-testing of Questionnaire
As mentioned in the previous section, the questionnaires were sent to participants for
pre-testing. 17 participants were selected for the pre-test and they included professionals
from the maritime industry who are port managers, researchers, lecturers, professionals
in supply chain entities as well as professionals from industries that are not related to
maritime. These participants were asked to review the cover letters and questionnaires
to identify areas for improvement. Approaching participants who were not part of
sampling frames in the pre-test would help provide opinion from a broader perspective
which was necessary especially for research that involves respondents from all over the
world. The participants involved in the pre-test stage were asked to rate the
questionnaires in terms of its length, how well they understood the objectives of each
part of the questionnaire, layout, length of time they took to complete, instructions, how
concise the wordings were and if there were any leading and double-barreled questions.
See Appendix G for the feedback form used in pre-testing. Based on all the feedback
and comments collected, the following modifications were made:
 After the pre-test, the instructions in the questionnaires were given in bullet
points instead of paragraphs to facilitate reading.
 The tables that were initially used to define the scale used for indicating
likelihood of occurrences and consequences of the PSCD threats were removed
and the definitions were refined and listed in a bulleted format.
 In Part A, some descriptions of PSCD threats were refined to be more concise

and easier to understand. For instance, ‘Vessel Traffic Service Breakdown’ (A5)
was renamed as ‘Breakdown of Vessel Traffic Management System’ (A5); ‘Port
Community System/Network System Shutdown’ (A6) was renamed as
‘Breakdown of Port Information System’ (A6) and ‘Labor Strikes’ (A12)
became ‘Port Labor Strikes’ (A12). In particular, ‘Shortage of Resources’ (A11)
which was previously categorized as ‘Planning Threats’ was renamed ‘Shortage
of Facilities or Equipment’ (A11) classified under ‘Planning Threats’ and
‘Shortage of Manpower (not due to labor strikes)’ (A13) classified under
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‘Manpower Threats’. This is to reflect the fact that resources refer to both
equipment and manpower.
 In the questionnaire to port management, the codes assigned to each item were
changed to facilitate data recording at a later stage and the measurement items in
Part B were shortened as comments that they were too lengthy were received.
The number of items measuring per factor was reduced wherever possible by
combining items measuring the same concept or moving the items to another
more relevant factor. For instance, B6.1 (originally B25) was moved to the
factor named ‘Employment Involvement and Empowerment’ as it is related to
motivating employees to be involved in process improvement. B2.7 is an
additional item. It was added to acknowledge the importance of adhering to
security initiatives such as the International Ship and Port Facility Security code
(ISPS code), the Container Security Initiative (CSI), the 24-Hour Advance
Manifest Rule, Customer-Trade Partnership Against Terrorism (C-TPAT), and
the Authorized Economic Operator (AEO) of the World Customs Organization,
which can contribute to mitigating risks in seaports when effectively
implemented. B8.4 was also added to reflect the importance of continuous
improvement through research and development.
 For the questionnaire designed for port management, the phrasing of the items
was revised so that it is more specific and makes measurement more precise. For
instance, C11 and C12 originally contained the phrase ‘very quickly’ and C20
had the words ‘very low’, but they did not specify how quickly or how low. As
different respondents may have different interpretation of the phrases, the
revised questionnaire avoided using vague representation of measurement. In the
revised questionnaire, the phrase ‘such that effects of disruptions are minimized’
was added to C11 and C12 so that respondents have a standardized sense of
quickly, while ‘very low’ was removed from C20.
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In addition to the above changes, for both sets of questionnaires, grammatical errors
were corrected and there were also changes made to the layout of the tables used in both
questionnaires to make the questionnaire neater and less cluttered. Overall, there were
no major changes to any part of the questionnaires and the feedback on the items
offered a good foundation for the revision of questionnaire. After which, pilot testing on
the questionnaire for port users was conducted with five respondents from the port
users’ sampling frame and the questionnaire for port management was pilot tested with
nine respondents from the port management’s sampling frame. The purpose of pilot
testing was to identify any potential problems if the questionnaires were to be mass
distributed and to ensure that the objectives of the research can be met. Results from the
pilot testing revealed that there were no issues or problems with the survey and hence
the revised questionnaires were translated and then distributed.
4.7.5. Administration of Questionnaire Distribution
The revised questionnaires were distributed electronically to all port users and port
management in the sampling frame. The cover letters which included a brief
introduction of the author and research made up the body of the emails. The
questionnaires were sent as attachments in the emails and the respondents were required
to send the completed questionnaires back to the author through email or fax. Also in
the body of the email was an alternative way to answer the questionnaire, which was
through an online survey software called Qualtrics. The web address of the online
questionnaire was provided in the email body. Several measures were deployed to
increase the participation rates of the two questionnaires.
Firstly, the cover letters stated clearly the objectives of the study. As the recipients were
from the port industry or were involved in or oversee the port supply chains to some
extent, knowing that the research purpose revolved around what they knew made the
study relevant and attractive to them. This would keep them interested in reading further.
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Secondly, bearing in mind that it is usually the management who tend to be more
interested in participating, wherever information was available, the contact of managers
of the port user entities and port management were recorded in the mailing list. Sending
the questionnaires directly to their individual email accounts instead of the
organization’s general contact offered personalization and ensured a higher opportunity
that the questionnaires reached the inboxes of the intended recipients.
Thirdly, the respondents’ time is valuable and the lengths of the questionnaires were
kept as short as possible. As mentioned, the length of the questionnaire for port users
was two pages long and that for port management was five pages. These were
considered acceptable by the participants in the pre-test stage. A short questionnaire is
an important measure as it encourages the respondents to start and complete the
questionnaires.
Fourthly, the cover letters appealed for their help and support and explained that they
would also get to benefit from well-functioning port-related supply chains which is the
main outcome that this study hopes to achieve. Moreover, the findings of this research
was offered to the respondents. These provided inducement and incentives for their
participation.
Next, the format of the questionnaires was one of the measures as well. The
questionnaires were created as a form which the respondents can simply click to check
their selections and click on boxes to type in their responses for open-ended questions.
This made the questionnaires simple and user-friendly. The questionnaires were created
in Microsoft Word which is a widely used application, and thus provides familiarity in
the answering process. The online survey software saves the responses and enables
respondents to continue from where they had stopped previously; the respondents can
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also work on the questionnaires on their mobile phones while on the go. This online
platform hence provides convenience and encourages participation from respondents
who are technologically savvier or less desk-bound.
In addition, the cover letters let the recipients know that only summarized results of the
survey would be reported and the results would not be linked to any individual or
specific organization. Hence, no sensitive information such as name, age or name of
organization was asked in the questionnaires. This assured them of their anonymity and
confidentiality.
Finally, deadlines were stated clearly in the cover letter to speed up the respondents’
participation. Reminders were sent to respondents who missed the due dates and a
repeated appeal for their participation was made along with the reminders. See
Appendices H and I for samples of reminder letter sent to port users and port operators.
Such follow-ups were useful as respondents were very busy and tended to attend to
urgent matters at work first. After which, they failed to remember about the
questionnaires. The reminders helped to bring in many more responses and also
demonstrated to them that the author is serious and sincere in asking for their help.
The above tactics were useful as 104 questionnaires were returned from port
management and 123 were collected from port users. The response rate was 12.31% for
port management and 8.1% for port users. A higher response rate is expected if the
author was able to personally call or visit the organizations. However, as this survey
involved a large number of overseas organizations, time and costs were the limitations.
There also existed a reluctance to participate as English is not predominantly used in
many countries.
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4.7.6. Data Preparation
In data preparation process, the raw data were edited, coded and entered for analysis
(Cooper and Schindler, 2013). The purpose of editing the data was to ensure that the
data is accurate, consistent and uniformly entered. Therefore, the collected data were
scanned for errors and omissions before the data was recorded. For instance, there were
a few respondents from both port users and port management who misunderstood the
instructions for Part A. The author then contacted the respondents again to explain about
the right way of answering before full data could be collected. Several respondents also
indicated revenue in different currencies and thus these data was reconstructed to
achieve standardization. The responses entered in demographics were scanned
thoroughly to ensure that the respondents fulfilled the characteristics of the sampling
frame. For example, out of the 104 responses collected from port management, one
returned questionnaire was excluded in the analysis due to the fact that it only handles
passengers. Hence, the participant was disqualified.
The responses were also checked for item non-response (Lussier, 2011). In the case
where many respondents omitted the same question, that question should be considered
to be dropped to ensure that there is no bias. However, for both sets of questionnaires,
this was not an issue, though there were very few respondents who omitted one or two
questions. For these respondents, the measurement level used for those omitted
questions allowed an average value to be plugged in and hence this method was used to
deal with item non-response. However, a second questionnaire received from the port
management sampling frame was excluded in the analysis as the part on risk matrix was
not completed. As the respondent had left several questions in Part A unanswered, an
average value was not used to replace the blanks to avoid introducing bias. Responses
from two other respondents, also from the port management sampling frame, were
discarded as they left at least one section of Part B (mitigating approach) or Part C (port
performance) of the questionnaire unanswered. In total, all returned questionnaires
collected from the port users were complete and could be used, while three returned
questionnaires from the port management were excluded from analysis as they had
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omitted a significant number of questions unanswered and another one from the port
management group did not meet the criteria of a cargo-handling port and hence was also
excluded from analysis.
The coding process assigns numbers or symbols to the responses in order to allow the
answers to be grouped into categories (Lussier, 2011, Cooper and Schindler, 2013). The
fixed-alternative questions were pre-coded and responses were recorded according to
the numbers already assigned to the available choices. Questions which were open-
ended were coded according to guidelines proposed by Cooper and Schindler (Cooper
and Schindler, 2013). They suggested that categorizing of open-ended data set should be
appropriate to research questions, exhaustive, mutually exclusive and derived from a
single dimension. Hence, the open-ended responses collected were coded in a manner
that reflects the guidelines, so that it facilitated analysis of results of the different
response categories in Chapters 5 and 6. For questions related to demographics of the
respondents, the choices were coded after the responses were collected, for example, a
question with choices ‘Yes’ and ‘No’ would be assigned values ‘1’ and ‘2’ respectively.
The entering of data was done as soon as a returned questionnaire was edited and coded.
This is so that follow up can be done with the respondents should there be any
misinterpretation of the instructions. The data were first entered into an Excel
spreadsheet. Each respondent was given a unique ID in the first column and their
responses were entered in cells in a horizontal manner such that one respondent takes up
one row in the spreadsheet. As there were two sets of questionnaires, input from the port
management was saved in another sheet, separate from the input from port users to
avoid confusion in the data preparation process. However, after all responses were
collected, as responses from both port management and port users were required for the
development of risk matrix, all responses to Part A were then combined in another sheet.
After all responses have been collected, checked, coded and entered into the spreadsheet,
the data set was then transferred to SPSS.
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4.8. Statistical Analysis
The qualitative data collected from in-depth interviews were manually analyzed and
insights have been incorporated into the design of the questionnaires. The data collected
from questionnaire responses were analyzed using Excel, SPSS version 21.0 and AMOS
version 22.0, which were both the latest versions as of 2013. Excel was used to draw the
risk matrices, SPSS was used to analyze descriptive statistics and AMOS was used to
provide inferential analysis. SPSS is a software developed for statistical analysis
through entering data, performing exploratory data analysis and many useful statistical
facilities as compared to Excel. SPSS is adequately competent in handling large data
sets. AMOS was used to perform Structural Equation Modeling (SEM) on the primary
data. SEM is a statistical technique which has the capabilities to test complex
relationships between measured and latent variables as well as the relationships among
the latent variables. Hence, SEM is used instead of solely factor analysis or multiple
regression. Besides AMOS, there are other similarly proficient software that can be used
for the same purposes. LISREL, EQS, Mplus, SAS PROC CALIS are some examples of
alternatives, but they are not used in this research as AMOS is relatively user-friendly as
it does not require the modeler to have programming knowledge and it has a graphic
interface that allows visual representation of variables, which enhances communication
of results (Cunningham and Wang, 2005).
4.9. Error Control Measures
According to Thai (2006), many researchers have emphasized the importance of

controlling biases which exist in two forms – instrumental biases and response biases.
Instrumental biases are related to the design of research instruments, which in this
research is the surveys, while response biases are produced by respondents. The
questionnaires were worded and phrased carefully in a manner that avoided
instrumental biases which are presented in the form of questions that are complex,
leading and loaded, ambiguous, double-barreled, sensitive or too personal and questions
113
that contain built-in assumptions (Zikmund, 2007). According to the results from pre-
test, the questionnaires were free from these biases. To prevent inconsistencies, the
same measurement units were applied throughout the questionnaires which primarily
used a five-point scale with 1 being the lowest value for strongly disagree and 5 as the
highest value for strongly agree. Given that the questions were more concise as they
were shortened in the revised questionnaires while not compromising on specificity, an
outcome agreed by all the participants in pre-test stage, instrumental biases were
minimized in this research.
In relation to response biases, several measures were in place to control the biases.
Before the interviews, the interviewees were sent, through email, an attachment
specifying the introduction of the research, the research objectives and key areas of
inquiries so that they could be adequately prepared for the interviews yet they could not
prepare answers beforehand. The interviews were conducted at the participants’ offices
or venues mutually agreed by both the participants and the author. These were some
measures to control errors as participants might give unreliable responses if they were
distracted, unwell or unprepared (Lussier, 2011). As the interviews were pre-arranged at
the interviewees’ convenience, they would have time to prepare psychologically for the
interviews and they also had the freedom to cancel the appointment should they feel
unwell. In addition, the interviewer avoided agreeing or disagreeing with the
interviewees’ opinions to avoid leading or encouraging them to answer in a certain way.
For the questionnaires, the deadlines stipulated for respondents to return their answers
were not unreasonable. The respondents were requested to return the completed
questionnaires within two weeks from the time the questionnaire was sent for the first
time, and the ‘earliest convenient time’ for subsequent reminders. Both the online
questionnaires platform and the attachment could be answered halfway and continued at
another time. Hence, the respondents had the flexibility and freedom to work on the
questionnaires as and when they are comfortable. The returned questionnaires were
checked to see if respondents had given the same answers to sections or a sequence of
questions as these responses indicate that the respondents might not have given truthful
114
or reliable answers. Errors produced by the participants can be controlled using these
methods.
4.10. Summary
This chapter has presented an explanation and justification for the research design and
methodology. The research objectives were met through a development of risk matrices
and validation of a management model built on a triangulated application of the
principles of risk management, business continuity management and quality
management. The survey methodology was used to collect primary data for this
research. The PSCD threats and measurement items used in questionnaires were decided
upon from literature review and the results of interviews with industry professionals.
The target population for the questionnaires were port management and port users from
all over the world and the selection of sampling frames had been discussed. The data
collection process involved carefully designing the questionnaires, administering the
questionnaires in a way that increased participation rates, meticulous data preparation
and a series of measures to control biases. The work done in methodology is the
preliminary step leading to the analysis of results.
115
CHAPTER 5. RESULTS – PERCEPTION OF PSCD THREATS AND CONSEQUENCES
5.1. Demographics of Respondents
This chapter2 presents the empirical results of the survey conducted with port operators
and port users on the likelihood and consequences of PSCD threats. A total of 2364
questionnaires were distributed to 845 port operators and 1519 port users worldwide.
104 responses were collected from port operators and 123 responses were collected
from port users samples. The figures accounted for 12.31% of response rate from port
operators and 8.10% from port users. Table 5.1 shows the response rates for both
samples.
Table 5.1: Response Rates for Both Samples
Received
Distributed
Number Response Rate
Sample
Port Operators 845 104 12.31%
Port Users 1519 123 8.10%
Total 2364 227 9.60%
Source: Author
For sections related to risk matrices, a total of 227 responses had been collected from
port management and users. Of the 227 responses, 104 came from port operators and
2
The following publication from the author is based on part of this chapter:
116
123 from port users. Responses from two operators were not used as one of them was a
passenger port and the other did not complete the section that was meant for risk matrix.
All responses from port users were used. Therefore, of the 227 responses collected for
risk matrix, 225 of them were used for analysis in this research. A breakdown of
proportion of responses from port users and port operators that make up the total
number of responses used for risk matrix is shown in Figure 5.1.
Figure 5.1: Proportion of Respondents from Each Sample
Source: Author
Respondents who are port operators handled containers, liquid bulk, dry bulk, vehicles,
a combination or all of the above. Figure 5.2 shows the different types of cargo handled
by the port managers.
117
Figure 5.2: Types of Cargo Handled by Respondents who are Port Managers from Port
Operators and Port Authorities
Source: Author
Respondents from the port users consist of shipping lines, freight forwarders, NVOCCs,
cargo owners, vessel owners, vessel management companies and combinations of the
above types. Figure 5.3 shows the breakdown of each type of organization from
respondents who are port users. The majority of the port users are headquartered in Asia,
followed by Europe and North America. Both African and South American
headquarters share the same proportion and the smallest group comes from Oceania.
However this imbalance does not result in biasness in the analysis as these companies
answered the questionnaire based on the ports used most frequently by them instead of
any practice by their organization. Figure 5.4 shows the location of their headquarters.
118
Figure 5.3: Types of Port Users
Source: Author
Figure 5.4: Locations of Headquarters of Port Users
Source: Author
119
Almost half of the port users indicated that their organizations do not conduct disruption
management or have similar risk-related management. A majority of the port users do
not conduct disruption management or similar risk-related management jointly with the
ports. Figures 5.5 and 5.6 depict such risk-related practices at their organizations.
Figure 5.5: Proportion of Port Users who Conduct Disruption Management
Source: Author
Figure 5.6: Proportion of Port Users who Conduct Disruption Management Jointly with
Ports
Source: Author
120
More details on the demographics of port operators who responded are provided in
Table 5.2 and that of port users are provided in Table 5.3. Table 5.4 shows the
demographics of all respondents used in the results of risk matrix, combining port users
and port operators.
121
Table 5.2: Demographics of Port Operators for Risk Matrix
Number of Valid Percent of

Respondents Respondents
Number of Employees
Less than 100 22 21.57%
100-499 40 39.22%
500-999 14 13.73%
1,000-4,999 8 7.84%
5,000-9,999 7 6.86%
More than 10,000 7 6.86%
Not Answered 4 3.92%
Total 102 100.00%
Functional Area
Operations 33 32.35%
Non-Operations 53 51.96%
Both 11 10.78%
Total 102 100.00%
Designation
Executive 31 30.39%
Manager 24 23.53%
Senior Management 26 25.49%
Top-level Executive 10 9.80%
Others 7 6.86%
Total 102 100.00%
Experience
Less than 1 year 3 2.94%
1 - 5 years 19 18.63%
5+ - 10 years 14 13.73%
10+ - 20 years 30 29.41%
More than 20 years 32 31.37%
Total 102 100.00%
Source: Author
122
Table 5.3: Demographics of Port Users for Risk Matrix

Number of Employees
Less than 100 40 32.52%
100-499 37 30.08%
500-999 10 8.13%
1,000-4,999 9 7.32%
5,000-9,999 3 2.44%
More than 10,000 24 19.51%
Total 123 100.00%
Functional Area
Both 17 13.82%
Total 123 100.00%
Designation
Executive 34 27.64%
Manager 44 35.77%
Others 3 2.44%
Total 123 100.00%
Experience
1 - 5 years 17 13.82%
5+ - 10 years 14 11.38%
10+ - 20 years 30 24.39%
Total 123 100.00%
Source: Author
123
Table 5.4: Demographics of all Respondents for Risk Matrix

Number of Employees
Less than 100 62 27.56%
100-499 77 34.22%
500-999 24 10.67%
1,000-4,999 17 7.56%
5,000-9,999 10 4.44%
More than 10,000 31 13.78%
Total 225 100.00%
Functional Area
Both 28 12.44%
Total 225 100.00%
Designation
Executive 65 28.89%
Manager 68 30.22%
Others 10 4.44%
Total 225 100.00%
Experience
1 - 5 years 36 16.00%
5+ - 10 years 28 12.44%
10+ - 20 years 60 26.67%
Total 225 100.00%
Source: Author
124
5.2. Results
In this section, descriptive statistics for each group of respondents will be presented
followed by their respective risk matrices. The highest and lowest risk scores assigned
by different groups will be highlighted and risk matrices will be developed based on the
different nature of respondents to assess if there is a difference in their perception
towards PSCD threats.
5.2.1. Descriptive Statistics
As there were two groups of respondents who answered the sections on risk matrix,
their responses were tabulated separately to assist in the evaluation of their attitudes
towards PSCD Threats. The mean scores for likelihood and consequences for each
category of PSCD Threats assigned by port operators, port users and both groups
combined are shown in Table 5.5. A higher score for likelihood indicates higher
possibility of the threat occurring and a higher score for consequences indicates worse
impact of the threat. Planning threats (A8-A11) were ranked the highest for likelihood
by both port operators and port users. For consequences, planning threats (A8-A11)
were ranked highest by port operators while infrastructure threats (A1-A7) were ranked
highest by port users. Security threats (A15-A19) were assigned lowest values for
likelihood and consequences by both the port operators and port users groups. When
their responses were combined, planning threats (A8-A11) were ranked highest for
likelihood and consequences scores, while security threats (A15-A19) were lowest.
The port operators group was further divided into three main categories to evaluate
possible differences in their responses. Out of the 102 usable responses, two
respondents did not indicate the type of cargo handled at their ports, hence they were
not included in this part of the analysis. As the types of cargo handled will render
different information exchanged, infrastructure and requirements at the ports, variation
in responses from different types of ports is expected. Though ports can also be
125
differentiated with respect to their geographical locations, unless a reasonably high
enough number of responses were collected from each region, a comparison made
among them would not be very meaningful as in the case of this research. Thus, the
three categories of port operators in terms of the types of cargo handled were ports that
handle only containers, those with non-containerized cargo and those which handle both
containers, bulk and/or vehicles (multi-purpose ports). Table 5.6 shows that container
ports ranked planning threats (A8-A11) as the highest for likelihood and consequences.
This result is the same for ports that handle non-containerized cargo while multi-
purpose ports ranked planning threats (A8-A11) as the highest likelihood and manpower
threats (A12-A14) as the worst consequences. Security threats (A15-A19) were ranked
lowest for both likelihood and consequences by all three types of ports.
Similarly, the port users group was divided into two main categories – those that own,
operate and/or manage vessels and those that do not. Therefore, shipping lines, ship
owners and ship management companies made up the first category and the second
category comprised mainly of cargo owners and freight forwarders/NVOCCs. These
two groups represented differing perspectives – one that is ship-oriented and the other is
relatively cargo-oriented. Their responses for each category of PSCD threats are
recorded in Table 5.7. The figures in the table show that port users who were involved
in owning, operating or managing vessels ranked planning threats (A8-A11) as the
highest for likelihood and infrastructure threats (A1-A7) as the lowest for consequences.
Non-vessel-related port users ranked planning threats (A8-A11) as the highest for both
likelihood and consequences. Security threats (A15-A19) received the lowest values for
both likelihood and consequences scores by port users regardless of the group they
belonged to.
126
Table 5.5: Scores Assigned to PSCD Threats Categories
N Mean Std. Deviation

Port Management
Likelihood
Planning Threats 102 2.34 1.01
Manpower Threats 102 1.91 0.76
Infrastructure Threats 102 1.89 0.67
Security Threats 102 1.48 0.57
Consequences
Port Users
Likelihood
Consequences
Port Management and Users

Likelihood
Consequences
Source: Author
127
Table 5.6: Scores Assigned to PSCD Categories by Different Types of Ports

Container Ports
Likelihood
Consequences
Non Container Ports
Likelihood
Consequences
Multi-purpose Ports
Likelihood
Consequences
Source: Author
128
Table 5.7: Scores Assigned to PSCD Categories by Different Types of Ports Users

Liners/Ship owners/Ship Management
Likelihood
Consequences
Non-vessel-related Organization
Likelihood
Consequences
Source: Author
5.2.2. Risk Scores
The scores for each PSCD Threat by all different groups of respondents are provided in
Tables 5.8, 5.9 and 5.10. Risk scores are calculated by multiplying likelihood scores
with consequences scores (Waters, 2007). First, risk scores for each type of risks were
calculated using this method for each response. Then, the risk scores were averaged and
reported in Tables 5.8, 5.9 and 5.10. The highest risk scores for each column are in bold
while the lowest are underlined.
129
From the perspective of port operators, the highest risk score of 7.51 was assigned to
Congestion within Terminals (A9). This PSCD threat also received the highest risk
score of 6.02 from port users and 6.70 when both the responses from port operators and
users were combined. The lowest risk score assigned by port operators was 1.99 for
Stowaway (A17), while that assigned by port users was 2.16 for Trafficking (A15), with
Stowaway (A17) coming close as second lowest with a risk score of 2.24. When the
responses of port operators and port users were combined, Trafficking (A15) received
the lowest score of 2.10 and Stowaway (A17) was the second lowest with a risk score of
2.12.
Both containers and multi-purpose ports gave highest risk scores of 9.09 and 4.89
respectively to Congestion within Terminals (A9). Ports that do not handle containers
witnessed the highest risk score of 9.93 to Shortage of facilities or equipment (A11) and
the lowest score of 1.87 to Trafficking (A15), and this PSCD threat also received the
lowest risk score of 2.06 from ports handling only containerized cargo. On the other
hand, the lowest risk score of 1.84 was assigned by multi-purpose ports to Stowaway
(A17).
Both categories of port users assigned the highest risk scores of 5.51 and 6.80 to
Congestion within Terminals (A9). This result was in line with that of container and
multi-purpose ports. Shipping lines, ship owners and ship management companies gave
the lowest risk score of 2.06 to Breaking in/Theft (A18), while the other category of
port users gave the lowest risk score of 1.88 to Stowaway (A17).
130
Table 5.8: Scores Assigned to Each PSCD Threats by the Different Groups of Respondents
Port Operators
Port Operators Port Users
and Users
Label on Graph PSCD Threats L C Risk L C Risk L C Risk
A1 Port Equipment Breakdown 2.45 2.17 5.53 2.09 2.07 4.57 2.25 2.12 5.01
A2 Inadequate Port Cargo-Handling Equipment 2.12 2.20 5.16 1.60 2.04 3.63 1.84 2.11 4.33
A3 Occupational Accidents 2.08 1.78 3.92 1.72 2.13 3.91 1.88 1.98 3.92
Infrastructure
A4 Power Outage 1.62 2.05 3.47 1.37 2.04 3.01 1.48 2.04 3.22
Threats
A5 Breakdown of Vessel Traffic Management System 1.65 2.03 3.43 1.48 2.31 3.40 1.56 2.18 3.42
A6 Breakdown of Port Information System 1.84 2.03 4.01 1.49 1.76 2.97 1.65 1.88 3.44
A7 Collisions in Waterway 1.51 2.26 3.52 1.65 2.64 4.30 1.59 2.47 3.95
A8 Congestion in Waterway 2.01 2.25 4.83 2.42 2.06 5.20 2.24 2.15 5.03
Planning A9 Congestion within Terminals 2.61 2.61 7.51 2.60 2.16 6.02 2.61 2.37 6.70
Threats A10 Congestion at Hinterland Transfer 2.49 2.60 7.39 2.27 2.08 5.10 2.37 2.32 6.14
A11 Shortage of Facilities or Equipment 2.26 2.60 6.74 2.02 2.17 4.83 2.13 2.36 5.69
Man- A12 Port Labor Strikes 1.75 2.45 4.37 1.69 2.63 4.61 1.72 2.55 4.50
power A13 Shortage of Manpower 2.01 2.09 4.37 1.78 2.11 3.99 1.88 2.10 4.16
Threats A14 Misinterpretation of Instructions at Workplace 2.00 1.93 4.10 1.78 1.67 3.29 1.88 1.79 3.66
A15 Trafficking 1.41 1.44 2.03 1.41 1.54 2.16 1.41 1.50 2.10
A16 Smuggling/Contraband 1.59 1.57 2.52 1.48 1.64 2.60 1.53 1.61 2.56
Security
A17 Stowaway 1.39 1.41 1.99 1.32 1.66 2.24 1.35 1.55 2.12
Threats
A18 Breaking in/Theft 1.74 1.56 2.87 1.48 1.55 2.40 1.60 1.55 2.61
A19 Terrorist Attacks 1.25 2.42 3.02 1.28 2.37 3.34 1.27 2.39 3.20
L=Likelihood, C=Consequences
Source: Author
131
Table 5.9: Scores Assigned to Each PSCD Threats by the Different Types of Port Operators
Purely
Non-containers Multi-purpose
Containers
Label on Graph PSCD Threats L C Risk L C Risk L C Risk
A1 Port Equipment Breakdown 2.76 2.17 6.48 2.63 2.32 6.15 2.11 2.05 4.38
A2 Inadequate Port Cargo-Handling Equipment 2.36 2.09 5.55 2.43 2.43 6.47 1.72 2.14 3.96
A3 Occupational Accidents 2.52 1.85 5.03 2.13 1.90 4.40 1.69 1.67 2.70
Infrastructure
A4 Power Outage 1.79 1.82 3.82 1.70 2.03 3.43 1.43 2.27 3.27
Threats
A5 Breakdown of Vessel Traffic Management System 1.91 2.00 4.15 1.87 2.13 3.90 1.27 1.95 2.46
A6 Breakdown of Port Information System 2.15 2.06 4.91 1.87 1.90 3.80 1.57 2.11 3.41
A7 Collisions in Waterway 1.78 1.81 3.76 1.63 2.23 3.57 1.22 2.59 3.27
A8 Congestion in Waterway 2.33 1.94 5.15 2.23 2.72 6.42 1.57 2.14 3.30
Planning A9 Congestion within Terminals 3.09 2.64 9.09 2.77 3.03 8.90 2.06 2.24 4.89
Threats A10 Congestion at Hinterland Transfer 2.94 2.61 8.76 2.77 3.18 9.80 1.86 2.11 4.14
A11 Shortage of Facilities or Equipment 2.58 2.58 7.61 2.70 3.33 9.93 1.70 2.03 3.59
A12 Port Labor Strikes 2.00 2.06 4.67 1.87 2.33 4.20 1.46 2.95 4.41
Man-power
A13 Shortage of Manpower 2.03 2.06 4.67 2.47 2.22 5.42 1.65 2.00 3.32
Threats
A14 Misinterpretation of Instructions at Workplace 2.31 1.81 4.52 2.21 2.32 5.20 1.61 1.74 2.97
A15 Trafficking 1.55 1.30 2.06 1.33 1.43 1.87 1.38 1.57 2.16
A16 Smuggling/Contraband 1.70 1.39 2.45 1.60 1.63 2.77 1.51 1.68 2.43
Security
A17 Stowaway 1.48 1.30 2.09 1.53 1.47 2.13 1.22 1.49 1.84
Threats
A18 Breaking in/Theft 2.00 1.48 3.21 1.87 1.70 3.43 1.43 1.54 2.22
A19 Terrorist Attacks 1.27 1.88 2.55 1.20 2.19 2.52 1.30 3.11 3.92
Source: Author
132
Table 5.10: Scores Assigned to Each PSCD Threats by the Different Types of Port Users
Liners/Ship owners/ship Non-vessels-related

management Organizations
Label on Graph PSCD Threats L C Risk L C Risk
A1 Port Equipment Breakdown 2.07 2.01 4.35 2.12 2.16 4.90
A2 Inadequate Port Cargo-Handling Equipment 1.45 1.91 2.92 1.84 2.24 4.71
A3 Occupational Accidents 1.62 2.01 3.41 1.88 2.33 4.67
Infrastructure
A4 Power Outage 1.30 2.05 2.82 1.47 2.02 3.31
Threats
A5 Breakdown of Vessel Traffic Management System 1.42 2.59 3.52 1.57 1.90 3.22
A6 Breakdown of Port Information System 1.43 1.69 2.78 1.57 1.88 3.24
A7 Collisions in Waterway 1.53 2.95 4.37 1.82 2.18 4.20
A8 Congestion in Waterway 2.20 2.04 4.74 2.76 2.08 5.88
Planning A9 Congestion within Terminals 2.53 2.10 5.51 2.71 2.24 6.80
Threats A10 Congestion at Hinterland Transfer 2.23 1.99 4.67 2.33 2.20 5.76
A11 Shortage of Facilities or Equipment 1.73 2.14 4.05 2.45 2.20 6.00
A12 Port Labor Strikes 1.74 2.73 5.00 1.61 2.47 4.02
Man-power
A13 Shortage of Manpower 1.58 2.14 3.50 2.08 2.06 4.73
Threats
A14 Misinterpretation of Instructions at Workplace 1.59 1.61 2.85 2.06 1.78 3.96
A15 Trafficking 1.31 1.58 2.08 1.56 1.48 2.29
A16 Smuggling/Contraband 1.32 1.65 2.26 1.71 1.63 3.10
Security
A17 Stowaway 1.28 1.88 2.47 1.37 1.33 1.88
Threats
A18 Breaking in/Theft 1.27 1.52 2.06 1.80 1.59 2.92
A19 Terrorist Attacks 1.14 2.32 2.74 1.51 2.43 4.24
Source: Author
133
As there were two main groups of respondents for risk matrix, a test of difference at
95% was carried out to assess if there is a statistically significant difference in the
scores assigned to the likelihood and consequences of PSCD Threats when answering
the questionnaires. Table 5.11 shows that there was a slight difference in mean and
standard deviation between the two groups of respondents. Table 5.12 shows that the
significance value was 0.07, which means that the null hypothesis is accepted and there
is no significant difference between the port operators and port users in assigning
likelihood scores at significance level of 0.05.
Table 5.11: Descriptive Statistics for Both Groups for Likelihood Scores
Respondents N Mean Std. Deviation Std. Error Mean

Port Operators 102 1.88 0.64 0.06
Port Users 123 1.73 0.54 0.05
Source: Author
Table 5.12: T-test for Equality of Means for Likelihood Scores
95% Confidence
Sig. Interval of the
(2- Mean Std. Error Difference
t df tailed) Difference Difference Lower Upper
Equal
variances 1.87 223 0.06 0.15 0.08 -0.01 0.30
assumed
Equal
variances
1.84 197.01 0.07 0.15 0.08 -0.01 0.31
not
assumed
Source: Author
Similarly, a test of difference was also carried out for scores assigned to consequences
of PSCD Threats. Table 5.13 shows that there was smaller differences in mean and
standard deviation of scores assigned to consequences as compared to scores assigned to
134
likelihood. Table 5.14 shows that the significance value was 0.7, which means that the
null hypothesis is accepted and there is no significant difference between the port
operators and port users in assigning consequence scores at significance level of 0.05.
Table 5.13: Descriptive Statistics of Both Groups for Consequence Scores
Respondents N Mean Std. Deviation Std. Error Mean

Port Operators 102 2.07 0.64 0.06
Port Users 123 2.03 0.74 0.07
Source: Author
Table 5.14: T-test for Equality of Means for Consequence Scores
95% Confidence
Equal
variances 0.38 223 0.71 0.04 0.09 -0.15 0.22
assumed
Equal
variances 0.38 222.62 0.70 0.04 0.09 -0.15 0.22
not
assumed
Source: Author
135
5.2.3. Risk Matrices
Risk Matrices were then developed based on the scores in Tables 5.8, 5.9 and 5.10. Risk
matrices based on data collected from port operators, port users and port operators and
users combined are depicted in Figures 5.7, 5.8 and 5.9 respectively. Each matrix is
divided into four quadrants. Region 1 contains PSCD threats with relatively lower
likelihood and consequences scores assigned. Region 3 shows PSCD threats with the
highest likelihood and consequences scores and hence more attention should be paid to
these threats. The remaining PSCD threats fall in Region 2. For both groups of
respondents, all planning threats (A8-A11) were in Region 3 and security threats (A15-
A19) with the exception of Terrorist Attacks (A19) which fell into Region 1. In
comparison to other security threats, Terrorist Attacks (A19) was given higher
consequences and lower likelihood scores and, as a result, it fell in Region 2 for both
groups.
Figure 5.7: Risk Matrix Based on Responses Collected from Port Operators
Source: Author
136
Figure 5.8: Risk Matrix Based on Responses Collected from Port Users
Source: Author
Figure 5.9: Risk Matrix Based on Responses Collected from Port Operators and Users
Source: Author
Figures 5.10, 5.11 and 5.12 are matrices for container ports, ports that do not handle
containers and ports that handle both containers and other cargo respectively. As can be
seen from these risk matrices, in addition to the four quadrants, there was an additional
portion, Region 4, where a few PSCD threats can be found. These risks were not
necessarily the ones with the highest risk scores. This region was added onto the risk
137
matrices to depict the differences in perception towards PSCD threats by different types
of port operators in comparison to other respondents. PSCD threats that fall in Region 4
are those that receive higher consequences and/or likelihood scores and thus, more
focus is recommended for these threats. Specifically, threats that fell in Region 4 were
Congestion within Terminals for container ports (A9); Congestion within Terminals
(A9), Congestion at Hinterland Transfer (A10) and Shortage of Facilities or Equipment
(A11) for ports that do not handle containers; and Terrorist Attacks (A19) for multi-
purpose ports. Particularly, the responses from multi-purpose ports differed from those
of the other two types of ports. In Figure 5.12, many PSCD threats received relatively
lower scores for likelihood. As a result, most of the threats ended up in Regions 1 and 2.
On the other hand, the threats were more spread out in risk matrices for container ports
and ports that handle non-containerized cargo.
Figure 5.10: Risk Matrix Based on Responses Collected from Ports that Handle Only
Containers
Source: Author
138
Figure 5.11: Risk Matrix Based on Responses Collected from Ports that do not Handle
Containers
Source: Author
Containers and Other Types of Cargo
Source: Author
139
The risk matrices based on responses from different types of port users are presented in
Figures 5.13 and 5.14. Organizations which are non-vessel related recognized more
threats in Region 3 than shipping lines, ship owners and ship management companies.
For non-vessel-related organizations, planning threats (A8-A11) received higher scores
of likelihood and consequence and thus were mostly found in Region 3. For shipping
lines, ship owners and ship management companies, though planning threats (A8-A11)
with the exception of Shortage of Facilities or Equipment (A11) were also found Region
3, these threats possessed lower risk scores than those assigned by non-vessel-related
organizations. Collisions in Waterway (A7) was ranked the worst in terms of
consequences by port users that manage or operate vessels while Port Labor Strikes
(A12) had the highest mean score of consequences for those whose organizational
functions are non-vessel-related.
Shipping Lines, Ship Owners or Ship Management Companies
Source: Author
140
Figure 5.14: Risk Matrix Based on Responses Collected from Port Users who are Non-
vessel-related Organizations
Source: Author
In summary, planning threats (A8-A11) generally had higher mean and standard
deviation while security threats (A15-A19) had lower mean and standard deviation for
likelihood and consequences scores assigned by all respondents in most cases.
Congestion within Terminals (A9) received the highest mean score for likelihood and
risk score, while the responses from the different groups of respondents were mixed in
scores assigned to threats for consequences. Terrorist Attacks (A19) received the lowest
mean score for likelihood in most cases. Trafficking (A15) and Stowaway (A17) had the
lowest mean score for both consequences and risk scores in most cases. A summary
table of results is provided by Table 5.15. The results will be discussed in more details
in the following section.
141
Table 5.15: Summary of Mean and Risk Scores – Individual PSCD Threats
Port Operators Port Users

Port Liner/Ship
Operators Owner/
Port and Port Non- Multi- Ship Non-vessel-
Operators Port Users Users Container container purpose Management related
Congestion
within
Congestion Congestion Congestion Congestion Terminals Port Congestion
Congestion in
Likelihood within within within within Equipment within
Congestion at Waterway
Terminals Terminals Terminals Terminals Breakdown Terminals
Hinterland
Transfer
Highest
Congestion Collisions Congestion Shortage of
Port Labor Port Labor Collisions in
Consequences within in within Facilities or Port Labor Strikes
Strikes Strikes Waterway
Terminals Waterway Terminals Equipment
Congestion Congestion Congestion Congestion Shortage of Congestion Congestion
Congestion within
Risk Score within within within within Facilities or within within
Terminals
Terminals Terminals Terminals Terminals Equipment Terminals Terminals
Terrorist Terrorist Terrorist Terrorist Terrorist Terrorist
Likelihood Stowaway Stowaway
Attacks Attacks Attacks Attacks Attacks Attacks
Trafficking Breaking
Lowest Consequences Stowaway Trafficking Trafficking Trafficking Stowaway Stowaway
Stowaway in/Theft
Breaking
Risk Score Stowaway Trafficking Stowaway Stowaway Trafficking Stowaway Stowaway
in/Theft
Source: Author
142
5.3. Discussion of Results
5.3.1. The role of ports in supply chain disruptions
The in-depth interviews conducted with industrial professionals revealed that there was
a high level of consensus among port operators and their users that ports play a critical
role in supply chains. All of the port operators interviewed felt that their ports are
playing an important role in the supply chains of their customers as their ports are “the
interface to meet the demands of the end customers” as one interviewee had put it.
Though this interface has the potential of contributing to supply chain disruptions, it is
also capable of mitigating disruptions, for example, the port can play a part in helping
shipping lines to “catch up on the variability in their vessel schedules”, a usual
circumstance of severe weather conditions and seasons. This reiterates a port’s role in
supply chain disruption management and that ports are indeed more embedded in supply
chains.
According to the interviewees and the results of the survey, not every one of the
identified 19 PSCD threats had occurred at their ports and they also felt that different
ports face different challenges. The results from Table 5.15 support this viewpoint as
the PSCD threat with highest likelihood and worst consequence faced by ports handling
different types of cargo are not the same.
Planning threats, particularly congestion within terminals, can be rather common at

certain regions, while the same threats are reduced to a minimal level at other ports in a
different region. For instance, as an interviewee pointed out, “congestions at the port
have become a norm in some regions… that the downstream entities would already
have planned for more margins”. However, there were certain ports where disruptions
due to congestions were reduced to a minimal. Infrastructure (A1-A7) and manpower
(A12-A14) threats were mainly clustered in Region 2 of risk matrices for multi-purpose
ports. Ports that handle non-containerized cargo had assigned higher scores for
143
manpower threats (A12-A14) than other ports. On the other hand, trafficking (A15),
smuggling (A16), stowaway (A17), theft (A18) and terrorism (A19) were less
frequently found at these ports and all security threats (A15-19), except terrorist attacks
(A19), were generally thought to be having a minimal effect on supply chains when
they occurred. This view was shared by both the port operators and port users.
While the risk matrix in Figure 5.9 shows that port operators and port users generally
felt that planning threats (A8-A11), especially congestion within terminals (A9), occur
most frequently, Figures 5.7 and 5.8 show that they had differing views on the damage
propagated by the threats. In particular, respondents from ports handling containerized
and non-containerized cargo perceived that planning threats (A8-A11) pose higher
dangers in terms of the consequences they bring, while port users were more concerned
with collisions in waterway (A7) as their attention tend to be on the direct impact of
these threats on their cargo and vessels. Collisions in waterway (A7) naturally result in
higher chances of damage and loss to the cargo and vessels as compared to congestion
within port terminals. When the responses of port users were separated into vessel and
non-vessel related organizations, the difference in perspectives was more evident.
Specifically, the vessel-related group perceived that collisions in waterways (A7) would
have brought the worst consequences while the non-vessel related group selected strikes
to be the threat that would result in the worst consequences. External parties will
understandably be more interested in a business relationship with the port management
when they are shown how such an approach could benefit them. In port operators’
cooperation and collaboration with port users, it is advantageous for both external
parties and port operators to understand each other’s perspectives as common grounds
could then be created for more balanced efforts in the cooperation. Safeguarding the
port users’ assets – vessels and cargo, would be of paramount importance to them, thus
these are point of interests which the port management should consider as well.
144
Other relevant PSCD threats raised by respondents include wrong positioning of
containers, sanctions, lack of manpower at customs, delays in updating export list and
vessels’ ETA delayed. The occurrences of these threats are expected to be in relation to
the effectiveness of information exchange, experience and proficiency of employees in
carrying out tasks, and the adequacy of planning of port processes. The findings derived
from the 19 identified PSCD threats are expected to enhance these aspects nonetheless.
Efforts in managing collaborations and communications with port users have direct
effects on information exchange between the port and its users. Additionally, measures
that generally reinforce planning capabilities, port infrastructure and professional skills
of port employees are relevant in managing these threats.
5.3.2. Factors affecting occurrences of PSCD threats
Types of cargo handled
Different types of cargo handled give rise to different types of risks. Depending on the
types of cargo moved, in some cases, ports can be the “most important part in supply
chains”, as pointed out by an interviewee. Examples of such cases are the bulk cargo,
especially when the cargo owners have their facilities at the ports to receive or store the
cargo once they are unloaded. In these situations, equipment breakdowns or congestions
at the ports will immediately cause a delay or a halt in the supply of the cargo, resulting
in fewer opportunities to catch up on the delays as such possibilities could otherwise
have arisen during the transportation of cargo from the ports to the cargo owners.
On the other hand, ports handling containerized cargo utilize automated systems to a
larger extent in cargo handling processes. This affects the extent of labor-intensiveness
and the frequency of communication at the ports, hence, resulting in different
occurrences of PSCD threats faced. Labor and communication play important roles in
the handling of non-containerized cargo which requires mostly non-automated systems
of loading and unloading procedures as compared to the benefits and convenience
145
brought about by containerization. Thus, when handling this type of cargo, the potential
of PSCD threats hinge on the level of labor-intensiveness and communication. The
benefits of standardization offered by containerized cargo explains smaller variability in
the potential of security threats across all containerized ports due to the presence of
security initiatives tailoring to containerized cargo. However, one difficulty with
handling containerized cargo is the complexity of cargo arrangement, often resulting in
repositioning and restacking of containers, thus exposing the cargo to delays. The level
of security threats may be affected by the previous and first port of call as the vessels
and cargo are subjected to varying degrees of investigations, depending on the
requirements at that port. As such, transshipment ports assume a lesser extent of
responsibility on transshipment cargo as compared to import and export ports on import
and export cargo.
Market trends
Planning and infrastructure threats are closely related to, as the name suggests, planning
ahead. With larger vessels ordered by the shipping lines, the remedies for the PSCD
threats unavoidably require capital intensive investments either in the building of
infrastructure or the provision and maintenance of the port equipment. This concern has
been expressed by a few interviewees belonging to different ports. Sources of capital
and revenue can be better established with the intervention of the government. Port’s
integrative role into supply chains has increased the range and complexities of service
provision. The increased integration has altered the demands of port users. Meeting the
needs of port users requires capital intensive investments on port infrastructure. The
construction and developments of port infrastructure depend on the profiles of port
customers. Understanding the profile of their customers helps to understand the needs of
the customers so that necessary facilities are constructed to handle their fleets. This will
also safeguard the ports against inadequacy and insufficiency in infrastructure and
equipment, which may give rise to congestions and resource shortages. Thus, planning
together with the government and port users involves planning for sufficiency, adequacy
146
and contingency as well sustainability. The following quote from an interviewee
illustrates this view:
“We … work together with our customers; to make sure that we are ready when they
are ready, as they like to buy bigger ships…We need to know the profile of our
customers so that we can ensure that the necessary facilities are there when needed…
The facilities must match.”
Business environment
Both the interviewees who were port operators and port users acknowledged the
seriousness of congestion and the demand for adequate facilities or infrastructure at the
port. Infrastructure threats and planning threats appear to be rampant in developing
countries while particularly low in threat levels in areas where there are mentions of
very proximate working relationships with its government. Ports belonging to the
caliber of the latter group work closely and harmoniously with the government with
regards to issues on future capacity expansion to ensure their capability in staying
relevant in future market environment with the trends of larger vessels and higher cargo
turnover in meeting the future needs of the port customers.
Congestion is often related to the absence of “suitable and sufficient” facilities, as

described by one of the managers from a port. Developments in infrastructure is costly
and might require legislative or regulatory approvals, thus government play an
important role in planning to target the PSCD threats related to the hardware at the port.
The participation or intervention of government can take the form of modes of
investments to fund port development projects which are essentially costly. However,
bureaucracy is likely to create inefficiencies. In particular, the role that the local
government, regulators and port authority plays in security threats is straightforward
since they are directly involved in enforcing security initiatives. However, the level of
security threats in a port is also dependent on the previous port of call of the vessels and
147
the origin of the cargo which might result in the cargo being subjected to investigations,
thorough checks, quarantine, and problems at customs clearance as security lapses are
detected at a port with stricter requirements. For this reason, it is understandable that the
extent of responsibility assumed in managing security and criminal threats differs in a
transshipment port and in import and export ports. A closer and effective working
relationship with the government is thus recommended in managing security threats, but
the challenges in fostering such a connection are largely on the local business culture,
political agenda and the influence of the government.
The extent of government intervention and support varies in different regions and
depends largely on the government leadership style, which in turn forms part of the
local business cultures. Standards are challenges as social and cultural factors determine
which practice is acceptable. An interviewee at a port pointed out that the impact posed
by the PSCD threats might have been assumed in planning stages at supply chain
entities such that the effects or consequences of the threats are reduced. In such cases,
certain risks might be acknowledged as norms in business operations. In regions where
regulatory ambiguity exists, there are higher chances of a misalignment of expectations.
Similarly, corrupt practices result in detrimental effects on the port’s business
management due to the competitive disadvantages that come along with corruption.
Figure 5.15 shows three factors that highlight the dynamics of the PSCD threats and
their respective impacts.
Figure 5.15: Factors affecting occurrences of PSCD Threats
Source: Author
148
Generally, threats that require a higher level of attention are Terrorist Attacks and all
planning threats, namely Congestion in Waterway, Congestion within Terminals,
Congestion at Hinterland Transfer and Shortage of Facilities or Equipment.
Infrastructure and manpower threats tend to possess relatively lower frequencies and
less severe impacts while security threats are mostly found to be associated with the
lowest frequencies and minor impacts. However, of the manpower threats, port labor
strikes should be given higher level of attention as the risk matrices show that it does
have a higher degree of impact on supply chains. The factors that affect the potential of
PSCD threats in supply chain disruptions can be attributed to the working relationship
with the government and port users, regulated safety and security levels, externalities
from the market environment, level of preparedness and types of cargo handled at the
port. Specific recommendations for different threats and ports vary, but the general
essence of managing these threats is to consider the abovementioned factors in devising
strategies to reduce disruptions.
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CHAPTER 6. RESULTS – MANAGEMENT MODEL
6.1. Demographics of Respondents
This chapter 3 discusses the results and findings of the PDM. For sections on the
management model, the survey was conducted with only port operators and port
authorities. A total of 845 questionnaires were distributed and 104 responses were
received. The response rate was 12.31%. Out of the 104 responses, 100 were deemed
useful for analysis. Four responses were unable to be used as one of them was a
passenger port and the remaining three had at least one section left empty. Table 6.1
gives the breakdown of the number of completed questionnaires received and used in
this study from both samples.
Table 6.1: Number of Completed Questionnaires Received and Used
Received
Sample Distributed
Total Used
Port Operators and authorities 845 104 100
Total 845 104 100
Source: Author
3
The following publications from the author is based on part of this chapter:
LOH, H. S. & THAI, V. V. 2015b. Managing Port-related Supply Chain Disruptions (PSCD): A
Management Model and Empirical Evidence. Maritime Policy & Management, In press.
150
The majority of the respondents are involved in their port’s disruption management as
shown in Figure 6.1. A further breakdown of the details of the respondents is available
in Table 6.2.
Figure 6.1: Respondent’s Involvement in Disruption Management at Respective Ports
Source: Author
Then, tests of differences were carried out to assess the effects of respondents’
functional area, designation and involvement in disruption management on scores
assigned to management model measures as well as port performance. ANOVA tests
were carried out on functional area and designation on mitigating measures and
performance scores. The results are shown in Tables 6.3 and 6.4 respectively.
Independent t-test was carried out on respondent’s involvement in disruption
management as there were only two groups for this category. The results are shown in
Tables 6.5 and 6.6.
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Table 6.2: Demographics of Respondents for Management Model
Number of Percentage of
Types of Cargo Handled
Containers only 33 33.00%
Bulk only 17 17.00%
Vehicles only 4 4.00%
Combinations 46 46.00%
Total 100 100.00%
Number of Employees
Less than 100 22 22.00%
100-499 41 41.00%
500-999 14 14.00%
1,000-4,999 8 8.00%
5,000-9,999 7 7.00%
More than 10,000 7 7.00%
Total 100 100.00%
Functional Area
Both 11 11.00%
Total 100 100.00%
Designation
Executive 31 31.00%
Manager 24 24.00%
Others 7 7.00%
Total 100 100.00%
Experience
1 - 5 years 20 20.00%
5+ - 10 years 14 14.00%
10+ - 20 years 30 30.00%
Total 100 100.00%
Location of port
Africa 2 2.00%
Asia 67 68.00%
Europe 15 15.00%
North America 7 7.00%
South America 1 1.00%
Oceania 4 4.00%
Unknown 3 3.00%
Total 100 100.00%
Source: Author
152
Table 6.3: Descriptive Statistics of Functional Area and Designation on Scores
Assigned to Management and Port Performance Sections
95%
Confidence
Interval for
Mean
Std. Std. Lower Upper
N Mean Deviation Error Bound Bound Min Max
Mitigating Measures
Functional Area
Non-Operations 54 3.75 0.43 0.06 3.63 3.87 2.51 4.76
Operations 33 3.83 0.45 0.08 3.67 3.99 2.96 4.82
Both 11 4.05 0.46 0.14 3.74 4.36 3.44 4.91
Total 98 3.81 0.45 0.05 3.72 3.90 2.51 4.91
Designation
Executive 31 3.86 0.51 0.09 3.67 4.04 2.51 4.96
Managerial 60 3.80 0.45 0.06 3.69 3.92 2.62 4.91
Others 7 3.87 0.41 0.16 3.48 4.25 3.11 4.26
Total 98 3.82 0.46 0.05 3.73 3.92 2.51 4.96
Port Performance Measures
Functional Area
Non-Operations 54 3.60 0.44 0.06 3.49 3.72 2.1 4.4
Operations 33 3.63 0.51 0.09 3.45 3.81 2.35 4.6
Both 11 3.89 0.53 0.16 3.53 4.25 3.2 5
Total 98 3.65 0.48 0.05 3.55 3.74 2.1 5
Designation
Executive 31 3.72 0.38 0.07 3.58 3.86 3.1 4.6
Managerial 60 3.61 0.52 0.07 3.47 3.74 2.1 5
Others 7 3.65 0.53 0.20 3.16 4.14 2.95 4.4
Total 98 3.65 0.48 0.05 3.55 3.74 2.1 5
Source: Author
153
Table 6.4: ANOVA test on the Functional Area and Designation
Sum of Mean
Squares df Square F Sig.
Mitigating Measures
Functional Area (Operations and Non-operations)
Between Groups 0.83 2 0.41 2.12 0.13
Within Groups 18.56 95 0.20
Total 19.38 97
Designation (Executives, Managerial, and others)
Between Groups 0.07 2 0.03 0.16 0.85
Total 20.61 97
Functional Area (Operations and Non-operations)
Between Groups 0.76 2 0.38 1.69 0.19
Total 22.04 97
Designation (Executives, Managerial, and others)
Between Groups 0.25 2 0.13 0.55 0.58
Total 22.05 97
Source: Author
Table 6.5: Descriptive Statistics for Involvement in Disruption Management Group
N Mean Std. Deviation Std. Error Mean

Mitigating Measures
Yes 72 3.85 0.40 0.05
No 24 3.72 0.57 0.12
Yes 72 3.67 0.45 0.05
No 24 3.57 0.58 0.12
Source: Author
154
Table 6.6: T-test for Equality of Means for Respondent’s Involvement in Disruption
Management Group
95% Confidence
Mitigating Measures
Equal
variances
assumed 1.23 94 0.22 0.13 0.11 -0.08 0.34
Equal
variances not
assumed 1.03 30.82 0.31 0.13 0.13 -0.13 0.39
Equal
variances
assumed 0.89 94 0.38 0.10 0.11 -0.13 0.33
Equal
variances not
assumed 0.79 32.98 0.44 0.10 0.13 -0.16 0.36
Source: Author
There were six choices for functional area in the questionnaire. Overall, 65 respondents
were involved in operations and 11 of the 65 were also involved in planning and other
non-operations functions. ANOVA tests results show that the significance value for
functional area on management and port performance measures were 0.13 and 0.19
respectively. Therefore, it is concluded that the null hypothesis is accepted and there is
no significant difference between those involved in operations, non-operations or both
in scores assigned to management as well as port performance measures at significance
levels of 0.05.
For designation, the respondents were either at the executive or managerial level.
Respondents who selected the option “others” gave designations which were unclear as
to whether they belonged to the managerial level or not. Hence, ANOVA tests were
155
conducted on the three groups: executive, managerial and others. ANOVA tests results
also show that the significance value for designation on management and port
performance measures were 0.85 and 0.58 respectively. In other words, the null
hypothesis is accepted and there is no significance difference between those who are of
executive, managerial levels and those who are not in scores assigned to management as
well as port performance measures at significance levels of 0.05.
Independent-samples t-tests results show that the significance value for involvement in
disruption management on management and port performance measures were 0.31 and
0.44 respectively. Thus, the null hypothesis is accepted and there is no significance
difference (in the responses) between those involved in disruption management at their
ports and those who are not in scores assigned to management as well as port
performance measures at significance levels of 0.05.
6.2. Results
This section begins with the presentation of descriptive statistics. Then, there are
alternative models which are to be tested and compared in addition to the theoretical
model presented in Chapter 4. The alternative models will be compared using fit indices.
The measurement model fit and validity issues will then be addressed. The most
appropriate model will be established and the model validation and explanation will be
presented.
6.2.1. Descriptive Statistics
The minimum, maximum, mean and standard deviation scores assigned to management
and port performance measures are shown in Table 6.7. For mitigating measures,
“Internal Risk Management” received a highest mean of 4.14 and “Collaborative
Relationships with Relevant Agencies” received a lowest mean of 3.53 but a highest
156
standard deviation of 0.80. “Service Objectives Enhancement” had a lowest standard
deviation of 0.47. For port performance measures, C10 (see Appendix F) had a highest
mean of 4.01, while C15 had the lowest mean of 3.05 but also a highest standard
deviation of 1.15. On the other hand, C14 had the lowest standard deviation of 0.57.
Table 6.7: Descriptive Statistics of Scores Assigned to Management and Port

Performance Measures
Std.
Min Max Mean Deviation
Internal Risk Management 1.75 5 4.14 0.60

(Items B1.1-B1.4)
Mandatory Controls 2.67 5 3.98 0.49
(Items B2.1-B2.7)
PSCD Impact Analysis 2.67 5 4.09 0.57
(Items B3.1-B3.3)
Disruption Recovery Planning 2.33 5 4.01 0.63
(Items B4.1-B4.3)
Service Objectives Enhancement 2.17 5 3.97 0.47
(Items B5.1-B5.6)
Employee Involvement and Empowerment 1.75 5 3.70 0.69
(Items B6.1-B6.4)
Collaborative Working Relationships with Supply 2 5 3.61 0.54
Chain Parties
(Items B7.1-B7.7)
Collaborative Relationships with Relevant 1.62 5 3.53 0.80
Agencies
(Items B8.1-B8.4)
Relevance Evaluation 1.33 5 3.65 0.77
(Items B9.1-B9.3)
Recommendation for Improvement 1.75 5 3.74 0.66
(Items B10.1-B10.4)
Financial Health 1.80 5 3.52 0.69
(Items C1-C5)
Market Reputation 2.20 5 3.62 0.53
(Items C6-C10)
Resilience of Internal Operations 1.80 5 3.68 0.55
(Items C11-C15)
Internal and External Opportunities 1.80 5 3.79 0.58
(Items C16-C20)
Source: Author
157
6.2.2. Use of Item Parceling
In usual situations, when structural equations modeling (SEM) is used, every individual
item will be an indicator of the latent construct it belongs to. An optional premodeling
step in SEM is parceling, which is a process that sums or averages items and the parcels
are then used as the manifest indicator (Little, 2013). There are many advantages of
parceling. When the requirement of multivariate normality is not met in SEM, the
parcels formed may approximate a normal distribution (Coffman and MacCallum,
2006). However, simulation has suggested that the effects of modeling nonnormally
distributed variables in SEM are that the chi-square values are inflated, which thus
increases the chances of rejecting the model when it should not be rejected, though
parameters estimates remain rather accurate (Kline, 2010). The use of many individual
items in SEM is problematic and causes a poor fit, thus parceling is introduced (Marsh
et al., 1998). Another widely-quoted advantage of using parcels is that the proposition
of aggregation enables parceling to increase reliability (Little, 2013, Kishton and
Widaman, 1994) which results in more true-score variance (Little, 2013). In addition the
use of parceling does not result in loss of estimation precision in SEM (Graham and
Tatterson, 2000).
In the case of this survey, there was no comparison between samples and the indicators
were formed based on well-established concepts and principles from previous studies
which means that model misspecification and masked additional latent constructs were
not an issue, thus the use of parceling was justified. Parceling was carried out in this
research as there was a large number of indicators used and sample size was not large.
The use of more indicators results in a better representation of the latent construct
(Coffman and MacCallum, 2006). This view is also supported by Rushton, Brainerd and
Pressley (1983), who proved that the use of parcels enabled relationships between
conceptually similar constructs to be revealed while individual items were not able to
demonstrate that. Thus, instead of deleting items to a number that is appropriate and
158
comfortable for SEM applications to manage, the use of parceling prevents incorrect
inferences and avoids the situation of removing essential indicators which have been
included in this research based on previous studies.
Parcels can be created using the subset-item-parcel approach or all-item-parcel approach

(Matsunaga, 2008). Subset-item-parcel approach involves random or non-random
selection of forming subsets of items and each subset constitutes a parcel. All-item
parcel is an aggregation of all items and using composite scales as indicators of the
constructs. The two methods can be used together. Firstly, PDM was considered as a
single construct and the means of indicators were used to form three parcels, P1, P2 and
P3, instead of sums as the number of items going into the parcels differ (Little, 2013).
Items B1, B3, B7, B8 in the questionnaire were used to form P1, items B4, B2, B10
were used to form P2 and items B5, B6, B9 were used to form P3. Secondly, port
performance, including disruption management, has four constructs – RIO, IEO, MR
and FH. Items C1-C5 in Part C of the questionnaire were formed for FH, items C6-C10
for MR, items C11-C15 for RIO and items C16-C20 for IEO. Therefore, each of these
four constructs had one item and two parcels. In creating these parcels, the highest
loadings and the lowest were parcelled together, thus it was not a random selection of
items. For example, items C3 and C5 were parcelled to form FH1, C1 and C2 formed
FH2, while C4 remained as an item as its loading is the third highest out of the five
items. This approach is the domain representative method which Kishton and Widaman
(1994) concluded to be the better method. Then, the modification indices were
examined for every construct and loadings were checked to ensure homogeneity.
Confirmatory factor analysis (CFA) was then run and the fit indices will then be
evaluated.
6.2.3. Measurement Model Fit
In SEM, attention will be given to the measurement model and the structural model.
These two components decide whether a hypothesis can be accepted or not. In this
159
research, four alternative models were tested and compared. Firstly, the measurement
model is the component that displayed the model’s constructs, indicator variables and
the connection between them. Figure 6.2 shows the baseline model of this research. The
fit indices were examined and the construct validity and reliability were evaluated in the
assessment of the measurement model. On the other hand, the structural model is the
model that determined the stated or predicted the relationship between specific
constructs.
In this section, the measurement and theoretical models were first identified and three
alternative models were proposed. Figure 6.3 is the theoretical model hypothesized in
Chapter 4 and Figures 6.4, 6.5 and 6.6 show the remaining alternative structural models.
Thus, M2, M3, M4 and M5 are nested models and M2 is the theoretical model. Figure
6.4 shows that M3 is a partially mediated model while M4 in Figure 6.5 is a non-
mediated model and M5 in Figure 6.6 is a fully mediated model. CFA was performed
on M1 and following the modification indices, C6 and RIO2 (C13 and C14) were
removed to achieve better fit. The three items asked if the market share of the
respondent’s port has been increasing, has experienced constant improvement in its
operational efficiencies, and if collaborations between the respondent’s port and its
partners have improved efficiency levels of its internal processes and operations. The
removal of these items does not jeopardize the measurement of the objectives.
Remaining items related to market reputation as well as disruption management
performance in terms of threat levels and effectiveness of collaborations can replace
what could have been captured by the removed items.
160
Figure 6.2: The Measurement Model – M1
Source: Author
Figure 6.3: Theoretical Model of Research – M2
Source: Author
Figure 6.4: Alternative Model – M3
Source: Author
161
Source: Author
Source: Author
A comparison was made among the alternative models to examine the relationships
between constructs. The fit indices of all the models are shown in Table 6.8. There are
three main types of fit measures: absolute fit measures, incremental fit measures and
parsimony fit measures (Hair et al., 2006). Absolute fit measures how appropriately the
theoretically deduced model fits the sample data (Hooper et al., 2008, McDonald and
Ho, 2002). The Chi-square test, root mean square residual (RMR) and standardized root
mean square residual (SRMR) are popular examples of absolute fit measures.
Incremental fit measures how well a priori model fits as compared to a baseline model
162
(Hair et al., 2006). These indices are relative fit indices (McDonald and Ho, 2002) that
compare the chi-square value to a baseline model (Hooper et al., 2008). The Tucker-
Lewis Index (TLI), Bollen’s Incremental Fit Index (IFI) and Comparative Fit Index
(CFI) are common examples used as relative fit indices (Tanaka, 1993, Maruyama,
1997, Hooper et al., 2008). Parsimony fit measures whether the specified model is
parsimonious (Hair et al., 2006) using tests such as the root mean square error of
approximation (RMSEA) and the Parsimony Normed-Fit Index (PNFI). The indexes
stated above are reported in combination in Table 6.8.
Table 6.8: Comparison of Fit Indices
χ2 RMSEA
Model df SRMR CFI TLI IFI PNFI
(p-value) (90% CI)
M1 55 71.670 0.055 0.0504 0.975 0.964 0.975 0.636

(0.065) (0.000 ;
0.089)
M2 59 74.891 0.052 0.0526 0.976 0.968 0.976 0.679

(0.079) (0.000 ;
0.085)
M3 55 71.670 0.055 0.0504 0.975 0.964 0.975 0.636

(0.065) (0.000 ;
0.089)
M4 59 98.203 0.082 0.0794 0.940 0.921 0.942 0.655

(0.001) (0.052 ;
0.110)
M5 57 71.678 0.051 0.0505 0.978 0.969 0.978 0.659

(0.091) (0.000;
0.085)
Source: Author
In the assessment of measurement model validity, there is no one best test that portrays
how good the model is (Hair et al., 2006). Researchers have suggested different
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statistical tests for this purpose and they should be examined together. A commonly
used goodness of fit index is χ2 or the chi-square test statistic (Brown, 2006). The
measurement model which was also named M1 in this research has a chi-square of
71.67 with 55 degrees of freedom and a p-value higher than 0.05. Thus, there was an
acceptable model fit and the proposed model was accepted. The chi-square was also
non-significant, suggesting that the model was consistent with the observed data. Other
evidence of adequate fit between the hypothesized model and sample data includes the
examination of relative chi-square which is obtained by dividing the chi-square fit index
by degrees of freedom. As such, M1 had a relative chi-square of less than 2 and this
ratio lies in the recommended range (Carmines and McIver, 1981).
Next, a badness of fit index and a goodness of fit index should be evaluated and this is
satisfied by an examination of RMSEA and CFI (Hair et al., 2006). RMSEA is 0.055
which fulfils the cut-off criteria set by Steiger and Lind (1980). CFI is 0.975 which well
exceeds the criteria of 0.95 (Bentler, 1990). Other fit indices presented in Table 6.8 also
fulfil the cut-off criterion recommended by several researchers: SRMR < 0.8 (Bentler,
1995), TLI > 0.95 (Tucker and Lewis, 1973) and IFI > 0.95 (Bollen, 1989). There is no
standard or a cut-off value widely agreed upon for PNFI, but a typical PNFI value
should be approximately 0.5 (Byrne, 1998). Therefore, it can be concluded that
acceptable model fit has been established from the examination of multiple indices.
6.2.4. Reliability and Validity of Measurement Model
The construct validity of the model measures how well the measured set of items reflect
what they are proposed to measure, that are the theoretical latent constructs (Hair et al.,
2006). It was assessed through an investigation of convergent validity, discriminant
validity and nomological validity. It has to be noted that face validity had already been
established through literature review and the initial phase of data collection that
included conducting interviews, pre-testing and pilot testing processes. Convergent
validity is a more rigorous approach than face validity and it can be measured by: (1)
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factor loadings, (2) average variance extracted (AVE) and (3) reliability. The
standardized loadings estimates, average variance extracted and reliability estimates of
all latent constructs in the measurement model are reported in Table 6.9.
As can be seen from Table 6.9, all standardized loadings estimated at least 0.5, which
satisfies the guidelines by Hair et al (2006). The recommended criterion is that the
factor loadings should be at least 0.5 and those above 0.7 exhibit “significant
explanatory power for that factor” (Karavdic, 2006). The results from Table 6.9 shows
that the lowest loading was 0.583 and there were only two other loadings below 0.7
(C12 and MR1). Therefore, it can be concluded that all factor loadings were significant
and adequately met the requirements for convergent validity.
Table 6.9: Standardized Loadings Estimates, Average Variance Extracted and

Reliability Estimates of Measurement Model
PDM FH MR RIO IEO

P1 0.890
P2 0.906
P3 0.894
FH1 0.795
FH2 0.712
C4 0.724
MR1 0.617
MR2 0.703
RIO1 0.717
C12 0.686
IEO1 0.841
IEO2 0.741
C17 0.583
Average Variance
80.41% 55.44% 43.74% 49.23% 53.21%
Extracted
Construct Reliability 0.92 0.79 0.61 0.66 0.77
Source: Author
165
The next measure to examine convergent validity was the AVE, which was a more
stringent test than the examination of factor loadings. It was not provided by AMOS
software and had to be computed manually for all latent constructs by dividing the sum
of the squared standardized factor loadings by the number of items or using the formula:
n
( i2 ) / n . All except MR and RIO had AVE estimates above 0.5. Though Hair et al
i 1
(2006) recommended AVE estimates to be at least 0.5, according to (Liu et al., 2011)
the AVE values of MR approximate those recommended by Fornell & Larcker (1981)
which are in line with those by Hair et al (2006).
However, an additional measure was performed to further prove that there was
convergent validity. This procedure involved, for each construct, dividing the square of
the sum of all factor loadings belonging to that construct by the sum of that and the
error variance terms for that construct or by using the formula:
n n n
( i ) 2 /[(  i ) 2  (  i )] . This formula calculates the construct reliabilities of each
i 1 i 1 i 1
latent construct. This method is a more rigorous test than the commonly reported
Cronbach’s alpha or coefficient alpha which has several weaknesses (Cronbach and
Shavelson, 2004, Garver and Mentzer, 1999, Raykov, 1998, Raykov, 1997). The rule of
thumb set by Hair et al (2006) is that the construct reliability estimates that are at least
0.7 suggest good reliability, and those between 0.6 and 0.7 are acceptable. The results
from Table 6.9 shows that all construct reliability estimates fulfilled this requirement as
the lowest value was 0.61 and the highest was 0.92. Therefore, an evaluation of the
construct reliabilities indicated that there is internal consistency as the construct
reliabilities of all constructs satisfied the guideline of 0.6, with three of the constructs
displaying good reliability and PDM faring exceptionally well, with a value of 0.92.
Another method used by Netemeyer et al (1990) to reinforce convergent validity was to

conduct a chi-square test difference between an unconstrained model and a constrained
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one for the factors with AVE values below 0.5. Following the same test and since the
discriminant validity needs to be assessed as well, the results for the chi-square test
differences of all factors are reported in Table 6.10. The cells that read error are AMOS
runs where estimates could not be calculated as there was a bad model fit. As compared
to the unconstrained model in which χ2 (55, N=100, p<0.05) = 71.67, the chi-square
values in Table 6.10 indicate that there was a significant improvement in fit of the
unconstrained model. In other words, the differences in chi-square values are significant
in all cases and the constrained model is rejected. The results from Table 6.10 show that
the constructs were distinct from each other and thus, there was discriminant validity in
the measurement model. This test of unidimensional nature to establish discriminant
validity between the constructs has been widely accepted by researchers (Deery et al.,
1999, Bagozzi et al., 1991, Anderson and Gerbing, 1988).
Table 6.10: Chi-square test difference
Constructs PDM FH MR RIO IEO

PDM - error error error error
FH error - 123.461 104.621 114.123
MR error 123.461 - error error
RIO error 104.621 error - 110.949
IEO error 114.123 error 110.949 -
Source: Author
Lastly, nomological validity was tested. Nomological validity considers if the

correlations between constructs are rational. Thus, the constructs correlations were
needed in determining nomological validity. From AMOS output, the covariances and
correlations tables were inspected. Tables 6.11 and 6.12 show the covariances table and
correlations table respectively and they show that all correlations between the constructs
were positive and significant at a level of 0.05. Table 6.13 reports the correlation matrix
in which the diagonal values show the construct variances, the values below the
construct variances are correlation estimates obtained from Table 6.12 and the figures
above the construct variances were computed by squaring the correlations. The results
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of Table 6.13 are evidence that nomological validity was achieved as the signs and
significance of the proposed correlation relationships among the latent constructs in the
measurement model were deemed to have positive correlation relationships between
them.
Table 6.11: Covariances Table of Measurement Model
Estimate S.E. C.R. P
PDM  FH .181 .042 4.342 ***
PDM  MR .113 .032 3.500 ***
PDM  RIO .201 .044 4.565 ***
PDM  IEO .230 .042 5.472 ***
FH  MR .181 .049 3.681 ***
FH  RIO .285 .065 4.406 ***
FH  IEO .241 .055 4.356 ***
MR  RIO .224 .055 4.062 ***
MR  IEO .134 .041 3.245 .001
RIO  IEO .260 .058 4.492 ***
Source: Author
168
Table 6.12: Correlations Table of Measurement Model
Estimate
PDM  FH .62
PDM  MR .58
PDM  RIO .74
PDM  IEO .85
FH  MR .70
FH  RIO .79
FH  IEO .67
MR  RIO .93
MR  IEO .55
RIO  IEO .77
Source: Author
Table 6.13: Correlation Matrix of Measurement Model
Constructs PDM FH MR RIO IEO

PDM 1 0.38 0.33 0.54 0.71
FH 0.62 1 0.48 0.62 0.45
MR 0.58 0.70 1 0.86 0.31
RIO 0.74 0.79 0.93 1 0.60
IEO 0.85 0.67 0.55 0.77 1
Source: Author
6.2.5. Model Comparison
As competing models have been proposed, this section selects the model that best
explains the data through an examination of statistical tests. In other words, that is the
model that will most likely be replicated in a different sample that belongs to the same
population (Hoyle, 2012). M2, M4 and M5 were nested in M3. A chi-square test of
difference was hence used as the main test to examine if the differences in chi-square
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values of the models were significant. For M3, χ2 (55, N=100, p>0.05) = 71.67 and for
M4, χ2 (59, N=100, p<0.05) = 98.203. Comparing M3 and M4, the chi-square change
was 26.533 for df = 4, which was significant (p<0.05). In other words, adding mediating
paths would have explained the data better than not adding (Yuan and Bentler, 2004).
For M5, χ2 (57, N=100, p>0.05) = 71.678. Comparing M3 and M5, chi-square change
was insignificant. Hence, M5 which was more parsimonious, explains the data as well
as M3. Comparing M2 and M5, the change in chi-square was insignificant (p>0.05),
with a difference of 3.213 for df = 2. This implies that removing paths from IEO to FH
and MR have explained the data as well as when they have been added. In this case, the
more parsimonious model, that is M2, was preferred.
6.2.6. The Structural Model
The previous section has provided evidence that M2 was the most fitting model selected
after statistical testing and comparison with other alternative models. Figure 6.7
displays the full model of M2. In evaluating the theoretical model, its standardized
residuals were inspected. Standardized residuals are presented in matrix form in AMOS
output as shown in Table 6.14. These values represent the differences between observed
and fitted covariance terms and should preferably be small, ranging from -4.0 to 4.0
(Byrne, 2001, Hair et al., 2006). In addition, the modification indices had been
examined to determine if further freeing of paths were suggested such that model fit
could be improved significantly. From Table 6.14, it is justifiable that no additional
estimation or freeing of paths is recommended. This conclusion is consistent with the
results of standardized direct and indirect effects between latent constructs as shown in
Table 6.15. Therefore, both the matrix and modification indices obtained from AMOS
output as well as the results of total effects all suggest that there are no issues with
model fit and model specification problems.
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6.2.7. Testing of Hypotheses
Table 6.16 shows that most of the correlations between the constructs are positive and
significant at a level of 0.05. The results suggest that Hypotheses 2, 3, 4 and 5 are
supported; Hypotheses 1 and 6 are not supported.
171
Figure 6.7: Path coefficients of structural model
Source: Author
172
Table 6.14: Standardized Residuals Covariances of Theoretical Model
So
urce: Author
Table 6.15: Standardized Direct and Indirect Effects between Latent Constructs
PDM IEO RIO MR

Direct
IEO 0.845
RIO 0.300 0.505
MR 0.847
FH 0.781 0.038
Indirect
IEO
RIO 0.427
MR 0.615 0.428
FH 0.590 0.411 0.032
Total
IEO 0.845
RIO 0.726 0.505
MR 0.615 0.428 0.847
FH 0.590 0.411 0.813 0.038
Source: Author
173
Table 6.16: Estimates of structural model
Hypothesis Paths Estimate C.R.
H1 PDMRIO 0.30 1.31
H2 PDMIEO 0.85* 8.65
H3 IEORIO 0.51* 2.05
H4 RIOFH 0.78* 2.24
H5 RIOMR 0.85* 4.40
H6 MRFH 0.04 0.11

*Result is significant at C.L. 95%
Source: Author
6.3. Discussion of Results
6.3.1. Findings from Hypothesis Testing
It is seen that the proposed PDM had a significant and positive effect on internal and
external opportunities. To a large extent, disruption management improves port
performance in terms of development and optimization of existing capabilities. The
improvements in internal capabilities in this manner can be conducted through internal
and external means. These improvements have positive effects on port operation
performance which are leveraged on as drivers for tangible and intangible advantages.
While there was strong significant influence of PDM on internal and external
opportunities, the relationship between PDM and resilience of internal operations was
not significant. The reason could be that improvements in core resilience require the
development of both tangible assets and upgrading of internal capabilities which are
objectives of internal and external opportunities identification. Therefore, the
relationship between PDM and resilience was rendered insignificant. To support this
view, the relationship between the management model and internal resilience was fully
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mediated by internal and external opportunities with total effects of 0.51 (see Figure
6.7). The influence of internal and external opportunities was significant on resilience of
port operations. Considering this result, the importance of the PDM can be explained by
increasing the resilience of port through a series of continuous improvements that are
conducted both internally and a competence acquired from external opportunities.
The relationship between the PDM and financial health of a port was attributed by both
direct and indirect effects from the resilience of its operations on its financial health.
The significant and positive effects from resilience of port operations on its financial
health further reiterated the implications of port resilience. The strong relationship
between the resilience of internal operations and financial health can be explained by
the inherent characteristics of resilience from which financial stability and substantial
savings were generated from reliable operations and rapid recovery. Similarly,
resilience had an approximately equally strong influence on the port’s market reputation,
with a total and direct effects. Contrary to what was previously hypothesized, the
influence of market reputation on financial health is not significant with weak direct
effects. The unique nature of port’s competitive landscape suggests that financial health
in this respect could most likely be a result of customer retention as other factors such as
geographical location, proximity to trading areas and hinterland connectivity are among
important considerations of potential port customers. Therefore, other strategic
decisions with respect to regional development will likely complement a reputation of
high resilience.
6.3.2. Implementation of the management model
It is highly consistent among interviewees from the port operator group in their
agreement that the directives guided by the institutional bearings are relevant and
capable of managing port-related disruptions. The port operators interviewed expressed
that they are largely satisfied with the risk management process at their own ports,
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though a few commented that there is definitely room for improvement. The following
is a summary of points raised during the interviews by the experts:
1. Employees play a vital role in managing disruptions
2. Both port users and port management appreciate efforts in collaboration among
them and the government
3. Contingency planning, risk management and human resource management at

ports are highly regarded by both port users and management
4. Differences in business cultures create difficulties in managing expectations
5. Investments to fund disruption management is a challenge to overcome
6. Cost should not be compromised in port service; low cost remain valuable to
port users
Generally, there are three main issues to consider when implementing the proposed
management model and they are further elaborated below.
Employee recruitment and retention
The majority of the interviewees who were port operators revealed that they rely heavily
on their front-line workers together with technology in threat identification. This is also
the reason why these ports try to retain experienced employees as they are often more
competent in managing exceptions. Business continuity plans may be well-documented,
but are sometimes executed haphazardly. The critical underlying factor is the experience
of those involved who initiate the emergency response plans. This is explained by one
of the interviewees:
“Usually, whoever is involved in the case will solve the problem as soon as possible; so
it all depends on the person’s experience and if he/she had come across similar cases
previously… Sometimes, we will just tell the older and more experienced workers ‘Hey,
take a look’, then they will solve it.”
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As every situation is unique, the employees who carry out daily operations need to rely
on past experience and their vigilance to identify indications of underlying risks, as
illustrated in a typical comment as below:
“We have performance indicators across systems. There are also triggers, so we know
when the performance is not at optimal. However, the indicators do vary, depending on
weather, moisture level… So, we do see variations.”
Therefore, it has to be ensured that all employees are well-equipped with the necessary
knowledge and upgraded professional skills in workplace safety and risk management.
Improvements in the professional skills of employees help ensure that they stay relevant
and possess the necessary technological and technical capabilities. The training of
employees should work towards increasing the level of awareness in risk management,
technology utilization and operational efficiency. The psychological wellness of
employees is also critical in everyday work performance. Thus, issues regarding the
welfare and plight of port employees at work warrant attention. Apathy and avoidance
from the management tend to generate greater resentment and grievances among the
employees. Hence, though a win-win outcome may not always pan out, getting the
employees involved and rewarded are imperative in making them feel appreciated.
However, one major challenge faced is to connect the individual employees and
motivating them, so that they can contribute to the shared aspiration and business
network considering that there is much reliance on manpower in daily operations and
disruption management process.
In addition, time plays a critical role in disruption management and the interviewees
suggested that delegating the front-line workers with authority to act accordingly and
responsibly in their daily operations is one way of minimizing the occurrence of
disruptions, and in some cases, the potential or impact of a threat. As a result, the risk
management knowledge, technical competencies and experience of the workers affect
the capability of the port in disruption management. This raises the issue of outsourcing
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port workers. Many ports outsource workers to reduce costs and to ensure that there is
sufficient manpower. However, the safety standards and training of the outsourced
workers are likely not to be overseen by the port. Thus, the port has to be very selective
in the type of functions to be outsourced. In addition, a few of the interviewees recalled
that their port was at a losing end when one of their major contractors went on a strike
and the port “had to scramble and ask for help from other contractors to replace those
workers”. To avoid losing responsiveness and becoming overly reliant on external
parties, one solution is to control the percentage of outsourced workers. This will ensure
that the result of outsourcing is in-line with the initial objective, that is, to reduce
uncertainties instead of being exposed to higher level of uncertainties.
Financial and information flows
Externally, the port also has to exercise risk management processes contingency
planning together with other parties. These external parties include the government and
the port users who will likely be affected by disruptions that originate from the port.
One observation is that, in most cases, the port mostly works with the shipping lines and
hauliers among the port users. Apart from port users, some ports also work closely with
the unions. The concerns of investment costs have been raised by the interviewees from
the port management. At ports where there were collaborations with the local
government, the port management were able to plan for many years ahead. This is
because national trade and investment plans are indicative of the port’s development
potential and advantages. However, the needs and profiles of the port users, especially
shipping lines, will also directly affect the sufficiency and adequacy of future plans.
Evaluation of market environments and customers’ profiles help to ensure effective
plans through gathering of pertinent information. Challenges faced in the process of
disruption management undertaken by the port require the cooperation and feedback
from its users to be appropriately addressed. The extent of participation of port users in
the implementation of the management model requires such information to be
communicated with the ports.
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Threshold of port users
Business cultures vary and this is one concern expressed during the interviews. This is a
tricky issue as the port management needs to balance between applying the same level
of strictness in their regulations and allowing flexibility while compromising on safety
standards, since flexibility in business transactions may be more highly valued in one
region than in another. One consequence is losing customers who require more
flexibility. In regions where business cultures allow rules and regulations to be less rigid
or even vague and open to interpretation, a port with practices that are strict tends to
lose out on flexibility. An interviewee has experienced a difficulty in this issue,
recalling that “We lose customers who need more flexibility… when we rejected
customers and asked them to rectify some problems, they asked why somewhere else let
them in.”
Another difficulty in addressing this concern is that the port users have different levels
of tolerance for disruptions. One critical factor that the port users place much emphasis
on is cost and this point has been raised by the port users during the interviews.
Therefore, it would be wise if the port operators understand the threshold of their
customers and ensure that their performance lies within the boundaries, if not on the
frontier. For the case of import and export ports, the port users are price sensitive and
can easily opt for cheaper alternatives, as long as the extent of possible disruptions at
the cheaper port lies within their threshold. A few interviewees commented on the cost
in disruption management, emphasizing that “It is expensive… sometimes what
customer wants is productivity and that will mean increase cost, but customers don’t
want to pay that extra”. This is also illustrated in the comment of another interviewee as
follows:
“Our job is to help customers minimize delays and demurrage… by ensuring that there
is warehouse availability and berth availability. If we increase handling rate, we will
incur more costs, but we bear the costs… We understand the industry; we take a
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broader view and absorb the costs…We try to provide good service at reasonable
price… to stay in the business.”
In summary, it is the leveraging of resources that matters. The development of a

strategic architecture for leveraging corporate resources and ensuring that it is in line
with the corporate strategic intent brings about the need for a managerial culture that
encourages committed teamwork and the ability to think ahead with the capacity to
manage changes. This capability of the port forms a tool for communicating with its
customers and other external constituents. With the functionality of the ports focused,
the management is also expected to rethink and strategize along the market opportunity
horizon for long term sustainable growth and thus the port is encouraged to monitor and
review its existing plans and processes. This is where active management of opportunity
gaps through re-evaluation of management policies and management of performance
gaps on various business dimensions relevant to the port take place. This applies not
only to different time horizons, but also to different market segments.
The interviews and surveys produced findings that corroborate the principles of the
proposed management model for PSCD threats, supporting the significance of risk
assessment, disaster recovery planning, involvement of employees and management,
collaborations with members of the port community and continuous improvement on
the disruption management process. Six indicators that affect the implementation of the
management model have been identified: employee recruitment and retention,
information flows, financial flows, flexibility, cost and port users’ threshold. These are
the factors that the port should consider in the successful facilitation of model
implementation.
Appendix J introduces a major chemical manufacturer based in Singapore. The

simulation exercise in the Appendix J illustrates the impact of the disruption from
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SPM’s perspective. A comparison in costs will be made with the usual non-disruption
situation and when disruption strikes without the implementation of the PDM. All
information and data obtained and used in the simulation exercise were derived
primarily from the interviews and also from the company website. Please refer to
Appendix J for more details.
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CHAPTER 7. CONCLUSION
7.1. Summary of Results
The role of ports in supply chains has evolved from simply a platform for cargo transfer
to a supply chain node that is expected to be agile due to its increased integration into
supply chains. With respect to the new role, there exist risk areas, which are referred to
as PSCD threats, that are capable of disrupting supply chains. Based on the
contemporary literature review and interviews with professionals from the industry who
are port operators and users, a list of common PSCD threats and a management model
have been introduced and validated. An overview of the findings can be found in Figure
7.1. Dotted arrows in Figure 7.1 refer to absence of validation that establish
relationships between constructs.
Figure 7.1: Summary of findings
Source: Loh and Thai (2015a)
This research has examined the role of ports in supply chain disruptions through the
establishment of the portfolio of each PSCD threat based on data collected from port
operators and port users. The PSCD threats are divided into four categories,
infrastructure threats, manpower threats, planning threats and security threats. These are
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the underlying threats capable of resulting in disruptions at port operators. The results
show that planning threats (A8-A11) had higher mean, while security threats (A15-A19)
had lower mean scores of likelihood and consequences assigned by all respondents in
most cases. Congestion within Terminals (A9) received the highest mean score of
likelihood and risk score, while the responses from the different groups of respondents
were mixed in scores assigned to threats for consequences. Terrorist Attacks (A19)
received the lowest mean score for likelihood in most cases. Trafficking (A15) and
Stowaway (A17) had the lowest mean score for both consequences and risk scores in
most cases. The factors that affect the occurrences of PSCD threats are market trends,
business environment and types of cargo handled at the port. The results benefit both
port operators and port users as they bring attention to areas which port management
should focus on to ensure resilience for their ports which in turn benefits their users.
The other objective of this research is to operationalize measures and actions for the
purpose of minimizing port-related supply chain disruptions. Hence, a port-related
supply chain disruption management model was proposed and validated. The
management model seeks to ensure supply chain resilience by ensuring that the PSCD
threats are managed and that the impact of the disruptive consequences is mitigated. The
management model was synthesized from the application of RM, BCM and QM
theories and was presented in three tiers such that the directives can be operationalized
from the top management to the front-line employees. There were five institutional
bearings at the top management level and ten management policies at the second tier,
which were further expanded into operational actions at the third tier. The proposed
PSCD management model takes into consideration the changing role of ports and
requires collaborative working relationships internally within the organization as well as
with external parties.
In the implementation of the management model, three factors were raised during the
interviews as issues and concerns to consider. These included employee recruitment and
183
retention, financial and information flows and port users’ threshold. The SEM results
suggest that the proposed PDM has positive impact on port performance ultimately, in
terms of the port’s financial health and market reputation. Therefore, the research
findings corroborate the effectiveness of principles applied in the proposed model,
supporting the significance of risk assessment, disaster recovery planning, involvement
of employees and management, collaborations with members of the port community and
continuously improvement on the disruption management process.
The approach of the combined theoretical application of the three principles behind the
management model presented in this research cannot be found in existing literature. In
general, the PSCD threats and the management model are the main outcomes of this
paper. Through these findings, it is hoped that the port management are now provided
with a guideline in their management of threats in everyday port operations and a
direction that aims to reduce the disruptive potential of their ports, such that supply
chain resilience can be ensured.
7.2. Academic Implications
This research provides several academic contributions.
Identification of PSCD Threats
First, it has identified a list of PSCD threats which is currently absent in prior research
despite recognizing the fact that ports play a significant role in supply chains. The
investigation on the PSCD threats has shed light on operational issues that require
attention and also the impact experienced by different categories of port operators and
users. Secondly, this present study determines the extent to which ports play the role in
supply chain disruptions, enabling the frequency and consequence of each threat to be
defined arithmetically, hence illustrating a comparison of frequency and impact of each
threat. On top of that, the evaluation of PSCD threats takes into account the perspectives
from supply chain entities and different types of port operators. Taking their
184
perspectives into consideration would render future studies aiming to increase port
resilience and supply chain continuity to remain relevant and feasible.
Development of Management Model
The triangulated application of RM, BCM and QM principles in disruption management

has been validated to provide benefits to ports. This approach is absent in current
literature and is able to provide a more comprehensive protection and mitigation of
PSCD threats. In terms of theory building, this study has provided a framework and
operational guidelines to minimize port-related supply chain disruptions, which are
currently less focused in the literature. The research draws principles from supply chain
perspectives in order to present a more comprehensive and feasible approach to
disruption management in the contemporary port environment. Hence, this research
clarifies our understanding of the role that ports play in supply chain disruptions. It adds
to the scant body of literature on port resiliency and enhances the understanding of the
trade-offs that are to be considered by the port in disruption management. The
management model also provides a concrete basis for future studies that are tailored to
address the different port characteristics. This study thus provides a theoretical
foundation for future studies with relevant contributions to port resiliency and supply
chain continuity.
7.3. Managerial Implications
In addition to the academic implications, the findings of this study also offer practical
managerial implications for both port operators and port users.
Identification of PSCD Threats
This study assists port management with respect to their strategic decision making and
policy development. Specifically, the results of this study encourage an increased
contingency level at ports through determining the areas which should warrant focus. In
185
this respect, a more realistic view of where operations can fail will be reflected, assuring
the deliverables of port services. The determination of the role of each threat in
disruptions facilitates efficient and effective allocation of resources. The results suggest
a collaborative working relationship with the government and port users, while
maintaining a healthy and cooperative internal organizational culture. As the findings
reveal the concerns of supply chain entities who are users and customers of the ports,
they suggest areas which port management can establish strategic cooperation and
coordination with the external entities. Internally, more effort and emphasis should be
placed on raising risk awareness and risk management training as the port is reliant on
the employees’ vigilance in identification of potential threats and mitigation of
disruptions. Port management can then identify essential skills and knowledge to be
acquired and shared among employees. On the other hand, port users are provided with
a basis of assessment of the risk level at the ports they use and the extent of the impact
on themselves, thereby allowing them to account for exceptions in their planning to
maintain the sustainability of their supply chains and the continuity of their operations.
Development of Management Model
The management model serves as a guideline and framework for port management in
their disruption management. This study has also identified areas where the port
management can focus on, without compromising on costs and quality of the services
provided. The effective implementation of the management model is expected to
enhance the functionality of port operations, thus assisting port management in retaining
its clientele.
The SEM results reveal the significance of the management model as a framework to
ensure port performance in terms of increased organizational resilience that brings about
benefits from valuable corporate assets. With regards to internal policy development
and implementation, the proposed holistic approach in disruption management had been
validated to have a positive impact on port performance. The results of this study also
186
indicate that both self-regulating and collaborative initiatives on transformation into a
resilient port have positive influence on the organizational performance and corporate
image. Hence, it is encouraged that emphasis be placed on the internalization of cultures
incorporating RM, BCM and QM through the emergence of new responsibilities
delegated to employees, introduction of new skills and the involvement and
participation of external bodies in disruption management. The need for port
management to respond to its own vulnerabilities and uncertainties from its business
environment is a strategic imperative. However, the capability to do so is likely to be
complemented and leveraged on with the effects from the development on a larger scale
that involves regional cooperation across industries and systems of governance.
As the management model improves the resilience of the port and its adaptability to
disruptions, cargo in ports can then be successfully delivered to downstream supply
chain entities or to the cargo owners with fewer hiccups. For the upstream supply chain
entities, they will be freed from the liability and costs of holding the cargo if the cargo
can be delivered in a timely manner.
7.4. Research Limitations and Future Research Directions
The current proposed PSCD indicators only offer detection of PSCD threats. However,
when threats cannot be totally avoided or eliminated, an additional set of disruption
recovery indicators shall provide an evaluation of the port’s capability in disruption
management. A future research opportunity could be to assess the port’s capability in
disruption recovery. On the same note, the actions to increase the recovery capabilities
of the port following a PSCD should also be defined to create an even more
comprehensive coverage from the disruption.
Another limitation is that the evaluation of each PSCD threat was restricted by
assigning a value to its frequency and consequence. Hence, future work can also be
187
carried out to examine frequencies and consequences of different levels of severities of
a threat. In the analysis of risk matrices, three types of ports were investigated – purely
container ports, non-container ports and multi-purpose ports. As tanker terminals are
likely to experience higher risk levels due to the cargo handled, future research on
PSCD threats can address tanker terminals separately. For each of the risk matrices, the
naming of the regions follows the usual categorization for 2x2 matrices and this resulted
in two quadrants named Region 2. However, the strategies that port management can
use to address the risks in each of the two Region 2 might be different. Future studies
can explore the differences of the PSCD threats in Region 2 and further categorize the
threats. Due to the small number of respondents, analyses could not be conducted
according to the respondents’ geographical locations and organisational sizes. It would
be meaningful if future studies could evaluate the threats based on different regions of
ports and port users for a comparison of perspectives.
It has to be noted that the implementation of the management model might produce
different extents of outcomes and effects, depending on the maturity of the ports and
market setting the port is situated in. Such differences in results was not shown in this
study as the responses received from ports of different regions and stages of
development were not balanced. This limitation should be addressed in future similar
studies. Hence, future studies should also analyze the effects of the management model
in different regional settings or markets, as well as ports handling different cargo types.
Although this study has some limitations, the academic and managerial implications
reveal areas where port management should establish strategic capability to increase
port resilience and enhance sustainability in the current business landscape.
188
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APPENDICES
Appendix A: Interview Questionnaire for Port Users
1. In your opinion, do ports contribute in any way to supply chain disruptions?
2. Do you think that ports are playing an important role in the supply chains of your organization?
3. In the case of your organization, had there been any supply chain disruptions that were caused by
port disruptions?
4. Regarding disruption management with seaports:

a. Does your organization collaborate with ports to manage disruptions? If yes, can you
describe these collaborations?
b. Have these collaborations been successful and why?
c. Are there any changes to the collaborations that you wish to see? If yes, what are they?
5. Are you in direct contact with the port? How do you communicate with the port?
6. What is your assessment or evaluation on how ports manage disruptions?
7. In your opinion, which port(s) manages disruptions very well and why do you think so?
8. In your opinion, in which ways can ports manage disruptions better?/What changes or improvements
would you like to see in how ports manage disruptions?
9. Do you have any comments or recommendations for improvement in this study?
199
Appendix B: Interview Questionnaire for Port Operators
1. What is your view on the role of ports in supply chains?
2. Do you think that your port is playing an important role in the supply chains of your customers?
3. In the case of your port, had there been any case that has led to supply chain disruptions?
4. Regarding disruption management within your port.

a. How is a disruption discovered at your port?
b. What is the usual course of action following a disruption?
c. Have you encountered any difficulties in the process of managing the threats and
disruptions? If yes, what were they and how were they solved?
d. What is your assessment or evaluation on how your port manages disruptions?
e. Are there any changes to disruption management at your port that you wish to see? If yes,
what are they?
5. Regarding disruption management with external parties.

a. Does your port collaborate with external parties to manage disruptions? If yes, can you
describe these collaborations?
b. Have these collaborations been successful and why?
c. Are there any changes to the collaborations that you wish to see? If yes, what are they?
6. Please refer to the table that briefly describes the components in the management model in the
information sheet. The model contains actions which when implemented are expected to reduce
chances of port disruptions and to mitigate losses should a disruption occur.
a. Are there other approaches or measures that are not reflected in the management model but
have been used by your port to manage the threats? If yes, please briefly describe them.
b. Is there anything else you feel is important or wish to include or change in the model?
7. Do you have any comments or recommendations for improvement in this study?
200
Appendix C: Cover Letter for Port Users
Dear Sir/Mdm,
Good day.
My name is Loh Hui Shan, a Ph.D candidate at Nanyang Technological University, Singapore. I am
writing to seek your help in a research study on 'The Role of Ports in Supply Chain Disruption
Management'. The objectives of this research are to explore the magnitude of port-related threats that
could potentially lead to disruptions in supply chains and design measures to contain and reduce
consequences of such threats. Thus, the port-related supply chain disruption (PSCD) threats and their
corresponding consequences have to be identified, so that measures can be designed to target them and to
minimise the occurrences of supply chain disruptions resulted from disruptive events at seaports. I need
your help in the attached questionnaire for supply chain organizations or port users on experiences in
supply chain disruptions as a result of events or risks at seaports.
The valuable input from your organization is very important to us and will help to shed light on building
resilient and adaptable ports, so that operations at upstream or downstream supply chain entities such as
your organization will not be adversely affected and that your customers’ expectations can be delivered in
a timely manner. Hence, I hope you could take some of your valuable time to participate in this survey by
or at your earliest convenient time.
After completing the questionnaire, kindly send it back to us by email to hsloh1@e.ntu.edu.sg .

Alternatively, the questionnaire can be completed online by accessing the link below:
https://qtrial.qualtrics.com/SE/?SID=SV_3mk88ga8M8YAYv3
The participation of your organization is very important to the success of this study. Please rest assured
that all responses will be completely confidential and anonymous. In addition, the results of the survey
will be summarized and the results will not be linked to any specific organization or individual. As a
token of appreciation, a free executive summary of the study will be sent to you if you so wish.
Thank you very much in advance for participating in this study. If you encounter any problems or
questions, please do not hesitate to contact me at hsloh1@e.ntu.edu.sg / +65 9128 5619 or Asst Prof Thai
Van Vinh at vvthai@ntu.edu.sg / +65 6790 5331.
Sincerely,
Loh Hui Shan
Division of Infrastructure Systems and Maritime Studies,

School of Civil and Environmental Engineering,
Nanyang Technological University, N1-B4b-07, 50 Nanyang Avenue, Singapore 639798
http://www.ntu.edu.sg/cee
201
Appendix D: Cover Letter for Port Operators and Authorities
Dear Sir/Mdm,
My name is Hui Shan Loh, a Ph.D candidate at Nanyang Technological University, Singapore. I am
writing to seek help from the management of port operators/authorities in a research study on The Role of
Ports in Supply Chain Disruption Management. The objectives of this research are to explore the
magnitude of port-related threats that could potentially lead to disruptions in supply chains and relevant
design measures to contain and reduce consequences of such threats. Thus, the port-related supply chain
disruption (PSCD) threats and their corresponding consequences have to be identified. These threats are
controllable risks related to port operations; hence natural disasters are excluded from this study.
Measures will be developed to target them and to minimize the port’s potential in stimulating port-related
supply chain disruptions. I would greatly appreciate if a senior representative from your management can
complete the attached questionnaire on experiences in risk and disruption management at ports.
The valuable input from your organization is very important to us and will help to shed light on building
resilient and adaptable ports, thereby enhancing your port’s competitive edge. Hence, I hope your
representative could take some of his/her valuable time to participate in this survey by or at his/her
earliest convenient time.
After completing the questionnaire, kindly send it back to us by email to hsloh1@e.ntu.edu.sg.

Alternatively, the questionnaire can be completed online by accessing the link below:
Follow this link to the Survey:

Take the Survey
Or copy and paste the URL below into your internet browser:
https://qtrial.qualtrics.com/WRQualtricsSurveyEngine/?Q_SS=dmtakjOVd2xFnqB_5j9hMD1nMVHcVTL&
_=1
If your organization manages the operations of more than one terminal, please answer the questionnaire
with respect to the one handling the largest cargo volume. The participation of your organization is very
important to the success of this study. Please rest assured that all responses will be completely
confidential and anonymous. In addition, the results of the survey will be summarized and the results will
not be linked to any specific organization or individual. As a token of appreciation, a free executive
summary of the study will be sent to the respondent if he/she so wishes.
Thank you very much in advance for participating in this study. If you encounter any problems or
questions, please do not hesitate to contact me at hsloh1@e.ntu.edu.sg / +65 9128 5619 or Asst Prof Thai
Van Vinh at vvthai@ntu.edu.sg / +65 6790 5331.
Sincerely,
Hui Shan, Loh (Ms.)

202
Appendix E: Questionnaire for Port Users
203
204
Appendix F: Questionnaire for Port Operators and Authorities
205
206
207
208
209
Appendix G: Feedback Form Used in Pre-testing
210
Appendix H: Reminder Letter Sent to Port Users
Dear Sir/Madam,
Good day.
We at Nanyang Technological University have recently sent an email and a questionnaire to you asking
for your help on a research study entitled 'The Role of Ports in Supply Chain Disruption Management '. If
you have already completed and returned the questionnaire, we would like to thank you very much for
your contribution to this research. However, if you have not yet responded, we would highly appreciate if
you do so since your response is extremely important to our study. Please find attached with this email the
questionnaire for your kind input. Alternatively, the questionnaire can be completed by accessing the link
below:
https://qtrial.qualtrics.com/SE/?SID=SV_3mk88ga8M8YAYv3
Please kindly complete the questionnaire by or at your earliest convenient time.
To thank you for your help in participating in our study, a summary of results will be sent to you if you so
wish.
Should you have questions or wish to know more about this study, please feel free to contact me
at hsloh1@e.ntu.edu.sg / +65 9128 5619 or Asst Prof Thai Van Vinh at vvthai@ntu.edu.sg / +65 6790
5331.
Sincerely yours,
Loh Hui Shan

211
Appendix I: Reminder Letter Sent to Port Operators and Authorities
Dear Sir/Madam,
Good day.
We at Nanyang Technological University have recently sent an email and a questionnaire to you asking
for your help on a research study entitled 'The Role of Ports in Supply Chain Disruption Management '. If
you have already completed and returned the questionnaire, we would like to thank you very much for
your contribution to this research. However, if you have not yet responded, we would highly appreciate if
you do so since your response is extremely important to our study. Please find attached with this email the
questionnaire for your kind input. Alternatively, the questionnaire can be completed by accessing the link
below:
https://qtrial.qualtrics.com/SE/?SID=SV_5mzGfxQYF3NAatn
Please kindly complete the questionnaire by or at your earliest convenient time.
To thank you for your help in participating in our study, a summary of results will be sent to you if you so
wish.
Should you have questions or wish to know more about this study, please feel free to contact me
at hsloh1@e.ntu.edu.sg / +65 9128 5619 or Asst Prof Thai Van Vinh at vvthai@ntu.edu.sg / +65 6790
5331.
Sincerely yours,
Loh Hui Shan

212
Appendix J: Numerical Simulation
J.1. Introduction
This section introduces a major chemical manufacturer based in Singapore. The names
of the company and its products have been changed to protect its identity. A comparison
in costs will be made with the usual non-disruption situation and when disruption strikes
without the implementation of the PDM. Interviews were conducted with an executive
from the logistics department. The executive has 10 years of working experience with
the company and is familiar with the financial flows and physical distribution of the
cargo. The data used in the simulation are actual figures provided by the company from
the year 2012. All information and data obtained and used in this simulation exercise
were derived primarily from the interviews and also from the company website.
J.2. Background of Singapore Plastic Manufacturer (SPM)
Singapore Plastic Manufacturer (SPM) is a major manufacturer in the petrochemical

industry since 1980s. It grew steadily over the next 20 years and has since become one
of the region’s largest producers, diversifying from its niche in manufacturing into the
provision of a wide range of supply chain solutions. In 2013, SPM produced 50
different products, of which 80% were sold through cargo trading house to almost 300
customers worldwide. The profit was approximately USD$9 million and asset value was
about USD$35 million for the year 2012.
The core business of SPM is supplying six main patented chemical products. The names
of these products are omitted to ensure confidentiality guaranteed to the company.
Below is a brief description and application of each product:
1. PE is an easily processed material that offers excellent clarity and strong

bonding and sealing strengths. It is used in food packaging, shrink wrapping,
zipper storage bags, films for industrial packaging, etc
213
2. EA possesses physical toughness and good processability which enable it to be
used in a variety of foam, thermal insulation material and as an adhesion
between solar cell.
3. PP1’s excellent high-speed processability, high clarity and other properties

allow it to be developed into a wide range of household products and yarn
applications.
4. PP2 offers high clarity, excellent impact strength and stability. Hence it is a
material commonly used in feeding bottles and infusion bottle applications.
5. PP3 demonstrates superior sealing, barrier, adhesiveness and optical properties

and is thus used for food packaging, cigarette packaging and lamination films.
6. PP4 has high heat resistance, high impact and stiffness balance and is super high
gloss. It is used in bathroom equipment, coffee-maker and automobile parts.
The production of these products utilizes advanced technology and the products provide
a variety of industrial applications and a wide array of consumer goods. The production
process is on-going, with the production plant operating 24-hours a day. The cost
involved in the production process is USD$1650/MT. Production rates are largely
determined by oil prices, forecasts in selling prices and seasonal peaks. Thus,
fluctuations in productions are not unusual especially when plastics are considered a
commodity. Due to festive seasons, there is higher demand for the products. Hence,
production peaks from October to January with a rate of 2800MT/day and is at its
lowest from June to September with a rate of 2200MT/day. From February to May,
production is at its average rate of 2500MT/day. To cushion itself from the ill effects of
uncertainties, the production process is such that 60% is pulled by customers’ orders
and 40% of production is stored as inventory. The finished products are stored in the
warehouse for one to two months, depending on the period of demand.
214
The locations of SPM’s customers are mainly in China, Japan and other South-East
Asian countries. SPM’s customers are either manufacturers or traders. A typical order
from one customer ranges between 1 TEU to 20 TEUs. These are 20-foot long
containers and the usual mode of transportation to the customers is by sea.
J.3. The SPM Supply Chain
The general process from point of sale inquiry to product delivery is shown in Figure J.1.
The process starts with a sales order. As soon as it is officially created, its in-house
planning systems transmit the information to its production planner who will then start
planning for production schedule for that batch of order. Before production begins for
the order, raw materials will be ordered from Japanese suppliers. The supplies of raw
materials will be shipped from Japan. After which, the production process will be
activated and the finished products will be stored in a warehouse. The finished products
are stored in the warehouse for two month during off-peak seasons (June – September),
one month during peak period (October – January) and one and a half months during
remaining months (February – May). Restuffing process at the warehouse is automated
and stuffing rate is 2.5TEU/hr. Unstuffing process is manual and the rate is slower, at
1TEU/hr. As SPM sells products on CIF terms, the shipping department then arranges
for delivery of product by sea freight to the customers’ port.
215
Figure J.1: Order Fulfilment Process at SPM
Source: Author, synthesized from interviews with SPM’s employee
The network of suppliers, production plants, warehousing sites and customers for PE,
EA, PP1, PP2, PP3 and PP4 comprised the SPM supply chain and is depicted in Figure
J.2. As can be seen from the figure, SPM is positioned before the manufacturers of
consumer products. There are several other entities in its downstream supply chain and
uncertainties occurring earlier at the chain tend to have its ill effects felt down the chain.
In this case, manufacturers, distribution centers, retailers and end consumers would be
able to feel the impact.
216
Figure J.2: SPM Supply Chain
The flow of materials within SPM supply chain is provided by Figure J.3. Raw
materials are transported from Japanese suppliers and stored in SPM warehouse in
Singapore till it is needed for production. At the production plant, raw materials are
converted into the finished products which are then kept at an in-transit storage area
near production site and then transported to finished products warehouse till it is ready
to be packed by in-house contractors and transported to the export port for shipment to
the customers’ port.
217
Figure J.3: Flow of Materials from Suppliers to Consumers
The flow of materials is expected to follow the stages shown in Figure J.3 in usual
situations. However, in the case of an occurrence of PSCD threat, alternatives might be
undertaken. This will likely result in modifications to material flow in terms of time
spent at each stage and routes taken to reach the next stage. Therefore, the costs
involved at each stage will be different in such situations, depending on the actions
taken.
218
J.4. Simulation
During the occurrence of PSCD threat, there are four main categories of outcomes.
Cases 1 and 2 depict two expected outcomes when the management model is
implemented - disruptions are avoided or mitigated. This section demonstrates the
difference between the four cases in terms of costs involved. The costs reflect time
spent as well since time is reflected by storage cost, manpower charges, warehouse cost,
inventory holding cost and transportation cost. However, the outcomes are hypothetical
and thus do not indicate the presence of a supply chain disruption management plan at
SPM. This exercise seeks to illustrate the impact of different outcomes to ascertain the
importance of port disruption potential by using realistic data. More specifically,
 Case 1: Containers stored at finished goods warehouse for 15 days then trucked
to PSA and used the first shipping line (SL1) for sea transportation to
Guangzhou port. No disruptions experienced or negligible disruptive effects felt.
 Case 2: Containers stored at finished goods warehouse for 15 days and stayed
for additional six hours before being trucked to PSA and used SL1 for sea
transportation to Guangzhou port. Twelve hours delays experienced.
 Case 3: Containers stayed at finished goods warehouse for 15 days then trucked
to PSA. However, as PSA experienced a major accident in its waterway and
investigation is undergoing, PSA is temporary closed. SPM decides to transport
the containers through Jurong Port instead. As SL1 does not call at Jurong Port,
containers are then retrucked from PSA to SPM’s warehouse for unstuffing and
restuffing to be transported by SL2 to Guangzhou port. A second shipping line
(SL2) offers transportation to Guangzhou at a higher charge; a difference of
$210 per TEU.
 Case 4: Containers stayed at finished goods warehouse for 15 days then trucked
to PSA. PSA is closed due to port strike, and SPM decides to wait, containers
are retrucked from PSA to SPM’s warehouse. However, the crisis escalated and
the issues remain unresolved after 10 days. SPM decides to transport the
containers through Jurong Port instead. As SL1 does not call at Jurong Port,
219
containers are then retrucked from PSA to SPM’s warehouse for unstuffing and
restuffing to be transported by SL2 to Guangzhou port. SL2 offers transportation
to Guangzhou at a higher charge; a difference of $210 per TEU.
The expression of total costs comprises three components – production cost,

warehousing cost and transportation cost incurred. A breakdown of each type of costs in
Table J.1 shows the costs components involved. Figure J.4 shows the cargo flow as each
cost component is incurred. Costs for the four cases will be calculated and a comparison
will be made to examine the amount of savings generated should PDM be implemented.
The assumptions of the supply chain system are as follows:
1. Disruptions at the port are the only disruptive event encountered from the time
finished product enters warehouse till it reaches customer’s choice of port.
2. Information is shared truthfully among all involved parties.
3. Lead time and customers’ orders are independent.
4. Finished products are left in warehouse for additional 10 days, after which
alternative plans will be activated by SPM.
5. Alternative plans are executed without disruptions.
6. All involved ports and transportation service entities are willing to accept cargo.
7. Cargo handling rates are the same at all involved ports.
8. No berthing and cargo handling constraints at all involved ports.
9. Tariffs and port charges of all involved ports are the same.
10. Sea freight and inland transportation costs do not fluctuate due to the
crisis/disruption.
11. Transportation on alternative routes does not encounter further disruptions.
220
12. Customers are infinitely patient and will not switch to other suppliers.
13. All months have 30 days.
Table J.1: Costs Involved in Simulation
Components of Costs Involved:

1. Production Cost 2. Warehousing Cost 3. Transportation Cost
a. Storage a. Trucking to port
- Packaging bags b. Port charges
- Forklift handling c. Sea freight
d. Stuffing/unstuffing at port
b. Container stuffing
(when applicable)
c. Manpower
- Normal working hours
- Over time charges
d. Miscellaneous services
- Restacking of palletized
cargoes (when
applicable)
- Supply of labors &
material for stretch
wrapped
- Cleaning of empty
pallet
e. Inventory holding
221
Figure J.4: Processes that Incur Costs
In addition, the following symbols and notations of parameters will be used in the
calculations:
1. PC = Production cost
2. WC = Warehouse Cost
3. Ws = Warehouse storage cost
4. Ws.PB = Cost of packaging bags
5. Ws.FH = Forklift handling cost
6. WCS = Container stuffing in warehouse
7. WMP = Manpower charges
8. WN = Normal working hours
9. WOC = Overtime charges
10. WMS = Miscellaneous warehouse charges
222
11. WMS.R = Restacking of palletized cargo
12. WMS.SW = Supply of labor and materials for stretch wrapped
13. WMS.C = Cleaning of empty pallet
14. WIH = Inventory holding cost
15. T = Transportation costs
16. TT = Trucking
17. Tpc = Port charges
18. TSF = Sea freight
19. TS/US = Stuffing/Unstuffing
20. X = Customer order (TEU)
21. XMT = Customer order (MT)
22. N = Number of pallets in each 20’ container
23. w = Number of days product spent at warehouse
24. t = Number of days from production completion to delivery to destination
The exact rate for each cost component is not shown as the company has requested not
to release the figures. According to the data provided by SPM, the parameters follow the
formulae below:
N = 16,
PC = 1650XMT ,
XMT = 16X,
Total Costs
223
X
=  (PC
i 1
i + WC i + TCi )
X [1650(X MT ) i + (Ws.PB ) i + (Ws.FH ) i + (WCS ) i + (WN ) i + (WOC ) i +

= 
i 1
(WMS.R ) i + (WMS.SW ) i + (WMS.C ) i + (WIH ) i + (TT ) i + (Tpc ) i +
(TSF ) i + (TS/US ) i ]
Figures J.5, J.6 and J.7 depict the graphical comparison of the costs of total costs,
warehousing costs and transportation costs incurred respectively of the four cases, while
Table J.2 shows costs in exact figures. As can be observed from Figure J.5, the gaps
between total costs of each case become larger when the order increases in size and
Case 4 incurs the highest total costs. The large difference between Case 3 and 4 is
mainly due to the additional 10-day inventory holding costs experienced in Case 4. The
graphs of Case 1 and Case 2 lie very close to each other because of the similarities in
circumstances shared by both. The only difference between the two cases is that there is
a 12-hour delay in Case 2 and this gives rise to higher inventory holding costs and
higher warehouse storage costs as shown by the figures in Table J.2. The graphs for
total costs are broken down into graphs for warehousing costs and transportation costs
for a closer look to account for the observations in Figure J.5.
The graphs for warehousing costs are shown in Figure J.6. The graph of Case 4 shows
that highest warehousing costs are incurred mainly due to the additional 10-day storage
at warehouse while the lowest occurs in Case 1. The differences among Cases 1, 2 and 3
are due to whether unstuffing and restuffing processes are required and these in turn
involve manpower which constitutes additional charges as the order size increases.
While it is not apparent in Figure J.6, the figures in Table J.2 show that warehousing
costs of Case 2 are higher than that of Case 3 for the first two TEUs. For orders with
three TEUs or more, the warehousing costs of Case 2 become lower than that of Case 3.
This trend is attributed by the unstuffing and restuffing rates experienced in Case 3 and
the duration of delays in Case 2. Therefore, the warehousing costs for different duration
224
of delays were investigated in Table J.3, with those that are higher than that of Case 3
highlighted. This sets the boundary at which warehousing costs of Case 2 exceeds that
of Case 3.
On the other hand, the graphs for transportation costs as displayed in Figure J.7 show
that there are only two lines. Cases 1 and 2 share the same graph as the transportation
means and plans for these two cases are the same. Due to the deviation in transportation
routes and shipping lines from the initial plan, the graphs of Cases 3 and 4 lie on each
other. The higher transportation costs of Cases 3 and 4 as compared to Cases 1 and 2 is
explained by the extra unstuffing and restuffing of products at the port as well as two
additional trucking legs (from PSA to warehouse and from warehouse to Jurong Port).
Figure J.5: Total Costs of Each Case
Source: Author
225
Figure J.6: Warehousing Costs of Each Case
Source: Author
Figure J.7: Transportation Costs of Each Case
Source: Author
226
The results of this section reiterate the significance of port resilience in supply chain
continuity. The marginal costs differences as depicted by the graphical representations
show that the increase in costs in an undesirable event is mainly attributed to higher
warehousing storage costs, inventory storage costs, manpower costs as well as
transportation costs. The duration of delays encountered will likely affect the
management decision to stay put or deploy alternatives as the costs incurred involves
the amount of additional work and rework to be carried out and the charges of
alternative plans. In summary, assuming no other types of disruptions are encountered
in the supply chain, a port user will experience additional costs when a PSCD threat
results in undesirable consequences ranging from a slight delay to loss of port service.
This numerical example is simulated from the perspective of the port user and since the
capacity of a port is much higher than the limit imposed in the simulation, that is 20
TEUs, the impact on all industries involved and users alike is expected to be
comparatively dire. The limitation of this simulation exercise is that the outcome of the
model in numerical simulation exercise is predetermined and hypothetical. Future
research can be conducted to carry out simulation to validate the model by using
realistic inputs and output to determine whether the desired outcome is achieved, such
that the cost impact of port users and port operators can be more realistically portrayed.
227
Table J.2: Summary of Costs
Warehousing Costs Transportation Costs Total Costs

TEUs Case 1 Case 2 Case 3 Case 4 Case 1 Case 2 Case 3 Case 4 Case 1 Case 2 Case 3 Case 4
1 $12,661.83 $13,074.09 $12,908.06 $21,153.14 $706.88 $706.88 $1,723.75 $1,723.75 $15,431.21 $15,843.46 $16,694.31 $24,939.39
2 $25,323.67 $26,148.18 $25,912.30 $42,402.48 $1,413.75 $1,413.75 $3,447.50 $3,447.50 $30,862.42 $31,686.93 $33,484.80 $49,974.98
3 $37,985.50 $39,222.26 $39,012.74 $63,748.01 $2,120.63 $2,120.63 $5,171.25 $5,171.25 $46,293.63 $47,530.39 $50,371.49 $75,106.76
4 $50,647.34 $52,296.35 $52,209.38 $85,189.73 $2,827.50 $2,827.50 $6,895.00 $6,895.00 $61,724.84 $63,373.85 $67,354.38 $100,334.73
5 $63,309.17 $65,370.44 $65,502.20 $106,727.65 $3,534.38 $3,534.38 $8,618.75 $8,618.75 $77,156.04 $79,217.32 $84,433.45 $125,658.90
6 $75,971.00 $78,444.53 $78,891.22 $128,361.76 $4,241.25 $4,241.25 $10,342.50 $10,342.50 $92,587.25 $95,060.78 $101,608.72 $151,079.26
7 $88,632.84 $91,518.62 $92,376.43 $150,092.06 $4,948.13 $4,948.13 $12,066.25 $12,066.25 $108,018.46 $110,904.24 $118,880.18 $176,595.81
8 $101,294.67 $104,592.71 $105,957.84 $171,918.55 $5,655.00 $5,655.00 $13,790.00 $13,790.00 $123,449.67 $126,747.71 $136,247.84 $202,208.55
9 $113,956.50 $117,666.79 $119,635.43 $193,841.24 $6,361.88 $6,361.88 $15,513.75 $15,513.75 $138,880.88 $142,591.17 $153,711.68 $227,917.49
10 $126,618.34 $130,740.88 $133,409.22 $215,860.12 $7,068.75 $7,068.75 $17,237.50 $17,237.50 $154,312.09 $158,434.63 $171,271.72 $253,722.62
11 $139,280.17 $143,814.97 $147,279.21 $237,975.19 $7,775.63 $7,775.63 $18,961.25 $18,961.25 $169,743.30 $174,278.10 $188,927.96 $279,623.94
12 $151,942.01 $156,889.06 $161,245.38 $260,186.45 $8,482.50 $8,482.50 $20,685.00 $20,685.00 $185,174.51 $190,121.56 $206,680.38 $305,621.45
13 $164,603.84 $169,963.15 $175,307.75 $282,493.91 $9,189.38 $9,189.38 $22,408.75 $22,408.75 $200,605.71 $205,965.02 $224,529.00 $331,715.16
14 $177,265.67 $183,037.24 $189,466.31 $304,897.56 $9,896.25 $9,896.25 $24,132.50 $24,132.50 $216,036.92 $221,808.49 $242,473.81 $357,905.06
15 $189,927.51 $196,111.32 $203,721.06 $327,397.40 $10,603.13 $10,603.13 $25,856.25 $25,856.25 $231,468.13 $237,651.95 $260,514.81 $384,191.15
16 $202,589.34 $209,185.41 $218,072.01 $349,993.44 $11,310.00 $11,310.00 $27,580.00 $27,580.00 $246,899.34 $253,495.41 $278,652.01 $410,573.44
17 $215,251.18 $222,259.50 $232,519.15 $372,685.66 $12,016.88 $12,016.88 $29,303.75 $29,303.75 $262,330.55 $269,338.88 $296,885.40 $437,051.91
18 $227,913.01 $235,333.59 $247,062.48 $395,474.08 $12,723.75 $12,723.75 $31,027.50 $31,027.50 $277,761.76 $285,182.34 $315,214.98 $463,626.58
19 $240,574.84 $248,407.68 $261,702.00 $418,358.70 $13,430.63 $13,430.63 $32,751.25 $32,751.25 $293,192.97 $301,025.80 $333,640.75 $490,297.45
20 $253,236.68 $261,481.77 $276,437.72 $441,339.50 $14,137.50 $14,137.50 $34,475.00 $34,475.00 $308,624.18 $316,869.27 $352,162.72 $517,064.50
Source: Author
228
Table J.3: Warehousing Costs for Case 2
Delays (Hours)
TEUs 2 4 6 8 10 12 14 16 18 20 22 24
1 $12,730.54 $12,799.25 $12,867.96 $12,936.67 $13,005.38 $13,074.09 $13,142.80 $13,211.51 $13,280.22 $13,348.92 $13,417.63 $13,486.34
2 $25,461.09 $25,598.50 $25,735.92 $25,873.34 $26,010.76 $26,148.18 $26,285.59 $26,423.01 $26,560.43 $26,697.85 $26,835.27 $26,972.69
3 $38,191.63 $38,397.76 $38,603.88 $38,810.01 $39,016.14 $39,222.26 $39,428.39 $39,634.52 $39,840.65 $40,046.77 $40,252.90 $40,459.03
4 $50,922.17 $51,197.01 $51,471.84 $51,746.68 $52,021.52 $52,296.35 $52,571.19 $52,846.03 $53,120.86 $53,395.70 $53,670.53 $53,945.37
5 $63,652.71 $63,996.26 $64,339.81 $64,683.35 $65,026.90 $65,370.44 $65,713.99 $66,057.53 $66,401.08 $66,744.62 $67,088.17 $67,431.71
6 $76,383.26 $76,795.51 $77,207.77 $77,620.02 $78,032.28 $78,444.53 $78,856.78 $79,269.04 $79,681.29 $80,093.55 $80,505.80 $80,918.06
7 $89,113.80 $89,594.76 $90,075.73 $90,556.69 $91,037.65 $91,518.62 $91,999.58 $92,480.55 $92,961.51 $93,442.47 $93,923.44 $94,404.40
8 $101,844.34 $102,394.02 $102,943.69 $103,493.36 $104,043.03 $104,592.71 $105,142.38 $105,692.05 $106,241.72 $106,791.40 $107,341.07 $107,890.74
9 $114,574.89 $115,193.27 $115,811.65 $116,430.03 $117,048.41 $117,666.79 $118,285.18 $118,903.56 $119,521.94 $120,140.32 $120,758.70 $121,377.08
10 $127,305.43 $127,992.52 $128,679.61 $129,366.70 $130,053.79 $130,740.88 $131,427.97 $132,115.06 $132,802.16 $133,489.25 $134,176.34 $134,863.43
11 $140,035.97 $140,791.77 $141,547.57 $142,303.37 $143,059.17 $143,814.97 $144,570.77 $145,326.57 $146,082.37 $146,838.17 $147,593.97 $148,349.77
12 $152,766.51 $153,591.02 $154,415.53 $155,240.04 $156,064.55 $156,889.06 $157,713.57 $158,538.08 $159,362.59 $160,187.10 $161,011.60 $161,836.11
13 $165,497.06 $166,390.28 $167,283.49 $168,176.71 $169,069.93 $169,963.15 $170,856.37 $171,749.58 $172,642.80 $173,536.02 $174,429.24 $175,322.46
14 $178,227.60 $179,189.53 $180,151.45 $181,113.38 $182,075.31 $183,037.24 $183,999.16 $184,961.09 $185,923.02 $186,884.94 $187,846.87 $188,808.80
15 $190,958.14 $191,988.78 $193,019.42 $194,050.05 $195,080.69 $196,111.32 $197,141.96 $198,172.60 $199,203.23 $200,233.87 $201,264.51 $202,295.14
16 $203,688.69 $204,788.03 $205,887.38 $206,986.72 $208,086.07 $209,185.41 $210,284.76 $211,384.10 $212,483.45 $213,582.79 $214,682.14 $215,781.48
17 $216,419.23 $217,587.28 $218,755.34 $219,923.39 $221,091.45 $222,259.50 $223,427.56 $224,595.61 $225,763.66 $226,931.72 $228,099.77 $229,267.83
18 $229,149.77 $230,386.54 $231,623.30 $232,860.06 $234,096.83 $235,333.59 $236,570.35 $237,807.12 $239,043.88 $240,280.64 $241,517.41 $242,754.17
19 $241,880.32 $243,185.79 $244,491.26 $245,796.73 $247,102.21 $248,407.68 $249,713.15 $251,018.62 $252,324.09 $253,629.57 $254,935.04 $256,240.51
20 $254,610.86 $255,985.04 $257,359.22 $258,733.40 $260,107.58 $261,481.77 $262,855.95 $264,230.13 $265,604.31 $266,978.49 $268,352.67 $269,726.86
Source: Author
229

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The role of ports in supply chain disruption

Loh, Hui Shan

Downloaded on 09 Jun 2023 23:32:05 SGT

LOH HUI SHAN

SCHOOL OF CIVIL AND ENVIRONMENTAL ENGINEERING

LOH HUI SHAN

SCHOOL OF CIVIL AND ENVIRONMENTAL ENGINEERING

A thesis submitted to the Nanyang Technological University

TABLE OF CONTENTS ........................................................................................... ii

ABSTRACT ............................................................................................................. vii

LIST OF TABLES .................................................................................................... ix

LIST OF FIGURES ................................................................................................. xii

LIST OF ABBREVIATIONS .................................................................................. xv

CHAPTER 1. INTRODUCTION .............................................................................. 1

1.1. Background ................................................................................................. 1

1.2. The Potential Impact of Ports on Supply Chains ........................................ 1

1.3. Research Questions ..................................................................................... 3

1.4. Research Purpose ........................................................................................ 4

1.5. Structure of the Thesis................................................................................. 6

CHAPTER 2. LITERATURE REVIEW ................................................................... 8

2.1. Introduction ..................................................................................................... 8

2.2. Supply Chain Disruption Management ........................................................... 8

2.2.1. Disruptions in Supply Chains ................................................................... 8

2.2.2. Strategies for Supply Chain Disruptions ................................................ 15

2.3. Ports as Part of Supply Chains ...................................................................... 23

2.3.1. The Changing Role of Ports ................................................................... 23

2.3.2. Integration of Ports With Supply Chains ................................................ 26

2.3.3. Challenges in Coordination and Integration ........................................... 29

2.3.4. Implications of Port’s Integration into Supply Chains ........................... 33

2.3.4.1. Multimodal Connectivity ................................................................. 37

2.3.4.3. Value-Added Services ..................................................................... 37

2.3.4.5. Efficiency ......................................................................................... 38

2.3.4.6. Information Exchange and Communication .................................... 38

2.3.4.7. Charges and Costs ............................................................................ 38

2.3.4.8. Diversification into Logistics Service Provision ............................. 39

2.3.4.9. Agility .............................................................................................. 39

2.3.4.10. Training of Port Workers ............................................................... 39

2.3.4.11. Port Networking ............................................................................. 40

2.3.4.12. Port Security................................................................................... 40

2.4. Port-related Drivers of Disruptions ............................................................... 41

2.4.1. Drivers from the Peripheral Environment .............................................. 45

2.4.2. Operational Drivers ................................................................................ 45

2.4.3. Human Factors ........................................................................................ 46

2.5. Strategies for Port-Related Disruptions......................................................... 48

2.5.1. Disruption Prevention Mechanisms........................................................ 48

2.5.2. Disruption Mitigation Mechanisms ........................................................ 50

2.5.3. Contemporary Concepts as Disruption Mitigation Strategies ................ 52

2.6. Literature Gaps .............................................................................................. 57

CHAPTER 3. THEORETICAL CORNERSTONES OF THE RESEARCH MODEL

3.1. Introduction ................................................................................................... 59

3.2. Development of PSCD Threats ..................................................................... 59

3.3. PSCD Indicators ............................................................................................ 62

3.5.1. PSCD Threats Defense Mechanisms ...................................................... 70

3.5.2. Discrete PSCD Deviators ....................................................................... 71

3.5.3. Collaborative PSCD Defense and Deviators .......................................... 72

3.5.4. Port’s Holism Towards PSCD Reduction .............................................. 73

3.5.5. Monitor and Review of PSCD Management Process ............................. 74

CHAPTER 4. RESEARCH METHODOLOGY ..................................................... 75

4.1. Introduction ................................................................................................... 75