Terminals, Ports, and Digitalization Essay

Pages: 45 (12247 words)  ·  Style: Harvard  ·  Bibliography Sources: 20  ·  File: .docx  ·  Level: College Senior  ·  Topic: Business  ·  Written: May 16, 2017

For these clients, inefficient processes due to lack of or inadequate digitalization may mean delays in cargo delivery, loss of cargo, and even loss of revenue, eventually resulting in customer dissatisfaction. If APMT is to enhance customer satisfaction, digitalization is an important priority. In essence, digital innovation is essential if the firm is to remain competitive.

Cruz and Sarmento (2016) are worth quoting in full as their findings identify the nature of the problem and the possible solution at one and the same time (p. 18):

Digitalization will allow for the large investments in infrastructures to be optimized and will lead to an increase in mobility and efficiency. This could be achieved by management providing real time information, or by increasing tolls to enable operators to be more flexible and to be able to respond to market and consumer changes, and to be more proactive. The transformation that has occurred in Portugal in the transport sector over the last decades has been an impressive effort to close the infrastructure gap that the country suffered. However, new challenges ahead focus mainly in reducing costs, improving quality, and increasing mobility. There is a large role for digitalization in this effort.

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What this means is that in the face of infrastructural demands for the port and terminal industry, a solution is needed that help the industry to refine its role, increase customer satisfaction and maintain economic growth and well-being. As Portugal has shown through its investment in infrastructure, the results are positive and digitalization can help to close the rest of the infrastructural gap that remains for the country's ports (Cruz and Sarmento, 2016). Indeed, Helig et al. (2017) have shown that "as actors in world-wide supply chains, seaports are particularly affected by technological change. Due to the high requirements in the logistics sector, e.g., regarding costs, efficiency, security, and sustainability, digital innovation is essential to stay competitive" (p. 1341). Not only therefore have researchers identified a need for ports to upgrade infrastructure, they have indicated that digitalization is the way to do it most effectively.

Essay on Terminals, Ports, and Digitalization Assignment

Digitalization also offers a valuable opportunity for enhancing customer satisfaction (Mithas et al., 2005; Ryding, 2010; Jan and Abdullah, 2014). However, much of the literature in this area has paid attention to the impact of IT investments on tangible organisational performance measures such as productivity, profitability, and market value. In other words, there has been little attention to the connection between IT investments and intangible aspects such as customer satisfaction.

However, the scarcity of scholarly attention to the impact of digitalization on customer satisfaction is particularly true for the port industry (Cruz and Sarmento, 2016). Much of the literature in this area focuses on organisational metrics such as container capacity, output, and cost savings, giving little or no attention to customer satisfaction and other customer metrics (Branch, 2012; Lee et al., 2012). The scarcity of research within the context of the port industry may be due to the fact that the port industry has been relatively sluggish in adopting digital technologies compared to other industries. Indeed, the port industry has remained mainly unchanged for the last 50 years, and has been slow to embrace new technology. This means that industry players continue missing important opportunities to increase customer satisfaction. In the port industry, digitalization can be valuable for improving the efficiency of processes -- from forwarding and clearing processes to cargo operations, shipping management, and inland transportation. Without strong digital platforms, managing these processes can be a daunting task to the disadvantage of not only the port company, but also its clients.

Even so, the little literature available illustrates that digitalization in the port industry can positively affect customer satisfaction (Lee et al., 2012; Port Technology, 2015; Pernia and Santos, 2016; International Container Insurance [ICI], 2016; Accenture, 2016; Heilig et al., 2017). In the port industry, customers constantly require seamless movement of their cargo. Digitalization can enhance cargo movement through cargo tracking systems and other technologies, thereby improving the customer service experience. While this literature provides important insights relating to the impact of port digitalization on customer satisfaction, empirical evidence in this area remains scarce. The few studies available may not be readily generalized beyond the context in which they were conducted.

For APMT, no research has been done to examine the link between digitalization and customer satisfaction. Since customer satisfaction is an important hallmark of organisational performance, it is crucial to understand how IT investments can influence customer satisfaction at the organisation. APMT serves a multiplicity of customers, including clearing and forwarding companies, export and import companies, and logistics firms. For these clients, inefficient processes due to lack of or inadequate digitalization may mean delays in cargo delivery, loss of cargo, and even loss of revenue, eventually resulting in customer dissatisfaction. Though APMT has implemented various technologies such as cargo tracking systems, no evaluation has been conducted to examine the impact of the technologies on customer satisfaction. It is imperative for the organisation to understand the value of digitalization, especially from the perspective of customer satisfaction.

According to consumer satisfaction theories, such as the Value Precept Theory and Contrast Theory, consumer satisfaction is not as simple to gauge as taking, so to speak, a measurement of engine oil using a dipstick. Value precept theory for instance holds that "what is expected from a product may not correspond to what is desired and valued in a product, and thus, values may be better comparative standards as opposed to expectations" (Yuksel and Yuksel, 2008, p. 1). Contrast Theory holds that "when actual product performance falls short of consumer's expectations about the product, the contrast between the expectation and outcome will cause the consumer to exaggerate the disparity" (Yuksel and Yuksel, 2008, p. 4). Both of these theories can be applied to the case study in the following manners:


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