First Section

Intellectual Capital Management in Ports

In the context of modern global economy, the market-value of many firms exceed far beyond the book-value of their tangible assets; indeed in most cases, the real value of a firm is many times more than the sum of her physical assets. This has led the management science into a quest for identification of resources that generate and sustain this considerable amount of surplus in economic firm

News ID: 77891

Date: 27 December 2017 - 10:47

The quest has been referred to as research for identification of ‘intangible assets’ or ‘intellectual capitals’. Identification of intellectual capitals, not only explicates the elements and mechanisms of value production in a firm to a great extent, but it also facilitates the bed for further improvement and enrichment of such assets, as well as providing the means for indicating the real value of the firm in the market and facilitating for more promotion in her favor. Ports are among valuable, strategic, national assets of each country and have a critical role in developments of nations. In tandem with evolution of new generations of ports and within the context of global knowledge economy, the share and functions of intellectual capital is steadily increasing in production of value in the port sector. In spite of the essential role of Intellectual Capitals in ports, Intellectual Capital Management has not been addressed independently and holistically in ports industry. This article focuses on indicating the role of intellectual capitals in the port sector, and proposing a hybrid model for categorization of ICs in the port context, and management of Intellectual Capital in ports. Intellectual Capital is to a great extent capable of clarifying the ongoing changes in the global port sector. It can be used to establish a new paradigm in port development that enables the port managers to analyze and/or forecast the trends in port industry, and improve the assessments for their essential resources, competencies, needs, and potentials in business development.

Introduction

In the beginning of the third millennium, ports are considered as strategic assets which can essentially contribute to social and economic development of nations. The modern concept of a port is a juxtaposition of such fundamental roles as national revenue-makers, regional trade-enablers, and linkages to global economy. These roles are usually configured by a set of such vital functions as logistics, multimodal transport, facilitation for industrial clustering, raise in local employment level, etc. In this context, one essential question may be asked: ‘Why have ports become so important in global economy, and international trade?’ The answer is simple: Ports act as the focal point of several added-value generating functions. First, the port activities have direct influence on delivery of goods in market, and their finished cost for supply in the end-market. In the more modern concepts of the port, port activities may also change the function of goods in a desirable way (e.g. via some specific logistical processing).The enhancements in delivery, costs , and functions of goods will produce added value in the shipments of commodities and products handled in a port. Second, the port activities involve production of port services, transport services, and logistic services. In this sense, port can be seen as an industry that generates national revenue, enhances employment, contributes to industrial clustering, attracts investments, and facilitates trade. Furthermore, good performance of ports can accelerate the flow of shipments in their supply chain, and provide a fast-turning variety of goods in the market and a multitude of choices for customers. This will in turn lead to enhancement of production, raise of competition, and variety of goods at lower costs for customers. In this sense, the ports can be seen as tools for improvement of standards of life, and engines of socio-economic development in national (or regional) level.

Along the past fifty years, port development has been subject to great transformations. In the port management literature, this transformational trend is usually acknowledged as the evolution of the first, second and third generation of ports (ref. table 1). In most of the references, this evolution trend is considered to be a result of such phenomena as globalization (that stemmed from the worldwide political, social , and technical evolutions of national and regional economic systems), and international trade, as well as such technological trends as containerization, ship building developments, Information and Communications Technologies developments, etc. Although these have an explicit role in evolution of ports, but they cannot fully explain the reasons of upheaving changes in the port industry. Understanding these rearrangements is critical, as they are determining in gaining a proper attitude in business, and following the correct direction in the path of port development. However, in order to gain a good perception of them, it is imperative to comprehend the underlying causes in the port industry and her environment.

As we will discuss in this article, development and dominance of intellectual capitals in ports are the most important factors that has laid the foundations for ongoing evolutions in the port sector. Later we will discuss that intellectual capital management is the key to success of ports in the intense competitive market.