Port capacity planning – A strategic management perspective

Abstract

This article examines the strategic factors influencing how Port Authorities (PAs) make decisions concerning investment to ensure capacity supply in the long term. Rooted in the strategic management literature, we draw upon the capabilities perspective to investigate what critical operational capabilities PAs require to achieve performance and the strategic factors influencing the choice of critical capability development to ensure the long-term capacity supply across different port contexts. We employ an exploratory case study of the Irish state-owned ports sector using both archival data and qualitative in-depth interviews conducted with senior executives in the Irish PAs of four Irish Ports and the relevant government agency. Key concepts from the strategic management literature are evoked to reconceptualise the capacity planning process to identify critical capabilities of ports and factors influencing PA decisions in managing and planning future port capacity. The purpose of this conceptualisation is to provide a strategic framework to comparatively analyse decision-making regarding capacity planning across organisations. Results identify five critical operational capabilities for PAs to ensure supply capacity for freight markets, highlighting important implications for policy and practice. Across port contexts, the strategic importance of various port management capabilities can change contingent on contextual factors accruing to a port’s operating environment. PA senior managers must consider both tangible resources related to physical capacity and intangible resources such organisational capabilities in evaluating future capability to supply capacity. Assessment of future capacity development within a given port must be cognisant of all capabilities required to develop capacity.