View from the ports' side: interview with Kurt J. Nagle
With more than 30 years of experience promoting international trade, Kurt Nagle has the right stuff to lead the American Association of Port Authorities—a group that serves ports from Alaska to Argentina.
Contributing Editor Toby Gooley is a writer and editor specializing in supply chain, logistics, and material handling, and a lecturer at MIT's Center for Transportation & Logistics. She previously was Senior Editor at DC VELOCITY and Editor of DCV's sister publication, CSCMP's Supply Chain Quarterly. Prior to joining AGiLE Business Media in 2007, she spent 20 years at Logistics Management magazine as Managing Editor and Senior Editor covering international trade and transportation. Prior to that she was an export traffic manager for 10 years. She holds a B.A. in Asian Studies from Cornell University.
Despite its name, the American Association of Port Authorities (AAPA) is a truly international organization. Its 160-plus member ports hail from throughout the Western Hemiäphere, from Alaska to Argentina. It's a constituency whose main business is facilitating global commerce; it is fitting, then, that President and CEO Kurt J. Nagle has a long history in promoting international trade.
After earning a master's degree in economics from George Mason University, Nagle went to work in the Office of International Economic Research at the U.S. Department of Commerce. From there, he became director of international trade for the National Coal Association and assistant secretary for the Coal Exporters Association. This year, he celebrated his 25th anniversary with AAPA, which he has headed since 1995. He also serves on the Executive Committee of the Propeller Club of the United States and is a former commissioner of PIANC, the International Navigation Congress.
Nagle speaks quickly but quietly, and his style is low-key—it's hard to imagine him getting angry or confrontational. But that calm demeanor doesn't mean he lacks passion for his subject. His enthusiasm was clearly evident when he spoke with DC Velocity about AAPA's four-part mission—advocacy, professional development and education, information sharing and relationship building among members, and promoting public awareness of the role and economic value of ports.
Q: You have a background in international economics and trade development. Does that help you to work more effectively with and on behalf of AAPA's members? A: It is relevant, and it has been helpful. In addition to my education, earlier in my career I worked for the U.S. Commerce Department's international trade branch on global economic issues. I also worked on international trade and related competitive issues while at the National Coal Association.
Certainly, that background has been helpful in recognizing that we're competing in a global economy and in understanding how that relates to our industry and to our members' competitiveness. It helps to understand what we have to do in the port industry and in the country as a whole about the issue of infrastructure investment. It is absolutely critical that we invest in infrastructure not only within the ports themselves but also in the connections to ports on the land side and on the water side to enable our country to be competitive.
Q: Your staff has changed in recent years. What kinds of expertise have you brought on board, and why? A: Our backgrounds and experiences reflect what is most important and relevant to our members and to our industry. First, we've added some resources that focus on initiatives like SHARE, which stands for Seaports of the Hemiäphere Allied in Relationships for Excellence. One of the key missions of this organization is to help members share lessons learned, best practices, and information about what works and what doesn't. ... We started SHARE about six years ago to enhance members' ability to share that kind of information. This also includes processes that facilitate electronic communication, such as our newsletter and webinars for education and for committee meetings.
More recently, we have increased resources for our "awareness" initiative, which is geared toward increasing recognition and understanding among policymakers—whether in Washington, in the various national governments throughout the Hemiäphere, or at the local level—of the critical importance of ports to national, regional, and local economies. We've also increased staff relative to U.S. transportation policy. With the surface transportation reauthorization coming up, it's critical that we work closely with government to develop a transportation policy that will help us as a nation to not only improve efficiency but also reduce congestion and improve air quality.
The third area where we've made staff changes is in adding someone who focuses on the Latin American delegation. His job is to ensure that issues that are particularly relevant and important to Latin American members are addressed and to facilitate the exchange of information. We also now have people on staff who have Spanish language and translation capabilities.
Q: AAPA's members include port authorities and managers from countries throughout the Western Hemiäphere. How does the organization meet the needs of such a diverse membership? A: One way we do that is by ensuring that resources that are contributed by everyone are not being used for something that benefits only some of our members. For example, our U.S. advocacy and government relations efforts are segregated in terms of staff, budget, and funding. Only U.S. members fund those resources.
Another way is that about 20 years ago, we separated our organizational structure into four delegations: Latin America, the Caribbean, Canada, and the United States. The delegations' leadership is represented on AAPA's executive committee and on the board of directors. By having all of the delegations represented in the broader policy and leadership positions, we are ensuring that the association provides value and is relevant to ports throughout the Hemiäphere. Certainly, when ports in different countries are looking at information technology or at developing a terminal, there are a lot of similar issues, questions, and practices. I think that's what members are looking for from us: to facilitate that exchange of information and lessons learned, and to provide a network and clearinghouse.
Q: AAPA has developed a training and certification program for port managers. What are the goals of that program? A: We started the Professional Port Manager, or PPM, program in the mid '90s. One of our key goals in the association is to enhance professional development. We also want to identify up-and-coming port leaders and provide them with the ability to develop their knowledge, skills, and relationships. These are all part of the PPM program.
About seven or eight years ago, we started a related program that includes issues that are particularly relevant to Latin American members. The program is offered in Spanish, or in Portuguese for the Brazilian ports.
This past year, we modified the regular program, which had been principally structured for individual study. We changed it to a class-based program; people now apply for a specific class and then go through the program together, for the most part, and we added group projects. That has really taken off. Our first class, the Class of 2014, started this year with 19 people. They've been together for two programs already, but there has been a lot of additional communication and correspondence among them. We're extremely pleased and excited by their enthusiasm and energy.
We have had about 80 people receive the PPM certification so far, and right now we have 150 total in the program. One of the requirements is a research project, a paper, or other type of project. ... Because our purpose is to educate and share information, we have made those papers and projects available so people can access and learn from them. This has been very beneficial to both individuals and ports.
Q: Transportation infrastructure is a hot topic in Washington now. Has AAPA been consulted on this issue? What are you telling Congress and the White House about how ports can contribute to efforts to revitalize the U.S. economy? A: We definitely have been asked to contribute to the dialogue. Secretary of Transportation Ray LaHood very early on had a conference call with many of the transportation stakeholder organizations, and AAPA was asked to be part of that. ... In February of this year, Secretary LaHood held a port summit, where he invited port directors from throughout the country to talk to him personally on key issues related to ports. That was the first time something like that has been done.
We've had very good ongoing dialogue not only with the secretary himself but also throughout his department, and more broadly within the administration. ... Commerce Secretary Locke, the former governor of the state of Washington, where he was a supporter of the state's ports, is another high-level official in the current administration who understands the importance and value of international trade and ports. He also recognizes the need to have infrastructure that allows us to be competitive in international commerce.
The message we're giving them is that ports are literally economic lifelines. They are critical links that provide access to the global economy, to the goods consumers expect to be in the stores when they go shopping, to the parts and components manufacturers rely on, and to farmers' being able to ship their grain overseas. We need all of that to work efficiently in order to compete, especially with the president's call for doubling U.S. exports in the next five years.
Another thing we're stressing is that transportation infrastructure investment and projects provide not only short-term economic benefits and jobs, but also long-term benefits that can improve the entire system's performance and help our nation in terms of economic efficiency and competitiveness. There are also environmental benefits, because infrastructure investment can help to reduce congestion and airborne emissions. We think there needs to be a greater emphasis on freight transportation than there has been historically.
Q: The Panama Canal expansion is expected to change shipping and trade patterns. Meanwhile, the container shipping business has been very volatile. How are ports responding to such uncertainty—especially when these factors are beyond their control? A: Economic conditions have had a significant impact on global trade, and obviously that has had an impact on ports' revenues and resources. Many of our members have had to undergo fairly significant belt tightening and look at reducing costs everywhere possible. But they still have to think about where to put their resources to manage through this. In many cases, ports are continuing to move forward with projects that will be needed when trade and commerce pick up again. These are long-term infrastructure projects that ports were building not for five years but for 30, 40, or 50 years down the road.
One of the things ports have become good at is strategic management—"adaptive management in uncertain times," as AAPA's former chairperson Geraldine Knatz called it. Ports are continually adapting their management strategies as situations change and evolve. Our members are looking at the Panama Canal expansion and other factors in international trade to determine what they mean for individual ports, as well as how to prepare themselves and adapt successfully to the new environment, whatever their role might be, whether as major load centers, feeder ports, or sites for handling specialized or niche cargoes.
Q: Exporters and importers—the ports' ultimate customers—say their top concerns are service quality, responsiveness, and efficiency. How can ports, which have limited flexibility because of their fixed infrastructure, ensure that they meet those needs? A: Ports are doing everything they can to make their own operations and the things they have direct control over as efficient, responsive, and flexible as possible to ensure the ultimate customer's needs are met. But this issue gets into the less clear or less direct role of public port authorities. A lot goes on at ports involving participants in the logistics chain that public port authorities don't have direct control over, such as terminal operators if the port is a landlord, tugs, pilots, the Coast Guard, Customs, security, labor, the Army Corps of Engineers, and private railroads and trucking companies. Public port agencies can serve as a vehicle to help coordinate, collaborate, partner, and facilitate the broad range of interests in and around the port. This is critical to achieving efficiency and supporting the customer.
Ports are, to a larger extent than in the past, looking to take on leadership roles that extend far beyond the terminal gates to whatever impacts them and their customers. That includes transportation policy affecting landside and waterside issues that are not in their direct control. The port authority is playing an increasingly vital, expanded role that is not limited to the confines of its facilities.
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
Serious inland flooding and widespread power outages are likely to sweep across Florida and other Southeast states in coming days with the arrival of Hurricane Helene, which is now predicted to make landfall Thursday evening along Florida’s northwest coast as a major hurricane, according to the National Oceanic and Atmospheric Administration (NOAA).
While the most catastrophic landfall impact is expected in the sparsely-population Big Bend area of Florida, it’s not only sea-front cities that are at risk. Since Helene is an “unusually large storm,” its flooding, rainfall, and high winds won’t be limited only to the Gulf Coast, but are expected to travel hundreds of miles inland, the weather service said. Heavy rainfall is expected to begin in the region even before the storm comes ashore, and the wet conditions will continue to move northward into the southern Appalachians region through Friday, dumping storm total rainfall amounts of up to 18 inches. Specifically, the major flood risk includes the urban areas around Tallahassee, metro Atlanta, and western North Carolina.
In addition to its human toll, the storm could exert serious business impacts, according to the supply chain mapping and monitoring firm Resilinc. Those will be largely triggered by significant flooding, which could halt oil operations, force mandatory evacuations, restrict ports, and disrupt air traffic.
While the storm’s track is currently forecast to miss the critical ports of Miami and New Orleans, it could still hurt operations throughout the Southeast agricultural belt, which produces products like soybeans, cotton, peanuts, corn, and tobacco, according to Everstream Analytics.
That widespread footprint could also hinder supply chain and logistics flows along stretches of interstate highways I-10 and I-75 and on regional rail lines operated by Norfolk Southern and CSX. And Hurricane Helene could also likely impact business operations by unleashing power outages, deep flooding, and wind damage in northern Florida portions of Georgia, Everstream Analytics said.
Before the storm had even touched Florida soil, recovery efforts were already being launched by humanitarian aid group the American Logistics Aid Network (ALAN). In a statement on Wednesday, the group said it is urging residents in the storm's path across the Southeast to heed evacuation notices and safety advisories, and reminding members of the logistics community that their post-storm help could be needed soon. The group will continue to update its Disaster Micro-Site with Hurricane Helene resources and with requests for donated logistics assistance, most of which will start arriving within 24 to 72 hours after the storm’s initial landfall, ALAN said.