A licence to operate

L&MH speaks with Caryn Anderson, Executive General Manager Strategy and Business Development at Port of Melbourne about the future plans of the Port and why Melbourne’s Port location gives it the competitive edge.

The Port of Melbourne is Australia’s largest maritime logistics hub, as a key economic asset for Victoria’s businesses and people. The Port will play a crucial part in the projected growth for Melbourne and Victoria.

The Port’s objective is to deliver a safe, responsible and reliable port facility and to play its part in delivering the efficient supply chain needed to support Victoria’s growing economy.

Logistics & Materials Handling spoke with Caryn Anderson, Executive General Manager at Port of Melbourne about the journey the Port has taken through privatisation, challenges for the future and the importance of working together.

Pathway to ports

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For Caryn, a route to a career in logistics was largely unplanned. “I’m not sure anybody sets out to work in this sector,” she says. Like many professionals in the sector, Caryn fell into the industry by accident.

With a background in Marine Science Caryn started in an environmental management role and it was here that she was exposed to the ports environment. She soon realised how exciting and dynamic logistics can be.

Next, Caryn did a law degree, specialising in international maritime law when an opportunity arose to work overseas directly with the shipping industry. “This was an exciting opportunity for me to see a different perspective and I think having a scientific background has allowed me to draw together all of the different elements – finding patterns and simplicity through it all is part of the challenge,” she says.

Caryn’s role is largely around coordination, planning and strategy. “There’s lots of moving pieces, and we are fortunate to have a a great team who are technically competent and passionate about what they do – this helps us to keep across the diversity of issues,” Caryn says. A stand-out advantage for Caryn is that every day is different in logistics. “One day you will be dealing with a farmer who is growing purple carrots to export to Japan, the next day you could be dealing with the Minister’s office and the next day a wharf carrier — it’s fantastically diverse and it keeps it real,” Caryn says.

Planning roles can quickly become very abstract, but in Caryn’s role at Port of Melbourne this is not an option. “This position gives me the opportunity to be quite hands on and to work with industry to identify real solutions instead of a situation where everything looks good on paper but if you go down to the port and talk to the carriers, they tell you a different story. We are keen to make a difference and drive real efficiencies for the businesses that use the port” she says.

Privatisation

In 2016, the Port of Melbourne’s commercial operations and assets were leased by the Victorian Government and Caryn played a key role in this process. “I was involved in the original scoping study when the government was considering privatisation. I was then the lead responsible for leading the transaction internally and separating the business in preparation for financial close,” she explains.

The privatisation was a lengthy and complicated process, but this was all part of the end goal. “I think one of the really good things about the time it took was that it was well-debated and considered by both sides of government. This meant that we ended up with a contractual arrangement as a private port manager that is strategically aligned with what’s in the best interest of Victoria. This is fundamental to what we do because we are serving the people of Victoria. When Victoria does well, our business does well.” She adds this was the really rewarding part of the privatisation process, to see how well structured it was.

Another important factor is that the Port of Melbourne shareholders are all long-term investors. “They are focused on long-term value of the port and in the context of a port this means infrastructure planning across a 30-year plus horizon. It’s about positioning for the collective success of the port freight supply chain over the longer term,” Caryn says.

Preparing for growth

Melbourne’s population growth is projected to grow substantially, reaching five million by 2021 and soaring past eight million by 2050 according to Plan Melbourne report. This has significant implications for the Port. “The Port reflects what is happening in the Victorian economy, trade across the wharf is a lead indicator of economic activity,” Caryn explains.

“Over recent years we have seen growth rates around 3 per cent and have forecase around 3 to 4 per cent going forward. However, the trade volumes that have been passing through the port year to date are sitting around 8.5 per cent, from a compound growth perspective, changes like this can move us past our planning capacity and bring forward our infrastructure considerations. The big challenge for us, like any demand and supply model, is forecasting what the demand is going to be and population growth will have a significant input into this,” she says.

Caryn is aware that the port cannot act alone and much of preparing for growth is dependent on external factors. “Like any organisation, we have plans in place in terms of how we think infrastructure might be delivered. We are continuously monitoring our key drivers for growth, innovations across the supply chain and commercial arrangements – all of which will influence the infrastructure that is ultimately delivered. We view the logistics supply chain as a system which is slightly more challenging because it means we are talking about shared infrastructure across the supply chain, this investment tends to be “lumpy” and has long lead times. The other challenge is structuring an appropriate business case to finance investments within this type of a model – but we can’t get caught off guard in terms of delivery time,” she says.

Caryn also sees this population growth as a great opportunity for the Port of Melbourne. “The rate at which the population is growing has an important implication for the city and how it works, how freight and logistics is integrated to service the city needs and the role of the port is an exciting opportunity,” she states. Historically, the conversation was often about moving the port out of the city, but now with a 50 year lease, Caryn believes that as population grows there is an opportunity to leverage the port’s city centre location. “When you think about how much growth is going to occur within and around the CBD, the location of the Port could actually be one of the greatest opportunities for the future liveability of the city of Melbourne.”

According to Caryn, this is the kind of opportunity that calls for communication and collaboration between all the stakeholders and operators across the supply chain, a cause that she is passionate about. “It’s how we coordinate with the State Government and the Commonwealth around the infrastructure priorities that ensures the unprecedented investment we are seeing in infrastructure delivers real benefits to users and the economy more broadly,” Caryn says.

Port activity

The Port of Melbourne has a rich history with the people of Melbourne. “One of the really interesting things around ports is what’s coming through the Port is a lead indicator of what’s happening in the economy,” Caryn says. This is clear when looking at the data of the items that are moving through the port.

Over the last couple of years there has been significant growth and strong performance in new furniture. Caryn explains that this is a reflection of all the new residential developments that are going on in Victoria as well as a reflection of increased migration. There is also representation of responses to changes in global regulation, such as the recent Chinese regulations around recycled paper exports.

A licence to operate

 Caryn says the Port of Melbourne sees itself as custodian of the port and one of the most important aspects of her role is integrating effectively with the city. “The Port of Melbourne is a critical economic asset to the State Government and I think it’s important that we start at that position and then look at how we work with our neighbours and community to make sure that the Port can continue to grow and service the economy, while also recognising the growth and development in our neighbouring communities,” Caryn says.

Working with the neighbouring communities is not without its challenges. One particular challenge is that the Port of Melbourne has four different local governments to work with.

As is often the case when dealing with a number of stakeholders in one area, there are often different objective.“What we need to be doing more effectively is connecting what our economic drivers are, we need to talk in a more holistic sense, while also protecting the port and key freight corridors from residential encroachment,” Caryn says.

Within the Port of Melbourne there is a team that spends a lot of time reviewing planning applications which are within close proximity to the port. The team considers the sensitivity of certain developments to current and future port and freight operations. “We need clear expectations from the community in terms of what is allowable in close proximity to the port, while there are many complementary activities, there are also fundamental incompatible land uses such as freight corridors alongside residential and pedestrian activity,” Caryn explains.

Port of Melbourne is actively working with local governments to identify areas for growth and development within close proximity to the port and to balance the different objective to achieve the best overall outcome. For Caryn, there has been significant effort in putting planning controls in place that protect the port but there is an opportunity to work more closely with the State and local government to uphold those protections and plan responsibly for public safety and amenity and economic growth.

Raising awareness

A common issue across all logistics modes is raising awareness and interest in its activities from the public. One issue that is relatable for Caryn. “Until I worked in a port I didn’t realise that it existed, it was just one of those things that was just there.”

The Port of Melbourne is working directly with the community to raise awareness, finding that when major developments take place people become more aware of the port’s existence and start to think about freight and logistics. “There are a lot of people who are interested in what is happening at the port, but since the security requirements came into place it means in many respects the public has been excluded from the activities and operations at the port,” Caryn says.

She believes there is an opportunity to invite the public back in and the Port of Melbourne has been working with the community to find ways to connect. They are involved with Open House Melbourne and use it as an opportunity to ignite interest in what goes on at the Port, as well as organising regular public boat tours.

Competitive edge

For Caryn, the Port of Melbourne holds a unique competitive position. “For us, it’s about the whole supply chain, that’s where our focus is. We see ourselves playing a role across the total supply chain,” she says.

While responsible for the infrastructure and assets in the port, the Port of Melbourne also plays a role across the supply chain to ensure its efficiency. Caryn notes that the Port spends a lot of time working with individual supply chain participants to find out how they can work together to improve efficiencies to give Victoria that competitive edge.

Caryn says this is an exciting time for the future of logistics. “Over the last decade, we’ve seen huge advances in the availability and transparency of data, we are seeing completely different business models forming. This is a great opportunity to look at how we do things differently. If we think differently about how we might facilitate freight and logistics for the city and how we might design our infrastructure to make that work more effectively we have a huge opportunity here in Melbourne.”