{"id":375,"date":"2017-10-03T09:16:09","date_gmt":"2017-10-03T13:16:09","guid":{"rendered":"\/?p=375"},"modified":"2018-08-07T09:17:15","modified_gmt":"2018-08-07T13:17:15","slug":"remarks-of-commissioner-rebecca-dye-aapa-annual-convention","status":"publish","type":"post","link":"\/remarks-of-commissioner-rebecca-dye-aapa-annual-convention\/","title":{"rendered":"Remarks of Commissioner Rebecca Dye AAPA Annual Convention"},"content":{"rendered":"<p>Thank you. It\u2019s a pleasure to be here at AAPA\u2019s annual convention today.<\/p>\n<h3>FMC Focused on Ports<\/h3>\n<p>As my good friend, former colleague, and Port of Long Beach Executive Director, Mario Cordero, will attest, American seaports have become increasingly central to the work we do at the Federal Maritime Commission.<\/p>\n<p>For example, FMC agreements like the one between the Ports of Los Angeles and Long Beach allow them to discuss and agree on projects and programs to address supply chain optimization issues. Or the one between the Ports of Seattle and Takoma that allows them to establish an operating partnership as the Northwest Seaport Alliance. Also, the East Coast Gateway Terminal Agreement between the Georgia Ports Authority and the Virginia Port Authority to share operational information. These agreements help regional ports cooperate strategically as they adjust to the changing dynamics of liner shipping.<\/p>\n<p>Another port-related FMC activity is the Supply Chain Innovation Teams initiative that I\u2019ve been leading on behalf of the Commission since last year. This initiative grew out of four FMC ports forums we held around the country in the fall of 2014. The project employs small teams of industry leaders from all of the key supply chain organizations to work together to improve supply chain reliability and resilience.<\/p>\n<p>We mobilized three import-oriented teams and three export-oriented teams. We kept them small enough to be productive, but inclusive enough to ensure that all major perspectives were involved. The project was conducted under an FMC Order to allow for non-public meetings that would support mutual candor and give-and-take. The participants worked conscientiously and productively together, and the process was enlightening to them \u2013 and to us.<\/p>\n<p>I would also like to address a second topic today. One that should be of interest to the entire international shipping community: the Commission\u2019s long overdue review of existing regulations. In this review, we will be reassessing the fundamentals of our regulatory framework from the ground up.<\/p>\n<p>But first, the Teams:<\/p>\n<h3>Supply Chain as System<\/h3>\n<p>I believe that adoption of process innovations that apply new information technologies to the “ecosystem” of international supply chain networks is the route to transforming our international freight delivery system.<\/p>\n<p>To accomplish this, all supply chain actors \u2013 from ocean carriers to cargo owners \u2013 must be willing to change the way they think about international shipping\u2014and adopt a systemic perspective on our increasingly complex international supply chain. By the way, this includes government regulators, too.<\/p>\n<p>The complexity of our system of international liner shipping and freight delivery is growing. As systemic complexity grows, the solutions to supply chain operational challenges often appear less obvious.<\/p>\n<h3>Process Innovation and Small Team Engagement<\/h3>\n<p>Everyone I\u2019ve talked with who is involved with liner shipping is anxious to see the overall performance of the U.S. international shipping supply chain improved. And, because of that interest, the Federal Maritime Commission launched the Commission\u2019s Supply Chain Innovation Teams project in May, 2016.<\/p>\n<p>Our Teams contain industry leaders from seaports, marine terminals, liner companies, cargo owners (importers and exporters), ocean transportation intermediaries, drayage trucking companies, warehouses, and longshore labor. I have provided copies of our team participants list for you. They are an impressive group.<\/p>\n<p>The foundation of our project rests on two basic concepts: process innovation and small team engagement. <strong>Process innovation<\/strong>: incremental improvement on past operational success; and <strong>Small team engagement<\/strong>: no more than 12 members to a team, direct engagement with a <strong>specific goal<\/strong>. The overall purpose of the project is to develop commercial solutions to supply chain challenges, not government regulatory requirements.<\/p>\n<h3>Team Challenge: One Significant Operational Innovation<\/h3>\n<p>I encouraged our Teams to “step out of their enterprise silos” and choose one significant operational innovation that would improve supply chain reliability and resilience. Infrastructure and port performance metrics were “off the table.”<\/p>\n<p>We asked them to keep in mind that the international shipping \u2013 both for imports and exports \u2013 supply chain is a complex system that consists of interrelated components that continually affect one another. There are lots of interdependent pieces. With that in mind, our Teams agreed that dramatically increasing supply chain visibility among major supply chain actors is the operational innovation that would make the greatest improvement in overall supply chain system reliability and resilience.<\/p>\n<h3>Critical Information Visibility.<\/h3>\n<p>Our initiative is different from other IT projects you may have heard discussed lately \u2013 most of which focus on gaining efficiencies from digitizing specific individual business operations.<\/p>\n<p>Our teams focused on using information technology to provide critical information visibility to major supply chain actors, allowing them to act in harmony, not at cross purposes, in the supply chain “ecosystem.” Improved supply chain visibility requires identifying ways to provide the critical information needed by each supply chain actor. Critical information \u2013 not maximum data.<\/p>\n<h3>Critical Information Not Maximum Data.<\/h3>\n<p>Large <strong>data bases<\/strong> exist and may be useful to ports, terminals and liner companies for their own business purposes. But what the teams were developing in their face-to-face discussions and debates was the key <strong>information<\/strong> they needed to interact effectively.<\/p>\n<p>To support our teams\u2019 discussions, I spoke with many consultants. It\u2019s very “current” to stress the need for more information sharing in our ports. One consultant emphatically insisted that: “They just need to learn to share information!” My response was: “What information?” and “For what reason?” The IT systems that assist information sharing are expensive.<\/p>\n<p>So our teams\u2019 challenge was to define the <strong>types of information<\/strong> (not data) they needed to share and <strong>what would change<\/strong> if they received the information when they needed it. It is import ant to understand that defining critical information is not as easy as it sounds. It requires supply chain actors, especially cargo owners, to carefully identify what they need to know, when they need to know it and how it will improve operations.<\/p>\n<p>For example, we found that for U.S. importers a key question is: <em>When can I pick up my container from the marine terminal?<\/em> For exporters, the questions are: <em>When and where can I get an export container, and when is the best time to deliver the full container to the marine terminal?<\/em> Those seemingly simple and straightforward questions can be surprisingly difficult to answer.<\/p>\n<p>To tell a cargo owner when an import container is available for pick up, for example, a marine terminal operator must know about, for example, chassis availability, terminal yard operations, customs clearance and other relevant port activities \u2013 for each shipment. These underlying challenges have to be addressed <strong>before<\/strong> critical information can be made available.<\/p>\n<p>Our initiative has been well received by our stakeholders and by our Congressional Committees. We intend to publish the final report on the project this fall. We also hope to obtain authorization for a concept design for the seaport information portal.<\/p>\n<h3>Regulatory Reform.<\/h3>\n<p>Recently, this quote was picked up from another of my presentations. It\u2019s an accurate quote, but it doesn\u2019t fully explain my regulatory approach at the FMC. I believe the FMC has plenty of authority to accomplish our missions; our focus today should be on removing unnecessary government compliance costs from our international supply chain.<\/p>\n<p>When I joined the Federal Maritime Commission, after my legislative role developing the Ocean Shipping Reform Act, I expected that the Commission would continue incremental shipping deregulation. I was, unfortunately, too optimistic, but, nonetheless, I have continued to advocate for reducing government compliance costs across the board.<\/p>\n<p>In recent years, however, the Commission has begun reviewing existing regulations \u2013 the first fruit of which was our recent decision to relax requirements that tied service contracts to the filing of those contracts with the Commission. Then, last March, following the Trump Administration\u2019s executive orders on deregulation, the Commission established a Regulatory Reform Task Force to identify ineffective or unnecessarily burdensome regulations and make recommendations for their revision or elimination.<\/p>\n<p>So far, we\u2019ve had roughly 40 responses to the Notice of Inquiry that we published at the end of May, offering suggested changes that our stakeholders would like to see. The Commission staff is currently reviewing them.<\/p>\n<p>As thing stand at the moment, I expect to see several central questions arise in the early reform process. First: Is the FMC\u2019s tariff publication requirement \u2013 and its efforts to enforce those tariffs \u2013 a regulatory activity that has outlived its usefulness? Second: Do benefits accrue from our unique legal requirement that service contracts, and similar instruments, continue to be filed with the Commission? And also: (One of my favorites) Whether the Commission should publish competition and regulatory enforcement guidelines?<\/p>\n<p>I encourage all of you whose organizations and businesses are affected by the Shipping Act and FMC regulations to pay attention to, and get involved in this new regulatory reform initiative. Removing obsolete regulatory requirements will allow the liner industry to develop commercial practices that meet their customers\u2019 needs.<\/p>\n<h3>Conclusion.<\/h3>\n<p>I believe that increasing supply chain reliability and resilience through critical information visibility and removing unnecessary compliance costs from the supply chain by repealing obsolete regulations will strengthen the performance of our international freight delivery system and provide a strong boost to American economic growth.<\/p>\n<p>Thank you all for your attention. If we have time for questions, I\u2019ll be happy to address them.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Thank you. It\u2019s a pleasure to be here at AAPA\u2019s annual convention today. FMC Focused on Ports As my good friend, former colleague, and Port of Long Beach Executive Director, Mario Cordero, will attest, American seaports have become increasingly central to the work we do at the Federal Maritime Commission.... <a class=\"read-more\" href=\"\/remarks-of-commissioner-rebecca-dye-aapa-annual-convention\/\">Read More »<\/a><\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[9,6],"tags":[],"acf":[],"_links":{"self":[{"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/posts\/375"}],"collection":[{"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/comments?post=375"}],"version-history":[{"count":1,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/posts\/375\/revisions"}],"predecessor-version":[{"id":376,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/posts\/375\/revisions\/376"}],"wp:attachment":[{"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/media?parent=375"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/categories?post=375"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/tags?post=375"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}