FastPath

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FastPath Measuring Transport Logistics
Performance
ANDI Conference September 21st 2007
Peter D. Cook Project Manager -
FastPath Nathan Associates Inc. Julian Barona
M. Project Assistant Manager - FastPath Nathan
Associates Inc.
Paul E. Kent, Ph.D. Vice President/Infrastructure
Planning and Economics FastPath leader Nathan
Associates Inc.
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Main Objectives

• Evaluation of the current position of Colombia
  in the global context of trade facilitation
  transport logistics.
• Description of the FastPath approach to audit
  transport logistics system.
• Applying FastPath in Colombia

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Agenda

• The Impact of Logistics Inefficiencies
• Colombia in the Global Context World Bank Doing
  Business Analysis
• What is the FastPath Approach?
• How does FastPath Software Work?
• Potential for FastPath in Colombia
• Working with Stakeholder Group and Contractors
• Conclusions

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Topic 1
The Impact of Logistics Inefficiencies
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1. The impact of Logistics Inefficiencies

• Impact of shipping/transport costs on trade and
  GDP
• A 10 increase in transport costs reduces trade
  volume by 20 - (Limao and Venables 2000)
• Doubling shipping costs slows GDP growth by 0.5
  - (Radelet and Sachs 1998)
• Port gate congestion in Sri Lanka raises the road
  transport charges by 50 since trucks can make
  only one trip per day instead of 3 trips per day
  (FastPathTM team, Nathan Associates Inc., Sri
  Lanka Logistics Report 2007)
• Impact of decreasing port-logistics inefficiency
  on trade and GDP growth
• Port inefficiency, when mitigated, induces GDP
  growth by 0.47 percent (Kent and Fox 2004)

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Topic 2
Colombia in the Global Context -Indicators
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2. WB-Doing Business Report (DBR)

• Snapshot on the ease of doing business in 175
  countries (annual evaluation based on country
  surveys)
• Evaluation in trade measures as well as others
• Overall Colombia ranking in 2006 79/175
• Trading across border ranking 128/175
• Colombia has not improved its international
  competitiveness

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2. Trading Across Borders (2006)

• Costs and procedures involved in importing and
  exporting a standardized shipment of goods

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2. Trading Across Borders (2006)

• Colombia compared to other key economies

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2. Distance to Ports in Colombia

• Colombias disadvantage long distances and high
  hinterland transport costs per Tonne-km are
• 20 more than Argentina
• 38 more than Mexico
• 13 more than Brazil

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2. Commerce as of GDP
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Potential for growth with major commercial
integration gt TLC.
60
50
40
30
20
10
0
Chile
Brazil
Peru
Mexico
Panama
Ecuador
Colombia
Venezuela
Costa Rica
World BankgtWorld Development Indicators

• Colombia trade performance, as Percentage of its
  GDP, is low compare with other countries
• This shows room for imports and exports to grow

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Topic 3
What is the FastPath Approach?
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3. Components of the Logistics System
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It is a Decision-Support System
3. The FastPath Approach

• It is both a process and a toolbox
• The process includes
• A transport/logistics audit methodology
• Corridor and commodity specific analyses
• Stakeholder interactions
• The software application gives users
• A means of entering detailed corridor data,
• A means of summarizing and analyzing
  transport/logistics chain data
• A support tool for deciding priorities
• It will not make decisions for the user

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3. The Audit Methodology (Checklists and
Questionnaires)

• Focuses on two levels
• National or regional level
• The shipper association and freight-forwarder
  level
• Is based on
• A set of checklist questionnaires for sector
  managers and policy-makers for
• Customs
• Ports
• Railways
• Roads
• Logistics Services Industry
• A set of detailed survey questionnaires for
  shippers and freight forwarders

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3. The FastPath Software (Detailed Corridor
Analysis)

• Allows fast user inputs at different levels of
  knowledge
• General subjective knowledge (overall
  performance) good, fair, poor, very poor
• More detailed knowledge (specific costs and
  times)
• Expert knowledge (with some simple models)
• Provides automatic comparison with international
  norms
• Creates summary of logistic chain performance
  (cost/price, time and reliability) with total
  logistics score
• Allows comparisons of existing and improved cases
  (with graphics)

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Topic 4
How Does FastPath Software Work?
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4. Computerized tool Initial Screen



FastPath





Welcome





Help

About this Tool


Welcome to
FastPath









A Computerized Transport Logistics



Diagnostic Tool






Created for USAID



by












Nathan Associates
,
Inc
.












Define Scenario
Example Logistics Chain
Exit
Use Existing Scenario
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4. Transport/Logistics System
FastPath analyzes links and nodes in the system
Port/Terminal/Customs
Hinterland Transport/Transfer
Delivery
or Shipment
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4. Logistics Chain Schematic Diagram Input
Screen
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4. Transport/Logistics System Performance
Performance for each link and node is measured in
FastPath by
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4. FastPath Data Input Screens (detailed user)
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4. FastPath Data Input Screens (general user)
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4. FastPaths Results Summary
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4. FastPaths Graphic Display of Results
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The FastPath software calculates
4. Other FastPath Functions

• A general Logistics Score for each component of
  the Transport/Logistics Chain
• Costs and benefits and Net Present Value
• The Economic Importance of a Transport/logistics
  Chain

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Topic 5
FastPath in other regions - India -
Bangladesh - ASEAN Countries - Sri
Lanka - Mozambique - South Africa
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Topic 6
Potential for FastPath in Colombia
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6. Corridors in Colombia
DCs
Bogota Buenaventura Bogota Caracas Bogota
Cartagena Medellin Buenaventura Medellin
Cartagena Cali Buenaventura Cali - Quito
DCs
DCs
DCs
DCs
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6.FastPath in Colombia Could Include

• National level logistics modernization status
  audit
• Detailed analysis of selected corridor
  performance
• Benchmarking performance with other regions
• Highlighting of performance barriers in the
  import/export logistics chain, related to
  infrastructure, services, processes
• Analyzing policy/regulations, which result in
  delays, increased costs and poor service levels
  or low reliability
• Calculating the logistics score index for each
  corridor and each component, based on
  international standards
• Identifying and evaluating potential
  interventions
• Creating an action plan for improvements by
  corridor

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6. Scope of Work Could Include - 1

• Technical assistance for the evaluation of
  different corridors and selected commodities
• Generating a diagnosis of the logistics system in
  Colombia showing areas of inefficiency and
  their impacts
• Interacting with a variety of stakeholders to
  identify and prioritize issues
• Conducting corridor level analysis to identify
  specific problems in the transport/logistics
  system
• Applying the computerized FastPath methodology to
  assign price, time and reliability to each
  component of the logistics chain and compute the
  logistics scores
• Quantifying the impact of inefficiencies on the
  performance on the logistics chain
• Benchmarking the level of performance

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6. Scope of Work Could Include - 2

• Screening possible interventions using visual
  aids
• Doing analysis of specific interventions
• Performing What if scenario analyses
• Analyzing current and planned transport capacity
  of selected corridors and ports
• Analyzing existing and potential IT applications
  for improving logistics efficiency
• Examining institutional impediments to efficiency
• Conducting workshops and feedback sessions with
  stakeholders
• Interaction with stakeholders to identify
  potential improvements in the logistics system

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6. Scope of Work Could Include - 3

• Building on previous ANDI studies
• Working with ANDI to refine the FastPath model to
  fit Colombian conditions
• Set out FastPath as a monitoring tool for ANDI to
  use
• Training of ANDI staff in applying FastPath
  methodology and model

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6. Time Frame for FastPath Analysis

• National level analysis and association
  interviews 2 months to 3 months
• Detailed corridor audits 3 months to 6 months.
• International logistics, benchmarking and
  potential interventions 2 months
• Stakeholder Workshops and Action Plan
  Development 2 months
• Total 9 -14 months (depending on no. of
  corridors)

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Topic 7
Working with Stakeholder Groups of the Transport
Logistics Chain and Contractors
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Working with the Stakeholders, the FastPath team
7. Stakeholders and Contractor

• Asks for information about logistics performance
  (price, time and reliability) in the corridor and
  data sources
• Consults with the stakeholders about the best
  sources for checklists and interviews
• Asks for comments on critical issues, accuracy of
  information
• Asks for information on initiatives for potential
  improvements
• Asks for comments on different reports
• Provides a tool for continuing corridor
  performance monitoring by stakeholders

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7. Stake holders and Contractor
What we leave with the stakeholder group

• A diagnostic report
• Suggested actions
• Continued interaction between stakeholders and
  the contractor to continue corridor performance
  monitoring

What we leave with the contractor

• FastPath model with data for the corridor(s)
• The diagnostic report with suggested actions
• Final report
• A method to prioritize areas for improvement
  credibly and transparently
• The support of Nathan Associates Inc. to improve
  logistics systems and benchmark with other
  regions

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Topic 8
Conclusions
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8. Conclusions
Colombia in the Global Context

• According to the Doing Business Report Project
  Colombia in a Moderate position
• In Trading Across Borders (Customs and
  Transport/Logistics) Colombia is in a Bad
  Position.
• The gap between Colombia and the region is
  significant in time and cost to complete exports.
• Colombia must overcome disadvantage of longer
  hinterland-port distances

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8. Conclusions
FastPath

• FastPath can identify logistics areas that
  government and stakeholders can address to
  improve Colombia's competitiveness
• FastPath helps determine the priorities for
  where improvements should be made credibly and
  transparently
• FastPath provides the ability to benchmark
  performance to assess progress made from
  strategies that are implemented.
• ANDI could play an important role in monitoring
  performance of logistics corridors.

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8. Conclusions

• A FastPath project in Colombia could include
• National level diagnosis of transport/logistics
  system
• Detailed diagnosis and quantification of impact
  of inefficiencies and logistics scores for
  transport/logistics corridors
• Identification and screening of possible
  Interventions
• Evaluation of specific interventions
• Action planning with stakeholders
• Providing ANDI with a monitoring tool to support
  logistics analysis and communication with its
  stakeholders

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5. Sri Lanka Project
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5. ASEAN Countries