Port of Rotterdam presentation

Port of Rotterdam presentation

Manufacturing the future

Paul Smits, CFO at Port of Rotterdam Authority

“The best way to predict the future is to invent it,” says Paul Smits, CFO at Port of Rotterdam Authority, which administers and leases out 12 hectares in the Port of Rotterdam, adding that we can mould the future to our needs and lead society in some way.

“Humans are driven by short-term benefits and emotions. We can create the right conditions for people by creating an infrastructure and making sensible decisions in order to make this happen.”

Pillars for economic growth are education, infrastructure and innovation

Apart from security and peace, Smits said we should achieve stable economic growth, which creates good healthcare systems, education and other important key points in society. “Investments in education and infrastructure have the strongest correlation with economic growth. The three pillars for our future economic growth are education, infrastructure, and innovation.”

Smits said that the Netherlands’ current actions made change necessary. At the same time, he said, the port infrastructure in the Netherlands was rated the best in the world by the World Economic Forum. “[The Dutch port infrastructure] is so good because we invest in long-term plans with our partners. We look at long-term trends and developments and the client’s expectations for long-term plans,” he said, and explained the Port goes through this long-term vision and support base cycle every ten years. “Rotterdam has the best possible geographic location for a port in Europe. This is a gift and a massive responsibility. We are at the ceiling and have to stay there.”

“Even if you’re at the top, raise the bar”

In order to achieve this, Smits said the most important thing is to raise the bar. “Set it at a high level. Too many decisions in the Netherlands are based on risk avoidance. But we should base it on ‘excel’. If you base everything on risk avoidance, you’re going to fail … even if you’re at the top, raise the bar.”

According to the CFO, it’s important to “continuously improve what you’ve been doing for years and always see if you can enter a new market from your position.” When it comes to innovation an organisation should focus on continuous improvement as well as the development of new concepts. Companies such as Tesla Motors, Philips Lighting, Ampelmann and KLM Engineering & Maintenance are great examples of this success, for example by expanding their markets. KLM Engineering & Maintenance doesn’t only maintain its own planes, but also those of more than 20 other airlines at more than 50 airports. Smits also said that “Elon Musk created the best fully electric car in the world. Now his company, Tesla Motors, is worth $10 billion.”

Smits had once been advised not to look for the golden idea, but to be smarter than the competition; develop your market, create new activity, and then execute, he said.

Logistics as a sector benefits from inefficiency, because it’s about kilometres, said Smits. He explained that a truck travels empty on its way to pick up a container. “Transport companies don’t offer a short-term online platform on which companies can search whether or not there are containers available. It should be created.”

For inland shipping, Port of Rotterdam Authority launched InlandLinks, in collaboration with the Association of Inland Terminal Operations. It brings transparency to the market by providing an overview of the best intermodal routes, which services and facilities can be used at each inland terminal, and when capacity is available. “Such a project requires a long-term vision and a willingness to change your plans, and perseverance,” said Smits. “My belief is that ICT will have the same effect on inland shipping and logistics on the road. If you have a ship of 10,000 containers, it’s hard to track where they are without a computer.”

‘You need to look forward to survive’

Smits explained a Port initiative that sees heat sources on the Port linked together. “We took the initiative with other companies to establish a network of pipelines so we can burn less fossil fuel. Both examples – the heat source project and InlandLinks – involve parties with different interests, of which none are short-term. But without a long-term vision, these short-term efforts are pretty pointless. You need to look forward to survive.”

According to Smits, leadership is about creating an ambitious vision and putting in place an excellent team, which the leader must inspire, drive, challenge, and encourage. He said competencies are more important than experience. “Professional experience is no more than a pre-condition. The success of organisations is dependent on having the right people on the job,” he said.

 

“In the Netherlands, we focus too much on mediocrity,” concluded Smits. “Don’t accept mediocrity. Human capital is key. My most important experience as a leader was when my team set the bar really high and then worked together to reach that bar.”