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Investment in ‘Lean’ practices improves efficiency for APM Terminals customers

In 2018, APM Terminals made a firm commitment to tap into the huge potential that a ‘Lean’ philosophy promises. Four years on, the company is consistently breaking safety records, rolling out digital customer solutions faster than ever, and customers are benefitting from improved efficiency – including a 40% reduction in vessel idle times for one Shipping Line at APM Terminals Pipavav, India.

Known in APM Terminals as its ‘Way of Working’, it is an overarching philosophy - tried and tested for many years by companies well known for their efficiency, such as Toyota - that supports all of the strategic pillars that will help APM Terminals become the World´s Best Terminal Company. 70% of APM Terminals’ 22,000 employees have now been trained in and equipped to apply Lean methodologies.

APM Terminals Way of working helps create value from the customer´s perspective. Every employee, from the CEO to front line workers are trained to look for opportunities, however small, to continually improve the value creation process by eliminating waste. And by waste, we don’t just mean materials. The biggest gains in our industry come from time – reduced waiting times – shorter port stays – or delays due to avoidable equipment breakdowns.

APM Terminals has run almost 200 Kaizen’s this year alone. Simply put, Kaizen stands for continuous improvement. A Kaizen event pulls together people from all areas of the business for up to a week, to intensively work on an improvement goal. The baseline for Kaizen is standardization, which means that the process is documented in detail before we start our improvement journey. Best practices are shared global across APM Terminals operations.

These opportunities have resulted in millions of dollars’ worth of savings for APM Terminals and its customers. Furthermore, between 2019 and 2021, our Net Promotor Score - used to measure customer satisfaction - showed a positive trend for both landside and shipping line customers, rising by 5 and 13 points respectively. It increased further still in the first quarter of 2022.

40% Reduction in Vessel Idle Time

A big focus of Kaizen Events this year has been saving Port Hours. A shorter port stay means our customers can maximise the use of their vessels, reduce emissions and lower costs. At the same time our terminals also reduced emissions in support of our industry-leading carbonization goal.

At APM Terminals Liberia, process improvements to improve idle times have reduced vessel arrival cycles from 1h42mins to 55mins and departure cycle from 4h39mins to 50mins, along with numerous other associated environmental, safety and supply chain benefits.

This year’s Kaizen Team of the year at APM Terminals Pipavav for example, worked together with shipping line customer ONE in a joint Kaizen workshop. The outcome has been an average 40% reduction in vessel idle time.

Bringing external parties together

Without APM Terminals’ Way of Working approach, some projects may have previously been postponed due to their complexity. But now, armed with the right processes and tools, APM Terminals is also able to overcome these challenges. For example, APM Terminals Poti determined that 90% of vessel idle time was due to external stakeholders, such as Border Police, Customs, Shipping Lines, Vessel Agents, and Harbor Masters. Once this wa identified, all external stakeholders were involved in week long kaizen to tackle inefficiencies and improvements.

Other outcomes may invove smaller incremental improvements, such as an improved and faster way of securing employees working on a container roof, or offering a new service at the terminal that can save customers time and money. For exmple, APM Terminals Callao are using Lean methodology to fast track a license application to allow them to recharge reefer gas on the terminal, so that customer’s don’t incur additional transport costs to move a reefer off-terminal for this service. Many thousands of these small improvements and best practices can have a huge impact, especially when shared across the company’s 67 terminals.

Recognising employee efforts

These success stories are driven by APM Terminals highly trained employees. An annual global programme recognizes and reward Way of Working role models. Known as “Way of Working Heroes” they range from frontline workers to management, but all have one thing in common. They lead with passion, eagerness to learn and win together, with respect for each other, while improving safety, impacting customer experience, reducing waste and increasing efficiency.