AN ESSENTIAL MARKET RESEARCH AND PRODUCTIVITY TOOL
FOR THE TRANSPORTATION INDUSTRY©

Paper Presented at the Annual Conference of The Canadian Transportation Research Forum:
CTRF, May 14-17, 1995, Aylmer, Québec
by

Hazem Ghonima
President
TAF Consultantsä
Ottawa, Canada
E. mail: HazemGhonima@tafis.com

INTRODUCTION

The Canadian transportation system is a complex network of transportation routes and modes competing for commodities flowing between various domestic and international supply and demand centres. The type, amount and direction of the commodities moving through this network are influenced by a multitude of interdependent economical, technological, political and institutional factors at domestic and global levels. In a rapidly changing competitive transportation environment, comprehensive and efficient freight traffic data and forecasts are vital for strategic planning and development in the transportation industry. Analysis of the present and future behaviour of commodity flows require the examination and interpretation of large amount of information before any sound decision can be made. The complexity of the transportation system, the unavailability of comprehensive logically organized and harmonized information on commodity flows at reasonable cost make this task difficult. A solution to this problem is to develop and use knowledgeable computerized systems that provide comprehensive information on commodity flows at optimum costs.

This paper will examine the Commodity Flow Information System COMFISÓ , the latter was developed by the Author and reflects his vision of the tool needed to respond to the problem. Major factors which prompted the development of this system will be reviewed. The system concept and approach will be examined prior to describing its structure, components, outputs, applications and its impact on productivity in the transportation industry. Versions of COMFISÓ are presently installed and used by several organizations.

THE PROBLEM

Many factors necessitate the development and use of a tool such as COMFIS. It would have been relevant to review them in more details since the experience gained in encountering these problems might save a lot of efforts and money for many organizations - this topic may be the subject of another paper. However, for the purpose of this paper, the most important factors that prompted the development of a market research and productivity tool such as COMFIS can be summarized as follows:

• The World political, economical and technological situations are changing and with it the World trade pattern. These global dynamic events have affected the Transportation industry and required it to modernize its activities in order to remain competitive. To cope with these new global realities, governments and private organizations involved in the transportation industry, are attempting to use more efficiently their transportation managers and professionals by exposing them to the latest affordable technological know how in the transportation business.
  

• To remain competitive in today’s complex, sophisticated and dynamic global trade system, organizations are gradually discovering the need to access and use comprehensive up-to-date information on commodity flows in order to undertake market research, traffic analysis and forecasting - activities that are vital to the assessment and improvement of their competitive position. An understanding of present and potential future commodity flow through alternative transportation routes and modes can make the difference between the success or failure of a transportation business.
  
  
• Although these activities are vital for a successful business, they still are not necessary widespread or even exist in organizations involved in transportation industry. Rather they are sometimes adopted by selective and large public and private organizations. There are many reasons for this situation, most importantly is the cost of developing and maintaining these activities. The latter requires experienced and skilled professionals with a multi-disciplinary knowledge in transportation economics, market research, industrial complex analysis, system analysis and planning, port planning, engineering and traffic forecasting.
  
  
• In order to perform effectively, these professionals must have access to a wide range of information which can only be found in some specialized libraries. They usually need to subscribe to domestic and international business and financial journals, magazines, reports, data bases, on-line services, etc. Furthermore, in order to be efficient, these professionals must also be equipped with software applications and computers related to the multi-disciplinary aspect of their function. Therefore, they are required to be at ease with the use of these tools and continually aware of their evolution. In developed countries the human resources aspects of this function is becoming very costly and sometimes difficult to justify. In developing country, although the human resources aspects are much less costly than in developed countries, the training, skills, information and supporting tools could be the problem.
  
  
• Another reason for the restrained widespread of this function in many organizations can be the loss of confidence in a given information supplied by their professionals and or the decision maker may find that information never seems to be available on time for decisions. The unavailability of comprehensive, cost-effective, logically organized and harmonized information on commodity flows at one source makes the task of these professionals very difficult, time consuming and frustrating, particularly since the decision maker may not appreciate their situation.
  
  
• Presently, several medium and small sized transportation businesses rely mostly on government for free information and studies related to the global economy, trade, market research, traffic analysis and forecasting of the transportation aspects of their businesses. However, as a result of the urgent need to reduce its financial debts and increase productivity, the Canadian government is embarking in policy of restructuring (downsizing) or privatizing many of its public organizations. Consequently, these free services could be seriously reduced and may even be completely eliminated. Subsequently, this can create a gap in a vital information service sector that will need to be filled if the transportation industry is to remain competitive in this new information era. These factors among others have prompted the development and implementation of COMFIS - a cost-effective computerized system that provides comprehensive information on commodity flows within a global and dynamic perspective. A system in which harmonized information on the supply and demand, trade, shipments and markets of commodities can be obtained quickly and efficiently.

CONCEPT AND APPROACH

The system discussed in this paper reflects the growing needs for the uses of computerized information for traffic analysis and forecasting as well as the evolution in software and hardware technologies.

The system’s global approach is based on the concept that elements of a transportation system and factors that influence them are interrelated. By visualizing this relationship in a computerized information system, the identification, analysis and estimation of the present and future type, amount and direction of commodities flowing through a transportation network become efficient (Please see the above Figure).

Simply put, COMFIS visualizes the World transportation system as a multitude of transportation networks comprising transportation nodes and alternative routes and modes that are competing for commodities flowing between various domestic and international supply and demand centres. The amount and direction of commodities flowing through this network are influenced by several interrelated economic, technological, political and institutional factors at domestic and global levels. By assessing the impact of these factors, the process of analysing and forecasting commodity flows and traffic through alternative modes and routes is greatly enhanced and its credibility increased.

Accuracy of information, the ease of access and cost-effectiveness are the major objectives of this system. By operating on cost-effective micro-computers and a user-friendly environment, the information within the system is easily accessed and obtained with optimum maintenance, resources and costs, which makes it an ideal tool for budget conscious organizations seeking efficiency in a modern competitive transportation industry.

OVERVIEW AND STRUCTURE

COMFIS is based on a modular expandable core technology allowing additional modules that reflect present and future requirements. It consists of several integrated modules and sub-modules. COMFIS’ modules are composed of objects that represent major transportation elements and variables related to commodities flowing between the centres of production and consumption. The system simulates the flow of commodities by logically organizing the objects (elements and variables) according to their sequential relationship in the commodity flow process. Moreover, a module can include one or more sub-modules and objects can be grouped into an object group.

The figure above shows COMFIS’ logical structure and the relationship between its various objects. Accordingly, the commodity flow is a process which is represented by several object groups, each of which is composed of several objects (transportation elements and variables) as follows:

Supply/Demand

Production
Consumption
Shipments

Domestic Shipments

Loading and Unloading by Alternative Routes/Modes and by Ports, Seaboard Outlets and Markets (Establishments, Provinces) of origin and destination

Trade/ International Shipments

Loading (Exports) and Unloading (Imports) by alternative Routes/Modes and by Ports, Seaboard Outlets and Markets (Provinces/States, Countries, World Regions and Continents) of origin and destination.

SYSTEM FEATURES AND CHARACTERISTICS

The system presented in this paper is composed of six (6) major modules based on the modular structural design described earlier. The figure below shows the Main Menu with its modules and sub-modules.

COMFIS’ modules, sub-modules and objects (elements and variables) can be classified as follows:

Definitions Module

Definitions, classification of objects/groups (elements and variables) and sources of information used in COMFIS

Commodities Module

Agriculture Products
Forest Products
Mining Products
Manufacturing Products

Modes Module

Marine
Rail
Trucking
Pipeline
Aviation
Other

Routes Module

Great Lakes-St. Lawrence Seaway (GL-SLS)
Panama Canal
Suez Canal
Grain Routes
Iron Ore Routes
Coal Routes
Steel Routes
Other Routes

Ports Module

Location
Profile
Port Traffic
Distance and Time between Ports
Contacts

Markets Module

Establishment
Province/State
Country
World Region
Continent

To be characterized as efficient and user’s friendly the system satisfies the following criteria:

• Accuracy of information and ease of access are two of the major objectives of the system. Information is gathered from several reliable Canadian, U.S. and International Organizations.
  
• The system is multi-user and network-ready operating under Microsoft Windows™ environment.
  
• The scope and type of information provided make the system vital for many applications including: market research, traffic analysis, competitiveness studies, commodity flow analysis, traffic forecast, system planning, organization, presentation and education.
  
• Period and time series of information will vary depending on the topic and should represent the most recent available information. Periodical updates of information and added modules protect user's investment while maintaining consistency.
  
• The system is an intuitive and straightforward tool that provides the power of a comprehensive information system in everyday data management tasks. With a few clicks of a mouse on button based toolbar menus the user is able to easily work through increasing levels of details to obtain the desired information.
  
• The system can easily communicate with other applications by having the capability to automatically transfer its query output to a spreadsheet or a word processing file.

OUTPUT

Following is an example that demonstrates the type and scope of information that can be obtained from COMFIS. Assuming we want to start by getting information about the most important commodity X shipped between Canada and/or the U.S. and Country C. (Please see Figure below).

• What is the most important commodity X shipped between Canada/U.S. & Country C in quantitative terms (tonnes)?
  
• What is the shipments status of commodity X (loaded or unloaded)?
  
• What is the shipments type of commodity X (containerized or non-containerized)?
  
• If the shipment of commodity X is for exports then from which Canadian/U.S. port(s), seaboard outlet(s) & province(s)/state(s) is it shipped to Country C?
  
• Which port(s) in Country C receives (unloading) commodity X from Canada/U.S. & on which seaboard outlet(s) is it located?
  
• What is the distance(s) (in nautical mile & in km) & vessel time(s) (in days) between the Canadian/U.S. port(s) of loading of commodity X & the port(s) of unloading in Country C?
  
• What is the rank of Country C, in quantitative & percentage terms relative to other Country(s) that receives commodity X & from which Canadian/U.S. port(s), seaboard outlet(s), & province(s)/state(s) commodity X is shipped to other countries?
  
• Where is Country C located? Which seaboard outlet(s)? Which world region? Which sub-region & which continent?
  
• Show the profile (area, population, economy, background) of Country C.
  
• What is the rank of commodity X, in quantitative & percentage terms, compared to other commodities shipped domestically & internationally from Canada/U.S.?
  
• What is, in quantitative & percentage terms, the total Canadian/U.S. shipments of commodity X by province/state, seaboard outlet, route & port?
  
• What is the market(s), in quantitative & percentage terms, for commodity X by continent, world region, country, province, seaboard outlet & port?
  
• What is the total Canadian/U.S. production, consumption, exports, imports, stocks & prices of commodity X during the last 5 years?
  
• What is the total world production, consumption, trade & prices of commodity X during the last 5 years?

CONCLUSION

In a rapidly changing competitive transportation environment, comprehensive and efficient freight traffic data and forecasts are vital for strategic planning and development in the transportation industry. To remain competitive in today’s complex, sophisticated and dynamic global trade system, an understanding of present and potential future commodity flow through alternative transportation routes and modes, can make the difference between the success or failure of a transportation business.

The complexity of the transportation system, the unavailability of comprehensive, logically organized and harmonized information on commodity flows at reasonable cost, make this task difficult. A solution to this problem is to develop and use innovative and knowledgeable computerized systems that provide comprehensive information on commodity flows at optimum costs.

A market research and productivity tool should be dynamic, evolving with time in order to reflect the needs and requirements of the transportation industry. Technically, these systems are expected to become more efficient in terms of performance and cost-effectiveness by taking advantages of the continual development in software and hardware technologies. The impact of information systems such as COMFIS on the transportation industry is considerable. The scope and type of information that can be provided, its wide applications, the ease of use and access to information at optimum maintenance and costs, make it an ideal tool for budget conscious managers and professionals seeking efficiency in a modern competitive transportation industry.

DEFINITIONS OF TERMS USED IN THIS PAPER

Commodity Flow

Commodity flow is the process related to commodity movements through alternative modes and routes between the centres of production and consumption. In COMFIS the commodity flow process is represented by several object groups each of which is composed of objects that represent the transportation elements and variables.

Traffic Analysis and Forecasting

Traffic analysis and Forecasting is a function, as defined in this paper, encompassing the following stages and activities that are vital to a sound Policy and Business Decision Making.

Inventory Development

Gathering of data and information
Harmonizing information and data from various sources
Organizing data and information into logical structure

Developing knowledge Data Base Information System

Analysis

Market research
Regional Analysis
Industrial Complex Analysis
Cost-Benefit Analysis
System Analysis
Route Modal Choice Analysis

Forecasting

Macro-Economics
Commodity Supply and Demand
Commodity Flow Forecasts
Traffic Forecasts
Impact and Sensitivity Analysis

Policy and Business Decision Making

REFERENCES AND SOURCES OF INFORMATION

Agriculture Canada
American Iron and Steel Institute, U.S.
Canada Grains Council
Canada Ports Corporation
Canadian Grain Commission
Canadian Wheat Board
Energy Mines and Resources Canada
Ghonima, H. The Seaway Economic Planning System (SEPS-CMP), CTRF, Jasper, Alberta, Canada 1984. Institute for Iron and Steel Studies, U.S.
International Monetary Fund (IMF)
International Wheat Council (IWC)
Iron Ore Association, U.S.
Lake Carriers' Association, U.S.
Organization for Economic Co-operation and Development (OECD)
Shipping Federation of Canada, (the)
St. Lawrence Seaway Authority, (the), Canada
Statistics Canada
Skillings Mining Review, U.S.
TAF Consultants, Canada
Transport Canada
U.S. Dept. of Agriculture
U.S. Dept. of Army Corps of Engineers
U.S. Dept. of Commerce
U.S. Dept. of Energy
U.S. Dept. of Mines
U.S. Dept. of Transportation
United Nations (UN)
World Bank
Microsoft Windows is a trade mark of Microsoft Corporation.

Back to Top

Copyright © 1997 TAF Consultants™. All rights reserved.
Information in this document is secured from sources believed reliable and due care is taken in preparation, but accuracy and completeness cannot be guaranteed. The opinions expressed in this paper are not necessarily the opinions TAF Consultants. Other products and companies referred to herein are trademarks or registered trademarks of their respective companies or mark holders.
Revised: May 06, 2009