The Effects Of Port Security Compliance On The Competitiveness Of European Union Maritime Industry Firms

Abstract

ABSTRACT The Effects Of Port Security Compliance On The Competitiveness Of European Union Maritime Industry Firms. (May 2013)

Jonathan Stone Department of Maritime Administration Texas A&M University

Research Advisor: Dr. Joan Mileski Department of Maritime Administration

Prior research has addressed European Union (EU) water transportation policy and its impact on firm strategy. We extend this research by attempting to measure the effect of port security regulation compliance implementation on the perceived competitiveness of maritime firms located in European Union ports. We ask the question: Can firm specific implementation of required port security compliance enhance or hinder a firm’s competitive advantage? We use Resource-Based Strategic Theory as a framework for evaluating competitiveness. Resource based theory purports that assets and systems can give a firm a competitive advantage if they follow the “VRIN” criteria of Valuable, Rare, Inimitable, and Not easily substitutable. We ask via email and snail mail survey instrument whether certain security assets, resources and systems are “VRIN” and whether these assets, resources and systems give competitive advantage to the firm. The type of resources/assets/systems include physical assets such as fencing; ongoing management assets such as communication systems, planning and structuring management assets such as security planning systems; human assets such as employee knowledge; technological assets such as software protection; intangible assets such as a safety culture and financial assets such as cost savings from security compliance. We administer the instrument to all firms operating in EU ports in 2011-2012. A list of firms is obtained from IHSfairplay Ports and Terminals Guide. The results of the survey shows that most managers do not perceive a competitive advantage was gained in the way security assets/resources/management systems were implemented. However, a strong minority 34.12% of managers did perceive competitive advantage was gained from port security compliance where systems/assets/resources were not easily imitated or the “I.” Furthermore, managers perceive where they were located within the port as an important advantage to security and competitiveness.