ECONOMIC MODEL OF SUSTAINABLE VALUE CHAIN IN PASSENGER WATERWAY TRANSPORTATION SERVICE

Back to Page Authors: Maisa Sales Gama Tobias, Paulo Sérgio Lima Pereira Afonso

Keywords: value chain, sustainability, waterway transportation, cost management, cost model

Abstract: The service of passenger waterway transportation lacks economic models that help in designing and implementing strategies to ensure its sustainability in several aspects (economic, social and environmental). The size of costs, though not the only one, is of particular importance in these models. However, traditionally, cost management has been focused only on reducing production costs, for the purpose of companies to keep prices low and gain market competitiveness. Although, with all the technological advances, and other restrictions imposed by the market in terms of service, in the case of passengers waterway transportation: intermodal competition; quality of service; or by regulatory environment for public concession and; in the aspect of business: to stay in the market with natural, demand and institutional restrictions, this view is not enough. Thus, there is an evolution of a traditional cost accounting to strategic cost management. On the other hand, it is important to consider other important dimensions and recognize that companies no longer exist in isolation, but they are part of highly integrated value and supplies chains. Therefore, this work will explore and analyze the sustainable value chain of passenger waterway transportation service using the tools of strategic cost management. The method will start from three components of analysis: (1) definition of basic elements of sustainable value chain; (2) identification of main restrictions to the chain development and aspects critical for service sustainability; (3) development of a cost model and propositions to overcome the bottlenecks found, to add value. Whether in the internal cost structure of the company; operational cost reduction strategies; in search of new markets, or to establish new partnerships or even; in the broadest level, in terms of investments in infrastructure or recommendations involving governance decisions to improve the current institutional environment. The case study will be developed in passenger transport companies located in the Lower Amazon, consolidated in this market, with defined enterprise structure of business sustainability, and who have already been willing to collaborate with the investigation. As results, it is expected to understand the cost structures that support sustainable value chains, namely, costs of activities and relevant cost objects in order to determine the cost drivers, profitability margins, cost reduction opportunities and conditions conducive to competitive advantages related to the different strategic options to cost leadership, differentiation or approach. Finally, in the model to be developed, the proper characterization of cost structure and value creation in transport processes under study may constitute reference points for future more sophisticated applied works of optimizing the resources involved and supporting the decision making, in particular with regard to operations research and quantitative methods more robust.