Public and Private Sector Interdependence in Freight Transportation Markets (2009) / Chapter Skim
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13 S E C T I O N 2 Freight Transportation Decisions and Considerations
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The connectivity of the infrastructure system is also almost entirely a result of public sector decisions. The adequacy of capacity and the condition and performance of infrastructure are key to public freight transportation decisions.
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Since so much of the infrastructure for freight transportation is shared with passenger transportation, operational and cost assessment considerations unrelated to freight can affect freight transportation decisions. Public sector decisions concerning operations extend beyond the roadway network to airports and waterways.
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Freight transportation company investments can be made in infrastructure and in operations. The mix of infrastructure and operations investments varies widely by mode of transportation depending on how much of the infrastructure used is provided by the public sector.
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Levels of Decision Makers Within the private sector, there are many levels of freight transportation decisions made every day. Decision making in freight transportation businesses commonly extends down from the Board of Directors and the CEO all the way to the individual equipment operator (e.g., the truck driver or boat captain)
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There are significant differences between the private and public sectors with respect to freight transportation that can make the relationships between the two sectors difficult. There is a divergence in attitudes, processes, scale, geography, timing, and objectives that affect how decisions are made.
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The public sector process is thus more time consuming. Private sector decision making is often more focused than public sector decision making on the near term with short-run operating and financial decisions complementing longer-term strategic decisions.
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The remaining economic regulatory functions are carried out within the bounds of the regulatory status quo by public agency staff dedicated and focused on the private freight transportation sector. 8% 10% 12% 14% 1984 1987 1990 1993 1996 1999 2002 2005 2008 Source: Council of Supply Chain Management Professionals, 18th Annual State of Logistics Report Value of U.S.
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Public sector agency resources dedicated to freight transportation in these areas have been limited, because freight transportation has not generally been a high priority. The mismatch between public sector jurisdictional geography and the need to operate across global supply chains in the private sector leads to conflicting objectives.
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