A strategic decision support tool for shipyard production performance evaluation and support in budgeting for performance improvement

Student thesis: Doctoral Thesis


This research has been motivated by a demand from industry for an efficient decision support tool for shipyards to select and implement the right performance improvement strategies that fit the nature of their own business. This research project has developed a strategic approach, named shipyard production performance management (SPPM), to support shipyards to optimise their performance management strategy. The key functionalities of the algorithm include performance evaluation and budget optimisation for planning the improvement activities. SPPM is designed to evaluate the production performance using an advanced approach based on Key Performance Indicator (KPI) principles. The production performance of the shipyard is reviewed comprehensively from seven aspects, including Health and Safety, economic, environmental, technical, human resource, security and supply chain management. In total, there are 30 KPIs with their calculation details defined to measure the performance from these perspectives. Accordingly, the hotspots can be identified to prioritise the focus for the future improvement. This is not only to select the suitable emerging technology, but also to determine the capital investment required for such activities. How to optimise the budget for performance improvement then becomes the next question for which the shipyards need to find a solution. The budget optimisation function in SPPM has two functions named Performance Based Budgeting (PBB) and Budget Allocation Optimisation (BAO). PBB defines the total budget required with its allocation via adopting the framework of Cooperate Performance Management (CPM), while BAO applies when the total available fund is restricted. Depending on the decision context and data availability, the BAO can be performed by different calculation methods, including multi-criteria decision analysis (MCDA), utility theory and mathematical programming, for which procedures have been developed in this research. The development of SPPM is supported by a comprehensive knowledge-based that contains various well-established theories and models, practical experience shared by shipyards as well as numerous relevant researches in the field. More than just direct usage of this knowledge base, SPPM is the extension and combination of various existing theories or the application of these theories in new fields. Benefited from involvement of the shipyards, the developed algorithm has strong practicality, which has been developed as the extracted essence from intensive researches, taking into account of usefulness in measuring performance of each PPI, the data availability of the input parameters, and the level of acceptability and comprehensibility of the algorithm for users, etc. SPPM evaluate the production performance from multiple angles, such as technical, socioeconomics, sustainability, collaboration with third parties, and all the supportive and administrative activities at the shipyard, etc., and provide step-by-step instruction for the assessment. Besides, this tool has also provided the function that allows centralised performance data management. To sum up from the points above, the SPPM is an innovative and advanced strategic approach that can provide valuable support for the shipyard production performance management.
Date of Award5 May 2022
Original languageEnglish
Awarding Institution
  • University Of Strathclyde
SponsorsUniversity of Strathclyde
SupervisorPeilin Zhou (Supervisor) & Tahsin Tezdogan (Supervisor)

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