Applying the Total Quality Management Method in ICT Business

Kokonaisvaltaisen laatujohtamisen malli TQM (Total Quality Management) on noussut yhdeksi merkittävimmistä konsepteista globaalissa liiketoiminnassa, missä laatu on tärkeä kilpailutekijä. Tämä diplomityö pureutuu nykyaikaiseen kokonaisvaltaisen laatujohtamisen konseptiin, joka nostaa perinteisen laatuajattelun uudelle tasolle. Moderni laatujohtamisajattelu on kasvanut koskemaan yrityksen toiminnan kaikkia osa-alueita. Työn tavoitteena on TietoEnator Käsittely ja Verkkopalvelut liiketoiminta-alueen osalta laadun sekä liiketoiminnallisen suorituskyvyn parantaminen kokonaisvaltaisesti. Ennen varsinaisen laatujohtamis-konseptin käsittelyä työ esittelee ensin yleisellä tasolla perinteistä laatu käsitettä sekä käsittelee lyhyestiICT-liiketoimintaa ja siihen liittyviä standardeja. Lopuksi tutkimus esittelee priorisoituja parannusehdotuksia ja askeleita jotka auttavat organisaatiota saavuttamaan kokonaisvaltaisen laatujohtamiskonseptin mukaisia pyrkimyksiä.

A Feasibility Study of a Pelleting Plant as an Option for By Product Upgrading in Wood-Processing Industry

Tämän kannattavuustutkimuksen lähtökohtana oli se, että Yhtyneet Sahat Oy:n Kaukaan sahalla ja Luumäen jatkojalostuslaitoksella haluttiin selvittää pellettitehtaan kannattavuus nykyisessä markkinatilanteessa. Tämä työon luonteeltaan teknis-taloudellinen selvitys eli ns. feasibility study. Pelletöintiprosessi on tekniikaltaan yksinkertainen eikä edellytä korkea teknologian laitteita. Toimiala on maailmanlaajuisesti varsin uusi. Suomessa pellettimarkkinat ovat vielä pienet ja kehittymättömät, mutta kasvua on viime vuosina tapahtunut. Valtaosa kotimaan tuotannosta menee vientiin. Investoinnin laskentaprosessissa saadut tuotannon alkuarvot sekä kustannusrakenteen määrittelyt ovat perustana varsinaisille kannattavuuslaskelmille. Laskelmista on selvitetty investointeihin liittyvät yleisimmät taloudelliset tunnusluvut ja herkimpiä muuttujia on tutkittu ja pohdittu herkkyysanalyysiä apuna käyttäen.

Level Set Methods in Image Processing

This thesis gives an overview of the use of the level set methods in the field of image science. The similar fast marching method is discussed for comparison, also the narrow band and the particle level set methods are introduced. The level set method is a numerical scheme for representing, deforming and recovering structures in an arbitrary dimensions. It approximates and tracks the moving interfaces, dynamic curves and surfaces. The level set method does not define how and why some boundary is advancing the way it is but simply represents and tracks the boundary. The principal idea of the level set method is to represent the N dimensional boundary in the N+l dimensions. This gives the generality to represent even the complex boundaries. The level set methods can be powerful tools to represent dynamic boundaries, but they can require lot of computing power. Specially the basic level set method have considerable computational burden. This burden can be alleviated with more sophisticated versions of the level set algorithm like the narrow band level set method or with the programmable hardware implementation. Also the parallel approach can be used in suitable applications. It is concluded that these methods can be used in a quite broad range of image applications, like computer vision and graphics, scientific visualization and also to solve problems in computational physics. Level set methods and methods derived and inspired by it will be in the front line of image processing also in the future.

On-line –jatkojalostuksen integrointi mäntysahan tuotantoprosessiin

Diplomityön tavoitteena oli selvittää erilaisia jatkojalostusmahdollisuuksia, joilla voidaan nostaa suuren mäntysahan tuotteiston arvoa. Lisäksi tuli tarkastella jalostuksen integrointia sahan tuotantoprosessiin. Työn taustalla on toisaalta puutuotemarkkinoiden muuttuminen ja toisaalta raaka-aineen laadullinen huononeminen. Molemmat seikat vaikuttavat negatiivisesti perinteisen mäntysahan kannattavuuteen .Jatkojalostuksen integroinnilla sahatavaraprosessiin saavutetaan säästöjä tuotantokustannuksissa, kun tarkastellaan koko prosessia tukista jatkojalosteeksi. Myös raaka-aineen tuottavuutta voidaan nostaa integraation avulla. Jatkojalostus voidaan integroida sahatavaraprosessiin raaka-aineen valikoinnilla sahatavaraprosessin eri osissa, on-line –jalostuksella sekä taloudellisesti. Sahatavaraprosessissa tapahtuva raaka-aineen valikointi voidaan suorittaa tukeista ja sahatavarasta. Valikointikriteerinä voi olla puun ominaisuudet, sahatavaran mitat ja laatu. Valikointiin voidaan nykyteknologiasta hyödyntää röntgentekniikkaa sekä konenäköä. On-line –jalostus tarkoittaa kiinteästi sahatavaraprosessiin liittyvää jalostusta, jolloin ns. turhia prosessivaiheita jää pois ja syntyy säästöjä. On-line –jalostuksen edellytys on raaka-aineen jonkin asteinen valikointi, esim. pituus. Taloudellisesti integroitu jalostus tarkoittaa, että jalostuslaitoksella pyritään nollatulokseen ja jalostuksen lisäarvo palautetaan sahan toimittamaan raaka-aineen hintaan. Tällainen toiminta yhtiön sisällä poistaa turhaa keskustelua raaka-aineen siirtohinnoista ja siten vapauttaa osaltaan resursseja tuottavampaan toimintaan. Erilaisten jatkojalostusmuotojen ja puun ominaisuuksien hyödyntämisen seulonnan perusteella löytyi yksi jalostusmuoto, jolla voidaan kohottaa mäntysahan tuotteiston arvoa. Työn tuloksena syntyi investointiehdotus aihiotankotuotannosta ikkunateollisuuden tarpeisiin. Raaka-aineen hyödynnettäviä ominaisuuksia ovat männyn sydänpuun luonnollinen kestävyys sekä keskimääräinen oksaväli. Valikointi tehdään välitukeista, joiden sahaamisen kannattavuus on männyn rungon osista heikoin. Aihiotankoprosessissa hyödynnetään konenäköä ja sormijatkostekniikkaa. Jatkojalostuksen integrointi sahatavaraprosessiin toteutetaan rakentamalla on-line –jalostuslaitos sekä soveltamalla röntgentekniikkaa raaka-aineen valinnassa.

Electric field calibration method for scanning electron microscope

This paper proposes a calibration method which can be utilized for the analysis of SEM images. The field of application of the developed method is a calculation of surface potential distribution of biased silicon edgeless detector. The suggested processing of the data collected by SEM consists of several stages and takes into account different aspects affecting the SEM image. The calibration method doesn’t pretend to be precise but at the same time it gives the basics of potential distribution when the different biasing voltages applied to the detector.

Electrical Equivalent Circuit for Dry Bacteriorhodopsin Sensor

Bacteriorhodopsin (BR) is a photosensitive protein which functions as a light-driven proton pump. Due to its photoactivity, BR could be used in photosensing and information processing which has inspired researchers to study the photoelectric response and the appropriate measurement instrumentation for BR. In this thesis, the measurement instrumentation connected to a dry BR sensor was confirmed to affect the photovoltage response measured by using voltage amplifiers. Changing of the input impedance of the measurement instrumentation was shown to alter a part of the measured photovoltage response. The photocurrent measurements using transimpedance amplifier and the presented electrical equivalent circuit were used to show that the photocurrent measurements have no significant effect on the photoelectric response. The photocurrent was shown to be a derivate of the photovoltage response measured from the dry BR sensor when it was compared to the response measured with a voltage amplifier. This confirmed that another part of the photovoltage response was not affected by the measurement instrumentation. The time-variant behavior of the dry BR sensor was confirmed in both the photocurrent and the photovoltage measurements. This was caused by the fact that the capacitance of the dry BR sensor changes with the excitation light intensity.

Application of capillary electrophoretic methods for determining carbohydrates and aliphatic carboxylic acids formed during wood processing

Knowledge of the behaviour of cellulose, hemicelluloses, and lignin during wood and pulp processing is essential for understanding and controlling the processes. Determination of monosaccharide composition gives information about the structural polysaccharide composition of wood material and helps when determining the quality of fibrous products. In addition, monitoring of the acidic degradation products gives information of the extent of degradation of lignin and polysaccharides. This work describes two capillary electrophoretic methods developed for the analysis of monosaccharides and for the determination of aliphatic carboxylic acids from alkaline oxidation solutions of lignin and wood. Capillary electrophoresis (CE), in its many variants is an alternative separation technique to chromatographic methods. In capillary zone electrophoresis (CZE) the fused silica capillary is filled with an electrolyte solution. An applied voltage generates a field across the capillary. The movement of the ions under electric field is based on the charge and hydrodynamic radius of ions. Carbohydrates contain hydroxyl groups that are ionised only in strongly alkaline conditions. After ionisation, the structures are suitable for electrophoretic analysis and identification through either indirect UV detection or electrochemical detection. The current work presents a new capillary zone electrophoretic method, relying on in-capillary reaction and direct UV detection at the wavelength of 270 nm. The method has been used for the simultaneous separation of neutral carbohydrates, including mono- and disaccharides and sugar alcohols. The in-capillary reaction produces negatively charged and UV-absorbing compounds. The optimised method was applied to real samples. The methodology is fast since no other sample preparation, except dilution, is required. A new method for aliphatic carboxylic acids in highly alkaline process liquids was developed. The goal was to develop a method for the simultaneous analysis of the dicarboxylic acids, hydroxy acids and volatile acids that are oxidation and degradation products of lignin and wood polysaccharides. The CZE method was applied to three process cases. First, the fate of lignin under alkaline oxidation conditions was monitored by determining the level of carboxylic acids from process solutions. In the second application, the degradation of spruce wood using alkaline and catalysed alkaline oxidation were compared by determining carboxylic acids from the process solutions. In addition, the effectiveness of membrane filtration and preparative liquid chromatography in the enrichment of hydroxy acids from black liquor was evaluated, by analysing the effluents with capillary electrophoresis.

Customer knowledge processing in maintenance business: case study

The purpose of the study is to examine and increase knowledge on customer knowledge processing in B2B context from sales perspective. Further objectives include identifying possible inhibiting and enabling factors in each phase of the process. The theoretical framework is based on customer knowledge management literature. The study is a qualitative study, in which the research method utilized is a case study. The empirical part was implemented in a case company by conducting in-depth interviews with the company’s value-selling champions located internationally. Context was maintenance business. Altogether 17 interviews were conducted. The empirical findings indicate that customer knowledge processing has not been clearly defined within the maintenance business line. Main inhibiting factors in acquiring customer knowledge are lack of time and vast amount of customer knowledge received. Enabling factors recognized are good customer relationships and sales representatives’ communication skills. Internal dissemination of knowledge is mainly inhibited by lack of time and restrictions in customer relationship management systems. Enabling factors are composition of the sales team and updated customer knowledge. Inhibiting utilization is lack of goals to utilize the customer knowledge and a low quality of the knowledge. Moreover, customer knowledge is not systematically updated nor analysed. Management of customer knowledge is based on the CRM system. As implications of the study, it is suggested for the case company to define customer knowledge processing in order to support maintenance business process.

Local Features in Image and Video Processing - Object Class Matching and Video Shot Detection

The usage of digital content, such as video clips and images, has increased dramatically during the last decade. Local image features have been applied increasingly in various image and video retrieval applications. This thesis evaluates local features and applies them to image and video processing tasks. The results of the study show that 1) the performance of different local feature detector and descriptor methods vary significantly in object class matching, 2) local features can be applied in image alignment with superior results against the state-of-the-art, 3) the local feature based shot boundary detection method produces promising results, and 4) the local feature based hierarchical video summarization method shows promising new new research direction. In conclusion, this thesis presents the local features as a powerful tool in many applications and the imminent future work should concentrate on improving the quality of the local features.

Algorithmic Techniques in Gene Expression Processing. From Imputation to Visualization

The amount of biological data has grown exponentially in recent decades. Modern biotechnologies, such as microarrays and next-generation sequencing, are capable to produce massive amounts of biomedical data in a single experiment. As the amount of the data is rapidly growing there is an urgent need for reliable computational methods for analyzing and visualizing it. This thesis addresses this need by studying how to efficiently and reliably analyze and visualize high-dimensional data, especially that obtained from gene expression microarray experiments. First, we will study the ways to improve the quality of microarray data by replacing (imputing) the missing data entries with the estimated values for these entries. Missing value imputation is a method which is commonly used to make the original incomplete data complete, thus making it easier to be analyzed with statistical and computational methods. Our novel approach was to use curated external biological information as a guide for the missing value imputation. Secondly, we studied the effect of missing value imputation on the downstream data analysis methods like clustering. We compared multiple recent imputation algorithms against 8 publicly available microarray data sets. It was observed that the missing value imputation indeed is a rational way to improve the quality of biological data. The research revealed differences between the clustering results obtained with different imputation methods. On most data sets, the simple and fast k-NN imputation was good enough, but there were also needs for more advanced imputation methods, such as Bayesian Principal Component Algorithm (BPCA). Finally, we studied the visualization of biological network data. Biological interaction networks are examples of the outcome of multiple biological experiments such as using the gene microarray techniques. Such networks are typically very large and highly connected, thus there is a need for fast algorithms for producing visually pleasant layouts. A computationally efficient way to produce layouts of large biological interaction networks was developed. The algorithm uses multilevel optimization within the regular force directed graph layout algorithm.

Local Binary Patterns in Focal-Plane Processing. Analysis and Applications

Feature extraction is the part of pattern recognition, where the sensor data is transformed into a more suitable form for the machine to interpret. The purpose of this step is also to reduce the amount of information passed to the next stages of the system, and to preserve the essential information in the view of discriminating the data into different classes. For instance, in the case of image analysis the actual image intensities are vulnerable to various environmental effects, such as lighting changes and the feature extraction can be used as means for detecting features, which are invariant to certain types of illumination changes. Finally, classification tries to make decisions based on the previously transformed data. The main focus of this thesis is on developing new methods for the embedded feature extraction based on local non-parametric image descriptors. Also, feature analysis is carried out for the selected image features. Low-level Local Binary Pattern (LBP) based features are in a main role in the analysis. In the embedded domain, the pattern recognition system must usually meet strict performance constraints, such as high speed, compact size and low power consumption. The characteristics of the final system can be seen as a trade-off between these metrics, which is largely affected by the decisions made during the implementation phase. The implementation alternatives of the LBP based feature extraction are explored in the embedded domain in the context of focal-plane vision processors. In particular, the thesis demonstrates the LBP extraction with MIPA4k massively parallel focal-plane processor IC. Also higher level processing is incorporated to this framework, by means of a framework for implementing a single chip face recognition system. Furthermore, a new method for determining optical flow based on LBPs, designed in particular to the embedded domain is presented. Inspired by some of the principles observed through the feature analysis of the Local Binary Patterns, an extension to the well known non-parametric rank transform is proposed, and its performance is evaluated in face recognition experiments with a standard dataset. Finally, an a priori model where the LBPs are seen as combinations of n-tuples is also presented

Feasibility of industrial implementation of laser cutting into paper making machine

Laser cutting implementation possibilities into paper making machine was studied as the main objective of the work. Laser cutting technology application was considered as a replacement tool for conventional cutting methods used in paper making machines for longitudinal cutting such as edge trimming at different paper making process and tambour roll slitting. Laser cutting of paper was tested in 70’s for the first time. Since then, laser cutting and processing has been applied for paper materials with different level of success in industry. Laser cutting can be employed for longitudinal cutting of paper web in machine direction. The most common conventional cutting methods include water jet cutting and rotating slitting blades applied in paper making machines. Cutting with CO2 laser fulfils basic requirements for cutting quality, applicability to material and cutting speeds in all locations where longitudinal cutting is needed. Literature review provided description of advantages, disadvantages and challenges of laser technology when it was applied for cutting of paper material with particular attention to cutting of moving paper web. Based on studied laser cutting capabilities and problem definition of conventional cutting technologies, preliminary selection of the most promising application area was carried out. Laser cutting (trimming) of paper web edges in wet end was estimated to be the most promising area where it can be implemented. This assumption was made on the basis of rate of web breaks occurrence. It was found that up to 64 % of total number of web breaks occurred in wet end, particularly in location of so called open draws where paper web was transferred unsupported by wire or felt. Distribution of web breaks in machine cross direction revealed that defects of paper web edge was the main reason of tearing initiation and consequent web break. The assumption was made that laser cutting was capable of improvement of laser cut edge tensile strength due to high cutting quality and sealing effect of the edge after laser cutting. Studies of laser ablation of cellulose supported this claim. Linear energy needed for cutting was calculated with regard to paper web properties in intended laser cutting location. Calculated linear cutting energy was verified with series of laser cutting. Practically obtained laser energy needed for cutting deviated from calculated values. This could be explained by difference in heat transfer via radiation in laser cutting and different absorption characteristics of dry and moist paper material. Laser cut samples (both dry and moist (dry matter content about 25-40%)) were tested for strength properties. It was shown that tensile strength and strain break of laser cut samples are similar to corresponding values of non-laser cut samples. Chosen method, however, did not address tensile strength of laser cut edge in particular. Thus, the assumption of improving strength properties with laser cutting was not fully proved. Laser cutting effect on possible pollution of mill broke (recycling of trimmed edge) was carried out. Laser cut samples (both dry and moist) were tested on the content of dirt particles. The tests revealed that accumulation of dust particles on the surface of moist samples can take place. This has to be taken into account to prevent contamination of pulp suspension when trim waste is recycled. Material loss due to evaporation during laser cutting and amount of solid residues after cutting were evaluated. Edge trimming with laser would result in 0.25 kg/h of solid residues and 2.5 kg/h of lost material due to evaporation. Schemes of laser cutting implementation and needed laser equipment were discussed. Generally, laser cutting system would require two laser sources (one laser source for each cutting zone), set of beam transfer and focusing optics and cutting heads. In order to increase reliability of system, it was suggested that each laser source would have double capacity. That would allow to perform cutting employing one laser source working at full capacity for both cutting zones. Laser technology is in required level at the moment and do not require additional development. Moreover, capacity of speed increase is high due to availability high power laser sources what can support the tendency of speed increase of paper making machines. Laser cutting system would require special roll to maintain cutting. The scheme of such roll was proposed as well as roll integration into paper making machine. Laser cutting can be done in location of central roll in press section, before so-called open draw where many web breaks occur, where it has potential to improve runability of a paper making machine. Economic performance of laser cutting was done as comparison of laser cutting system and water jet cutting working in the same conditions. It was revealed that laser cutting would still be about two times more expensive compared to water jet cutting. This is mainly due to high investment cost of laser equipment and poor energy efficiency of CO2 lasers. Another factor is that laser cutting causes material loss due to evaporation whereas water jet cutting almost does not cause material loss. Despite difficulties of laser cutting implementation in paper making machine, its implementation can be beneficial. The crucial role in that is possibility to improve cut edge strength properties and consequently reduce number of web breaks. Capacity of laser cutting to maintain cutting speeds which exceed current speeds of paper making machines what is another argument to consider laser cutting technology in design of new high speed paper making machines.

Functionalisation of spruce O-acetyl-galactoglucomannans for barrier and composite applications

The increasing use of energy, food, and materials by the growing population in the world is leading to the situation where alternative solutions from renewable carbon resources are sought after. The growing use of plastics depends on the raw-oil production while oil refining are politically governed and required for the polymer manufacturing is not sustainable in terms of carbon footprint. The amount of packaging is also increasing. Packaging is not only utilising cardboard and paper, but also plastics. The synthetic petroleum-derived plastics and inner-coatings in food packaging can be substituted with polymeric material from the renewable resources. The trees in Finnish forests constitute a huge resource, which ought to be utilised more effectively than it is today. One underutilised component of the forests is the wood-derived hemicelluloses, although Spruce Oacetyl-galactoglucomannans (GGMs) have previously shown high potential for material applications and can be recovered in large scale. Hemicelluloses are hydrophilic in their native state, which restrains the use of them for food packaging as non-dry item. To cope with this challenge, we intended to make GGMs more hydrophobic or amphiphilic by chemical grafting and consequently with the focus of using them for barrier applications. Methods of esterification with anhydrides and cationic etherification with a trimethyl ammonium moiety were established. A method of controlled synthesis to obtain the desired properties by the means of altering temperature, reaction time, the quantity of the reagent, and even the solvent for purification of the products was developed. Numerous analytical tools, such as NMR, FTIR, SEC-MALLS/RI, MALDI-TOF-MS, RP-HPLC and polyelectrolyte titration were used to evaluate the products from different perspectives and to acquire parallel proofs of their chemical structure. Modified GGMs with different degree of substitution and the correlating level of hydrophobicity was applied as coatings on cartonboard and on nanofibrillated cellulose-GGM films to exhibit barrier functionality. The water dispersibility in processing was maintained with GGM esters with low DS. The use of chemically functionalised GGM was evaluated for the use as barriers against water, oxygen and grease for the food packaging purposes. The results show undoubtedly that GGM derivatives exhibit high potential to function as a barrier material in food packaging.

Comparing the alternative utilization method for coconut in Nzema, Ghana

There are many opportunities to utilise coconut in Nzema to support farmers. Coconut oil that is mainly used for food preparation in Nzema can be utilized as fuel to support overcoming of the energy crisis in the Ghana. Coconut oil in Nzema is not used in both transportation and electricity generation. A few of the waste husk and shell are mainly used as fuel in homes for heating but greater amount is left to rot or burn the coconut plantation. In addition, some portion of the granulated coconut kernel is sometime used as feed for piggery feed and the rest of the granulated kernel are left as waste on the oil processing site. In this thesis, the author identified alternative utilization of cocoanut, for instance the use of coconut husk and shell for charcoal production, and the use of coconut trunks as construction materials. It is envisaged that exploring these alternatives will not only reduce carbon emission in the country but will also contribute significantly to the sustainability of the local agro-industry.

Public-private partnership investments in dry ports – Russian logistics markets and risks

The investments have always been considered as an essential backbone and so-called ‘locomotive’ for the competitive economies. However, in various countries, the state has been put under tight budget constraints for the investments in capital intensive projects. In response to this situation, the cooperation between public and private sector has grown based on public-private mechanism. The promotion of favorable arrangement for collaboration between public and private sectors for the provision of policies, services, and infrastructure in Russia can help to address the problems of dry ports development that neither municipalities nor the private sector can solve alone. Especially, the stimulation of public-private collaboration is significant under the exposure to externalities that affect the magnitude of the risks during all phases of project realization. In these circumstances, the risk in the projects also is becoming increasingly a part of joint research and risk management practice, which is viewed as a key approach, aiming to take active actions on existing global and specific factors of uncertainties. Meanwhile, a relatively little progress has been made on the inclusion of the resilience aspects into the planning process of a dry ports construction that would instruct the capacity planner, on how to mitigate the occurrence of disruptions that may lead to million dollars of losses due to the deviation of the future cash flows from the expected financial flows on the project. The current experience shows that the existing methodological base is developed fragmentary within separate steps of supply chain risk management (SCRM) processes: risk identification, risk evaluation, risk mitigation, risk monitoring and control phases. The lack of the systematic approach hinders the solution of the problem of risk management processes of dry port implementation. Therefore, management of various risks during the investments phases of dry port projects still presents a considerable challenge from the practical and theoretical points of view. In this regard, the given research became a logical continuation of fundamental research, existing in the financial models and theories (e.g., capital asset pricing model and real option theory), as well as provided a complementation for the portfolio theory. The goal of the current study is in the design of methods and models for the facilitation of dry port implementation through the mechanism of public-private partnership on the national market that implies the necessity to mitigate, first and foremost, the shortage of the investments and consequences of risks. The problem of the research was formulated on the ground of the identified contradictions. They rose as a continuation of the trade-off between the opportunities that the investors can gain from the development of terminal business in Russia (i.e. dry port implementation) and risks. As a rule, the higher the investment risk, the greater should be their expected return. However, investors have a different tolerance for the risks. That is why it would be advisable to find an optimum investment. In the given study, the optimum relates to the search for the efficient portfolio, which can provide satisfaction to the investor, depending on its degree of risk aversion. There are many theories and methods in finance, concerning investment choices. Nevertheless, the appropriateness and effectiveness of particular methods should be considered with the allowance of the specifics of the investment projects. For example, the investments in dry ports imply not only the lump sum of financial inflows, but also the long-term payback periods. As a result, capital intensity and longevity of their construction determine the necessity from investors to ensure the return on investment (profitability), along with the rapid return on investment (liquidity), without precluding the fact that the stochastic nature of the project environment is hardly described by the formula-based approach. The current theoretical base for the economic appraisals of the dry port projects more often perceives net present value (NPV) as a technique superior to other decision-making criteria. For example, the portfolio theory, which considers different risk preference of an investor and structures of utility, defines net present value as a better criterion of project appraisal than discounted payback period (DPP). Meanwhile, in business practice, the DPP is more popular. Knowing that the NPV is based on the assumptions of certainty of project life, it cannot be an accurate appraisal approach alone to determine whether or not the project should be accepted for the approval in the environment that is not without of uncertainties. In order to reflect the period or the project’s useful life that is exposed to risks due to changes in political, operational, and financial factors, the second capital budgeting criterion – discounted payback period is profoundly important, particularly for the Russian environment. Those statements represent contradictions that exist in the theory and practice of the applied science. Therefore, it would be desirable to relax the assumptions of portfolio theory and regard DPP as not fewer relevant appraisal approach for the assessment of the investment and risk measure. At the same time, the rationality of the use of both project performance criteria depends on the methods and models, with the help of which these appraisal approaches are calculated in feasibility studies. The deterministic methods cannot ensure the required precision of the results, while the stochastic models guarantee the sufficient level of the accuracy and reliability of the obtained results, providing that the risks are properly identified, evaluated, and mitigated. Otherwise, the project performance indicators may not be confirmed during the phase of project realization. For instance, the economic and political instability can result in the undoing of hard-earned gains, leading to the need for the attraction of the additional finances for the project. The sources of the alternative investments, as well as supportive mitigation strategies, can be studied during the initial phases of project development. During this period, the effectiveness of the investments undertakings can also be improved by the inclusion of the various investors, e.g. Russian Railways’ enterprises and other private companies in the dry port projects. However, the evaluation of the effectiveness of the participation of different investors in the project lack the methods and models that would permit doing the particular feasibility study, foreseeing the quantitative characteristics of risks and their mitigation strategies, which can meet the tolerance of the investors to the risks. For this reason, the research proposes a combination of Monte Carlo method, discounted cash flow technique, the theory of real options, and portfolio theory via a system dynamics simulation approach. The use of this methodology allows for comprehensive risk management process of dry port development to cover all aspects of risk identification, risk evaluation, risk mitigation, risk monitoring, and control phases. A designed system dynamics model can be recommended for the decision-makers on the dry port projects that are financed via a public-private partnership. It permits investors to make a decision appraisal based on random variables of net present value and discounted payback period, depending on different risks factors, e.g. revenue risks, land acquisition risks, traffic volume risks, construction hazards, and political risks. In this case, the statistical mean is used for the explication of the expected value of the DPP and NPV; the standard deviation is proposed as a characteristic of risks, while the elasticity coefficient is applied for rating of risks. Additionally, the risk of failure of project investments and guaranteed recoupment of capital investment can be considered with the help of the model. On the whole, the application of these modern methods of simulation creates preconditions for the controlling of the process of dry port development, i.e. making managerial changes and identifying the most stable parameters that contribute to the optimal alternative scenarios of the project realization in the uncertain environment. System dynamics model allows analyzing the interactions in the most complex mechanism of risk management process of the dry ports development and making proposals for the improvement of the effectiveness of the investments via an estimation of different risk management strategies. For the comparison and ranking of these alternatives in their order of preference to the investor, the proposed indicators of the efficiency of the investments, concerning the NPV, DPP, and coefficient of variation, can be used. Thus, rational investors, who averse to taking increased risks unless they are compensated by the commensurate increase in the expected utility of a risky prospect of dry port development, can be guided by the deduced marginal utility of investments. It is computed on the ground of the results from the system dynamics model. In conclusion, the outlined theoretical and practical implications for the management of risks, which are the key characteristics of public-private partnerships, can help analysts and planning managers in budget decision-making, substantially alleviating the effect from various risks and avoiding unnecessary cost overruns in dry port projects.