Railroads care deeply about service and about intermodal. They know that intermodal is a growth engine and they know that to compete against trucks they must deliver reliable service. Talk to any railroad intermodal executive and you will quickly understand that they are as frustrated with unacceptable service when it occurs as the rest of us and they are working hard to fix things.
So what about precision railroading? Its important to separate the what from the how when you talk about this topic. Precision railroading at its core is changing the mindset of railroad operations from incremental, silo-based decision making to integrated network decision making. It is about understanding the collateral effects of individual decisions (which might seem logical like cancelling a train to save crew costs) on the overall network (when there is no power tomorrow at that train’s destination and we had to dead-head another crew because of train imbalance). It is also about relentlessly attacking variation and that includes customer-driven variation.
Ultimately the goal and the outcome of properly implemented precision railroading is both reduced costs and improved service. Many people find this to be counter intuitive, but time after time as far back in my career as the early ‘90s, railroads have had data and experience that proves that running a scheduled, disciplined network improves velocity and reliability while reducing costs. It’s just taken a long time–and one very determined senior executive–to get enough people to look carefully at the data and change their beliefs.
How it gets implemented is a different topic. It does not need to result in zero notice to customers before critical changes are made, it does not need to result in a total meltdown of operations because of an unrealistic timeline and it does not need to be done in a culture that abandons civility.
It does require changes in customer behavior. Some of the most disruptive variation on the railroad, outside of weather or poor maintenance practices for equipment or track, comes from customer requirements/requests. We have spent the last decade in an era where oversupply has allowed many shippers to ignore how their practices impact the networks of their transportation providers. That has led to shipper practices that include a lack of accurate forecasting, bunching of demand, incurring driver wait times and workweek business hours of operations that combine to contribute to capacity shortages and variability in transit performance. Changing those behaviors could unleash a tremendous amount of capacity into the system and improve delivery performance.
Precision railroading is a bright spot on the horizon. Yes, it will lower costs, but it will also improve service. It will move our railroads from being reactive to proactive. It will generate more interest in looking at the network as a whole and partnering and integrating across silos–customers with providers, railroads with steamship lines, dray and equipment providers and 3PLs–to generate a much bigger reward in the long run for all parties.
We are entering an era of constrained resources with driver shortages, increased regulation and choked infrastructure. As an industry we must look past the walls we all put up between ourselves and figure out how to work together to smooth demand, eliminate variation, attack empty miles and driver wait times, increase velocity and reliability and lower costs. We can do this, and we can do it while cultivating a culture of respect, inclusion and consideration.
We need to change the way we measure service to capture the integrated door-to-door performance rather than measuring discrete pieces of the puzzle. It is counterintuitive that we obsess over a few hours of variation in a train schedule and then let boxes sit on the terminal for days. We need to change our lens and focus on the velocity and reliability of the total system and address the waste and inefficiency in the handoffs. That is what we work on together at IANA.
All of the North American Railroads attended EXPO this year and all are active members of IANA. On average, the railroads brought more people per company than any other group– accounting for 8% of the preregistered individuals while representing only 1.4% of the companies. Railroads continue to contribute to the organization as directors on the IANA Board, participating on committees and task forces, as panelists and speakers and generous sponsors. They are certainly not lacking in interest or influence in our industry. Come join the conversation and be part of making a difference
Adriene B. Bailey is Principal at Brooks Davis Consulting and the Executive Director for Program Development and Curriculum at the Transportation Institute at The University of Denver. She serves on the Board of IANA and is currently its Chairman. Ms. Bailey wrote this in response to a piece on IANA and the state of intermodal that was published in FreightWaves last week.
