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Six Essentials for Railroad Growth RSMA Soft Cover 1966 Railway Systems and Mana
Six Essentials for Railroad Growth RSMA Soft Cover 1966 Railway Systems and Management Association Approx 125 pages
There is no such thing as a growth industry per se. There are only companies organized and operated to create and capitalize on growth opportunities. There are hopeful signs of increased opportunities for railroad growth. Since 1930 there has been a steady reduction in the railways' share of all intercity freight. However, the percentage share participated in by the railways has now indicated a leveling trend. It should not necessarily be imagined that the interruption of the downward trend means that the railways are soon going to recapture the lost traffic.
While each speaker or group will address itself to a particular subject, it should be kept in mind that all of these essentials are interrelated. One affects and is affected by one or more of the other essentials.
I would like to merely mention these six essentials, not necessarily in the order of their importance, and make a brief comment on them for orientation so that they may be kept before you during the coming three days.
The first essential in our theme is New Equipment. A total of $1,140 million, or 80%, of 1964's railway investment outlay went for equipment, nearly half again as much as the $785 million spent for equipment in 1963. A new second generation of diesel locomotives is on the rails.
I think it is important to note, and I am sure you are well aware that the most significant feature of new freight equipment is that it has been customer oriented or, to use the more general term, a large portion of the expenditure has been for special purpose cars. A total of 232,254 cars, or 27% of all coal car-loadings for two recent four-week periods, were hauled in unit trains. Future railroad growth will be affected by our ability to provide more and more equipment tailored to customer needs for the purpose of reducing his distribution costs. The day has passed when we can acquire new equipment without first going to the customer to determine whether or not the rolling stock is satisfactory to him.
The second essential is that of Organization. We must be organized in such a way that we can effectively manage and take advantage of the growth foreseen. It appears that the most significant change in organization is that of the sales force. Several roads have revamped the organization of their sales department, organizing them along industrial lines rather than along the lines of geographic territory. Again, the purpose of this reorganization is to better service the customer. Additionally, I feel that there is going to be a further centralization of control over the scheduling of train movements and the distribution of cars for loading. We presently have men working in transportation departments who maintain system control over fleets of specialized equipment so as to achieve maximum utilization. There will be a further centralization in other areas so as to make more intensive use of all facilities. Then, too, we must develop a quality control system that will measure the degree to which we are fulfilling the customer's requirements.
The mergers that have taken place over the last few years, and those under consideration, indicate the need to streamline our organization and get rid of the "fat" in the railway transportation system so that it can be geared for future needs.
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