School Reform: A New Report Card for Service Levels

Written by Gil Lamphere
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The time has come. Parents (Shareholders), Teachers (CEOs), Principals (Board of Directors), Students (Railroad Managements), and Boards of Education (STB) need a more descriptive report card—and the latter may demand it.

Students currently achieve and report raw numbers for increase/decrease in train speed, dwell time and cars on line. But the numbers and categories are virtually meaningless to Parents.

Parents want on-time arrival information for merchandise and intermodal because reliability is vital to the future growth of railroading. Teachers and Parents want to know if they can rely on Students and whether they are doing their best.

CSX discloses on-time arrivals and originations. They even were the first and only railroad to use carload trip plans, not just train arrivals. Hunter Harrison and Jim Foote were never afraid to set an achievement bar and disclose “How Are We Doing?”

Other Teachers often claim arrival times are too prone to manipulation, subjectivity, numerous assumptions and “special conditions.” What if Teachers swallowed their pride and disclosed to Parents, Principals and the Board of Education how reliable and trustworthy Students are?

For example, take CSX’s recent numbers:

  • On-Time Originations: 65%
  • On-Time Arrivals: 57%
  • Carload Trip Plan Performance: 64%
  • Intermodal Trip Plan Performance: 87%

Parents want this full information, perhaps graded as follows:

CSX gets a B+ for intermodal. Management freely admits they must do better, or else intermodal will not gain market share or grow as rapidly as the railroad needs. CSX gets Ds and an F for other measures. Management acknowledges that these must turn around ASAP.

Keep in mind that these aren’t even AP (Advanced Placement) courses. CSX has been taking PSR as a basic course for years.

CSX gets an A for having the guts to disclose the information. Don’t the CEOs, railroad managements, shareholders and boards of directors want to take ownership of this key data? If we grade kids, we ought to be able to grade ourselves. An honor roll gives valuable feedback to everybody. It’s time that more categories need disclosure, a grade and a description.

Establish a Harriman Award for service?

Gil Lamphere, Chairman of MidRail LLC, has several decades of experience as a principal investor and financier in rail industry and other private equity transactions. He has headed four private equity firms and has extensive operational experience as a Chairman and/or board member for a wide range of publicly traded and private companies. Lamphere is the former Chairman of the Illinois Central Railway, Co-Founder of MidSouth Rail Corporation and former board member of CN (Chair of the Finance Committee and a member of the Compensation, Investment, and Audit committees), CSX (Operations, Finance, Compensation, and Public Affairs committees), and Florida East Coast Railway. He led teams and boards that bought, managed and changed operations at Illinois Central, MidSouth, CN, Florida East Coast and Southern Pacific, with alumni leading Canadian Pacific, creating gains for investors in excess of $2 billion.