How IT is Helping the Railroad Industry Improve Efficiency and Service?
Railroads are poised for a comeback, thanks to rising fuel prices. IT provides the linchpin for a shipping model that integrates ships, trucks and trains.
There's something nostalgic about railroads. The steel tracks that rim the American landscape. The familiar ding-ding-ding as the crossing arm descends andthe freight train passes.
Even executives in the railroad industry recognize that, in some fundamental ways, freight railroads are untouched by time. "It's still steel wheel on steel rail," says Deb Butler, CIO and executive vice president of planning for Norfolk Southern, a company that's 177 years old.
But a funny thing has happened. As the price of diesel fuel soared and highway congestionincreased, new interest sprang up in the old form of transportation. "Shippers had been dubious about rail because it has historically been about moving very large finished goods or commodities in bulk," says David Rutchik, partner with sourcing and supply chain consultancy Pace Harmon.
As big retailers, manufacturers and even trucking companies themselves started scrutinizing their skyrocketingshipping costs, however, railroads began to look more attractive. "It's all about the economic pressure," says Rutchik. Sustainability, too. That old iron horse, chugging along at 49 miles an hour, has suddenly become a "green" option, given its ability to move a ton of freight 423 miles on one gallon of gas.
The increased demand has been good news for railroads in the short term. But long-term,experts say, demand for rail service could outstrip supply to such an extent that rail capacity becomes severely strained and rail shippers profoundly dissatisfied. The key to future growth and customer satisfaction—in addition to laying billions of dollars' worth of new track—will be new IT systems and technology-enabled business processes, which ensure that the railroads operate more efficientlyand predictably.
Rail carriers, anxious to take advantage of growing interest in their intermodal offerings, are investing in systems to become more flexible, improve on-time performance and increase their virtual capacity. Automated gate systems reduce backups at intermodal hubs, while complex trip-planning systems analyze variables, such as crew and locomotive availability and the weather, inorder to reduce bottlenecks on the tracks. The railroads are also updating their tracking systems to provide trailer-level location data and more frequent updates to satisfy a new breed of end customer. Wal-Mart or Kimberly-Clark, for example, wouldn't be satisfied just to know that the train left Seattle on Sunday and is supposed to get to Kansas City on Wednesday.
"The key to growth, servicelevels and getting the most capacity out of the railroad is using information and technology," says Butler. The question waiting around the bend is whether that will be enough.
Tema relacionado: TRANSPORTE FERROVIARIO
Autor: STEPHANIE OVERBY
¿Cómo está ayudando la industria del ferrocarril a mejorar la eficiencia y el servicio?
Los ferrocarriles están listos para el regreso,gracias a los precios de los combustibles. Proporciona a la pieza clave para un modelo de producción que integra los barcos, camiones y trenes.
CIO - Hay algo nostálgico acerca de los ferrocarriles. Las orugas de acero que bordean el paisaje americano. El conocido ding-ding-ding del tren de carga.
Incluso los ejecutivos de la industria del ferrocarril reconocen que en algunos aspectosfundamentales, los ferrocarriles de carga no han sido tocados por el tiempo. "Aún con ruedas de acero sobre rieles de acero", dice Deb Butler, CIO y vicepresidente ejecutivo de planificación de Norfolk Southern, una empresa que es de 177 años de edad.
Pero una cosa curiosa que ha sucedido. A medida que el precio del diesel se dispararon y el aumento de la congestión de la carretera, el nuevo interés...