Comments on trains Hunter Harrison article

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Comments on trains Hunter Harrison article
Posted by NYBob on Tuesday, July 10, 2018 2:24 PM

Anyone care to comment about the article. 

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Posted by Ulrich on Tuesday, July 10, 2018 4:11 PM

I thought it was a great article.. well written, interesting, and balanced. Keith Creel's assessment of EHH is probably right on the money.. if you knew him you loved him.. if you didn't know him you likely misunderstood him. That's probably true of alot of people.. Under his leadership CP went from industry laggard to industry leader.. Admittedly, EHH ruffled some feathers along the way, but that's bound to happen when one brings about change. 

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Posted by Paul_D_North_Jr on Tuesday, July 10, 2018 7:50 PM

"Puff piece".  No serious attempt to show contrary opinions.  Continues the myth that he alone lowered CN's operating ratio (most of that happened before he got there).  Does not mention the safety issues that arose while he was in charge - runaway in BC, fudging the grade crossing signal records during the EJ&E merger.  Does not discuss contrary views on the value of Precision Scheduled Railroading, or the "Hunter Camps".  

- PDN. 

"This Fascinating Railroad Business" (title of 1943 book by Robert Selph Henry of the AAR)
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Posted by williamsb on Tuesday, July 10, 2018 9:31 PM

I agree with Paul, puff piece. He ignored legal wage agreements, if you didn't like it you had to grieve it. CP engineers have something like 9000? grievances. CN employees aren't over him yet. CN probably still have grievances from his time. CN got more business from CP because customers were upset with his practices, so much so CN can't handle it all, although CN's capital projects this year might help.

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Posted by Ulrich on Wednesday, July 11, 2018 7:19 AM

The article did mention he was controversial and that some were less than thrilled with the changes he made. Overall, he left the Company in much better shape than he found it.. hard to argue with that.. and that's good for all involved parties. 

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Posted by CMStPnP on Wednesday, July 11, 2018 7:58 AM

Ulrich
Under his leadership CP went from industry laggard to industry leader

Kind of a recurring business cycle with Canadian run transportation companies.   Wasn't it a former head of United Airlines that was called North of the border to fix Air Canada and bring it back from the brink?

I remember when I worked at General Motors.   GM had a program of bringing Canadian Managers to the United States to train and apprentice then would send them back.   Even with that, GM had to send Executives North of the border to fix GM Canada at times.     So I am noticing a pattern here.    Maybe it is coincidental though.

So with all this tutoring going on, you would at least think that we should be able to fix a Canadian company and participate in the financial rewards after it is fixed but current Canadian law prohibits that for most Canadian companies. 

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Posted by Ulrich on Wednesday, July 11, 2018 8:20 AM

CMStPnP

 

 
Ulrich
Under his leadership CP went from industry laggard to industry leader

 

Kind of a recurring business cycle with Canadian run transportation companies.   Wasn't it a former head of United Airlines that was called North of the border to fix Air Canada and bring it back from the brink?

I remember when I worked at General Motors.   GM had a program of bringing Canadian Managers to the United States to train and apprentice then would send them back.   Even with that, GM had to send Executives North of the border to fix GM Canada at times.     So I am noticing a pattern here.    Maybe it is coincidental though.

So with all this tutoring going on, you would at least think that we should be able to fix a Canadian company and participate in the financial rewards after it is fixed but current Canadian law prohibits that for most Canadian companies. 

 

 

 

GM does that because GM is an American based company, and having key  people travelling back and forth periodically is therefore not all that unusual. Same happens at MacDonalds, Ford, Catapillar, Bombardier.. etc..  

CP shares are traded both on the TSE and the Nasdaq.. best way to participate in the financial rewards of any company is to become an owner.. i.e. a shareholder, and Americans are certainly not prohibited from buying shares in CP.   

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Posted by VOLKER LANDWEHR on Wednesday, July 11, 2018 9:39 AM

Ulrich
The article did mention he was controversial and that some were less than thrilled with the changes he made. Overall, he left the Company in much better shape than he found it.. hard to argue with that.. and that's good for all involved parties.

Does that include shippers? Or are they not involved?
Regards, Volker

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Posted by Ulrich on Wednesday, July 11, 2018 10:00 AM

VOLKER LANDWEHR

 

 
Ulrich
The article did mention he was controversial and that some were less than thrilled with the changes he made. Overall, he left the Company in much better shape than he found it.. hard to argue with that.. and that's good for all involved parties.

 

Does that include shippers? Or are they not involved?
Regards, Volker

 

 

 

Includes shippers.. shippers are really the driving force behind the Company's success as they pay the bills and make all those wonderful numbers that follow from the top line possible. Nothing else matters if the top line is bad.   

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Posted by VOLKER LANDWEHR on Wednesday, July 11, 2018 10:41 AM

Ulrich
ncludes shippers.. shippers are really the driving force behind the Company's success as they pay the bills and make all those wonderful numbers that follow from the top line possible. Nothing else matters if the top line is bad.

I totally agree.

But I think the shippers saw EHH's "success" differently. At least that was my impression from all I read. Therefore the question.
Regards, Volker

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Posted by Ulrich on Wednesday, July 11, 2018 11:02 AM

VOLKER LANDWEHR

 

 
Ulrich
ncludes shippers.. shippers are really the driving force behind the Company's success as they pay the bills and make all those wonderful numbers that follow from the top line possible. Nothing else matters if the top line is bad.

 

I totally agree.

But I think the shippers saw EHH's "success" differently. At least that was my impression from all I read. Therefore the question.
Regards, Volker

 

Some were not thrilled with the changes and the inevitable service disruptions.. but over the longer term most shippers appear to be happy with CP's transformation. They may or may not say so in so many words, but the level of traffic and growth speaks louder than words anyway. 

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Posted by D.Carleton on Wednesday, July 11, 2018 3:57 PM

Haven't read it yet; life is busy on the railroad. Even so I'm sure it will be a good read. Nevertheless I'm waiting on his biography Railroader by Howard Green later this year.

Editor Emeritus, This Week at Amtrak

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Posted by oltmannd on Thursday, July 12, 2018 3:32 PM

Whether EHH did the right things or not depends on answering the question "What is it that you want to happen?".

What PSR does is take the existing traffic, smooth or trim away the lumps and bumps until the flow is smooth and uniform, then trim away the resources until the smooth flow just fits the resources with very little saftey stock.

This creates a very efficient operation for the current traffic.  The results show in the low OR's he's created wherever he went.

This is a very conservative approach to railroading since it is focused on the "here and now."

So, if the goal is "create the most efficient RR, right now!" Then he's your man.

But, that may not be the same thing as "generate the highest profit" or "generate a cash flow with the highest net present value".  These things require thinking about current customers from the perspective of future potential and focusing on new traffic more than just the current stuff.

The counter arguement is that EHH's way throws off enough cash that it can spare some for investing in future growth.  I don't think he stayed long enough in any one place for this theory to be tested.

My personal opinion is that he was great at what he did, but what he did was short sighted and risky.

I think the current crop of RR CEOs are also short-sighted, probably due to EHH's influence, but not quite to the same extent.

-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/

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Posted by Ulrich on Thursday, July 12, 2018 7:15 PM

Great point Oltmannd, and so very true. Businesses and people are often far too focussed on the short term when a longer view would be much more beneficial. A good example (although unrelated) is going to college. For four solid years we're focussed on the outcome.. knowledge, a degree, and perhaps a professional designation. But after that most of us drift.. and that's because there's nolonger that time expectation.. And before long 10 and 20 years have gone by, and we're no further ahead.. behind in fact.. because we haven't progressed beyond the odd promotion and cost of living increase. And so it is in the world of business as well... few give the long view more than a cursory consideration.. Some family businesses do, but that's because they don't have outside shareholders to answer to. The railroads are largely driven by short sighted shareholders who want a return next quarter, never mind what happens in ten years down the road.. Too bad.. the real rewards, whether in business or on a personal level, go to those who can subordinate the short term to a 10 or even 20 year goal.  

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Posted by SD70Dude on Thursday, July 12, 2018 10:14 PM

Ulrich
VOLKER LANDWEHR
Ulrich
ncludes shippers.. shippers are really the driving force behind the Company's success as they pay the bills and make all those wonderful numbers that follow from the top line possible. Nothing else matters if the top line is bad.

I totally agree.

But I think the shippers saw EHH's "success" differently. At least that was my impression from all I read. Therefore the question.
Regards, Volker

Some were not thrilled with the changes and the inevitable service disruptions.. but over the longer term most shippers appear to be happy with CP's transformation. They may or may not say so in so many words, but the level of traffic and growth speaks louder than words anyway. 

At CN most are still PO'd...

But not quite as much as when he was actually here.

Greetings from Alberta

-an Articulate Malcontent

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Posted by samfp1943 on Thursday, July 12, 2018 11:40 PM

D.Carleton

Haven't read it yet; life is busy on the railroad. Even so I'm sure it will be a good read. Nevertheless I'm waiting on his biography Railroader by Howard Green later this year.

  Having known him[EHH], as a young man (SL-SF-1960's in Memphis, and his father{M.P.D.} , as well).  I think D. Carlson's  statement is accurate.                Looking forward to the book!      

Sam

 

 


 

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Posted by cx500 on Thursday, July 12, 2018 11:43 PM

Ulrich
going to college. For four solid years we're focussed on the outcome.

A very apt analogy.  Short term results say forget about college, get a job and income now.  And indeed in the short term, for four years you probably enjoy a much better standard of living.  But look ahead 5-10 years and the difference between the two choices may be rather different.

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Posted by CMStPnP on Friday, July 13, 2018 1:57 AM

Ulrich
CP shares are traded both on the TSE and the Nasdaq.. best way to participate in the financial rewards of any company is to become an owner.. i.e. a shareholder, and Americans are certainly not prohibited from buying shares in CP.   

It's illegal under Canadian law to become a majority owner.   Which means the majority of any rewards to fixing a Canadian company of course goes back to the Candians that caused the issues in the first place.    I'd call that hardly fair.

Also, believe there is a law that requires companies that do business in Canada above a specific volume have to establish a Canadian HQ.    Not really normal business practice to establish an HQ in a country where 90% of the people live within 100 miles of the border and potentially only a few hundred miles from your North American HQ in the United States (like GM).    Texas used to have a law like that but abandoned it.

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Posted by MP173 on Friday, July 13, 2018 6:16 AM

I read the first article last night and found it very interesting and informative.  

Ok, I am not a CP employee and didnt experience first hand the culture change.  To that I cannot comment.  The financial results were dramatic.  How those results occurred seemed to be based on a formula which involved common sense.  Shut down inefficient hump yards.  Extend sidings to handle longer trains (he didnt seem to do that at CN).  Improve existing route structures (North Route) to handle increased tonnage.  Stop the erosion of intermodal business by improving schedules.  Move the HDQ to a company owned property rather than a leased property.  Manage labor costs (ok...this is a lightning rod and I admit not knowing all the particulars).

One must ask the real simple question....why didnt the previous administration at least implement some of these in order to improve service and drive down costs?  

On a personal note....my employer of 28 years has gone from a single owner (walk in his office at any time type that grew the business) to being owned by faceless mega corp that only wants quarterly results.  I do not completely understand that culture, but must accept it or move on in life.  Years ago President Obama stated "elections matter and you lost" when meeting with Republicans.  That can be transferred to ownership and management of corporations.  "Leadership matters" and not everyone is going to be happy.  

Are the intermodal shippers happy?  Must be.  Are the farmers happy?  No and they never will be as it is in their nature to complain (full disclosure, I own a small farm).  Automotive shippers happy?  Seem to be as they are shifting business back to CP.  

I cannot wait for the book.  As an owner of IC stock - transferred to CN I am a big fan of EHH.  But, I didnt work for him.

The CSX article, heck it could be a book, would be very interesting but many believe EHH knew he had a short calendar to work with.

Ed

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Posted by Ulrich on Friday, July 13, 2018 7:28 AM

CMStPnP

 

 
Ulrich
CP shares are traded both on the TSE and the Nasdaq.. best way to participate in the financial rewards of any company is to become an owner.. i.e. a shareholder, and Americans are certainly not prohibited from buying shares in CP.   

 

It's illegal under Canadian law to become a majority owner.   Which means the majority of any rewards to fixing a Canadian company of course goes back to the Candians that caused the issues in the first place.    I'd call that hardly fair.

Also, believe there is a law that requires companies that do business in Canada above a specific volume have to establish a Canadian HQ.    Not really normal business practice to establish an HQ in a country where 90% of the people live within 100 miles of the border and potentially only a few hundred miles from your North American HQ in the United States (like GM).    Texas used to have a law like that but abandoned it.

 

Hardly fair.. and hardly true as well. CN may be the one exception where no one shareholder (including US, Canadian, or anyone else for that matter) can own more than 15% of the Company. Nevertheless, the Company's largest shareholder is Cascade Investments (Bill Gates) which owns roughly 12%. 

Lots of Americans own shares in CP as well as CN..and its not as if Canadians don't have the wherewithal to fix broken businesses.. Sometimes we hire top people from the US, and sometimes our top people go south to run American based companies. 

 

 

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