Euclid Murphy Siding Euclid I think PSR is just a fancy name for a new business attitude that has swept over the U.S. business community over the last 10-15 years. Just like PSR, this new business attitude spreads like a virus, and yet nobody can clearly define it or explain it. It is more an unconscious fashion of attitude than an actual prescription of operation. While it has been sweeping the business sector for many years now, I would say that it has just showed up in the railroad industry. This attitude does have specific features such a switch from honoring the customer to disdaining them. The new attitude somehow manages to rationalize that the customer’s loyalty is no longer needed because the new attitude can outsmart the customer. I believe this new attitude is a reaction throughout U.S. business in large part because it has been beat up by the competition of the Chinese cost advantage. This showed the U.S. business culture that the U.S. consumers were willing to give up quality while quality was the only advantage that U.S. manufacturers had over Chinese competition. This has left a sense of bitterness in the U.S. business culture. So they have reacted by cutting out the frills and becoming lean and mean. I find myslf dumbfounded as I actually agree with one of your posts 100%. That does indeed seem unusual. It must be a good sign.
Murphy Siding Euclid I think PSR is just a fancy name for a new business attitude that has swept over the U.S. business community over the last 10-15 years. Just like PSR, this new business attitude spreads like a virus, and yet nobody can clearly define it or explain it. It is more an unconscious fashion of attitude than an actual prescription of operation. While it has been sweeping the business sector for many years now, I would say that it has just showed up in the railroad industry. This attitude does have specific features such a switch from honoring the customer to disdaining them. The new attitude somehow manages to rationalize that the customer’s loyalty is no longer needed because the new attitude can outsmart the customer. I believe this new attitude is a reaction throughout U.S. business in large part because it has been beat up by the competition of the Chinese cost advantage. This showed the U.S. business culture that the U.S. consumers were willing to give up quality while quality was the only advantage that U.S. manufacturers had over Chinese competition. This has left a sense of bitterness in the U.S. business culture. So they have reacted by cutting out the frills and becoming lean and mean. I find myslf dumbfounded as I actually agree with one of your posts 100%.
Euclid I think PSR is just a fancy name for a new business attitude that has swept over the U.S. business community over the last 10-15 years. Just like PSR, this new business attitude spreads like a virus, and yet nobody can clearly define it or explain it. It is more an unconscious fashion of attitude than an actual prescription of operation. While it has been sweeping the business sector for many years now, I would say that it has just showed up in the railroad industry. This attitude does have specific features such a switch from honoring the customer to disdaining them. The new attitude somehow manages to rationalize that the customer’s loyalty is no longer needed because the new attitude can outsmart the customer. I believe this new attitude is a reaction throughout U.S. business in large part because it has been beat up by the competition of the Chinese cost advantage. This showed the U.S. business culture that the U.S. consumers were willing to give up quality while quality was the only advantage that U.S. manufacturers had over Chinese competition. This has left a sense of bitterness in the U.S. business culture. So they have reacted by cutting out the frills and becoming lean and mean.
I think PSR is just a fancy name for a new business attitude that has swept over the U.S. business community over the last 10-15 years. Just like PSR, this new business attitude spreads like a virus, and yet nobody can clearly define it or explain it. It is more an unconscious fashion of attitude than an actual prescription of operation. While it has been sweeping the business sector for many years now, I would say that it has just showed up in the railroad industry.
This attitude does have specific features such a switch from honoring the customer to disdaining them. The new attitude somehow manages to rationalize that the customer’s loyalty is no longer needed because the new attitude can outsmart the customer. I believe this new attitude is a reaction throughout U.S. business in large part because it has been beat up by the competition of the Chinese cost advantage. This showed the U.S. business culture that the U.S. consumers were willing to give up quality while quality was the only advantage that U.S. manufacturers had over Chinese competition. This has left a sense of bitterness in the U.S. business culture. So they have reacted by cutting out the frills and becoming lean and mean.
I find myslf dumbfounded as I actually agree with one of your posts 100%.
That does indeed seem unusual. It must be a good sign.
...blind squirrel, acorns, etc?......My whole industry-building & building materials- is going through exactly what you have described. Who am I kidding? Every industry seems to be going through that right now!
Thanks to Chris / CopCarSS for my avatar.
jeffhergert Euclid I think PSR is just a fancy name for a new business attitude that has swept over the U.S. business community over the last 10-15 years. Just like PSR, this new business attitude spreads like a virus, and yet nobody can clearly define it or explain it. It is more an unconscious fashion of attitude than an actual prescription of operation. While it has been sweeping the business sector for many years now, I would say that it has just showed up in the railroad industry. This attitude does have specific features such a switch from honoring the customer to disdaining them. The new attitude somehow manages to rationalize that the customer’s loyalty is no longer needed because the new attitude can outsmart the customer. I believe this new attitude is a reaction throughout U.S. business in large part because it has been beat up by the competition of the Chinese cost advantage. This showed the U.S. business culture that the U.S. consumers were willing to give up quality while quality was the only advantage that U.S. manufacturers had over Chinese competition. This has left a sense of bitterness in the U.S. business culture. So they have reacted by cutting out the frills and becoming lean and mean. I don't believe US business interests are bitter that production has moved out of the country since they are the ones that moved it. Free trade/Open trade treaties was the vehicle for them to use. Those agreements weren't written to benefit other countries per se, but rather to benefit US companies (Who now look at themselves as 'multi-national', owing no allegiance to any locale.) by moving production to low cost countries. Maybe not all companies wanted to do so, but once your competitors do it, they would be hard pressed not to follow along too. American business interests are more and more following the idea that the only reason a corporation exists is to maximize shareholder value. No other consideration applies. While that doesn't necessarily mean take a short term view, most have. Especially those activist investors and hedge funds that want the highest return as quick as possible. PSR just shows that those people have recently rediscovered the railroad industry. Jeff
I don't believe US business interests are bitter that production has moved out of the country since they are the ones that moved it. Free trade/Open trade treaties was the vehicle for them to use. Those agreements weren't written to benefit other countries per se, but rather to benefit US companies (Who now look at themselves as 'multi-national', owing no allegiance to any locale.) by moving production to low cost countries. Maybe not all companies wanted to do so, but once your competitors do it, they would be hard pressed not to follow along too.
American business interests are more and more following the idea that the only reason a corporation exists is to maximize shareholder value. No other consideration applies. While that doesn't necessarily mean take a short term view, most have. Especially those activist investors and hedge funds that want the highest return as quick as possible. PSR just shows that those people have recently rediscovered the railroad industry.
Jeff
Jeff,
I agree with your points about businesses outsourcing to China. I should clarify that the businesses that I am referring to as being bitter from the outsourcing experience are the ones that stayed here. They believed their age old marketing that had convinced them that their customers wanted quality, so they made quality their centerpiece.
Then the Chinese experience shows them that most of the U.S. market actually wants lowest possible price even if quality goes out the window. So those bitter U.S. manufactureers are embittered to have to throw their quality out the window and make products here like the ones made in China. They feel betrayed by their U.S. market so they will now teach us a lesson. That is the bitterness in the U.S. business culture I was referrring to.
The bad news for U.S. consumers is that they no longer have a choice between high quality and low price. The choice is now between low quality Chinese goods and low quality domestic goods. At least the Chinese are not bitter.
I think this bitterness is actually starting to show itself in the developing trade war with China. That will really be exciting.
charlie hebdoA narrow, short-term mentality pervades far more than this administration. Infrastructure is not maintained, let alone upgraded. Basic research and R&D are underfunded. The sad list is long, as we decline.
Very intriguing comment and quite true. I believe this attitude has been evolving since deregulation and has exponentially gained momentum over time to the extent that actual customer service nowadays is the exception. But quality control was a problem for American manufacturing before China became the default alternative. The friction between labor unions and management ultimately created an environment where companies were free to chase the cheapest source of labor worldwide. Whether the consumer supported or instigated the change is arguable. I think the consumer was presented with a fait accompli, in effect. So, by whichever mandate, corporations have tried to do "more with less" and I see no end to that trend once it is underway unless some counterveiling force arises. The problem with regulation is that it seldom, if ever, hits problems on the mark and is a political solution, therefore imperfect and subject to other interests. Management might wish to avoid resulting constraints, yet they are apparently on the fast-track toward condoning it.
delete.
zardoz The current administrationof this country seems to me to be another example of PSR-type of mentality: cut services, massage data to create an appearance of profitability, and totally ignore the eventual ramifications of your current decisions. In the end, we will all end up paying for it (we being those of us that are not in the top 1%).
The current administrationof this country seems to me to be another example of PSR-type of mentality: cut services, massage data to create an appearance of profitability, and totally ignore the eventual ramifications of your current decisions.
In the end, we will all end up paying for it (we being those of us that are not in the top 1%).
A narrow, short-term mentality pervades far more than this administration. Infrastructure is not maintained, let alone upgraded. Basic research and R&D are underfunded. The sad list is long, as we decline.
PSR is nothing more than a Hedge Fund model to hoover money from a rail property in as short a period as possible.
Never too old to have a happy childhood!
Having spent 40 years on the railroad - from the demise of PRR through the mega-mergers (mega-meltdowns) of the 90s - it is obvious that deregulation was sorely needed to rationalize a business that was being devastated by archaic rules. That said, the pendulum seems to have swung to a point where a few remaining carriers are suffering from extreme hubris and manging data to the exclusion of delivering service, aside from lip service. This has been on-going for some time. Even during the years when the entire Northeastern rail scene was on the rocks, there was still a culture of service with what resources were available. Deregulation and increased profitability seems to have fostered a culture of parking trains and dog-catching and perhaps that is the only culture that remains in too many cases. At some point, regulation has to check the tendency to maximize (short-term) profits at the expense of viability as common carriers. While not being a fan of regulation, per se, some extent of control over the current trend may well be in the best interest of railroads over the long-term, for too many carriers seem to have been seduced by the pied piper of PSR that apparently has already perpetrated a transportation crisis.
SAN ANTONIO, Texas — Surface Transportation Board Vice Chairman Patrick Fuchs says the independent agency is ready to tackle several issues that have been languishing for years, including how reasonable rates are determined and shipper requests...
http://trn.trains.com/news/news-wire/2019/05/federal-regulators-gearing-up-for-major-decisions-vice-chairman-says
Brian Schmidt, Editor, Classic Trains magazine
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