You might be asking yourself why I say the Class 1's could learn a thing or two from McDonald's? When they could learn from the competition, or fellow C1's? Yet what can make them more competitive?. So.. Why not learn a thing or two from an outside industry juggernaut such as McDonald's? MCD is a retail powerhouse, and if you own stock it proves this point. Many of us have dined at and, or probably worked there in our youth or otherwise. MCD prides itself on a consistent reliable product. Every store whether corporate, or franchise maintains a checklist of restaurant process and QC standards.
During my short tenure at MCD many moons ago I worked the grill. Which during my time was, or is a semi-automated process. One thing that I found interesting during my tenure there was just how well of an oiled machine MCD is. The key to why they are so successful is the day in day out process of giving customers an experience that fosters repeat business. Keeping a menu that is easy to read with familiarity. Quick (They're currently rolling out a 60 second DT time for breakfast hours) dining room, and drive-thru service. Sit down service is avaible as well with electronic table markers that allow an employee to bring your food to your table. An easy to use app for placing orders to be picked up via drive-thru, or curbside. The app also features the McCafe rewards program that rewards repeat customers with free items after every fifth purchase.
So where do the C1's fit into this?.. I'll explain. A consistent reliable transportation product starts with an easy detailed to read "menu" of your product. How many services are available to prospective customers and how do they fit into the customers overall supply chain? How easy is it to acquire a service? Do these services actually produce what they advertise? When I pull up to the drive thru, and order a #3. I know exactly what I'm getting. The #3 even displays how many calories are in my order. Example? How easy is it for a customer to purchase service from UP? I've read, and heard it's a tedious process to become a customer with UP. Not only that when a csutomer does finally get through the process the end product ends up being not entirely what was ordered.. Transparency is key to getting and keeping the wheels turning.
One area that could use improvement is how the C1's have changed the way demurrage charges are handled. So why not allow customers that have a positive track record of turning cars in 24 hrs or less, to be rewarded? Remember that McCafe rewards from earlier? Set a minimum of 95% compliance score for a 30 day period. Any customer that maintains the score over that period recieves free demurrage for a example a weekend. If they achieve the same score over a 90 day period allow them 10 days free of demurrage charges. Work with those customers who strive to help you get more turns out of your fleet. More revenue from loaded miles is always a much better outcome than eating yourself alive with the lowest OR possible...
These are just a few thoughts anyhow. It never hurts to learn from those established outside of your industry. Their longevity speaks for itself. What are your thoughts?
I think the problem is thinking the class ones don't know how to manage their business. They know exactly how to manage them.
The way the majority owners of shares want.
If the majority want as large as possible, fast, short term returns that's the way the company is going to be managed. If it means running your company into the ground to do it, mortgaging tomorrow for today, so be it. To heck with tomorrow.
Jeff
About 15 years ago, McD's rolled out that sixty second thing for everything. And just as quickly dropped it.
The way railroads are being run today would mean that you would have to go to a major central location to get your burger. Local outlets would be a thing of the past, as they all have to be individually staffed and supplied. Following the railroad example, the semi full of patties and fries would only have to make one stop in a given area, instead of hitting several stores.
Convenient for you? Nope. Convenient for them? Absolutely!
Larry Resident Microferroequinologist (at least at my house) Everyone goes home; Safety begins with you My Opinion. Standard Disclaimers Apply. No Expiration Date Come ride the rails with me! There's one thing about humility - the moment you think you've got it, you've lost it...
First, a comment regarding the demurrage incentive. Unless something has changed in the 17 months since I pulled the pin, just about all Class 1 demurrage plans provide a credit for cars released early which can be used to offset debits for cars held beyond free time.
Now, to your overall point that the railroads should work to improve the customer experience. Having spent over 40 years as a rail customer, you would have to try very hard to dissuade me from my belief that the railroads simply don't care about the customer's experience. If you're a captive shipper, they operate with the belief you have no viable alternative to rail service and need them more than they need you. In fact, most Class 1 folks I dealt with over the years seem to operate from the perspective that your business is tantamount to their birthright - it's THEIR traffic, not yours.
Now, the exception to this "rule" is the short line railroad industry. They WANT your business and put forth an effort to make working with them as easy as possible.
I can very much appreciate your thought process with your suggestion but, until the thinking at Class 1 railroads makes a 180 degree course change, improving customer experience is probably the farthest thing from their minds.
Curt
I thought this was going to be a thread on the cleanliness of locomotive restrooms.......ha-ha.
The short term profit goals of the Wall Street money people or pump and dump crews has always reminded me of this tale of The Hot Dog Stand which I was able to find on google at:
https://medium.com/@jeffswystun/the-hot-dog-stand-story-a-business-parable-b598c46170da
Living in the Chicago area (I moved into Addison in 1963) and shortly found a new hot dog stand nearby. It was new and I have watched it grow into a major eatery. And their stores could teach McD's something about how to provide fast service. They have not grown as fast as McD's but they were sold a few years ago. It was PORTILLO's and their story starts out:
"The first Portillo's hot dog stand known as "The Dog House" opens in 1963 on North Avenue in Villa Park. Owner and founder Dick Portillo invests $1,100 into a 6' x 12' trailer without a bathroom or running water. To get the water he needs, he runs 250 feet of garden hose from a nearby building into the trailer."
https://www.portillos.com/our-story/
At lunch hour, at the one near me, they have two lines with order takers that take the order, call it in to the kitchen, swipe your card or take your cash, stick a number on your car, and depending on the complexity of your order, another staffer hands you your order and pulls the number off of your auto or directs you to a parking spot to wait for it. This during the pandemic.
This discussion all revolves around the question 'What is the Economy?' Is the economy the monetary manipulations of Wall Street or is it the creation and selling of products, goods and services on Main Street?
Never too old to have a happy childhood!
CMStPnPI thought this was going to be a thread on the cleanliness of locomotive restrooms.......ha-ha.
I dunno - since this whole COVID-19 thing, our engine cabs have been cleaner than they've ever been.
It's been fun. But it isn't much fun anymore. Signing off for now.
The opinions expressed here represent my own and not those of my employer, any other railroad, company, or person.t fun any
SD60MAC9500These are just a few thoughts anyhow. It never hurts to learn from those established outside of your industry. Their longevity speaks for itself. What are your thoughts?
The railroads will model themselves after the McD's ice cream machine.
But seriously -
Part of the problem are these new "plans" is that they are very inflexible. One of the greatest changes I've seen in my career has been the loss of the ability of terminals to make their own, local, decisions. I don't know if that makes us more or less like the golden arches?
PS. Mcnuggets with honey. Is there any other way?
Has not that ability (local decisions) been preserve to sme extent at BNSF?
It seems to me that McDonalds might be copying off the railroads in some respects, where imperatives to reduce the workforce have impacted quality, yet no one seems to care.
According to Wendy's, McDonalds Burgers are round because they cut corners..
I find it rare to be served a burger in either place that is more than 10 degrees above room temperature.
Although McDonalds does have some company owned locations, generally people are buying the food from a McDonalds franchisee, not directly from the large corporation. The franchisee is a much smaller business that can more easily focus on individual customer service. McDonalds does set standards for their franchisees, but the actual operation is left to the smaller business. The franchisee is a "Middleman" who provides added value by more readily being able to focus on individual customer service than the large, distant corporation could.
The "large, distant" corporation adds value by creating efficient food distribution (done through other middlemen), national advertising, standards, etc. McDonalds corporation makes its money by owning the land the franchises are located on and leasing it to the franchise store operators.
Ford Motor Company operates in a similar manner. We don't buy cars and trucks from Ford, we buy them from a Ford dealer. The dealer is a smaller business and is better able to focus on individual customer sales than the vehicle manufacturer could ever do.
There's a name for this. It's called "Descrepancy of Size". And it's a very valid reason for a middleman to be in a distribution or service channel. In these cases the middleman doesn't add costs to the channel, he takes costs out by making the channel more efficient.
The class 1's have a challenge providing good retail service to smaller customers and "Discrepancy of Size" is a big reason why. Short lines have gained a reputation for providing improved service to smaller rail customers. They're functiioning in a way similar to the McDonalds franchiees and Ford dealers function. Adding them to the rail service channel reducess cost and improves service to the customer.
I'd like to try having the class 1's franchise out their local service on all lines. This would move the operations and marketing of such service to organizations with a better ability to focus on smaller volumes.
Of course, there would be union issues to work out.
"...Although McDonalds does have some company owned locations, generally people are buying the food from a McDonalds franchisee, not directly from the large corporation. The franchisee is a much smaller business that can more easily focus on individual customer service. McDonalds does set standards for their franchisees, but the actual operation is left to the smaller business. The franchisee is a "Middleman" who provides added value by more readily being able to focus on individual customer service than the large, distant corporation could.
The "large, distant" corporation adds value by creating efficient food distribution (done through other middlemen), national advertising, standards, etc..."
McDonald's [Restaurants(?)] is primarily a 'franchised' operation. Locations are 'owned' by individuals, or their corporate entities; those entities contract with McD's Coprorate; It controls virtually every phase of the operations of McD's franchised locations; the parameters of Corporate controls cover all phases.
Hiring policies, uniforms, all logo'd consumable supplies, and food sources. Managers are trained to 'specifics' regarding their jobs, and sanitation of locations. McD Corporate controls each step of the supply chain, and quality controls within that chain. Martin-Brower Co. is a major source for food and consumables for many franchisees.
In some ways McD Corporate could be similar to a railroad in the way it maintains the 'qualities of its operatons'. In some ways, the interactions of Short Line RR's and their exchanges and interchanges with the C-1's ; could be handled as greyhonds suggested.
"...This would move the operations and marketing of such service to organizations with a better ability to focus on smaller volumes..."
[Further]:"...Of course, there would be union issues to work out..."
Sort of an interesting concept.
McDonalds is tight as it can be with the standards it sets. You may not like what's on the menu, but I've never heard of anyone getting sick from eating at McDonalds. When you consider the millions of meals they serve each day this is an amazingly great record for food safety.
My now EX wife worked for 10 years in McDonalds distribution. She was at corporate HQ which was then in Oak Brook, IL. Here are some stories:
When a receiver rejects a load the railroad can be liable if it acted improperly. The railroad then buys the load and reimburses the proper party for the value of the load. So, the N&W (or NS, I don't remember) delivers a carload of frozen fries in Cleveland that's no longer frozen. The railroad failed to protect the temperature as required. The load was rejected (properly) and a damage claim was filed against the railroad. The claim was paid and the railroad now owned the thawed french fries. Then the railroad freight claims guy (they tend to suck big time) sells the fries. I don't want to know what they were used for.
Anyway, this was against McDonalds standards. Their name and logo were on those boxes of potatoes and if those potatoes weren't fit to be sold at McDonalds those potatoes were to go in a garbage dump. Nowhere else. But the railroad's freight claims guy (did I mention they suck big time?) insisted on selling the thawed fries. The N&W/NS didn't see another load. The EX shifted the fries to TOFC with trucking east of Chicago. And she didn't change it back.
We were on a vacation in Maui. If I remember correctly, at the time McDonalds had all of three restaurants on Maui. She insisted on taking time to go inspect the "Maui Distribution Facility". Note: it also served KFC and others.
On one dark and dreary winter Saturday we drove out to a McDonalds distribution center in Lemont, IL. McDonalds was introducing salads and she was going to take the temperature of the salad fixins before they were distributed to the restaurants. Everything was OK. I was shown their indoor rail dock. They used it to store junk. So much for rail marketing.
As I previously stated, I've never heard of anyone getting sick from McDonalds food. But they had "Go Teams" at corporate HQ. If there was to be a health problem at a McDonalds (God Forbid!) there were people assigned to be on the first jet out of Chicago to deal with it. And I don't mean PR people. These were people who knew food safety and could rapidly fix the problem.
The EX wasn't on the restaurant food safety Go Team. She was on the distribution center food safety Go Team. They didn't store food up next to a wall. They stored it away from the wall with the floor space between the food and the wall painted red. The red paint highlighted any rodent droppings, and if you've got rodents in a food distribution center you've got a big damn problem. They did everything possible to keep the rats out. But nothing is perfect. I recall her having to go once. I teased her about having to go look at the dead rat.
Sounds like the Class 1s not only don't say, "You want fries with that?" They are also saying, "We are pretty sure you are not worthy of eating one of our burgers."
In some ways, it sounds like the railroads are already operating like McD's.
Local franchisees take care of the local business, while corporate (albeit with contractors) takes care of moving large quantities of product between the source (warehouses) and the franchisees.
Back in the day when there were hundreds of Class 1's would be more like the franchisees getting their own supplies.
The Class 1 "railroad way" is kind of the antithesis of the old Burger King "have it your way" slogan. The Class 1 version of this would be "have it our way".
Lithonia Operator Sounds like the Class 1s not only don't say, "You want fries with that?" They are also saying, "We are pretty sure you are not worthy of eating one of our burgers."
My one McDonalds Quality Control story was from when they introduced the Quarter Pounder. I went to a McD about a mile from their Oakbrook HQ and ordered one. Got it, sat down and bit in. Blood was red as it ran out. Took it back to the counter and told the young man, "THIS IS RAW". He replied. "It can't be, Its done by computer!" I asked for a higher authority who also gave me the same run around. Asked for the Manager. When he came out, he looked at it, told me they would bring me another, picked up about six waiting for sale from the bin and dumped them in the waste and went back into the grill area. About three minutes later, a properly cooked QP was delivered to me. The computer must not be linked to the grills temperature.
Electroliner 1935 The computer must not be linked to the grills temperature.
And if you asked an old-time diner grill guy where his computer was he'd have pointed to his forehead and said "Right here!"
Nothing against Mickey-D's by any means, I like Mickey-D's, but thank goodness there's still some old-time burger joints around. One's Triple A, the others are the Big Leagues.
No, it's more like they're saying, "Today we have a plain hamburger, no cheese, no pickle or onion, no ketchup but with mustard and you have to buy 110 of them. Tomorrow we'll have crispy chicken, with all condiments but you'll have to buy 150 of them."
And when you drive up, they welcome you with, "Welcome to the PSR RR. How may you help us?"
Here in Toronto there are a lot of hamburger/souvlaki joints. If you start by saying "I'd like a cheeseburger with lettuce and..." The guy will interrupt and say, "Chizbooger!" Then he or someone else will cook it and then say, "What you like?" Then you say what toppings you want. My point is, the only way they will serve it is your way.
I haven't eaten in a Mcdonalds in many years but I do recall if you asked for a Big Mac with or without something, the people behind the counter got very confused.
Maybe railroads should take the souvlaki joint approach.
Electroliner 1935 My one McDonalds Quality Control story was from when they introduced the Quarter Pounder. I went to a McD about a mile from their Oakbrook HQ and ordered one. Got it, sat down and bit in. Blood was red as it ran out. Took it back to the counter and told the young man, "THIS IS RAW". He replied. "It can't be, Its done by computer!" I asked for a higher authority who also gave me the same run around. Asked for the Manager. When he came out, he looked at it, told me they would bring me another, picked up about six waiting for sale from the bin and dumped them in the waste and went back into the grill area. About three minutes later, a properly cooked QP was delivered to me. The computer must not be linked to the grills temperature.
At least, that 'Manager' got the important part of his 'studies'
at Hambuirger U.
It's an apples to oranges comparison. Railroads.. especially the class ones, are more profitable than any food outlet, including McDonalds. Moreover the railroads have a competitive moat.. McDonalds has its brand (which is valuable), but they're constantly facing new fast food competitors and not just burger joints either. Where was Fire House Subs just 20 years ago? Nowhere.. and now they've got how many thousands of stores competing with the golden arches? And that's just one chain.But I guess there's always something one can learn from others. And demographics are also working against MacDonalds as the baby boomers who were mostly responsible for their rapid growth can nolonger process their food so easily.
Ulrich It's an apples to oranges comparison. Railroads.. especially the class ones, are more profitable than any food outlet, including McDonalds. Moreover the railroads have a competitive moat.. McDonalds has its brand (which is valuable), but they're constantly facing new fast food competitors and not just burger joints either. Where was Fire House Subs just 20 years ago? Nowhere.. and now they've got how many thousands of stores competing with the golden arches? And that's just one chain.But I guess there's always something one can learn from others. And demographics are also working against MacDonalds as the baby boomers who were mostly responsible for their rapid growth can nolonger process their food so easily.
Well, your just comparing hamburgers to sub sandwiches now.
Baby boomers may not care for McDonald's as much any more. (But surprisingly, many do.) But their children/grand children do. IMO That's there real strength. There's a lot of better fast food chain burgers (and even more mom & pop places) that are much better than McDonald's, but it seems that's where the families with children go.
And I will give them credit, the food is usually consistent no matter which restaurant you visit. Mediocre maybe, but consistent.
jeffhergertAnd I will give them credit, the food is usually consistent no matter which restaurant you visit. Mediocre maybe, but consistent.
And that's part of the secret to their success, they're a known quantity. You can go to any McDonalds in any part of the country and expect to find the same menu with the same standard of quality. No surprises, you know exactly what you're going to get. Granted, some McDonalds are going to be better than others, but if there's a lapse in the standards it's the fault of the local franchise holder, not the company.
By the way, aside from one location that had incredibly slow and incompetant service I've never been to a bad Wendy's.
Flintlock76 jeffhergert And I will give them credit, the food is usually consistent no matter which restaurant you visit. Mediocre maybe, but consistent. And that's part of the secret to their success, they're a known quantity. You can go to any McDonalds in any part of the country and expect to find the same menu with the same standard of quality. No surprises, you know exactly what you're going to get. Granted, some McDonalds are going to be better than others, but if there's a lapse in the standards it's the fault of the local franchise holder, not the company. By the way, aside from one location that had incredibly slow and incompetant service I've never been to a bad Wendy's.
jeffhergert And I will give them credit, the food is usually consistent no matter which restaurant you visit. Mediocre maybe, but consistent.
My local Wendy's closed.
BaltACDMy local Wendy's closed.
That's too bad, but there's usually a reason. Either they weren't doing enough business or they lost the lease on the property.
We had a Burger King nearby that closed, but it didn't surprise me. The food was good but the service was terrible, so slow you'd have sworn they were working backwards!
We had a Dairy Queen close too, the landlord raised the rent higher than the DQ wanted to pay. Same with a Wendys in a downtown Richmond office building. Man, did they do some business with the lunchtime crowd! They weren't open seven days a week but didn't need to be!
I was in NC for some classes. I forget what the chain was, but it was a popular one. Except in that city. That one was dead. Open, but darned few customers.
The BK there wasn't bad, but it was dirty - I've never seen a fast food restaurant that bad.
jeffhergert IMO That's there real strength. There's a lot of better fast food chain burgers (and even more mom & pop places) that are much better than McDonald's, but it seems that's where the families with children go.
A lto of the mom and pop places here have the same Sysco or US Foods truck delivering to them. May be an independent - but they are still using chain food.
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