Gramp.... There *is* such a thing as acceptable risk. The railroads I think still live in the Industrial Age mentality. It's not about the bogeyman of profit over everything else. If there's no margin, there's no mission. What's necessary is a shift in overall thinking.
There *is* such a thing as acceptable risk. The railroads I think still live in the Industrial Age mentality. It's not about the bogeyman of profit over everything else. If there's no margin, there's no mission. What's necessary is a shift in overall thinking.
Human movement involves risk. Walk and you can turn your ankle and fall. In falling you may break bones in your body. Fall while carrying a heavy load and the likelyhood of breaking bones is higher. Move on beasts of burden and you risk falling further to the ground, with higher speed beasts of burden that distance can be multiplied by the speed of the beast etc. etc. etc. and in todays world of transportation we have 50/60 MPH railroad freight trains with car weighing 286K pounds and in some cases more hauling Hazardous commodities.
Despite any and all efforts railroads make to prevent accidents - they are still going to happen as making the risk level of movement equal to ZERO is not possible in the world in which we live.
Never too old to have a happy childhood!
charlie hebdo tree68 charlie hebdo Safety should not be held hostage to making a profit. The system is flawed Absolutely no disagreement there... Yet we see it every day. And what to do beyond the usual "hearts and prayers" and a thousand bucks for the inconvenience?
tree68 charlie hebdo Safety should not be held hostage to making a profit. The system is flawed Absolutely no disagreement there... Yet we see it every day.
charlie hebdo Safety should not be held hostage to making a profit. The system is flawed
Absolutely no disagreement there... Yet we see it every day.
And what to do beyond the usual "hearts and prayers" and a thousand bucks for the inconvenience?
CMStPnP Very rare for an operations guy to get into the Executive Suite
Very rare for an operations guy to get into the Executive Suite
FWIW, Tim Cook, CEO of Apple, was an Industrial Engineer and picked because he was very good at handling the supply chain. Contrast that with Intel, which started off with a circuits guy, then a semiconductor process guy followed by an accountant. Intel was crushing the competition for a number of years as they had the high volume Process down, but recently have been falling behind TSMC with the advanced nodes.
The problem with railroads is that are a long term investment, in a securities market where most of the investment decisions are made by fund managers whose main interest is meeting next quarter's numbers. These managers generally prefer to deal with financial types like themselves.
charlie hebdoSafety should not be held hostage to making a profit. The system is flawed
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...
UlrichThis pretty much sums up every accountant I've met in my 40 plus years in transportation. The accountants present the data.. they develop the financial statements in accordance with Generally Accepted Accounting Practices (GAAP). They present their findings to the senior management team, the senior managers make their decisions based on many factors, including the financials and their interpretation. The accountant will tell you if you're making money or not.. if your numbers are consistent with industry norms.. and they will alert managers to any dangers as far as potential cashflow problems, tax issues etc. They also provide guidance on such things as equipment trade cycles by taking into consideration depreciation and maintenance upkeep and when old equipment should be reallocated or replaced altogether. They generally don't involve themselves in the mechanics of the business.. that's where the operations and sales people come in.
Not sure I agree. I was at Enron prior to the collapse as an IBM Business Consultant...... the Accounting Department was at the forefront of informing management that Operations wasn't quite operating within legal bounds. Additionally, pointing out the various conflicts of Interest of hiring people into the firm from the same firm auditing the books. And they warned that repeatedly with Arthur Anderson overruling some if not all the warnings at a higher level (they had a racket going). I believe Enron had utility company roots if I am not mistaken. So right there you have a contradiction in the line of argument that Accounting only stays in it's lane and only presents data. It actually is the expectation that it NOT stay in it's lane when it sees things starting to go off the rails (pardon the pun).
SD70DudeAlso, what background do most modern executives come from? Very few spent any time working on the shop floor.
Exactly, predominantly Accounting, Finance, and Sales. Very rare for an operations guy to get into the Executive Suite and that is because in my view your promoted on "what have you done for me lately". THe first three have a much easier time showing that on paper than someone in Operations unless the Operations guy goes way beyond the extra mile and restructures things on the Operations side to make them more efficient and documents the savings which is unlikely to happen without an Accountant, Finance or Sales approval and those departments taking some of the credit for the savings.
PJS1Clearly, you know little about how the work product of accountants and finance people is structured and presented to executive management. You apparently know even less about how corporate tactical and strategic decisions are made. The overwhelming majority of accountants act in a professional manner. Their work product is based on robust principles. Moreover, their outputs are scrutinized by internal and external auditors. In the case public corporations, the scrutiny includes the IRS, SEC, etc. Cost accountants, who usually are employed by the corporation, present management with cost studies on a regular schedule. It is usually monthly. In most cases it does not take management very long to see that labor is a major cost driver. They may ask for scenario analyses to determine the impact of adds or deletes. But it is management that makes the decision with respect to headcounts. Not the accountants! The notion that professional accountants and financial analysts tell management what they want to hear as opposed to presenting properly supported financial data for their consideration is an insult. Equally insulting is calling accountants bean counters!
Ouch! I think your forgetting you were in a single industry and I have always felt your assertions very narrow and within that industry's focus (having consulted with Enron in the past). Accounting and operations is different by sector speaking as a former MULTI-INDUSTRY business consultant with IBM. You should know that already as well as an Accountant. Manufacturing Accounting is different from Utility Accounting. Especially in the areas of Inventory accounting.
My Father was a CPA and in the manufacturing sector he very much did have a influence and recognized influence on employment levels, on the Manufacturing side the Accounting department is much more involved in Industrial Operations than in other sectors.........later moved to Exec VP, still had the CPA license and so under BaltACD's definition, still qualifies as a bean counter vs your attempting to split that out between Accounting Dept and Exec Suite. Bean Counter is a rather loose description which I take to mean anyone approaching company operations from a strict accounting perspective. Not everyone in the Exec Suite has an Accounting background, some are from Sales, some from Operations (though I have to admit not much from Operations) mostly Sales or Accounting. So there is also differing interpretations of what a Bean Counter is here in the Forum.
charlie hebdo tree68 n012944 People on this site think accountants have way more power than they really do. Confusing the bean counters with the number crunchers... It's the analysts that will figure out whether the cost of that siding is worth the expense. Accountants simply give them the numbers to work with as n012944 points out. Safety should not be held hostage to making a profit. The system is flawed
tree68 n012944 People on this site think accountants have way more power than they really do. Confusing the bean counters with the number crunchers... It's the analysts that will figure out whether the cost of that siding is worth the expense. Accountants simply give them the numbers to work with as n012944 points out.
n012944 People on this site think accountants have way more power than they really do.
Confusing the bean counters with the number crunchers...
It's the analysts that will figure out whether the cost of that siding is worth the expense. Accountants simply give them the numbers to work with as n012944 points out.
Safety should not be held hostage to making a profit. The system is flawed
Thus is our entire society.
blue streak 1Let us take a look at the NS Palestine derailment. Its now 2025. As NS chief I go to accounting department and ask. Have you totaled up all the costs of this derailment? Accounting tells me it is A dollars from these items but a few other department say to accounting you forgot these items. Redouing you come up with B dollars. Now you say we have to put so much into fixing the problem that caused the wreck. How much more do we need to invest to reduce the probably of this type derailment ?
Exactly.
And, like the Pinto, if the cost to fix the problem is more than the cost of the problem, it's probably not going to get fixed.
So, East Palestine cost B dollars when everything is added up. Given what we know (apparent bearing failure, possible failure of detection facilities), we have to consider prevention.
If we find that adding inspectors and making improvements to detection facilities will cost C dollars, we then have to compare that to B. If C is more than B (as amortized, etc), then we'll just eat the cost of the occasional incident. And this is likely even more true with Wall Street driving financial decisions.
There might be a "good will" factor involved, but given the short attention span of the public these days, it's probably not significant. "Oh, look! Another balloon..."
tree68 Confusing the bean counters with the number crunchers... It's the analysts that will figure out whether the cost of that siding is worth the expense. Accountants simply give them the numbers to work with as n012944 points out.
n012944People on this site think accountants have way more power than they really do.
blue streak 1 My question is do accountants really know the consequences of their cost statements. Can many accountants say for example if you lengthen this siding you will save this many recrews?
My question is do accountants really know the consequences of their cost statements. Can many accountants say for example if you lengthen this siding you will save this many recrews?
Of course not. Nor would they be asked to. Operations would say, if you lengthen this siding you will save x amount of recrews. The accountants would then say, recrews cost the company x amount, lengthening the siding will cost us y, it will take us z amount of months to recoup the cost.
Management on a higher level will then take the information and make the decision on making the siding longer or not. People on this site think accountants have way more power than they really do.
An "expensive model collector"
Accountants are not analysts. They provide and verify accurate data for others to analyze and make a decision based on it.
My question is do accountants really know the consequences of their cost statements. Can many accountants say for example if you lenghten this siding you will save this many recrews? Or even more non transparent you will save this much per diem if you lenghten this siding ?
If you use one less loco you will save its diesel and hourly loco maintenance cost ? But do they then take in extra costs of more per diem, recrews, lost customers, missed connections, more train sets needed for each customer ?
It is very complicated. It will be too bad that we cannot find out how operating costs will go down for FEC when all the improvements are complete between Cocoa and MIA for Brightline.
PJS1 BaltACD The finance team (CFO, chief accountant, chief auditor, etc.) make recommendations to executive management. They tactical and strategic corporate decisions are made by the CEO with the concurrence of the board of directors. Bean counters hide behind their projected 'What ifs?' and their 'If this, then that'. Making the decisions and hiding behind their projections. If Finance doesn't know what element the CEO fears offending the most, you have to be kidding. Clearly, you know little about how the work product of accountants and finance people is structured and presented to executive management. You apparently know even less about how corporate tactical and strategic decisions are made. The overwhelming majority of accountants act in a professional manner. Their work product is based on robust principles. Moreover, their outputs are scrutinized by internal and external auditors. In the case public corporations, the scrutiny includes the IRS, SEC, etc. Cost accountants, who usually are employed by the corporation, present management with cost studies on a regular schedule. It is usually monthly. In most cases it does not take management very long to see that labor is a major cost driver. They may ask for scenario analyses to determine the impact of adds or deletes. But it is management that makes the decision with respect to headcounts. Not the accountants! The notion that professional accountants and financial analysts tell management what they want to hear as opposed to presenting properly supported financial data for their consideration is an insult. Equally insulting is calling accountants bean counters!
BaltACD The finance team (CFO, chief accountant, chief auditor, etc.) make recommendations to executive management. They tactical and strategic corporate decisions are made by the CEO with the concurrence of the board of directors. Bean counters hide behind their projected 'What ifs?' and their 'If this, then that'. Making the decisions and hiding behind their projections. If Finance doesn't know what element the CEO fears offending the most, you have to be kidding.
Bean counters hide behind their projected 'What ifs?' and their 'If this, then that'. Making the decisions and hiding behind their projections.
If Finance doesn't know what element the CEO fears offending the most, you have to be kidding.
Clearly, you know little about how the work product of accountants and finance people is structured and presented to executive management. You apparently know even less about how corporate tactical and strategic decisions are made.
The overwhelming majority of accountants act in a professional manner. Their work product is based on robust principles. Moreover, their outputs are scrutinized by internal and external auditors. In the case public corporations, the scrutiny includes the IRS, SEC, etc.
Cost accountants, who usually are employed by the corporation, present management with cost studies on a regular schedule. It is usually monthly. In most cases it does not take management very long to see that labor is a major cost driver. They may ask for scenario analyses to determine the impact of adds or deletes. But it is management that makes the decision with respect to headcounts. Not the accountants!
The notion that professional accountants and financial analysts tell management what they want to hear as opposed to presenting properly supported financial data for their consideration is an insult. Equally insulting is calling accountants bean counters!
This pretty much sums up every accountant I've met in my 40 plus years in transportation. The accountants present the data.. they develop the financial statements in accordance with Generally Accepted Accounting Practices (GAAP). They present their findings to the senior management team, the senior managers make their decisions based on many factors, including the financials and their interpretation. The accountant will tell you if you're making money or not.. if your numbers are consistent with industry norms.. and they will alert managers to any dangers as far as potential cashflow problems, tax issues etc. They also provide guidance on such things as equipment trade cycles by taking into consideration depreciation and maintenance upkeep and when old equipment should be reallocated or replaced altogether. They generally don't involve themselves in the mechanics of the business.. that's where the operations and sales people come in.
SD70Dude... Also, what background do most modern executives come from? Very few spent any time working on the shop floor.
Also, what background do most modern executives come from? Very few spent any time working on the shop floor.
And the few that have come from the 'shop floor' by the time they have gotten to the Executive Suite have forgotten that they were ever on the shop floor.
Equally insulting is the tendency for the accounting department and management in general to only think in numbers, as opposed to what those numbers translate into out in reality.
Cutting a budget or increasing stock buybacks by X% sounds so nice and simple, and is very easy to type out. But in reality that will translate into employees being laid off, maintenance being cut, and assets being sidelined or disposed of (think reduction of the locomotive fleet).
In turn those decisions lead to the remaining employees having to work harder, leading to more stress in the workplace among other things. Cutting back on maintenance leads to equipment breaking down more often and becoming more difficult to operate (a small example is how often locomotive toilets are cleaned), as well as more accidents like derailments. Having fewer assets in service will mean that eventually you can't fulfill your customer service obligations, resulting in lost revenue and perhaps inviting more government oversight and regulation.
You can quote all the data in the world to justify your recommendations to management, but you're still not making your decisions with a true understanding of how your company operates in mind. And you'll never experience their negative effects.
Greetings from Alberta
-an Articulate Malcontent
BaltACDObviously you are not observing 21st Century corporate practice - the 'top man' wants to hear what he wants to hear - subordinates either feed him the information he want to hear or they are looking for their next job.
The same applies to the 'top man.' He answers to the investors and the board of directors.
Obviously you are not observing 21st Century corporate practice - the 'top man' wants to hear what he wants to hear - subordinates either feed him the information he want to hear or they are looking for their next job.
Not saying that is right, just that it is.
Leveraged buyouts haven't exactly made any useful contributions, either.
charlie hebdo My personal opinion is that if you want the US rail infrastructure to function well, take it out of the profit/market motive.
My personal opinion is that if you want the US rail infrastructure to function well, take it out of the profit/market motive.
tree68 PJS1 Clearly, you know little about how the work product of accountants and finance people is structured and presented to executive management. You apparently know even less about how corporate tactical and strategic decisions are made. Management will make decisions based on what the stockholders tell them they want, especially major stockholders. And the stockholders seem to want an ever lowering OR. I have little doubt that there's a trickle down effect. As noted, the financial wizards are going to tell management what management wants to hear. If they tell management something management (and thus, the stockholders) want to hear, then they'll be told to "sharpen their pencils." This does not mean that accountants and other financial analysts are not good at what they do - it means that if they want a paycheck, they'll produce the desired results.
PJS1 Clearly, you know little about how the work product of accountants and finance people is structured and presented to executive management. You apparently know even less about how corporate tactical and strategic decisions are made.
Management will make decisions based on what the stockholders tell them they want, especially major stockholders. And the stockholders seem to want an ever lowering OR.
I have little doubt that there's a trickle down effect. As noted, the financial wizards are going to tell management what management wants to hear. If they tell management something management (and thus, the stockholders) want to hear, then they'll be told to "sharpen their pencils."
This does not mean that accountants and other financial analysts are not good at what they do - it means that if they want a paycheck, they'll produce the desired results.
Although PJS1 and I don't see eye to eye on some issues, some posters on here clearly do not understand the role of accountants and finance folks in corporations. I had some direct experience in corporate years ago. My father was an MBA comptroller and he told CEOs, etc. what the numbers were factually, hardly a yes man or a beancounter. As a psychologist I have heard from many corporate executives and folks in accounting. But some folks on here have a very narrow, distorted view.
PJS1Clearly, you know little about how the work product of accountants and finance people is structured and presented to executive management. You apparently know even less about how corporate tactical and strategic decisions are made.
Rio Grande Valley, CFI,CFII
PJS1 tree68 The two phenomena are at odds with each other. The operations people need people, but the bean counters don't want people. I held senior management positions in accounting, finance and audit for Fortune 200 Corporations for the last 25 years of a 40 year career in corporate America. I don’t recall a single instance where the chief accountant or CFO decided or even recommended how many employees the company should have. The finance team (CFO, chief accountant, chief auditor, etc.) make recommendations to executive management. They tactical and strategic corporate decisions are made by the CEO with the concurrence of the board of directors.
tree68 The two phenomena are at odds with each other. The operations people need people, but the bean counters don't want people.
And when that recommendation is couched as 'if you hire 100 people the Operating Ratio will go UP 2 points'! What decisions do you expect the CEO who is being beat up by Wall Street to make?
Ed Kyle charlie hebdo 10 years ago there was less use of DP. Now UP has many longer trains, what are essentially two trains counted as one. Definitely more than five years ago when I moved within sight of the mainline. I also see the saily moves from Belvidere which would not be seen in Richelle of course. Coal is declining and that trend will continue. Sadly those Belvidere trains may be going away. I've read that the Belvidere Assembly Plant is soon to shut down at the end of February. For what its worth, I did a 24 hour train count at Rochelle on January 17 this week via. webcams. 40 UP trains and 21 BNSF trains. 16 of the UP trains were intermodal. 3 were pure autorack, which wasn't common after PSR when they tended to be combined with other trains. Only one coal move. The total *is* higher than I've seen for a few years. - Ed Kyle
charlie hebdo 10 years ago there was less use of DP. Now UP has many longer trains, what are essentially two trains counted as one. Definitely more than five years ago when I moved within sight of the mainline. I also see the saily moves from Belvidere which would not be seen in Richelle of course. Coal is declining and that trend will continue.
10 years ago there was less use of DP. Now UP has many longer trains, what are essentially two trains counted as one. Definitely more than five years ago when I moved within sight of the mainline. I also see the saily moves from Belvidere which would not be seen in Richelle of course. Coal is declining and that trend will continue.
Sadly those Belvidere trains may be going away. I've read that the Belvidere Assembly Plant is soon to shut down at the end of February.
For what its worth, I did a 24 hour train count at Rochelle on January 17 this week via. webcams. 40 UP trains and 21 BNSF trains. 16 of the UP trains were intermodal. 3 were pure autorack, which wasn't common after PSR when they tended to be combined with other trains. Only one coal move. The total *is* higher than I've seen for a few years.
- Ed Kyle
Thanks, Ed. Did you notice how many were essentially double trains? The most useful comparison metric would be total # of cars daily average but difficult to obtain.
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