What I heard versus what I wanted to hear
Heard: Our
strategy is:
1.
Rate increases
2.
Small growth
3.
Small, targeted
capacity investment
Wanted to hear: Investment
in velocity to reduce cost, create value, fill RR up with IM traffic
Heard: Triple Crown to do auto-parts. IM will try to convert existing FAK, but
lanes don’t match well.
Wanted to hear:
Triple Crown expertise in door to door service will be applied to
existing IM lanes
Heard: Velocity trend is headed right direction
Wanted to hear: An
actual plan or strategy to increase velocity
Heard:
(analyst: less than 2006 traffic but
2006 employee count) Velocity is good.
Reduces recrews and overtime
Wanted to hear:
Aggressive pursuit of long pool crews through process
improvement/targeted investment
Heard:
comparisons to 2014
Wanted to hear: comparisons to 2013
Heard: implications that RR the way is will be just fine in the long run, we just
have to get back to previous performance levels.
Wanted to hear: There
is a fundamental shift from coal to intermodal and we have plans to configure
our assets accordingly.
Heard: nothing
Wanted to hear: something
about PTC risk, workforce transition and training, how technology is helping
velocity
Heard: employee safety
stats lead off operation’s slides
Wanted to hear: to
hear almost nothing about employee safety. It’s just one of many internal processes that
are important. Safety is not our
value-added product.
Heard: We are keeping assets because coal may turn
around
Wanted to hear: Coal
is dying, we are planning accordingly, specifically X, Y, Z.
Heard: we have enough crews.
Wanted to hear: We
have enough crews. I know we’ve said it
before, but this time you can believe it - here’s proof, or tell about a new process
that tells us how many is enough
Heard: nothing
Wanted to hear: Here’s
what we’ve done to make sure 2014 meltdown doesn’t happen again.
Conclusion: Management is completely in “reaction” mode
with short term goal of driving up share price to avoid a near-term take over. There is little or no vision beyond the next
12 months. Where we’ve been is all we
ever need to be. This is a recipe for a
slow death and/or a yard sale.
I suspect that my view of where Norfolk Southern should be headed is either not realistic or feather's the wrong nests.
That's why (among a whole host of reasons) I'm not the boss.