Intelligent Rail Systems….But where’s my cargo?

Jim Taylor, Vice President, Travel & Transportation Industry Group, CSC

I think the rail industry’s advancements in the use of technology are great, as they bring our society closer to the realization of a vision for effective transportation systems. But an Intelligent Rail System has the potential to be yet another example of a victory in isolation unless it is part of a more holistic approach to Intelligent Freight or Passenger Transportation systems. Taken in isolation, it is an advancement no doubt, but if Intelligent Rail was developed in concert with container shipping lines, truckers and logistics service providers, it would be a major breakthrough.

Don’t get me wrong, it is great to know where a train is, even better to know that it is operating in a safe manner and fantastic that it has the ability to adjust its speed and route based on real-time traffic and route-setting adjustments based on alerts and notifications. But having the ability to provide real-time updates back to customers on where their cargo is, and the condition of that cargo if temperature-sensitive or if hazardous, is the more important breakthrough that is still pending. Further, to know when it will arrive at the destination rail ramp, how that compares to a customer’s inventory planning schedule, whether the payments to release it have been made and whether the next leg of transportation is standing by waiting for the cargo arrival – this is the paradigm shift that consumers and retailers are demanding, and thus the REAL challenge facing the rail industry.

A few years back, the freight railroads in the U.S. took a stab at improving cargo or shipment velocity by shortening the number of free days a trailer or container was allowed to sit on their rail terminals.  The “free storage” interval went from five days to two.  While this was a painful (and expensive) change to impose, users of the services (cargo owners) adapted and were able to move their cargo faster.  This meant better utilization of land, and significantly better utilization of the rail network and infrastructure.

The movement of freight via trains, much like ships, is a very capital intensive business. The only way to get the kind of returns necessary to justify these capital investments and the renewal of infrastructure is to increase the throughput – the volume of paying cargo or paying passengers – across this system.  Optimized cycle times to execute processes is crucial, and making the system easy to use by customers is another critical success factor. To achieve both of these goals, the systems have to be intelligent enough to generate accurate and timely data, which then must be converted into usable information.  That information in turn is used to help model and predict areas for improvement in processes, as well as to make it easier for customers to know when and where trains will arrive with a high degree of confidence. Rail transport systems today (as well as air transport) have significant buffer time built into schedules. This is partly due to congestion in the systems, but also due to poor data, and thus poor information. Schedule integrity and on-time performance reliability are not where they need to be.  We can do better, and the investments being made are a good indication that railroads are willing to spend money to improve their operations.

Hopefully, other players in the value chain will benefit from the railroads’ investments and attempts to improve their systems. As a user of rail services for many years, I am glad to see they have stepped up to the plate. I just hope we can create forums and initiatives where these advancements can be discussed and debated in order to create a more integrated approach and commitment to an optimized network of freight transportation for the entire country. Ideally, improving the velocity of shipments will lead to even lower transportation costs, better utilization of assets and, oh yeah, perhaps happier customers along the way!

This entry was posted in Innovation, News, Transportation and tagged , . Bookmark the permalink.

One Response to Intelligent Rail Systems….But where’s my cargo?

  1. Mary Jo MOrris says:

    JIm – like your post. Good way to inform us all on the value of our vertical. Thanks.

    Mary Jo

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