Situation

The railroad industry relies on a strong infrastructure, but there’s often a Catch-22. In times of plenty, railroads tend to be so overwhelmed that track maintenance becomes a "reactive" process, while during downturns, keeping costs low can take a toll on maintenance plans. Scheduled maintenance is one way rail companies solve this problem.

A North American class 1 railroad was experiencing record traffic volumes, but its physical infrastructure was a potential roadblock to further growth. Maintenance staff was stretched so thin that the company was perpetually in firefighting mode and struggling to be proactive. The company looked to Kearney for a better way to schedule and keep ahead of track maintenance.

Approach

Based on our assessment, it was clear that our client could clearly benefit from a long-term transformation of its maintenance program with the goal of simultaneously reducing costs, improving service, and increasing capacity. Becoming a world-class maintenance organization also means better planning and preventive maintenance, which improves productivity, reduces capital expenses through extended asset life, and lowers inventory and delivery costs.

We took a transformational approach to this project, helping the company move from a starting point of reactive operations through four increasingly sophisticated stages of development: transforming to a proactive approach, sustaining improvement by embedding change throughout the organization, innovating with a continuous-improvement mindset, and integrating to understand the total cost of failure to the organization.

Such transformations, however, require a cultural shift. So we recommended launching the new maintenance program in conjunction with several initiatives:

Improve maintenance planning processes
Expand preventive maintenance programs
Strengthen the capabilities of reliability engineering
Realign the organization for greater mobility
Integrate materials management into maintenance processes

Impact and advantage

Changes across the organization to planning and maintenance have meant that engineering requires less track time and can complete more work orders. The railroad quickly reduced its slow orders by 25 percent and improved its maintenance capabilities—raising productivity and reliability and reducing unscheduled maintenance. As a result, the railroad has been able to increase capacity—running more trains with fewer failure-related delays.