Improved
schedule integrity will be an
immediate
spin-off
Herman Evert . . . ‘We have to adjust our planning
to where the profit
margins exist.’
Leonard Neill
SPOORNET HAS justified its recent R1.4 billion IT investment in the face of continued wagon shortages with a clear statement: “Spoornet cannot finance equipment which is unlikely to bring in profits. Spending R1.4billion in a five-year contract in which most of its IT operations are outsourced, on the onther hand, enables the rail utility to make immediate and vast improvements to both schedules and general efficiency.”
The private industrial and commercial sector in South Africa should realise this, and understand the problems which Spoornet faces at present, says Herman Evert, general manager, strategy and systems.
“We do not proclaim that we are perfect and we admit to wagon shortages. But we are not sitting back and saying we are happy with ourselves either,” he says.
“We could go out and buy wagons and locomotives to make everyone happy, and if I could do just that and make immediate profit, everyone would love me. But if on the other hand Spoornet is bankrupt in two years as a result of the expenditure not showing returns, will the Government step in and take over the payments? Or who will come to our assistance?
“We have to be realistic in these matters. We have, for example, had complaints from timber growers who require service on lines that are otherwise little used. If we poured in transportation to meet all their requirements it might give them what they want, but we would be running our side at a significant loss. Three years from now they could be sunning on a Caribbean island, enjoying their good fortune, but where would we be?
“No, we don’t walk away from profitable business. But we have to adjust our planning to make a profit. The railway exists for us to make money. There are rolling stock shortages, but you cannot have more assets than what you can profitably deploy. That is why our buying pattern must be carefully planned.
“The seasonality of freight has to be weighed up against all the complaints we receive. We must look at which modes are suited to carry base loads and which are suited to peak seasons.
“We are a business, but one that is painfully aware that our success can only follow that of our customers.”
Evert is satisfied that Spoornet’s recently adopted approach of meeting each industrial sector in face-to-face talks is proving successful. Already, he says, such meetings are proving valuable and profitable to all concerned, and individual Spoornet personnel have been allocated to deal with each.
“I think the private sector as a whole is beginning to appreciate our attitude. When you look at the country’s roads, you cannot eliminate congestion by building more roads. Instead you plan to re-direct the traffic. Likewise, by discussing with industry, we are bringing about vital fundamental changes in efficiency.”
