Australasian Railway Association

Heavy Haul Rail Conference

27 – 28 August 2014

Pacific National

“Transformation to Customer Service”

Stephen Cowan

Our values

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SAFETY We‟re committed to

getting our people home

safely every day

CUSTOMER Supporting our customers

to succeed is at the heart

of all we do

PEOPLE &

TEAMWORK Working together in partnership

is how we achieve our goals

PERFORMANCE Our decisions and

actions focus on delivering

superior performance

Australia’s Largest National Rail

Freight & Ports Operator

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Pacific National at a glance

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Approximately

41%

AUSTRALIAN

COAL EXPORTS

Approximately

70%

RAIL FREIGHT ON

THE EAST-WEST AND

NORTH-SOUTH LONG

HAUL RAIL

CORRIDORS

3,600 employees

581 locomotives

12,700 wagons

800 train services/week

156mt Coal, 24mt Bulk

Pacific National – NSW/Vic

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1,860 employees

360 locomotives

5,300 wagons

>300 train services/week

125mt Coal & Bulk

39 customers

22 Driver depots

11 Maintenance facilities

Integrated Service Provider

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Revenue by market group

Grain

Construction & Infrastructure

Short Haul Containers

Minerals

Coal

• Broad span of market groups providing diversification

• Ability to direct labour for peak demands

• Recognised industry leader

• Representation with regulators and industry bodies

Our Customer Environment

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• Lower commodity prices

• Higher $AU

• Increased production costs

• Reduced demand

• Environmental/Government hurdles

• High competition markets

Customer Environment

• Reduced expenditure (infrastructure)

• Focus on low cost operations

• Downsizing (contractors, employees, sites)

• Commercial pressure applied to Suppliers

Impacts

• Increased focus on efficiencies

• Using multiple service providers (road/rail)

• Increased focus on performance of service providers - Pacific National

Result

Customer Survey – Customer

Comments

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Just to improve on the

speed of matters would

be helpful

Have some terrific

people at PN Coal

The bureaucracy and

contractual control and

lack of flexibility

There are other

companies that do it

better

...put some energy into

translating their words

into outcomes

They do not take

ownership of issues in

the coal chain They are trying to

address the issues that

we have had to raise

It‟s always difficult to

find relevant

information

The biggest issue..is

not being flexible from

an end supplier point of

view

The people I deal with

are very good

Big and

arrogant...They need

more innovation, more

flexibility, more

continuous

improvement

Pacific National – Response

Adapt, Innovate and Outperform

Value for money – competitive market position.

Performance and reliability – do what needs to be done

Flexibility – adapt and change

Innovation – technical and commercial

Industry Participation – active engagement

Customer Centricity – structure for Customer outcomes

Outward looking Customer focus.

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Phase 1 – Customer Focus

• Customer alignment

• Customer engagement

• Performance measurement

• Operating mode

Phase 2 – Performance

• Focus on sustained performance

• Shift Management Review

• Asset Management plan

• Industry Influence

• Volume Growth

Change Management

Employee Culture & Engagement

“The Transformation Program intends to transform the business

into a high performing business that has an embedded safety,

customer service, teamwork and performance culture.”

Transformation

Customer Centricity

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In a customer-centric organisation, the customer is at the core of

everything. All processes and company activity are done in support of

what the customer is trying to accomplish

Transformation – Working Together

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Our Objective

To Safely Deliver the Customer Service Plan

Competitive Advantage

Delivery of superior customer outcomes in multi-user,

complex supply chains. Differentiation through end-

to-end capability, innovation, skills, knowledge, and

experience.

Performance Focus Hunter Valley Coal Chain

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Latent capacity released, cycle time reduced, variance to plan reduced

12% System Throughput Increase

80% Decrease in PN Unplanned Losses

Performance Focus Hunter Valley Coal Chain

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Efficiencies and change in operating mode

result in:

• Reduction in cancellations and

• Improvement in on time running

Turn Around in 12 Months

Customer Comments - Positive

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We are Starting to Look Like This!!!

Changing Old habits, Old Culture….

‣ “You have to admit you have a problem before you can actually

change or improve.”

Breaking down the walls

Creating a „One Team‟ culture

‣ Working Together, One Team. One Plan, One Best Way

‣ Monthly Interface meetings

Clear accountabilities

Centralised customer touch point – “Who‟s doing what?”

Clear communication – internally & externally

Honest, Open and Trusting

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Working Together

Questions

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