Indian Railways’ Turnaround and Pakistan Railways in crises allaround
While reading the book of Organizational Behavior, I reached at the appendix in which comprehensive cases of some individuals (Arnold Schwarzenegger, Mahatma Gandhi etc) and some successful Business organizations like Walt-Mart, Apple Inc. were given. I continued to turn the pages to reach at the end of book. Suddenly I saw a heading “Indian Railways: A Turnaround Story”. I started to read this story.
You would tend to think that what is special in it. . .The reason why i took interest in reading is that Pakistan Railway is going through a crises and is going constantly in decline from past few years, so success story of same department of neighboring country pulled all my attention.
The book states :
Indian Railways, the largest bureaucratic organization in the world, made a surplus of INR 130 billion in 2005-2006 and of about 200 billion INR in 2006-2007……
How can the indian Railways, which was running into losses or marginal surplus for years together show such results ? Surplus was as low as 1.49 billion in 1999-2000. Lalu Parsad Yadav, the minister of railways of government of India, has been able to bring in positive results. He reposes faith in 1.4 million employees of Indian Railway.
Lalu Parsad Yadav, Yes ! Lalu parsad Yadav is the man who lead Indian Railways and within two and half years, he made Indian Railways into Profits…
What did they do to Improve Indian Railway ?
What they did is what B-schools teach. They analysed various operations of the railways and also the competition. Ideas for improvement were taken from officers at various levels and also from best practices abroad. They then came up with the success mantra: running heavier, longer and faster trains. For this, they took many initiatives such as increasing axle load for goods train, adding more coaches to passenger trains, market-oriented tariffs, reducing wagon turnaround time, extending platforms to match length of trains, key freight incentive schemes and passenger-profile management. They were to a great extent successful in bringing back the business they had lost to road and air.
Some critics have pointed safety concerns, which is about the damage an overloaded train can cause to the tracks. Already there have been cases of track failure. But, with a proactive management this can be overcome. What is more important is that Indian Railways is now the second most profitable public sector venture of the country.
Few people know that the railways was not the first preference of Prasad, who wanted the home portfolio. But, once he got the new responsibility, he made up his mind to turn it around. He brought in Sudhir Kumar as his officer on special duty (OSD). This choice was critical. Unlike many Indian Administrative Service officers who don’t care to learn and grow after clearing the civil services exam, Sudhir Kumar constantly updated himself by attending various management programmes at the Indian Institute of Management, Ahmedabad (IIM-A) and the Administrative Staff College of India in Hyderabad. There he honed his management skills.
After becoming Prasad’s OSD, he maintained his linkage with IIM-A. The railways funded IIMA to do research and develop a case about its turnaround and also get suggestions for improvement.
I was amazed by media reports that raised aspersions about this sponsored research. Wasn’t lack of this kind of industry-institute interface bemoaned by academicians? How many Indian companies have taken this kind of initiative to develop cases by sharing their data with B-schools, let alone providing funding? Indian Railways has also set an example by setting a chair in IIM-A, which will enable researchers to study its infrastructure developmental plans and future prospects. They have also given consultancy projects to other top IIMs.
The rail ministry is convinced of the impact of good management education on the efficiency and growth of the railways. To give a global perspective and adequate training, the ministry has mandated that senior members of the staff get the best of learning from top global B-schools such as New York University’s Stern School of Business, Insead campuses in France and Singapore, and HEC Paris. They also are talking to Wharton, the Harvard Business School and the Massachusetts Institute of Technology’s Sloan School of Business, for advanced management programmes, which will be tailor-made for the railways.
Though most of the ideas for transforming the railways did not originate from him, Prasad deserves his share of credit. Besides selecting right officials, he also empowered them to try out new ideas and made sure that there are no impediments in their functioning.
No doubt, the railway turnaround is a big image and morale booster for Prasad. But, it is also a lesson for our politicians that if they can’t be completely incorruptible, they can at least provide leadership simply by leveraging India’s intellectual capital.
Pakistan Railway – at a glance.
“We have been warning officers for the last three years that the railway system will collapse but our supervisors ignore our recommendations,” says Sagheer Cheema, a mechanic who has been with the organisation for 25 years, speaking on the current disarray that engulfs Pakistan Railways (PR).
Pakistan Railway is running into losses from past few years, despite that it is the major medium of long-term transportation of majority of Pakistanis, PR is unable to maintain itself as a profitable organization. In the mid of 2011, PR becomes totally bankrupt and all of the goods trains were stopped due to the severe shortage of locomotives and fuel.
The situation become worse leading to the cancellation of as many as 115 railway services.Ac service was also stopped in many train.The trains which were running faced the record late arrival and departure leaving passengers into countless problems….
As most of the government corporations,Pakistan Railway is also suffering from internal corruption.In the near past, many corruption stories was highlighted in media and there are many more which do not takes a place in news headings.
Selling of Railway’s used wood at lower prices is just a new example. In 2008 Government placed orders for the procurement of 75 locomotives from a chinese firm.It is said that ,60 locomotives from the same firm was purchased in 2000, out of which 53 are now standing out-of-order, because their spare parts are not available and the maintenance cost is too high and the rest of engines are still running at lower efficiency.
Some steps taken for Restoration of Pakistan Railway…
On 29 December 2011, PR restored freight train service from Karachi to upcountry.
On 4th Feb 2012,he First Pak Business Train made its first journey from Lahore to Karachi.The train is equipped with modern facilities. Passengers can enjoy LCD TV, WiFi internet and fast food. Each coach has a security guard, sweeper, three hosts and is equipped with security cameras.
On the same day the Pak Business train reached Karachi, it was announced that 5 more trains will be run in near future by the help of private sector.
Several bailout packages were announced by GOP of which initial installments were payed to the PR but Railway minister always seems unhappy with government complaining the non-payment of funds …
Steps to be taken yet….
The first and foremost problem PR facing today is shortage of locomotives.PR officials say that at present around 90 engines are on the tracks – out of a total fleet strength of 500. Thus less than 20% of engines are in working condition.So immediate procurement of a good number of high quality engines should be the first priority of PR. Alongwith,
- Railway Minister should be changed as “good Leadership can change the fate”
- Changing the top-level management
- Inductance of experts on the “Right man for right job” basis.
- Cutting off the Internal non-productive expenses.
- Cutting off the extra employes which are “burden” on PR.
- Decreasing the expenditures of Railway Ministry.
- Manufacturing of Quality engines within the country to meet internal demand.
- Provide passengers with all modern facilities, so to attract passengers and to develop a good positive image……
There is always a chance for improvement.These are few of the most necessary steps to be taken by PR management in order to turnaround the present situation of Pakistan Railway.