Henry Hattenrath
Project Consultant| Tectonic Engineering MSA LLC
New York, Ny, United States
What Did You Tell the PM was the Commuter Railroad Company’s Risk Policy-Part 1?
This is the first in a series of articles that will comprise a mock-version of a Risk Policy for a Commuter Railroad Company (CRC). This article covers the scope, purpose, Mission/Vision, customer satisfaction attributes and objectives and goals.
Future articles will cover other policy topics for typical risks, philosophies for managing risks, risks to accept, risks to transfer, risk to avoid, and managing project risks.
Scope
This Policy covers a broad range of topics that focus on the typical risks to operation [usually the Transportation Department] of its core business at the Commuter Railroad Company (CRC) directly affecting:
• Infrastructure, including right-of-way assets and transport vehicles
• Performance metrics, including customer satisfaction, on-time performance and other commitments
• Daily operations and internal processes
The policy summarizes its philosophies for managing risks and provides guidance to its employees on managing risks with the greatest potential impact from risk events. Many other risk events with less direct impact to the operations are managed through lower tier Policies.
This Policy is complemented by other lower tier Policies, procedures and processes that support the normal operating functions in the CRC’s organizational structure with separate responsibility silos that include: Safety, Security, Police, Human Resources, Procurement/Contracts, and Legal Departments.
Purpose
• To ensure the Risk Management Policy is documented, recognized and understood by CRC employees, and
• To assure that risks encountered on capital projects can be managed by Project Managers across all core business functions, while minimizing any negative risk impacts and maximizing benefits from positive risk impacts.
Mission/Vision Statement
The CRC’s Mission Statement is:
Provide World Class transportation to customers, and implement service schedules and operation and maintenance plans that complement and enhance the communities we serve.
The CRC’s Vision is:
To be recognized as the Benchmark for effectiveness, efficiency and service quality on commuter railroads in the USA.
External Customer Satisfaction Attributes
The CRC’s Business Plan identifies 7 performance attributes (indicators) that are used to monitor and assess progress on meeting established annual goals. The performance indicators and the monitoring departments are:
• Reduce Employee and Customer Accidents (Safety)
• Increase On-Time Performance for Schedule Train Service (Operations-Transportation/Engineering/Maintenance of Equipment)
• Improve Overall Ratings on Customer Satisfaction Survey (Marketing)
• Market Share of Public Transportation (Marketing)
• Control Net Operating Expenses at or below Established Budget (Office-Of –Management and Budget[OMB]/Fiscal Control)
Internal Customer Satisfaction Attributes
Governed by several internal policies and procedures, the CRC identifies, measures and reports on several attributes for internal customer satisfaction. Some of the attributes and the responsible enterprise, which cross management and business functions, are:
• Maintaining material inventories (Procurement and Logistics)
• Operating office systems and business technology (Information Services)
• Processing employee payroll (OMB. Fiscal Control)
• Processing of Accounts Payable (OMB/Fiscal Control)
• Processing Reimbursable Expenses (OMB/Fiscal Control)
• Maintaining Strategic Business Plan, 20 Year Needs Assessment, Five Year Capital Program Plan (Strategic Investments, Engineering, CPM, Maintenance of Equipment)
• Managing Capital Program (Engineering, CPM, Maintenance of Equipment)
• Completing Annual Performance Review (All Depts.)
Synergy Between Objectives and Goals
The goals for the performance indicators are:
• Employee & Customer Accidents
• On-Time Performance
• Overall Customer Satisfaction Rating
• Market Share
• Operating Expenses
The synergy between performance indicators and annual goals, and the departmental level goals is vetted during the annual budget process. Each department establishes budgets for headcount, operating expenses, reimbursable expenses (expenses repaid by outside funding sources for capital improvements), and goals for indicators that are correlated to CRC’s performance indicators.
Additionally, departments supporting the CRC’s Capital Programs (Capital Program Management, Engineering, Maintenance of Equipment, and Strategic Investments) present supplementary goals for project/ milestone dates and funding requirements/expenses.
Conflict Resolution/Prioritization of Competing Objectives and Goals
While core business performance indicators are the primary focus of risk management, there will be other supplementary project dates and funding requirements should be integrated into corporate management of risk affecting performance indicators. As a result, there may be times where conflicts for resources arise.
In all cases, the needs to sustain core business functions and maximize achievement of corporate performance indicators supersede the needs of individual projects. As a result, changes in project benchmarks will occur, and as may be needed, the CRC’s Capital Program will be adjusted accordingly.
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