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How TTX, a key connection in North America’s railroads, hauled all its back office onto the cloud.
By Margaret Harrist | July 2021
We’ve all waited (somewhat) patiently in our cars as a long train cuts across the road. And if you were observant during those rail crossing stops, you would have noticed that many of the railcars going by are yellow, with TTX in red letters.
But did you ever consider the complex supply chain operations behind those railcars? How do you get the right type of railcar in place at the right time to carry anything from cars to lumber to gravel bound for multiple destinations? That’s where “railcar pooling” comes in—and TTX is a company privately owned by North America’s leading railroads that makes this crucial part of the supply chain far more efficient.
TTX owns a fleet of 168,000 railcars—including flatcars, auto carriers, boxcars, and open-top railcars—that is operated as a pool shared by the railroads. This pool gives them flexibility to quickly adapt to market demands and cuts down on the waste of returning empty railcars. The company is permitted through the Surface Transportation Board, part of the US Department of Transportation, which regulates railroads and pool railcars.
“Railroads own a certain amount of track going from location A to B,” explains Vicki Dudley, TTX CFO and treasurer, during a recent Oracle Live virtual event focused on cloud applications. “If they're not operating in a pool, when a railcar gets to the end of point B, and they don't have another load to pick up, they have to haul it back empty. Within a pool, they can interchange with other railroads, including railroads that don't actually own TTX. This saves money for the industry and allows the railroads to offer cheaper prices to shippers. We’re not here to maximize profits, but to provide the right type of railcar, in very good condition, at the lowest cost that we can while keeping our financial health.”
While TTX is privately owned, most of the railroads that own it are public companies, so TTX’s financial reporting needs to be compliant with Sarbanes-Oxley requirements, she says.
“The Oracle solution proved to be the most complete, modern suite of enterprise applications on a common platform. It allows us to concentrate on our business and not on the technology that supports it. That’s what we were looking for.”
But the company was running on a heavily customized, on-premises SAP ERP system, custom code, and software as a service for a number of different functions, which resulted in a lot of manual effort, says TTX CIO Bruce Schinelli, who joined Dudley and Steve Miranda, Oracle executive vice president of applications product development, for the Oracle Live event.
This patchwork of solutions was supporting critical business processes, and it made adapting to change or even keeping up with technology advancements nearly impossible, Schinelli says.
As TTX considered alternatives, the team created a rigorous scoring criteria to evaluate various options across HCM, supply chain, and ERP, with a goal of moving to a solution that was mobile, modern, well-supported, and on a single platform.
“The Oracle solution proved to be the most complete, modern suite of enterprise applications on a common platform,” Schinelli says. “It allows us to concentrate on our business and not on the technology that supports it. That’s what we were looking for.”
“Big kudos to the team members, who were working with a new system and a new work environment and were able to close the year out without missing a beat or causing any operational challenges,” Dudley says. “The fact that we were working from home didn't hurt our ability to rise to the challenge of 2020.”
That year had two distinct parts for TTX. In the first half, the company saw a big drop in railcar usage—not surprising, as this is a leading indicator of the economy—and the company was able to quickly recognize that and work to control costs, she says. But in the last half of that year, usage picked up to the point where TTX met its financial plan by the end of 2020.
Now, after a year and a half on the new systems, the TTX team sees business processes more as end-to-end rather than as isolated tasks, she says—and that’s helped to break down silos in the company.
The cadence of quarterly updates to the cloud applications that Oracle provides has also been a big change. “We put together a process to evaluate and test new features,” Dudley says. “When we were on premises, every change was a huge project and because of that, the software really hadn’t evolved for many, many years. We’re now seeing that we can continually improve and evolve our business processes so we can be best in class where it provides savings or benefits for our owners.”
The days are over when a company could get away with creating a highly customized software system and run it for years without updates, Schinelli says, for a lot of good reasons.
“Frequent updates and improvements ensure a constantly improving business process, as well as safety and security,” he says. “The likelihood that we're going to create some kind of system that provides business processes that are better than anything that everybody else is doing is vanishingly small. The best thing to do is find the right partner to drive you toward industry standards.”
Oracle has been a good partner in TTX’s transformation, Schinelli and Dudley agree. In addition, representatives from TTX participate in the Oracle strategy councils for finance, SCM, HCM, EPM, and analytics, helping to define future product development.
“We're taking advantage of any opportunity that we can to engage with Oracle, give feedback, and express our opinion on some of the future features that might come out,” Dudley says. “I think we've laid a great foundation with the software, and the relationship will continue to evolve as we try to reach our goal of being more efficient and cost effective. In my opinion, the best is yet to come.”
For those just starting a journey to the cloud, Dudley offers a few lessons learned:
Photography: Courtesy of TTX
Margaret Harrist is director of content strategy and implementation at Oracle, where she focuses on digital disruption, enterprise resource planning, supply chain, Internet of Things, and SaaS. Follow her at @mharrist.