“Sorry Minister, we know it left Hamilton, but it failed to arrive in Taumarunui.” – NZ Railway Executive

The above quote is attributed to an executive from the state-owned New Zealand Railways in the 1980s. A farmer had written to Richard Prebble, the then Minister for Railways complaining that the Railways had lost his tractor. After weeks of fruitless complaining and an offer to pay $20 to compensate the loss based on some obscure statutory railway regulation, he wrote to the Minister.

Prebble then ordered the railways to find the tractor. A reply came back stating that the tractor had failed to arrive in Taumarunui. The distance by rail between Hamilton and Taumarunui is just under 160 kms. At the time, the NZ Railways was a monopoly, had 22,000 employees and was losing a million dollars a day. It was also losing customers, freight and sometimes whole wagons. With 22,000 employees in a small country like New Zealand they could not find a tractor!

Prebble then wrote apologetically to the farmer stating that they could not find his tractor. Frustrated that the bureaucrats (and the Minister) in the railways could not help him, the farmer decided to take matters into his own hands. He got into his car and followed the railway line. In a week, he found his tractor and six missing rail wagons!

Following this sad account of poor customer service, consultants were engaged. Their final report found many of the railway ‘managers’ had been promoted “simply because they looked the part”, “have been “yes-men” to their superiors”, and “never take a decision for which, if it fails, they can be held to account”. The railways were later privatised.

What is the lesson for managers here?

An organisation with 22,000 employees, even with the direction of the Minister could not compel its employees to care enough for its customers to find something as big as a tractor. Clearly, not only did the employees not care, but management was also either ineffective, incompetent or had no authority or a combination of all of the above. This is also a great example of how sadly how poor culture ‘kills’ an organistion, in this case corporate culture! It can be defined as ‘how we do things around here’, and it is intangible but can be ‘felt’.

Successful organisations need clear goals. Management not only needs to be responsible, but held accountable and have the authority to act.

@thenetworkofconsultingprofessionals