An Enterprise Approach

Edward McKeiver

VP Service Delivery Coal Markets

Aurizon

30th April, 2014

Sydney Harbour Marriot

Aurizon• Operations across all

mainland States

• 2,670km of track owned,

managed and operated in

Central Queensland

• 267mtpa of volumes hauled in

FY13

• ~7970 employees

• $9.6bn of total assets

• Market capitalisation of ~$8bn

Derailments – Situational Appraisal

• FY12 – One derailment every 38hrs

• 230 derailments (33 Mainline, 197 Yard)

• A complex risk profile

• Legacy infrastructure conditions

• Human Factors (lapses, procedures not followed)

• 67% on QR National Infrastructure, 33% on 3rd

Party Infrastructure

• Investigation ownership, reporting and analysis

needs significant overhaul and improvement

• 80% in Queensland including 55 wheel

obstruction derailments

Focus

• Enterprise problems require Enterprise solutions

• Required a leadership paradigm shift in standards and

expectations to drive cultural change

• Derailments are not the norm or acceptable

• A significant training exercise needed to be undertaken to

heighten derailment risk awareness

• Accountable Line Management needed support

• Collaborative Leadership expected

Derailment Prevention Community of Competence (CoC)

• Representatives from across the enterprise with a specialized

focus and interest in preventing derailments (network)

• Charter - To develop and foster best practice derailment

prevention solutions and facilitate their implementation across

Aurizon to eliminate derailments

• New leadership

• Appointment of a full time resource

• Systematic approach and refocused enterprise strategy

Strategy – FY13

• 3 Core Areas

• Improved collection and utilisation of data – critical in

understanding the levers to drive future strategy

• Uplift capability - investigative talent and derailment

precursor awareness across the enterprise

• Creation of safe operational yard infrastructure – high risk

interventions in known “hot spots”

Data, Reporting and Analysis• Reinstatement and mandated requirement

for detailed derailment reporting (Form 7)

• Regular analysis of levers to drive strategy

12377%

3019%

42%

32%

FY13 - All Derailments by State

QLD

WA

NSW

VIC

230

115

160

0

50

100

150

200

250

FY12 Count FY13 Target FY13 Count

FY13 - All Derailment Performance

Total

Linear (Total)

Total FY12: 230Total FY13: 160

Improvement30.43% (Direct Count)

46.71% (Normalised Mtkm)

Rate FY12: 7.81Rate FY13: 4.16

129

53

125

17 14

64.5

26.5

62.5

8.5 7

82

37

1410 12

5

0

20

40

60

80

100

120

140

Bulk Coal Rollingstock Network Intermodal Iron Ore

FY13 - All Derailment Performance by Function

FY12 Count

FY13 Target

FY13 Count

10

8 8

7

6 6

4 4 4 4 4 4

3 3 3 3

2 2 2 2 2 2 2 2 2 2 2

0

2

4

6

8

10

12

FY13 - All Derailment Frequency by Location - Count > 1

Count of Location

103 out of 16065% of Sample

11041%

5018%

4517%

218%

145%

135%

93%

62%

21%

FY13 - All Basic Causation - All Levels

Engineering

Mental/psychological

Job Factors

Organisational

Motivational/communication

Physical/physiological

Knowledge, skill and experience

Management systems

Abuse or misuse

2440%

1423%

1423%

59%

35%

FY13 - Track, Roadbed, StructuresImmediate Causation

Track geometry

Points and Crossings

Roadbed

Rails, Joints, Fastenings, Sleepers

Other Way and Structures

Capability Uplift

• 60 Derailment Prevention

Champions (DPC’s) trained

across the enterprise

• Systems approach including use

of ICAM

• Support investigators and line

management to take proactive

approach in derailment

prevention

• “Tools” deployed in strategic

locations – quality investigations

Networking and the Learning Organisation

Enterprise Awareness

• Intranet site with

resources

• “Toolbox Talks””

• Learning Packs

• Video Resources

• DPC SharePoint site

• Awareness of every

derailment

• Shared reports for

learning

Sharing the Learnings – Salmon Gums

• Play Example of CoC Video

Infrastructure Interventions

• Targeted interventions in known

“hotspots”

• Closure/removal of high risk

locations

• Investment to restore to standard

• Townsville

• $1.9M

• 35 derailments down to 10 (FY13

compared to FY12)

Strategy – FY14

3rd Party Engagement

• Create tension and reinforce

accountabilities

• Collaborative approach including

joint investigation

Best Practice Standards

• Single Enterprise Standards (1/2

Distance Protection)

• Standards as reference point for

factual investigation

• Support for National Standards,

COP’s and Guidelines

• Rail Welding and Rail Stress

Management

Derailment Prevention Awareness Program• ½ day workshop for operational

staff including leadership teams

• Proactive approach to

identification of derailment

precursors

• Engaging and gaining

commitment

• Rollingstock, infrastructure and

human factor focus

• 5% of “front line” trained to date

Other Strategic Initiatives

• Establishment of Infrastructure Rail

Management Team (“blue” roads) –

“Whole of Life” asset management

• Replacement of “sensitive”

rollingstock – Minerva consists

• Improved ballast wagon design

• Wayside detection “supersites” and

use of ACFM technology

Results – On Target FY14

Summary

• Holistic enterprise/supply chain/industry approach required

• Given human factors, engagement and leadership is paramount

to drive change in the safety culture

• Success is underpinned by activities aimed at becoming a

“learning organisation”

• Use Standards as a factual reference base.

• Leverage Community - Collaborate to share, learn and grow.

• Never stop asking “why?” (systems approach and basic

causation)

• Improved Safety/Stakeholder outcomes for all.

Questions

Thank You

The “Champions”