RAILS REALIZE EDI IS THE LIFEBLOOD OF THE BUSINESS

RAILS REALIZE EDI IS THE LIFEBLOOD OF THE BUSINESS

Railroads are learning to speak their customers' electronic language. They have no choice, if they want to stay in business.

Customers want electronic data interchange, and the marketplace will punish us if we do not go along, said Norman G. Heller, assistant vice president, marketing, Norfolk Southern Corp., Atlanta, Ga.Mr. Heller was speaking at the Connecticut Maritime Association seminar on EDI held here last week. Other panelists seconded his message.

EDI is the language railroad customers want their carriers to speak. EDI is computer-to-computer communication using highly standardized electronic versions of common business documents.

Railroads created EDI about 20 years ago. But they did not keep up with the technology to which they had given birth, Mr. Heller and other panelists said.

Now they have no choice.

Our customers are dragging us into it, Mr. Heller said.

Speaking of his railroad in particular, Mr. Heller noted that Norfolk Southern came to be regarded as a slow starter in EDI.

We have seen the error of our way. It is in our interests to be an aggressive supporter of EDI, he said.

Because the electronic messages it uses are highly standardized, EDI easily can leap corporate and modal boundaries.

EDI can handle tasks from paying bills to issuing invoices to tracking shipments. Luring railroads away from the technology was the use of incompatible computer systems as a marketing tool.

Railroads hoped customers would adapt their computer system and not those of their competitors. Instead, customers accumulated piles of incompatible computer programs and a steadily increasing level of frustration.

Now the tune has changed. If you're really intent on doing business for your customer, don't be so selfish about it, said Don Odegard of Southern Pacific Transportation Co. of San Francisco, Calif.

Compatibility is an essential ingredient of rail-oriented electronic communications system, Mr. Odegard said. However, many of those who regard line-specific systems as utterly incompatible are incorrect, he said.

Southern Pacific became known as one of the most vocal proponents of line- specific system through the push it gave its Liberator system. But Liberator is not as incompatible as some claimed, he said.

All along, the company's billing programs have been transmitting documents formatted in the Transportation Data Coordinating Committee formats, he said.

We support the generic one, he said of standards.

Customer service benefits of EDI can be substantial, said Joseph Waldo of Consolidated Rail Corp. of Philadelphia.

Conrail has been the most vocal proponent of EDI in the rail industry. A year ago it informed its third party freight brokers they would have to start using the technology.

Every one of those consolidators is on EDI now, he said. As a result, the number of error disputes has been cut in half, he said.

In addition, the amount of manual effort needed to process data has declined sharply and less time has been needed to conduct audits.

The program has been very successful, Mr. Waldo said of Conrail's EDI push.