THE january • february MAGAZINE 1973 'Market orientation applied' The Traffic Department Vice Pmsident Market PROFIT Development CENTERS and Pricing G. F. Reynolds . Ass!. Vice Pres. Automotive, Manufactured 8. Miscellaneous Products o · Ft E. Bennett Regional Manager Sales New York G. V. Valley N JAN. 16, as part of the Milwaukee R oad's increasing L. W. Schroeder O emphasis on marketing, the Traffic Department under­ went a major restructuring to meet the changing needs of the railroad's customers. The department's new organiza­ tional framework (shown above) is designed to make the railroad more effective in identifying and solving customer Director of Services distribution problems. K. G. Hosfield "We l1ave a sembled into one responsibility group all the elements necessary to provide immediate, innovative Restructures for 'Profit' ". ". "\ r "\ ,""I Director of Directo r of . - -. Director of Director of Pricing-Grain Prici ng-F06d Marketing Research Customer Relations W. H. Wall G. W.·Gunder R. H. Burn H. A. Springer " ~ Director of . Director of Director of , Pricing Marketing Research Customer RelaHo,ns R. J.Stephenson G. U. Fisher E. S. Rogers \. ./ I' I' Director of Director of Director of Pricing Marketing Research Customer Relatio ns R. T. Fleming E. A. Weill J. M. Fortrilan ., "­ .:/ " " - ". - "\ r: "\ ". ." Director of .oi rec.tor of. Oirector of . Pri cing _ Marketing Research Customer Rela·ti ons W. P. Mulien R. 'J. Hodor . P. A. Larson j \. ./ " I I " ". "\ I' ""I Ass!. D.irector Manager Pricing' Manager Pn ci ng Pricing '" IFA '" Manager Pri cing - E;CcWRTA TCFB .. WTL GF.TC ,NL MONT L. E.Fancher F. K. Brennan R. M. Vieth "- ../ I ""I Manager Tariff Manager Divisions -­ M anager Commerce Publn. and Rate """ .. Quotations R. O. Peiers. G. B.Bowman E. P. Hora "- ./ ./ I' Regional Manager Regional Manager Regio nal Manager Regional Manager Regional Manager Sales Sales " Sales Sales Sales Detroit Ch icago Milwaukee Des Moines Washington D.C. D. C. Workman Van Dunfee J. L. Phleger G. F. Meinlzer M. E. McCarrell ./ "­ ./ I I I I I I " I " "\ ". Regional Manager Regional Manager Regional Manager Regional Manager Sales Sales Sales Sales Kansas City San Francisco Seattle Portland B. H.Desens D. W. Cooksy D. A.Kelier J. H. Mitcham ./ " ./ " I I "\ Director Director of Sales Analysis Sales Control and Planning W. J. Donahoe S. F. Lupe \. " ./ and productive responses to the each of whom has for both the profit centers and the sales transportation needs of our ship­ one of the major components. force. H. Kronberg, vice The vice has re- The Profit Centers said. "The to him all of the Milwaukee At the heart of the Milwaukee ment's new framework will allow our Road's field sales force, an Road's effort are the four traffic people to work with assistant vice and 11 centers. Since the term each other and the customer to tailor regional managers of sales. This center" is not completely the railroad's capabilities to the cus­ includes managers, sales rp,."rp~pnt atory, some confusion about these tomer's particular situation. tives and staff at all of the railroad's groups might arise without proper ex­ "The challenge we face is 53 sales offices. Reporting directly to of their purpose and func­ the service that the Milwaukee can the vice president-sales are a director tion. as attractive and profitable to of sales and planning, a di­ The of the center customer as possible. This chal­ rector of sales control and a director that the best way lenge is the essence of our of services. Each director is in charge a railroad to make money is to strategy, and we are totally com­ of a staff which a support sell its mitted to meeting it." role vital to the overall sales and mar- a form that The restructured Traffic effort. compo­ Under the vice president-market the profit centers do is cut nents which are to work development and pricing are the four across traditional organizational lines together to identify commodity-oriented profit centers, and effectively bring together all and solve the distribution both and scveral rclatcd pricing and mar- the various analysis and decision­ and of the railroad's elements. functions, data and skills that customers. Each profit center contains all the are necessary to rail rates and One component is the sales force elements necessary to service which are beneficial and which is geographically organized ment and forecast profitable to both the railroad and its and has throughout bution services. Working with an as­ customers. the United Canada and in sistant vice in each profit So the "profit" in the Orient. center is a director of pricing, a di­ works two The other component is rector of a di­ and for the railroad. the profit center group which is or­ rector of customer relations and a cost an­ ganized commodity lines and staff of 18 to 20 people. alysis, market equipment works to the railroad's serv­ Because of the complexity of pric­ information and customer relations ices and resources to the needs of ing in the grain and food products into one group which the individual customer. traffic areas, the grain and food prod­ attacks the same from all The sales force continues to serve ucts profit center has a director of the railroad is able to identify as the liaison between the and a director of the customer's needs and to railroad and its customers. Field The other three all of its resources to fill them. This sales are re~iDom;IOle profit centers are: lumber and paper will enable both the Milwaukec Road for making local contacts and serv­ automotive, manufactured and its customers to "profit" from the customer accounts in their and miscellaneous ; and activities of the profit centers. geographic areas, but work with one chemicals, fuels and metal Another dimension of the profit or more of the four profit centers de- The in each profit cen­ center is to a customer expand on the of commodities a limited number of his existing and him find commodities and they can concen­ ways to open up new for his Each profit center concentrates on trate on and a closer under­ goods. a limited number of related commod­ standing of the particular Each of the Milwaukee Road's needs of those commodities. a four profit centers handles all matters customer's transportation problem is to the particular commodities identified, the members of the to it. As much as possible, profit center go to work to related commodities and commodi­ sales rate and equipment ties with similar needs have fJ"'lHIU15 arc also included under v~,v",.",v to resolve the problem at a been of the Traffic Depart­ level of service and price The assistant vice in ment. to the customer and at a profit to the of each profit center has work- the department is the vice railroad. him a director of (in president-traffic, who has the broad Also the case of the and prod­ of that all the ucts profit center, two dircctors of are properly ing are a general manager of market­ pricing), a director of rc­ the desired results, ing and pricing in Seattle, a director a dircctor of customer rela­ directly to the vice of economics and cost and a tions and a staff for each director. are the vice director of services. Each of Collectively are responsible for ident-sales and the these directors heads a staff npl'U'lfTl'l_ and identifying the dis­ market support tribution needs of a customer and de- 6 THE MILWAUKEE ROAD MAGAZINE *Standard Transportation Commodity Code The Profit. Centers and the commodities they handle Grain and Food Products Automotive,Manufacturedand Miscellaneous Products *S.T.C.C. No. Commodity 01 Farm Products *S.T.C.C. No. Commodity 09 Fresh Fish or other.Marine Products (Domestic and Import/Export) 20 Food or Kindred Products 22 Textile Mill Products 21 Tobacco Products, except 23 Apparel, also applies on other insecticides finished textile products or knit apparel 25 Furniture or Fixtures 27 Printed Matter 30 Rubber or Misc. Plastic Products 31 Leather or Leather Products 34 Fabricated Metal Products, except Ordnance 35 Machinery Lumber and Paper Products 36 Electrical Machinery or Equipment, also applies onSupplies . *S,T,C.C. No. Commodity · 37 Transportation Equipment 08 Forest Products 38 Instruments or Photographic Goods, 24 Lumber or Wood Products, except also applies on Optical Goods, Furniture Watches or Clocks 26 Pulp, Paper, or Allied Products 39 Miscellaneous Products of . Manufacturing 40 Waste or Scrap Mat.erials . 41 Miscellaneous Freight Shipments 42 Containers, Shipping; Returned Empty, also applies on carriers or Devices 44 Freight Forwarder Traffic 45 Shipper Association or Similar Traffic Chemicals, Fuels and 46. Miscellaneous Mixed Shipments Metal Products 47 Small Packaged Freight Shipments *S.T.C.C. No. Commodity (Import/Export Only) 10 Metallic Ores 08 Forest Products 11 Coal 09 . Fresh Fish or other Marine Products 13 Crude Petroleum, Natural Gas or Gasoline 10 Metallic Ores -14 Non-Metallic Minerals 14 Non-Metallic Minerals 19 Ordnance or Accessories 19 Ordnance or Accessories 28 Chemicals or Allied Products 20 Food or Kindred Products 29 Petroteumor Coal Products 21 .Tobacco Products, except insecticides 32 Clay, Concrete, Glass or Stone Products 24 Lumber or Wood Products, except Furniture · 33 Primary Metal Products; incl. galvanized; except coating orother .26 Pulp, Paper, or AIIild Products allied processing 28 Chemicals or Allied Products 29 Petroleum or Coal Products 32 Clay, Concrete, Glass or Stone Products NOTE: All import and export commodities, except farm 33 Primary Metal Products; incl. products (S.T.C.C.No.01), are included in the galvanized; except coating or other Automotive, Manufactured and Miscellaneous allied processing .