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Home / News & Reviews / News Wire / CSX CEO Hunter Harrison has died NEWSWIRE

CSX CEO Hunter Harrison has died NEWSWIRE

By | December 16, 2017

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CSX CEO E. Hunter Harrison
R.G. Edmonson
JACKSONVILLE, Fla. – CSX Transportation CEO E. Hunter Harrison, the influential and innovative railroader who was respected, sought after, feared, and loathed in equal measures, died today. He was 73.

Harrison worked his way up through the ranks after beginning his rail career as a carman for the Frisco in 1964 in his native Memphis. He had the distinction of being the only man to lead three of the big six Class I railroads – and twice becoming chief executive after boardroom battles.

Harrison was renowned for leading operational and financial turnarounds at Illinois Central, Canadian National, and Canadian Pacific. Analysts say the results cement his legacy as the best operating chief executive of modern times. “There has never been anyone better at quickly implementing cost cuts and efficiency initiatives in the railroad industry,” says analyst John Larkin of Stifel Equity Research.

Under Harrison, first as chief operating officer and then as CEO, CN became the most efficient railway in North America. Its operating ratio became the envy of the industry. But shippers weren’t impressed. The pace of change, combined with Harrison’s methods – like slapping penalties on cars that weren’t loaded or unloaded on weekends – alienated customers. Harrison’s relentless drive for efficiency ruffled more feathers than necessary, says independent analyst Anthony Hatch of ABH Consulting. “But you can’t argue with the results of his disruptive force,” he says.

Harrison left CN at the end of 2009, but jumped back into the industry two years later. Hedge fund Pershing Square Capital Management recruited him to lead a lagging Canadian Pacific. Harrison became CEO in June 2012 after Pershing Square won a bitter proxy battle that ousted CP board members and CEO Fred Green. The pace of the 18-month turnaround at CP beat the most bullish forecasts and Harrison’s own ambitious schedule. “It was incredibly impressive,” Hatch says.

Rather than retire from CP – something he said he failed at once, after leaving CN – Harrison joined forces with activist investor Paul Hilal and his Mantle Ridge hedge fund to pursue a management shakeup at CSX.

When he left CP five months early in January 2017, whispers that he was pursuing the top job in Jacksonville sent CSX stock soaring by more than 30 percent. CSX ultimately hired Harrison despite concerns about his health and his refusal to submit to a company physical. And CSX stockholders overwhelmingly approved an unusual $84 million payment to Harrison and Mantle Ridge, reimbursing them for salary and benefits Harrison left on the table at CP.

Harrison became CEO of CSX on March 6 and rapidly rolled out his Precision Scheduled Railroading operating model. After initial success in cutting transit time and significantly improving on-time performance, CSX stumbled. A summer of service problems prompted criticism from shippers and increased scrutiny from federal regulators. Harrison said shipper complaints were overblown, part of an effort to lobby for re-regulation of railroads.

Harrison had declared victory over the service problems and said he was proud of the way CSX was operating. But the day he took medical leave and Jim Foote was named acting CEO, the Surface Transportation Board asked Harrison to explain how the railroad would provide consistent and reliable service in light of persistent shipper complaints.

On Saturday, the company said: “It is with great sadness that we announce that E. Hunter Harrison, President and Chief Executive Officer of CSX, died today in Wellington, Fla., due to unexpectedly severe complications from a recent illness. The entire CSX family mourns this loss. On behalf of our Board of Directors, management team and employees, we extend our deepest sympathies to Hunter’s family. Hunter was a larger-than-life figure who brought his remarkable passion, experience and energy in railroading to CSX.”
Edward J. Kelly III, Chairman of the CSX Board of Directors, issued the following statement on behalf of the Board of Directors: “With the passing of Hunter Harrison, CSX has suffered a major loss. Notwithstanding that loss, the Board is confident that Jim Foote, as acting Chief Executive Officer, and the rest of the CSX team will capitalize on the changes that Hunter has made. The Board will continue to consider in a deliberative way how best to maximize CSX’s performance over the long term.”

Precision Scheduled Railroading, outlined in two books published by Canadian National, is about intense use of assets, fewer cars, fewer locomotives. It means there are fewer people to maintain them, and fewer trains means fewer crews.

Rail labor considered Harrison the enemy. Harrison created a culture of fear and intimidation at CP, rail labor leaders say.

“Before Hunter Harrison, we had a number of pretty high-level disputes with CP. It was a pretty standard relationship,” says Doug Finnson, president of the Teamsters Canada Rail Conference, which represents the running trades. “After Hunter Harrison arrived, it just went nuts…it was just an all-out war on workers at CP. The workers became the enemy in his drive to please the Pershing Square venture capitalists.”

It wasn’t only rail labor who felt Harrison’s wrath. Harrison despised top-heavy management structures and bureaucracy. So he culled the ranks at CP and CSX. Managers who didn’t measure up, or who couldn’t grasp Precision Scheduled Railroading, were quickly dismissed at CN, CP, and CSX. CP went through four chief financial officers while Harrison was CEO because it was difficult to find someone who could satisfy both Harrison and the board.

But Harrison’s inner circle speaks glowingly of the railroader and the man who was an unusually blunt and straight-talking executive in an era of CEOs who carefully measure every word.

CP CEO Keith Creel, who followed Harrison from CN to CP, said Harrison was a mentor.

Harrison was an outspoken advocate of railroad mergers. Although while at CP he came away empty-handed in pursuit of deals with Norfolk Southern and CSX, he continued to insist that railroads need to provide seamless service from coast to coast in order to better compete with trucks.

Harrison is survived by his wife and two daughters.

25 thoughts on “CSX CEO Hunter Harrison has died NEWSWIRE

  1. This is how you put it to the loser customer of which there are many in the world; “We hope you are satisfied with our service and we appreciate your business. However, we could use your help to keep your and our costs down if you would do …(whatever it is).
    It is possible that I would not have liked him much but, if a company survives because of him, that means people are still working rather than everybody unemployed.
    I never worked for a railroad but, I interviewed, once, for a conductor position for a class I and am so glad I was not offered a job. This is because one of the questions I was asked during the interview was how I was going to motivate other employees to work. Having already been familiar with your average government employee (where you need an act of God to get rid of him), I understood that railroad working conditions would be a carbon copy of government conditions. Thus, I had and have a good understanding of what this man was, likely, up against his whole working life.
    RIP if possible.

  2. “I’ve come to bury Caesar, not praise him.”

    Good or bad, have to admit the man did things his way!

  3. I believe the stockholders – both individuals (like Cindy Sanborn, ex EVP-COO and largest individual stockholder of CSX) and the institutions – ought to begin legal action against the current CSX board, especially Mantle’s allies. Boards are seldom held accountable for bad decisions.

  4. Very interesting comments. Just had to read ’em. Am a rail fan with my day job having been in aerospace. Harrison was not unique in the business world. More or less, Robert Crandall (American Airlines) comes to mind. Total failure in dealing with unions. Jack Welch (General Electric) is a story in itself about down-sizing. And look at the slow and agonizing death of Radio Shack from hiring incompetent CEO’s. People who populate many Boards have not a clue of how their company should work or in the case of CSX, to hire a man who would not submit to a medical exam.

  5. While some would argue EHH was not humane, he was a human. We all have faults, some more, some less. To his family and supporters there should be kindness and sympathy.
    An interesting comment made elsewhere yesterday on a related article, was interesting to me and may be of interest, to see the carnage left behind with the “unbridled” decisions that he made.
    That comment was written by W Cook, reference the article titled: Acting CEO Says CSX can survive ….
    The list of questionable decisions that ran “ a RR to bare bones” was EHH’s call when at the top. But, as I have read comments about his past, he was overruled in earlier years. His climb to fame was moderated by folks (RR CEO’s) that seemed to have throttled his enthusiasm for getting a better way established.
    Overall this is an interesting time in the world we live in.
    Not just RR’s but the financial world as a whole. (….one instance is the BNSF vs. UP operating scheme i.e. return on stock price or investment in future infrastructure…..)
    Speculating, intense focus on the bottom line, quick buck (no matter the way obtained), some lending institutions even persuade workers to make up accounts and rip off poor unsuspecting folks. That’s how “bidness works now a daze” (obviously not everywhere, but then is it a growing trend ???? endmrw1217171726

  6. It’s all about the money, and what money he would make by getting shares in his acquisitions. Screw the workers who perform to MAKE the money. What has his death earned him? Only what is passed on to beneficiaries.
    It’s the same-old “I’m in it for the cash.” I don’t care what happens to any person beneath me, unless I can influence them to make me richer. RIP Hunter..from all of us who wish we were greedier.
    It’s the “Trump mantra.”

  7. I have never run a railroad or for that matter worked for a railroad. I read TRAINS MAG and I think I know what goes on. IC, CN and CP are (or were, in IC’s case) linear railroads. What Harrison did to schedule and manage those lines worked well. Then Harrison goes to CSX, a spider-web of a railroad much more difficult to operate. He tried the same techniques that had worked on his earlier railroads. Or, he mailed it in, thinking he was smarter than he actually was. The result was a disaster. As I knew it would be. Hunter, rest in peace. I won’t speak to your personality or your integrity or your character, as I never met you. I will speak to your management of CSX. I knew you would be a disaster. Only your forced medical leave, and now your death, has saved that railroad from oblivion. You won’t be missed. Bring back Cindy Sanborn. She may have been in over her head, but at least she tried to run CSX to the best of her ability. As opposed to Hunter Harrison, who operated the railroad by taking a sledgehammer to it….. All my wife knows about railroads is what I tell her. She doesn’t read TRAINS MAG. She thinks Harrison was an idiot.

  8. @Jerry Conway – I’m not intending to make any political statements here, however I fail to see how you could consider Hunter Harrison AND Donald Trump as visionaries! Being retired from Amtrak after over 40 years, and being a life-long railroad enthusiast, I certainly did not agree with EHH’s cut-to-the bones M.O. … but he did have a vision of how a railroad (at least a primarity linear one, a la IC, CN, and CP) could be run. It’s a shame that, in the process, he stepped on so many toes and alienated so many employees and shippers, instead becoming more and more beholden to Wall Street interests. His great strength was, having worked his way up through the ranks, he DID have a firm understanding of the ins and outs of railroading. Mr. Trump, on the other hand, was born with the proverbial spoon in his mouth (or up another part of his anatomy); has no understanding of management other than by despotism; and during the primaries, the presidential campaign, and during his time in the White House has only proven over and over what an egostistical, insecure, bombastic imbecile he truly is; Mr. Trump is neither visionary nor a true leader.

    To Mr Harrison’s family, I do wish my sincere condolences at this unfortunate time of loss. May God’s peace be with them all.

  9. @Mr. Perkins – I must have touched a few liberal nerves here. My post was so far back, I hoped that I could say my peace and be done with it. But, if we must drag it out, so be it.

    As far as Mr. Trump, he is a billionare, cultural personality, and the last time I checked, the President of the United States. You, and those who constatly pollute the air whining about it, are not. Envy. We had to put up with eight years of Donothing Nobama, so take yours meds and bide your time till you get another chance.

    The same can be said for Mr. Harrison. As I see it so far, there are two groups of people who are throwing crap. One group are his subordinates. The other are armchair railroaders who believe that getting a cab ride 20 years ago qualifies them to run the day to day operations of a prototype railroad. What is common to both groups is the fact that they are on the bottom of the societal pile. They did not have the balls to risk their lives, families, and fortunes to climb their way to the top. So, they stand at the bottom, looking up, and realizing they will never be anything more than what they are, fling poo, hoping somehow to hit those near the top of the pile. Again, Envy.

    Mr. Harrison will be remembered for what he has done, and yes, others that come after him will emulate him, with varying degrees of success. His detractors will be forgotten long before he will.

  10. No Jerry, you just insult the intelligence of 65% of the population when you use the words Trump and Visionary in the same sentence.

  11. Last August * Brian mentioned rules …. Blogs …. okay, is it for comments on news articles also????
    ……. Wow, can we get away from swipes to Obama and Trump.
    …….. It seems to me that both of those are specific POLITICS issues and should be NOT ALLOWED.
    ……… Reference the 12-16-17 and 51st comment on EHH death news item ……. and back and forth about past/present presidents.
    …….. Just sayin’ endmrw1218171551 to editors: btw appreciate date stamp on recent update of the crash at DuPont

    • ….Your forum signature should not be used as a place to express your personal beliefs (religion, politics, marital status, sexual preference, etc.). Remember, this is a forum tied to our common bond of railroading; don’t let your personal viewpoints on unrelated topics interfere with the common reason we’re all here.

  12. Mr. Woodside, promoting my political agenda is not my goal. My examples were that of people who are succesful, and my point is that they garner a lot of unnecessary hate because of that success. If people are offended by that, then perhaps a gut check is needed to assess what the life goals of the haters really are.

  13. Not going to be Pc here, never will be either…so I’m calling it like it is. I for one am not sad to see him go, yes, it hurts his family being so close to Christmas but I don’t think they’re going to cry to much over the millions of dollars he most likely left them. As for Mr. Conaways’ comment about people running a railroad…guess what, common sense is the smartest way to run any business…even a government, but common sense no longer exists. He was sick and now he died, can everyone just move along and forget about him now.

  14. John Goodhand – Mr. Harrison’s health was not the issue. The issue was that he thought he could run CSX and I knew he could not. For the 84 million dollars CSX promised him above and beyond the agreed-to salary, the railroad could have hired 84 extremely smart managers, all 84 of them better than he was. Harrison’s problem was his ego. There was no secret to his success at IC, CN and CP. It was an open book. He wasn’t needed any more. The idea that only EHH could have scheduled a railroad was a joke. (Just like United Airlines knows all of American Airline’s tricks and vice versa.) If my memory serves (correct me if I’m wrong), scheduled freights on the IC go back two or three decades. Any one of us can quit our jobs, get fired, have a health crisis, or die. I know that inconvenient fact in my own life. I was good at my job before I retired. The much younger man who now does the same work built on my success and is, overall, a whole lot better than I ever was. At age 71, I’m two years younger than EHH was at the hour of his death. Starting at age 65, I have spent my days posting on web sites, not pretending I’m the only one who knows anything about the work I once did. … I’ll have the last word on EHH. His proposal (that he withdrew) to single-track CSX from Albany to Chicago was just plain dumb. 84 million dollars? The man wasn’t worth 84 cents.

  15. Very funny Jerry Conaway. Let’s see you have your career goals and life wrecked by this functioning lunatic and his idiotic policies and see if you’re singing the same tune afterward.

  16. When CSX was going to hire Harrison could not beleive
    it. I hope that the CSX stockholders get rid of the whole board of directors.Not insissiting on a physical was a boner of multimillion proportions. Is that Harrison’s fault? No, but a lot of families are going to probably be paying for it. As to him personnally RIP. Condolences to the family.

  17. Presumably, EHH has been handed a short handle shovel and is very close to the fire. Until now, even Satan chringed in this man’s presence.

  18. CSX needs stability right now. John McPherson should leave the board and become chief operations officer. He fixed FEC and knows psr as well as anyone. He’s more than qualified and the employees there need someone that can steady the ship

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