Executive Summary
This report examines and evaluates Amtrak’s performance management and provides
recommendations for improving performance and performance management at Amtrak.
Specifically, the report analyzes Amtrak’s Northeast Corridor Infrastructure and Investment
Development business line (NECIID) and its goal of Station and Connectivity Improvement.
Amtrak has established a strong framework for strategic planning and reporting. Amtrak
is operating under a five-year strategic plan that describes the Amtrak vision and outlines goals,
key metrics, and strategies to achieve those goals. A clear logic model exists in this framework
that guides Amtrak’s investments. In addition, Amtrak regularly reports on its performance and
produces both an annual report and monthly performance reports. These two reports measure
progress toward Amtrak’s corporate goals but not toward its newer business line goals.
Despite this framework, Amtrak does not adequately measure progress toward business
line goals. Investment in the Northeast Corridor (NEC) is essential for Amtrak’s future success
and the railroad faces a formidable but achievable challenge of developing high-speed rail on the
NEC. To achieve this vision, Amtrak must do a better job reporting on infrastructure investments
and the development of partnerships to provide rail service for the 21st century.
Most important, Amtrak must integrate better planning and reporting mechanisms and
include interim targets for goals. Amtrak should appoint performance officers to measure
progress and provide analysis for leaders to adjust infrastructure investments. Amtrak has
outlined ambitious projects that it should continue. Its leaders must commit to the vision for the
NEC and be transparent about progress. Anything less will result in failure.
Jamie Scott
Performance Management consultant
McCourt School of Public Policy
Amtrak’s Current Performance Management System
Amtrak is currently operating under a five-year strategic plan for FY2011-FY2015. The
strategic plan states Amtrak’s corporate vision and identifies the corporate goals and strategies
that support the realization of that vision. The Amtrak vision states:
Amtrak is America’s first intercity travel choice for connections to
and between the nation’s key metropolitan areas, providing
customer-driven, safe, environmentally-sustainable, energyefficient and inter-modally linked service to passengers,
communities and partners. Through recognized organizational
excellence, Amtrak’s diverse and talented team will lead the
development and growth of the high-speed and intercity passenger
rail system in North America.
To achieve this vision, the corporate strategic plan defines five broad corporate goals,
which are Safety and Security, Customer Focus, Mobility and Connectivity, Environment and
Energy, and Fiscal and Organization Excellence. Each goal provides relevant metrics, including
an FY10 baseline measure (the year before the strategic plan began), the target annual change,
and an FY15 target (the end of the strategic plan period). The strategic plan further identifies
seven corporate strategies that align with Amtrak’s corporate goals. Each strategy identifies the
goal or goals that it supports.
One of these corporate strategies is the creation of six separate business lines, which will
allow Amtrak to “better respond to the wants, needs and expectations of customer segments and
improve financial performance.” Amtrak is separating its main business areas to better manage
performance in those areas. The six business lines are Northeast Corridor Infrastructure and
Investment Development (NECIID), Northeast Corridor Operations, State Supported Services,
Commuter Services, Long-Distance Services, and Corporate Asset Development. This report
focuses specifically on the performance management system for the NECIID business line and
the business line goal of Station and Connectivity Improvement.
Each of the business lines has a strategic plan with a mission statement specific to that
business line. The NECIID mission statement reads:
Amtrak’s Northeast Corridor Infrastructure and Investment
Development Business Line manages and develops Amtrak-owned
railroad infrastructure to meet the growing high-speed rail needs
of the 21st century. This includes managing station assets,
infrastructure design, maintenance and construction services, asset
capacity and utilization planning, and dispatching services in
support of all railroad operations on the Northeast Corridor.
Similar to the corporate strategic plan, the business line strategic plans identify business
line goals, which include Safety, Superior Service, Financial Performance, Station and
Connectivity Improvement, and Environmental Improvement. Each business line strategic plan
identifies metrics that map to those goals, including an FY10 baseline, expected annual change,
and an FY15 target. The business line plans also articulate five strategies to achieve the business
line goals.
The NECIID strategic plan states that the goal of Station and Connectivity Improvement
is to “make travel easier and more attractive for train passengers by improving the appearance
and operation of Amtrak-owned stations and increasing opportunities to connect with other travel
modes in key markets.” This business line goal supports Amtrak’s corporate goal of Mobility
and Connectivity. To measure the performance of this goal, the NECIID strategic plan identifies
two key metrics: change in effective speed (mph) and the number of airport connections. The
FY10 baseline measure for the change in effective speed is 0.0, the target annual change is
+0.5mph and the FY15 target is +2.5mph. The FY10 baseline for the number of airport
connections is 2 and the FY15 target is 5. There is not a target annual change for the airport
connections metric. The NECIID strategic plan further describes two strategies to support the
goal of Station and Connectivity Improvement: building new partnerships with key stakeholders
and developing business and financial plans to build high-speed rail in the NEC.
In addition to a five-year corporate vision and a more specific business line vision,
Amtrak also produces an annual corporate budget and comprehensive business plan that identify
capital and operating budget requests and business strategies for the coming fiscal year. The
business plan cautions that the NECIID business line is new and does not yet have management
and pricing strategies in place. However, the plan discusses key infrastructure investments that
will support NECIID, though it does not provide additional detail. The plan does include budget
requests and business strategies to support NEC fleet and infrastructure but does not identify the
specific NECIID business line strategies and metrics that they support.
One key target in the business plan is resolving Amtrak’s $5.8 billion State of Good
Repair (SOGR) backlog of infrastructure investment over 15 years, which will help achieve
NECIID business line goals. Amtrak’s goal is to invest $760 million annually: $380 million to
replace existing infrastructure and $380 million to develop new infrastructure. Key metrics to
measure progress toward resolving the SOGR backlog include rehabilitating 200 bridges,
overhauling Baltimore’s B&P and Union Tunnels, rehabilitating rail crossovers and junctions,
and repairing electric traction systems. For FY13, the business plan provides funding totals for
specific groups of projects for the SOGR backlog, including bridges, tunnels, communications
equipment, signaling, station improvements, and other projects. Amtrak plans to invest $627.8
million overall in infrastructure upgrades in FY13, including projects beyond the SOGR backlog.
In addition to resolving the SOGR backlog, Amtrak’s FY13 business plan highlights key
projects in the Gateway Program, a program for building new infrastructure on the NEC to
support the development of high-speed rail. The FY13 business plan outlines major
infrastructure investments in and through New York City, including new tunnels under the
Hudson River, repairs to the existing Hudson River tunnel, two new bridges at Secaucus, NJ,
additional tracks between Newark and Secaucus, and upgrades to Penn Station in New York City.
Amtrak expects that it could complete these projects in twelve years at a cost of $15 billion, but
establishes this timeline as a best-case scenario rather than a performance target.
While the business plan outlines future investment, the Amtrak Annual Report reviews
past performance. The FY12 annual report provides quantitative financial measures of specific
engineering accomplishments. Many of these projects support the NECIID business line
generally and help resolve the SOGR backlog, but Amtrak does not compare these results to
targets for measuring performance. The accomplishments include new and upgraded bridges,
tunnels, stations, and other structures ($187 million); track ($148 million); electric traction ($20
million); and communications and signaling equipment ($31 million).
The annual report also provides performance metrics for corporate goals and the
strategies to achieve each goal. Metrics for the corporate goal of Mobility and Connectivity,
which the NECIID goal of Station and Connectivity supports, include the performance measure,
unit of measurement, FY11 baseline, FY12 target, FY12 actual, variance from prior year, and
variance from target. The specific measures are intermodal ticketing partnerships, change in
effective speed, and train delays per 10,000 miles. Similar metrics do not exist for the NECIID
business line strategic goals. Below is a summary of those measures:
Performance Measure
Intermodal ticketing
partnerships
Change in effective speed
Delays per 10,000 train
miles
Unit of
Measure
FY11
baseline
FY12
target
FY12
actual
Variance
from prior
year
Variance
from
target
Count
43
47
43
0
-2
MPH
0
0.5
0.6
0.6
0.1
Minutes
347
252
327
20
-75
Although the annual report does not measure performance, the railroad does produce
monthly performance reports that provide financial performance measures and other key
performance indicators (KPIs) with comparisons to monthly and year-to-date (YTD) targets. The
only KPI included in the monthly performance report with relevance for the NECIID business
line is end-point station performance but is only a summary of all Amtrak stations, not NECspecific stations. The performance report does provide NEC-specific on-time performance
metrics in another section but only compares these metrics to the same month in the prior year
and not to a monthly or annual target. In July 2013 NEC station on-time performance was 82.7%
compared to 84.2% in July 2012. The year-to-date (YTD) on-time performance for NEC stations
was 88.2%, compared to 89% YTD in July 2012. The report also includes a summary of
engineering outputs, many of which support NECIID business line goals, but similar to the
annual report do not include comparisons to identifiable targets.
Assessing Amtrak’s Performance Management System
Amtrak has a robust planning and reporting process but fails to connect performance
measures to stated goals. The performance management system is particularly weak because the
annual and monthly reports mechanisms do not measure progress toward the business line goals
identified in the business line strategic plan.
Amtrak’s performance management system focuses primarily on financial performance
and changes in ridership. In many of its documents, particularly in the introduction letters from
Amtrak CEO Joe Boardman, the railroad highlights improving financial performance and
growing ridership. In some ways this is a necessary first step for Amtrak—the railroad has a
short history as an organization and has struggled with financial underperformance, relying
heavily on Congressional appropriations over the years. Given this history of underperformance,
Amtrak focuses on reporting positive outcomes, rather than challenges to achieve financial and
operational goals. Amtrak’s infrastructure needs are enormous and its vision for high-speed rail
is ambitious. To build support for these investments, Amtrak must convince key stakeholders
that the vision is achievable. Perception is critical to Amtrak’s success.
The five year corporate strategic plan clearly links strategies to goals, and the creation of
individual business lines allows Amtrak to better manage the performance of its various
operations. Amtrak’s annual business plan further explains some of the NECIID business line
strategies that the corporate strategic plan does not, including NEC station and route planning. In
2012, Amtrak released the Union Station Master Plan, which envisions the redevelopment of
Union Station in Washington, DC, the southern anchor of the NEC. The master plan envisions
new capacity at Union Station and new rail service along the NEC. Investing in Union Station is
a significant project for achieving the NECIID business line goal of station improvement and is a
key part of Amtrak’s NEC investment strategy. Given the complexity of that project, a master
plan separate from the business line strategic plan is appropriate.
While the structure of the NECIID business line strategic plan is strong, it lacks a robust
set of metrics, providing only two metrics for the Station and Connectivity goal and offering no
indication of other key metrics. The railroad need not provide every single metric for the
business line in the strategic plan but it could provide an appendix with an expanded list or
information about developing additional metrics. If Amtrak indeed only created two metrics for
improving station connectivity, it cannot possibly achieve that goal.
Similarly, the business line strategic plan fails to indicate actions to implement the
business line strategies or make progress toward the specific metrics. For example, the NECIID
strategic plan identifies a strategy to build new partnerships with stakeholders for long-term
business development. However, the strategy does not indicate any tactical steps to build those
partnerships or the types of partners necessary to create new airport connections, a key metric for
the business line goal of Station and Connectivity Improvement. Certainly new partnerships will
help create those connections but the strategic plan does not provide details on the nature of this
relationship. This lack of detail leaves Amtrak’s ability to create airport connections uncertain.
Achievement of business lines goals is further complicated because progress toward the
key metrics for each goal are not readily measureable. For example, the strategic plan lacks any
metrics or qualitative evidence to document ongoing progress toward the development of new
airport connections. Certainly there are interim steps to add airport connections to Northeast
Corridor rail service, but Amtrak provides no way to determine whether it can successfully
achieve the FY15 goal of five total airport connections. The lack of interim steps means it is
unclear whether NECIID’s goals are stretch goals. Since the airport connections metric does not
provide a target for annual change (the interim steps), it is impossible to know if the goal is a
stretch goal for Amtrak.
Amtrak does not appear to use regular performance data to effectively manage its
infrastructure improvements. The railroad is realistic about its infrastructure challenges on the
NEC and has set some timelines for upgrading existing infrastructure and investing in new
infrastructure. Measurement of the progress of those projects remains unclear, as do any
adjustments to investment priorities based on those data. Since Amtrak’s recent annual report
does not measure engineering accomplishments in relation to targets, it is difficult to identify
areas of underperformance and the contribution of those engineering accomplishments toward
the resolution of the deferred maintenance backlog. These reports are reporting activity (outputs)
but not performance (outcomes).
Similar reporting issues exist in Amtrak’s monthly performance reports. These reports
include a wealth of financial performance data and route performance data. Amtrak is honest
about both positive and negative results, including negative budget performance and negative
route performance. These operational performance reports are lengthy—almost 100 pages—and
include numerous detailed tables and measures of monthly performance compared to the prior
month, year-to-date, and the same time last year. The data in these monthly performance reports
more clearly indicate operational areas in which the railroad is struggling. Amtrak appears to use
these data to correct operational performance but does not compare operational performance to
the goals, strategies, and metrics from the business lines strategic plans. Similar to the corporate
annual report, the monthly performance reports provide data on engineering outputs but do not
measure performance toward engineering outcomes. Much of the financial and engineering data
allow Amtrak to demonstrate if it is performing better than last year in a given category but not
whether that performance is as good, better, or worse than expected.
Finally, Amtrak’s strategic plan and comprehensive business plan do not indicate
individuals responsible for managing performance. The strategic plan states the importance of
managers who regularly review tactical plans to execute business strategies, but does not
specifically identify performance managers. Amtrak has done a good job creating the structure
for executing corporate and business line goals but the business line plans do not indicate the
data that managers use to adjust tactics or to whom managers report.
Improving Performance Management at Amtrak
The first step toward improving performance management and performance at Amtrak is
to better integrate planning and reporting mechanisms. To accomplish this, Amtrak must further
develop its strategies for the NECIID business line. Without a clear vision to achieve business
line goals of upgrading NEC infrastructure and developing high-speed rail, Amtrak cannot
manage its performance effectively. The two main reporting tools—the annual report and the
monthly reports—do not explicitly report on progress toward the NECIID goals. While the
business lines are new, neither the annual report nor the monthly performance report indicate
whether Amtrak will report on progress toward business line goals in the future. Instead, future
annual reports should include specific sections for each business line, with aggregated data and
progress toward annual goals. Monthly performance reports for each business line may be
unnecessary, given the slow pace of infrastructure investment. However, Amtrak would benefit
from regular reports of infrastructure progress with disaggregated data on specific projects,
which could inform content for the annual report. Amtrak has created a strong performance
management foundation in its strategic plan, with a clear hierarchy of goals and strategies. The
railroad should strengthen its performance management system with integrated reporting.
An operational plan specific to the business lines would also clarify Amtrak’s annual
goals and strategies. The annual budget and business plan provide information about Amtrak’s
corporate budget and corporate strategies. A large part of this plan concerns the NEC but much
of it concerns Amtrak’s other business lines. In such a format it is easy to lose sight of the NEC
investments and to assess the annual goals for that business line. The corporate strategic plan
includes the business line strategic plans; the budget and business plan should do the same.
Amtrak should also clearly identify a chief performance officer or team of performance
officers, which it should include as part of the business line strategic plan. The recent
reorganization to create business lines means that a performance officer will likely have greater
influence on performance at the business line level with a report to a corporate performance
officer. A chief performance officer could help establish additional metrics for the business lines
and assist the reporting process to ensure reported data adequately inform the business line goals.
The performance officer for the NECIID should not be a new position, but a senior manager with
responsibility for business line operations. If a performance officer is not integrated into the
work of the business line, and serves merely to measure and report progress, he or she may not
have support from the business line Amtrak employees.
Amtrak has an adequate plan for resolving its SOGR backlog and it should continue to
upgrade current infrastructure while investing in new infrastructure. Amtrak will never develop
high-speed rail on the NEC if it waits to address its infrastructure backlog before making new
investments. Amtrak should also continue its efforts to redevelop stations along the NEC,
beginning with Washington, DC’s Union Station. Key to improving station and connectivity
improvement will be increasing capacity at core stations along the NEC. The Gateway program
in the New York area is another project Amtrak should continue to prioritize.
Unfortunately there is no quick fix for Amtrak. The maintenance backlog and necessary
investments in high-speed rail are substantial enough that a long-term commitment to investment
is essential. Commitment to the vision, honesty about challenges, transparency about progress,
and continued fiscal stability are necessary for Amtrak to successfully upgrade the NEC. As it
commits financial and engineering resources to improving the NEC, Amtrak will become a safer,
more reliable, and more attractive travel option. As ridership increases, so will revenue and
Amtrak’s ability to provide high-quality rail service. Amtrak has developed the vision for the
NEC. Now it must commit the energy and resources to ensure it is on track to realize that vision.