Case Study II-3 Norfolk Southern Railway
Teaching Note on Case Study II-3:
Norfolk Southern Railway: The Business Intelligence
Journey
Objectives
The purpose of this case study is to explore the evolution of enterprise decision making and
business intelligence capabilities for a large company. Students will learn about some best
practices for building enterprise decision making and business intelligence capabilities over time
as a business evolves. The lessons learned from this case are transferable to other situations.
Overview
This case is a comprehensive example of how an organization evolved its enterprise decision
support and business intelligence capabilities in more than a decade amidst great change in the
Technology events below:
Business events:
2. In 1980 following the Staggers Rail Act, the rail industry was deregulated, and
business units needed to better understand things like customer service, costs,
4. In 2002, Norfolk Southern redesigned its opera
optimized plans for managing inventory and planning trips. Instead of the
5. Once TOP efforts were in place, Norfolk Southern began competing on service.
6. In recent years, Norfolk Southern announced its Track 2012 strategy. This
Technology events:
1. During regulation, Norfolk Southern put in place complex, proprietary
transaction systems that specialized in moving shipments from point A to point B
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2. In 1995, Marketing and Cost invested in a 1 Terabyte data warehouse with
3. Although the case does not touch on this, the merging of Norfolk Southern and
4. In 2002, Norfolk Southern began investing in new transaction systems that
incorporated operations research techniques to develop optimized inventory
5. Marketing created a BI application called accessNS, which provides visibility
6. Departments across NS now have BI applications, some of which are described
Teaching Suggestions
In class, we suggest that you have the students recreate the above two timelines. This exercise
works well if you create the business timeline across the top of the board, and the technology
timeline across the bottom. As the timelines fill out, it becomes clear what Norfolk Southern has
Questions for Discussion
1. Create a timeline of significant business and technology events that took place at Norfolk
Southern over time. In what ways does data warehousing and business intelligence fit with
Norfolk Southern strategy and business goals?
See the two lists of events and timeline suggestion above. The development of the timeline
evolves into a rich discussion about business and IT alignment. And, it is important to note the
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2. Describe the benefits of data warehousing and business intelligence at Norfolk Southern.
For background reading, we suggest you read the article:
Wixom, B. H. an – International Journal of
Business Intelligence Research, 1, 1, (2010), pp. 13-28.
by the case authors which features BI benefits at Norfolk Southern on pages 20-22. The article
explains that benefits from BI can be quite diverse, and the tangible/intangible value creation and
local/global scope vary.
Specifically, some of the benefits described in this case include:
Through the TOP initiative, Norfolk Southern has reduced rail cycle by a full day, which
translates into millions of dollars of annual savings.
3. What did the company do right that has led to the successful deployment of data
warehousing and business intelligence within Norfolk Southern?
Clearly the close alignment between business and IT is good. The way in which Norfolk
Southern has made investments and put effort into sustaining the alignment over time has
helped BI succeed because BI has remained strategically important to the company.
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4. What has promoted the spread or growth of data warehousing and business intelligence
within and across Norfolk Southern over time?
There are many reasons behind the spread of BI at Norfolk Southern. The following are the
most evident that emerge from this case.
When BI applications are easy to use, they are much more likely to be used! Application
design is taken seriously at Norfolk Southern, particularly around creating applications
5. What are the implications of a new ERP system, which will replace existing operational
sources?
6. What lessons learned from this case can be applied to other organizations?
Students come up with a wide variety of takeaways from this case. Some examples of what
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