Britain’s first railway? Business and Beaumont

Two lines originally thought to have been built around one year apart fight it out for the claim to be the ‘first’ British railway - this post explores the history of one of them. Huntingdon Beaumont was born at Coleorton in Leicestershire in around 1560, the youngest son of Sir Nicholas and Ann Beaumont. They exploited the rich supplies of coal within their estate and it is here that the young Huntingdon learned the business of mining. Driven by his insatiable energy, clear vision, but a reckless streak, in 1601 he moved to Nottinghamshire, and using what he had learnt at his parents’ mining business leased and worked coal pits at Wollaton, Strelley and Bilborough...

To read the rest of my post, please visit my new site HERE

Did the Management Ever Control Britain's 19th Century Railways?

Alfred Chandler

The rise of what Alfred Chandler called the ‘visible hand’ of management has dominated the business history literature for forty years. Simply put, Chandler argued that managers came to dominate American business in the late nineteenth and early twentieth century. As technology was introduced to companies and markets expanded, their processes of distribution and then coordination became more complex as they increased in size. Consequently, this generated a need for better administrative control of the organisations’ activities, leading to the rise of the ‘visible hand’ of management. Indeed, as managers grew in number within firms, they increasingly steered their destinies, wrestling control of corporate strategy from companies’ shareholders, financiers and directors. Chandler called this ‘managerial capitalism.’[1]

In the United States this process occurred first in the railroads. When faced with challenges such as safety concerns, then the increasing volume, speed and complexity of traffic on the line, companies quickly developed hierarchies of railway managers to coordinate their activities, leading to the rise of the ‘visible hand.’ Ward argued that a situation had developed on the Pennsylvania Railroad by 1873 where ‘paramount executive authority had emerged’, directors were by then ‘pliant acceders,’ and shareholders were virtually impotent.[2] Indeed, there is no doubt that Chandler admired railroads, such as the Pennsylvania, where managers had seized control of the organisation, arguing they were the best managed and innovative. They adopted high-level strategic direction, with considerable authority delegated to operating units and complex administrative practices were developed.[3] Indeed, Zunz also argued similar of the Chicago, Burlington and Quincy Railroad, which he considered an exemplar of good management practice because it was controlled by the company’s management class.[4]

The question, therefore, is to what extent this process was replicated in the British context? How much control did British railway managers have over their companies’ directors and shareholders in the nineteenth century, and, ultimately, their destinies? Chandler argued that because of the nation’s smaller size British railway managers were challenged less than their American counterparts to develop new and innovative management techniques.[5] Therefore, this possibly implies that British railway managers did not secure the same level of control as some American managers. However, Channon countered this by arguing that British railway managers were challenged in different ways because of the country’s high-density, expensive and intensive network, which was, unlike in the United States, complete in its operating and physical details in a much shorter time period after the industry’s establishment.[6] Therefore, while not ruling out a rise of the ‘visible hand’ of management, this may suggest that a different pattern of managerial development occurred within British railways. Nevertheless, neither of these perspectives really answered the question of whether there was a rise in the ‘visible hand’ of management in the British railway industry in the nineteenth century.

No comprehensive history of British railway management before 1914 has been written. Therefore, I have had to compile what I know about the rise of the ‘visible hand’ from case studies. However, some historians have broadly attempted to assess when the railways’ management class, particularly within larger companies, came to dominate the industry’s direction. Cain argued that General Managers, who were usually at the top of railway companies’ hierarchies, were the most important decision-makers in the industry by 1870.[7]  Channon made a similar claim, stating that before 1870 managerial ascendency ‘cannot be assumed.’[8] I believe both were wrong, and using a number of case studies I will suggest that management cannot be said to have ascended into a position of control before the 1900s.

Richard Moon

Terry Gourvish’s book on Mark Huish, the London and North Western Railway’s General Manager between the company’s formation in 1846 and 1858, is an enthralling text. It relates the story of a railway manager who during his administration and after his death was considered ‘unscrupulous, dictatorial and Machiavellian’; controlling the companies' policies. At face value this would suggest he was the first ‘managerial capitalist’ in Britain’s railway industry. Yet, Gourvish’s research showed the reverse. He argued that while Huish had more control of the company’s policies than his contemporaries, he did not possess the ‘dictatorial’ influence in decision-making often ascribed to him.’ Indeed, his resignation was forced on him 1858 as he did not satisfy the board’s requirements regarding inter-company diplomacy.[9]

Archibald Scott

Indeed, it was the career of the man who instigated  Huish’s resignation, LNWR director Richard Moon, that truly shows that the ‘visible hand’ of management did not really control policy on the British railway network until long after it had on many American railroads. Moon was appointed chairman of the company in 1861 and stayed in the post for thirty years. Before his ascendency becoming chairman, he had a reputation for taking a highly detailed interest in most of the company’s operational affairs, even when they were beyond his remit. Indeed, most railways’ boards met twice monthly, with directors meeting in committees the day before. Yet, Moon would be active in the company’s affairs every day of the week. Thus, when made chairman his controlling instincts were let loose. His biographer, Peter Braine, described him as being ‘not only a managing director, but also effectively his own General Manager,’ throughout his chairmanship. [10] Indeed, the company’s General Manager between 1858 and 1875, William Cawkwell, was very much under his and the board’s control.[11]

But directors having control of companies’ strategic direction was not unusual in the period. Lord Salisbury, chairman of the Great Eastern Railway between 1868 and 1871, looms large in the company’s history. On his appointment the GER was in chancery. Yet, he successfully turned it around and it began paying dividends again in the 1870s.[12] On the London and South Western Railway, as I will explain in my thesis, policy was dominated by directors until the 1881 when they gave the General Manager, Archibald Scott, more ‘general control’ over the concern’s affairs.[13] However, even then he was still under their control and did not have a decisive role in corporate decision-making. Lastly, on the Great Northern Railway in the 1850s, 60s and 70s it had directors who ‘thought they knew more about the business than the company’s senior officers.’[14] Therefore, this would suggest that the dominance of company boards was still present in the industry as late as the 1870s.

Indeed, from the 1860s there also appeared controlling positions within companies which would now be described as managing directorships. In most cases the individuals taking these positions were ex-managers, who on retirement became controlling directors. The most prominent examples of this were Edward Watkin and James Staats Forbes. They were fierce rivals, with Watkin chairing the Manchester Sheffield and Lincolnshire (1864-1894), South Eastern (1866-1894) and Metropolitan Railways (1872-1894); while Forbes was chairman of the London, Chatham and Dover (1873-1898) and Metropolitan District Railways (1872-1901). Both men had served as railwaymen and then had moved onto railways’ boards where they dominated policy.[15] The other example of this was the managing directorship of the Daniel Gooch on the Great Western Railway. Gooch had been the company’s Locomotive Superintendent between 1837 and 1864, and when he resigned took up a position on the board. He then became the company’s chairman, and had a position akin to a managing director between 1865 and his death in 1889.[16] Furthermore, James Ramsden on the Furness railway also was in such a position between 1866 and 1883.[17]

Myles Fenton

But by the late 1880s the dominant power of railway managers was coming through more widely within the British Railway industry. Between 1885 and 1897, as my thesis will show, Charles Scotter was the dominant General Manager of the London and South Western Railway, controlling almost all aspects of policy, large and small. Cornelius Lundie, General Manager and Superintendent of the Line of the Rhymney Railway between 1858 and 1904, ran the railway as he wished with little or no reference to the board’s interests.[18] Even Watkin  relied on the General Managers at each of his companies for their safe and efficient operation. They were the SER’s Myles Fenton, William Pollitt at the MSLR and John Bell at the Metropolitan.[19] Indeed, Hodgkins argued that because Pollitt and Bell were rivals a proposed link between the MSLR and Metropolitan in the 1890s would have been difficult to arrange. Therefore, this suggests that despite Watkin’s domineering chairmanship of his companies, his chief executives still heavily influenced their railways’ policies.[20]

George Gibb

These cases were, however, only the start of a shift of towards the absolute control of the ‘visible hand’ of management within Britain’s railways. In 1891 George Gibb was appointed General Manager of the North Eastern Railway. Gibb reformed the company’s operations and, through dominating the company’s board and staff, dragged it into a position where experts acknowledged it was a model of good management practice.[21] But Gibb was just the first of a new breed of railway executives. Indeed, as a crisis hit the industry around 1900, as passenger, goods and revenue growth stalled, the cost of fuel and materials increased, and railway securities became less favoured as investment opportunities, the role of reversing  the industry’s financial situation fell onto the shoulders of executives.

After 1900 a raft of new and innovative managers came to the fore within British railways. Sam Fay, an ex-LSWR employee, became the Great Central Railway’s General Manager in 1902, and through his dynamic leadership transformed it from being a poorly performing to concern into one that, while never rich, made great advances and innovations in operational practice.[22] On the Midland Railway Cecil Paget, the company’s Chief Operating Officer, devised a whole new method of train control that added greatly to the company’s operating efficiency,[23] reducing delays to freight trains from 21,869 hours in 1907 to 7,749 hours in 1913.[24] Lastly, in 1912 Herbert Walker became the LSWR’s General Manager. Through dominating the company’s directorate he reformed its management and introduced electric traction onto its ailing suburban network.[25]

Of course, not all railways had General Managers that were as dynamic as these three. However, generally by the early twentieth century executives controlled the strategic direction of most of the largest companies within the British railway industry. Furthermore, the process of the rise of the ‘visible hand’ was also helped, as my thesis will relate and as Channon discussed,[26] by directors having less time to dedicate to the companies they served. Before 1900 the many took an active interest in their railway companies as they had little else to occupy their time. However, from around 1900, as the British corporate economy grew, they took on other external responsibilities, such other directorships. Thus, large numbers of directors were occupied by these activities, leaving vacuum of control into which railway executives could step.

Herbert Walker

Therefore, it is not surprising that on the formation in 1912 of the Railway Executive Committee, established to organise Britain’s railways in wartime, all its members were General Managers of the country’s largest companies. Indeed, the diminished role of the railway directors in the administration of the industry by that time was reflected by the fact that not one was present on the REC. Consequently, Britain’s railways in World War One was completely managed by the ‘visible hand’ of management,[27] the final proof that it had secured strategic control of the industry by 1914.

Overall, this survey [tentatively] disproves Channon and Cain’s claims that railway managers were universally important to British railways’ policies by 1870, and there was much variance in who controlled their direction. Overall, in the contrast with experience of the American railroads, the rise of the ‘Visible Hand’ of management occurred relatively late in the British context; only truly emerging after 1900. But why this was so?

I think that Chandler was correct to some extent in arguing that British railway managers were challenged less than their American counterparts because of the country’s smaller size. Despite the dramatic traffic growth throughout the century, the smaller size of British railway companies meant that there was never a point until after the 1890s when the internal administrative control required by them was beyond the ability of one director or their boards to organise. Indeed, the highly centralised management structures of British railway companies throughout the period, where decisions could be made by a small group of directors or managers at the top of the hierarchy,[28]  meant that dynamic and knowledgeable individuals, irrespective of whether they were directors or a managers, had the possibility of controlling their railways. Thus, this is why it is unclear before 1900 if management had 'ascended' within the industry. Indeed, one factor in an individual controlling a railway in the period was his personality; and all of the men mentioned were certainly characters. 

-------------

[1] Channon, Geoffrey, Railways in Britain and the United States, 1830-1940: Studies in Economic and Business History, (Aldershot, 2001), p.5

[2] Ward, James A., ‘Power and Accountability on the Pennsylvania Railroad, 1846-1878’, Business History Review, XLIX (1975), p.58

[3] Channon, Railways in Britain and the United States, 1830-1940, p.5

[4] Zunz, Oliver, Making America Corporate: 1870-1920, (Chicago, 1990), p.47

[5] Chandler, Alfred D., Scale and Scope: the Dynamics of Industrial Capitalism, (London, 1990) p.253

[6] Channon, Railways in Britain and the United States, 1830-1940, p.29

[7] Cain, P.J., ‘Railways 1870-1914: the maturity of the private system,’ in Freeman, Michael J. and Aldcroft, Derek H. (eds.) Transport in Victorian Britain, (Manchester, 1988), p.112

[8] Channon, Railways in Britain and the United States, 1830-1940, p.44

[9] Gourvish, T.R. Mark Huish and the London & North Western Railway, (Leicester, 1972), p.167-182

[10] Braine, Peter, The Railway Moon – A Man and His Railway: Sir Richard Moon and the L&NWR, (Taunton, 2012), p.477

[11] Channon, Railways in Britain and the United States, 1830-1940, p.44

[12] Barker, T.C., 'Lord Salisbury, Chairman of the Great Eastern Railway 1868-1872' in Marriner, S., Business and Businessmen: Studies in Business, Economic and Accounting History, (Liverpool, 1972)

[13] The South Western Gazette, December 1881, p.2

[14] Simmons, Jack, The Railway in England and Wales 1830-1914, (Leicester, 1978), p.247

[15] Gourvish, T.R., ‘The Performance of British Railway Management after 1860: The Railways of Watkin and Forbes’, Business History, 20 (1978), p.198

[16] Cain, P.J., ‘Railways 1870-1914: The maturity of the private system’, in Freeman, Michael J. and Aldcroft, Derek H. (eds.) Transport in Victorian Britain (Manchester, 1988), p.113

[17] Simmons, The Railway in England and Wales 1830-1914, p.247

[18] Simmons, The Railway in England and Wales 1830-1914, p.247

[19] Gourvish, ‘The performance of British railway management after 1860’, p.188-191

[20] Hodgkins, David, The Second Railway King: The Life and Times of Sir Edward Watkin, (Melton Priory, 2002), p.609

[21] Irving , R.J., The North Eastern Railway Company: An Economic History, 1870-1914,  (Leicester, 1976)  p.261-264

[22] Dow, Andrew, ‘Great Central Railway,’ The Oxford Companion to British Railway History, (1997, Oxford), p.191-192

[23] Burtt, Philip, Control on the Railways, (London, 1926), p.144-151

[24] Edwards, Roy, ‘Divisional train control and the emergence of dynamic capabilities: The experience of the London, Midland and Scottish Railway, c.1923-c.1939, Management and Organisational History, 6 (2011), p.398

[25] Klapper, C.F., Sir Herbert Walker’s Southern Railway, (London, 1973), p.33-76

[26] Channon, Railways in Britain and the United States, 1830-1940, p.187-188

[27] Pratt, Edwin A., British Railways and the Great War: Organisation, Efforts, Difficulties and Achievements – Vol. 1, (London, 1921), p.40-50

[28] Bonavia, The Organisation of British Railways, p.17-18

A Misinformed but Devious Take-over of a Railway

The Somerset and Dorset Railway in 1875

The ultimate point of my PhD on the London and South Western Railway’s (LSWR) management between 1870 and 1910 is to determine the quality of managers' and directors' decisions in the period. Therefore, I deal with questions surrounding what drove decisions and what decision-makers knew when making them. One event I focus on is the LSWR and Midland Railway’s lease of the Somerset and Dorset Railway (SDR) in 1875.

The LSWR and Midland Railway's Lease

The SDR was formed from a number of small companies in 1862. Yet, after connecting to Bath in 1874 it got into financial trouble, even though the trade with the Midland at that place and the LSWR at Templecombe was healthy.[1] Consequently, the beleaguered company approached the Great Western Railway (GWR) with the proposal that it would purchase the SDR. Thereafter, the GWR and its Bristol and Exeter Railway (BER) allies engaged in protracted negotiation with the SDR,[2] and by early August a deal was close. On the 12 August 1875 James Grierson and J.C. Wall, the GWR and BER General Managers, visited the LSWR’s General Manager, Archibald Scott, at Waterloo. The LSWR and GWR were fierce competitors, but as an act of good faith Grierson and Wall informed Scott of the negotiations and offered the LSWR a working agreement on the southern part of the line between Templecombe and Wimborne.[3] Scott expressed his alarm at the proposal[4] and requested another meeting on the 16 August to give him time to consult the LSWR’s board.[5]

James Allport

It was at that point that the LSWR out-flanked the GWR. Scott met his board on 13 August and was immediately sent to Birmingham to confer with the Midland’s Deputy Chairman and General Manager, James Allport.[6] By the 17 August they decided to work with the LSWR to offer the SDR a better deal than the GWR and B&ER's.[7] Yet, knowledge of Scott's trip was withheld from Grierson and Wall when he met them on sixteenth,[8] with Scott stating that a LSWR half-yearly meeting of proprietors had prevented the board considering the matter.[9] This gave the LSWR and Midland time to finalise their deal with the SDR board, who on 19 August rejected GWR and BER’s offer. The agreement between the LSWR, Midland  and SDR was signed on the 1 November.[10] Naturally, the GWR was angered by Scott’s actions and opposed the leasing Bill in Parliament.[11] However, against its many protestations, this passed on 13 July 1876.[12]

Decision-making

The question remains as to why the LSWR decided to go behind the GWR's back and secure the SDR for itself? Certainly, LSWR decision-makers thought their company would benefit from leasing the SDR and augmenting its infrastructure. Scott described its traffic as being ‘in its infancy’ and at the parliamentary committee investigating the lease stated that:

James Grierson

‘A considerable amount of money will have to be expended on the Somerset and Dorset Line to improve it and make it efficient for traffic purposes, and I have no hesitation in saying that the traffic to be carried over the Somerset and Dorset Line in connection with the South Western system and the Midland as well as locally, will be very large indeed.’[13]

However, the LSWR did not employ accurate predictions of the capital expense required to realise the SDR's revenue generating potential. Like Channon argued regarding the Midland’s London extension in 1869, LSWR decision-makers’ knowledge of costs and revenues was too incomplete for accurate predictions of these things to be made.[14] Furthermore, there was realistically not time enough between Scott being notified of the GWR and BER’s plans on the twelfth, and the agreement’s completion on the nineteenth, for accurate forecasts to be formulated. This is not to say LSWR decision-makers had absolutely no idea of the potential revenues and costs of taking over the line, and the proposal for the LSWR to operate between Wimborne and Templecombe was deemed objectionable because Scott recognised the region’s poor revenue generating potential. But this analysis was not systematic, and based on ‘gut-feeling’ and experience.

In reality, the potential profits the SDR could generate with investment was not the reason the LSWR joined with the Midland to lease it. Before 1876 the SDR generated little traffic for the LSWR. In 1871 freight moving from the SDR onto the LSWR’s system contributed to the latter revenue of only £38,282, rising to £54,482 by 1875, the increase being because the Bath connection opened. Yet, this still only constituted 2.19 per cent of the LSWR’s gross receipts in 1875[15] and it is unlikely this traffic alone justified the lease.

Rather, the timing of the LSWR’s approach to the Midland and SDR were determined by the GWR and B&ER’s actions. The LSWR's trade could have been potentially disadvantaged if they had taken over the line, and Portal, the LSWR Deputy-Chairman, stated that the GWR and B&ER’s proposals were ‘highly injurious to the interests of the public, contrary to the interests of Parliament and hurtful to the South Western Company.’[16] Strategically, the SDR was important for the LSWR, with trade coming through it from the north and South Wales to Southampton. In August 1875 Scott stated that ‘…naturally the South Western Company, [has been] interested…for so many years been in the traffic in connection with the Somerset and Dorset line.’[17] Therefore, the GWR’s proposals would have given it control of this traffic, possibly damaging the LSWR's revenue.

Thus, the LSWR’s concern to control its trade and territory on its own terms, overrode others regarding the investment the line needed or its revenue generating capacity. Indeed, LSWR decision-makers were attempting to protect a regional monopoly, as Dodgson argued occurred at the time in the industry more generally.[18]

Archibald Scott

However, the lack of accurate cost and revenue predictions played a role in LSWR decision-makers’ mind-sets when approaching the SDR takeover. Firstly, they had believed from as early as the 1840s that traffic and revenue would always increase irrespective of the state of the economy (as I prove elsewhere in my Phd). This fed the belief that territorial protection would always put extra traffic onto the LSWR’s system, which would ultimately be good for company profits. Consequently, because accurate project forecasting was largely absent and decisions were usually made based on gut-feeling, these largely assumed beliefs underpinned the rationale and timing of most decisions. Indeed, in the SDR's case, for the LSWR to loose territorial control, may also have potentially lost it the profit from the naturally assumed traffic growth. Again, Channon argued that similar thinking was behind the Midland Railway’s construction of the London extension.[19]

A Successful Take-Over?

Ultimately, the SDR lease mirrored Watkin’s extensions of the Manchester, Sheffield and Lincolnshire railway to some extent, as Hopkins described them as ‘expensive failures’ because they ‘were not properly weighed up as investment opportunities’.[20] While the the success of the SDR lease is hard to determine accurately, it was seemingly limited. Between 1875 and 1880, when the LSWR and Midland was investing heavily in the line,[21] passenger numbers hauled grew by 53.22 per cent, and goods tonnage hauled increased by 26.75 per cent.[22] Contrastingly, the LSWR’s passenger traffic numbers grew by 44.26 per cent and goods tonnage by 37.90 per cent over the same period. Yet, thereafter, traffic growth on the SDR stalled, and between 1885 and 1895 the passenger and goods traffic originating from the company grew by 26.94 and 14.58 per cent respectively, while the LSWR’s proportions were 53.02 and 34.47 per cent.[23] Therefore, in later decades the SDR’s own traffic growth was proportionately much lower than the LSWR’s, and its traffic would have made up proportionately less of its parent company's over time.[24] Nevertheless, the benefit of the LSWR controlling the line for its traffic from the north and South Wales may have been considerable as the SDR provided a more direct route to Southampton for it, but this cannot be determined.

Overall, however, the case of the SDR lease shows that rather than mid-Victorian railway managers and directors making calculated decisions about network expansion; the protection of territory was a very important concern for them in the period. Yet, this was despite them never being able to truly quantify what the costs and benefits of protecting this territory would be.

------

[1] Williams, R.A., The London and South Western Railway, Volume 2: Growth and Consolidation, (Newton Abbot, 1973), p.173

[2] MacDermot, E.T., revised by Clinker, C.R., History of the Great Western Railway: Volume 2, (Shepperton, 1982), p.52

[3] The National Archives [TNA] RAIL 1066/1692, Sir D. Gooch to the Hon. R.H. Dutton Bart. 26 August 1875, p.44

[4] TNA, RAIL 1066/1692, Wyndham S. Portal. To Sir D. Gooch, 4 September 1875, p.46

[5] TNA, RAIL 1066/1692, Sir D. Gooch to the Hon. R.H. Dutton Bart. 26 August 1875, p.44

[6] TNA, RAIL 1066/1692, Archibald Scott’s evidence for Somerset and Dorset Railway Bill, Minute No. 418, p.55

[7] Williams, The London and South Western Railway, Volume 2, p.174

[8] TNA, RAIL 1066/1692, Sir D. Gooch to Wyndham S. Portal. 27 October 1875, p.48

[9] TNA, RAIL 1066/1692, Sir D. Gooch to the Hon. R.H. Dutton Bart. 26 August 1875, p.44

[10] Williams, The London and South Western Railway, Volume 2, p.174-175

[11] TNA, RAIL 1066/1692, Parliamentary Bills and Minutes of Evidence, etc.

[12] Williams, The London and South Western Railway, Volume 2, p.175

[13] TNA, RAIL 1066/1692, Archibald Scott’s evidence for Somerset and Dorset Railway Bill, Minute No. 378, p.42, 24 March 1876

[14] Channon, Geoffrey, Railways in Britain and the United States, 1830-1940: Studies in Economic and Business History, (Aldershot, 2001), p.107

[15] TNA, RAIL 1066/1692, Archibald Scott’s evidence for Somerset and Dorset Railway Bill, Minute No. 369, p.41, 24 March 1876

[16] TNA, RAIL 1066/1692, Wyndham S. Portal. To Sir D. Gooch, 4 September 1875, p.46

[17] TNA, RAIL 1066/1692, Archibald Scott’s evidence for Somerset and Dorset Railway Bill, Minute No. 375, p.42, 24 March 1876

[18] John, ‘New, disaggregated, British railway total factor productivity growth estimates, 1875 to 1912’, The Economic History Review, 64 (2011), p.639

[19] Channon, Railways in Britain and the United States, 1830-1940, p.107

[20] Hodgkins, David, The Second Railway King: The Life and Times of Sir Edward Watkin (Llandybie, 2002)

, p.486

[21] TNA, RAIL 262/16, Somerset and Dorset Joint Line Committee, Meetings of Officers 1875-1884

[22] Board of Trade, Railway Returns for England and Wales and Scotland and Ireland, 1875, p.58-62 and 1880, p.50-54

[23] Board of Trade, Railway Returns for England and Wales and Scotland and Ireland, 1880, p.52-56 and 1885, p.52-56

[24] Board of Trade, Railway Returns for England and Wales and Scotland and Ireland, 1875, p.62 and 1880, p.54

The Rise and Fall of the Second Class Passenger

 These days we only have one numbered class of travel, first class, and what was originally known as third is now designated ‘standard.’ Yet, I was recently asked by someone about what happened to second class, given that the mere fact that we had first and third must denote that at some point we had a second.

Before the railways arrived, the two main modes of transport were stagecoaches and steamships, and these only employed only two classes of travel. Apart from the mail coaches, which charged a premium for travel, most stagecoaches had two classes of passenger. Those paying the higher rate were carried inside, while those on the outside, who were forced to brave the elements, paid a lower rate. Similarly, those travelling on steamships either had ‘cabin’ or ‘deck’ accommodation.[1]

Yet, a glance at some shipping adverts from 1831 (left) shows more nuance in pricing. The steam packet service to the Channel Islands, while offering both ‘cabin’ and ‘deck’ accommodation, also offered ‘fore’ and ‘main’ cabins at different prices. Additionally, the ship to the United States offered steerage accommodation with or without ‘provisions.’ While these adverts would suggest there were three classes, in reality there were only two, and individuals could simply pay more for additional services while travelling. Indeed, there were not three distinct levels of service quality, each different from the other.[2]

Initially, the railways copied this two class system. In 1830 the first inter-city railway in the world, the Liverpool and Manchester Railway, had first and second class accommodation. Indeed, like on the steamships and stagecoaches, first class travel would be enclosed, whereas second class would be open. The two-class system was quickly transferred to other early railways, and an advert for the Warrington and Newton Railway (shown), opened in 1831 and which connected with the Liverpool and Manchester, shows this.[3]  

However, by the late-1830s the three class system had become the norm for all new and existing railway companies, even though third class carriages were not necessarily attached to each train. The railways could do this because the speed at which trains conveyed passengers meant that they could offer a range of services which were of varied quality.

The three classes of travel would continue undisturbed until the 1870s. First class passengers always had the best accommodation, their compartments containing soft furnishings and window glazing. Initially, second class carriages had roofs and padded seats, but were usually still open to the elements on either side. However, this latter feature did become less common up to the 1860s. Lastly, third class passengers travelled in little more than open trucks with wooden seats. On the Sheffield and Rotherham Railway’s opening in 1838 a reporter suggested these carriages would be ‘preferred in fine weather.’[4] Nevertheless, by the 1860s most third class carriages had been covered. Ultimately, all that could be said about changes in carriage design before 1870 was that they had got longer.

It was in the 1870s that the decline of second class travel began. On the 1 January 1875, after adding third class accommodation to every train in 1872, the Midland Railway abolished second class travel completely, while lowering the price of third. Furthermore, they downgraded the quality of the second class carriages by removing the leather backs of the seats, while also improving the quality of the third class accommodation by covering the seats with the same material and padding.[5] In addition, the company introduced carriages on its new Settle to Carlisle route which were twice as long as contemporary designs, had improved ride comfort because of swivelling bogies and which combined first and third class compartments.

The Midland undertook this pioneering action because of the forces acting on its business. Whereas in 1859 32.23 per cent of all railway passengers in the British Isles were travelling by second class, by 1874 the proportion was only 15.12 per cent. Furthermore, over the same period, the proportion of individuals travelling by third class rose from 49.92 per cent to 76.66 per cent. Indeed in the Midland’s case, the proportion of passengers travelling second class dropped from 23.37 per cent to 11.24 per cent, lowering the profitability of carrying them. [6] Therefore, eliminating second class accommodation reduced the cost of carriage construction and marshalling for the Midland. Furthermore, the improved third class accommodation would entice customers who would normally travel third class from competing railways. Indeed, to try and capture more of the quickly growing third class market was a shrewd business move.

It is unsurprising that many other railway managers protested at the Midland’s changes, presumably because of the precedent they set. Furthermore, those passengers that were not wealthy enough to purchase first class tickets, but purchased second to avoid the ‘rowdiness’ of the third class environment, also reacted with dismay.

Nevertheless, the Midland’s actions naturally meant that the other companies started examining the viability of their own second class accommodation, as well as increasing the size of their rolling stock. Indeed, the larger carriages constructed after the 1870s included higher quality third class compartments which attracted increasing numbers of people to this class of transport. Consequently, this helped second class travellers to diminish in number from 22.2 per cent of all passengers in 1870 to only 6.0 per cent in 1899.[8]

Therefore, for many companies offering second class accommodation was increasingly less profitable and more companies abandoned it. The Great Northern Railway, Manchester, Sheffield and Lincolnshire and Cheshire Lines Railways only offered second class travel on long distance services in the 1880s, and in the early 1890s the North Eastern, Great Eastern Railways and all Scottish Railways abandoned it completely. [9] The Great Western Railway abandoned second class in 1910.[10]

However, those companies who derived a higher proportion of their revenue from passenger traffic held on to second class for longer, given that they made healthier profits from this traffic. Indeed, in 1881 a report to the London and South Western Railway’s board by the General Manager, Archibald Scott, stated that he felt the reductions in second class accommodation on the northern railways were a mistake. Indeed, given that second class traffic remained an important source of the company’s income, constituting 25 per cent of passengers and one sixth of all travellers, he recommended that it should remain, which it did.[11] Indeed, his successor, Charles Scotter, also argued in 1894 that second class should be kept on the London and South Western given that it still ‘paid.’ However, he did recognise that the company’s case was ‘exceptional’ given that on other companies it did not so.

Ultimately, however, the even the companies dominated by passenger traffic also stopped offering second class accommodation as the proportion they carried fell. Thus, the London and South Western and South Eastern and Chatham Railways preserved it on main line services until 1918 and 1923 respectively.[13] Indeed, the latter was the last company to provide it on a British trunk line.[14] The last vestiges of second class were to be found on London and North Eastern Railway suburban services until 1938 and Southern Railway boat trains until 1948.[15]

Overall, second class had been killed by the higher quality of third class accommodation and ever-increasing numbers of third class passengers. With fewer and fewer people using it, the railways, driven by profit, no longer felt the need to provide it.

SPECIAL NOTICE

I will be doing a talk on 20 December at 6.30 pm at Kew Public Library on Victorian Railwaywomen, looking at who they were, where they worked in the industry and their pay and status. Mince pies and refreshments a provided, all for a mere £1. If you would like to attend, call the library to book a place on 020 8734 3352 (Opening Times: Tues - 10-1, 2-6; Wed 2-6; Fri 2-6; Sat 10-1, 2-6) or email kew.library@richmond.gov.uk 

------------------

[1] Simmons, Jack, ‘class distinctions,’ The Oxford Companion to British Railway History, (Oxford, 1997), p.84

[2] Hampshire Advertiser: Royal Yacht Club Gazette, Southampton Town & County Herald, Isle of Wight Journal , Winchester Chronicle, & General Reporter, Saturday, June 25, 1831, p.1

[3] Liverpool Mercury, Friday, August 5, 1831

[4] The Sheffield Independent, and Yorkshire and Derbyshire Advertiser, Saturday, November 03, 1838, p.2

[5] Birmingham Daily Post, Friday, January 1, 1875

[6] Board of Trade, Railway Returns, 1860 and 1874

[7] Simmons, ‘class distinctions’, p.85

[8] Unknown Author, ‘second class’, Saturday Review of Politics, Literature, Science and Art, 110 (1910, Aug. 27) p.259

[9] Simmons, ‘class distinctions’, p.85

[10] ‘second class’, Saturday Review of Politics,p.259

[11] The National Archives [TNA], RAIL 411/283, Report to the Directors as to Second and Third Class and generally upon passenger traffic, Archibald Scott to Board of Directors, 1 December 1881, p.4

[12] Charles Scotter interview with Commerce magazine, reprinted in The South Western Gazette, 1 December 1894, p.5-6

[13] Simmons, ‘class distinctions’, p.86

[14] Great Eastern Railway Magazine, 8 (1918), p.178

[15] Simmons, ‘class distinctions’, p.85

What Do You Want Your Railway to Do? - The L&SWR and the Need for a Corporate Vision

Some observers of the Britain’s railway system argue that current problem with the industry is that no one asks what Britain’s railways are for. Indeed, this lack of purpose harms the ability of the industry’s component players to work together, plan long-term or deliver a railway that is truly serving the people of this country. However, this is not simply a modern problem, and railway managers in the past also failed to define what their businesses were trying to do. Indeed, the case of the London and South Western Railway (L&SWR) shows how the application of a corporate vision can take a business from failure to success.

Scott

The first General Manager of the L&SWR was Archibald Scott. Scott had been the company’s Traffic Manager since 1852 and was made General Manager in 1870. For fourteen years he held this position within the company, retiring at the end of 1884.

Under Scott his very fixed ideas about how railways should be managed shaped company policy. He believed that because the railways’ had a monopoly on inland transportation, traffic and revenue would increase unabated. Consequently, to keep costs down and profits high improvements to train services, infrastructure and rolling stock were only sought from the Traffic Committee and Board when really necessary. Indeed, he believed that with no competition on many routes, it did not matter if the customers were unhappy as they would to use the railway anyway.  Thus, train services, stations and carriages were left in such a poor state during Scott’s administration that Punch nick-named the company’s management the ‘Wags of Waterloo.’

However, after 1870 these policies caused the company’s profit margin to be the smallest of the all Britain’s fourteen largest railways. This was because every potential improvement was looked at on a case-by-case basis with the minimisation of cost being the only factor in the decision. Thus, there was no joined-up thinking about overall company strategy and problems were simply solved in the short-term. Furthermore, no thought was given to growing the business beyond the traffics the company already served. Ultimately, this meant that while in the short-term costs were kept down, in the long term the company did not have an established trajectory, forcing up overall costs.

Scotter

Charles Scotter became the company’s General Manager in 1885 and rapidly set about turning the company’s fortunes around by bringing a vision and direction to the company’s policies. On his retirement in 1897 the Railway Magazine (RM) wrote that he was keen that ‘the line should live down any unfavourable reputation which it might have earned, and he found that the policy of giving the best possible facilities to the travelling public was the one at which at the same time, yielded to proprietors the highest dividend.’

The majority of Scotter’s reforms related to reversing the policies of Scott in the Traffic Department through improving the company’s services. Scotter did not, however, simply expand services uniformly and judged carefully where it would be advantageous to improve provision. To do this he engaged with the public and business people within the company’s territory, listening to their requests, even if they could not always be satisfied. Thus, the company’s train services, rolling stock and infrastructure improved in line with the public’s needs and beyond. No longer did the railway dictate to the customers what services they received, rather, the customers now had input on them. Thus, RM stated that Scotter had ‘led the proprietors step-by-step into fresh fields of traffic.’

Overall, Scotter’s tenure at the L&SWR was a success. RM stated, ‘there is no instance on record in this country where such striking results have been produced by a railway manager as those which have, within the short period of twelve years, attended the policy pursued by Sir Charles Scotter.’ Indeed, the company’s profit margin aligned with the average of the top fifteen companies and its share price rose from 118d per hundred shares in 1885 to 224d per hundred in 1897.[1]

Conclusion

Therefore, this case study shows why it is important for businesses to have corporate goals. Scott’s simplistic ad hoc approach to management, of simply minimising cost, delivered poor company profitability and an even poorer public image. However, Scotter’s arrival and the application of a corporate vision brought the L&SWR good profitability and wide praise. Indeed, this suggests that those in charge of Britain’s railways in the 21^st century really do need to ask the question of what the railway is for, so that they can ascertain where they want their industry to be in twenty or thirty years’ time. Such a step would allow everyone employed in the industry to be working towards the same goals, improve industry efficiency and deliver the British travelling public better value for money.

------------

[1] Railway Magazine, November 1897, p.385

When Two Transports Go To War... Trams vs Trains in the Late 19th and Early 20th Centuries

In the late 19th century the number of passengers that Britain's railways carried increased so rapidly that the companies’ infrastructure became desperately stretched. Indeed, I have described previously the London and South Western Railway’s troubles in adapting to this traffic growth; and how the company’s general manager was forced to resign because of complaints in The Times regarding the quality of the company’s service. (Found HERE) In 1870 British railways carried 336,545,397 passengers. By 1880 this had risen to 603,885,025, an increase of 79.44%. In 1890 817,744,046 passengers travelled, a 35.41% increase. Lastly, in 1900 British railways conveyed 1,142,276,686 individuals, equating to further growth of 36.69%.[1]

With such growth, and with the promise of consistently increasing passenger revenue, it is no wonder that in the late 19th century railway directors and managers were happy to make continual investment in improving their infrastructure, rather than hold back and cause overcrowding, poor services and slow train speeds. Thus, the railways invested heavily in improving stations, yards and sidings to improve their services and to accommodate future traffic increases. Furthermore, the Manchester, Sheffield and Lincolnshire Railway’s extension to London, started in 1895 and opened in 1899, could not have been initiated without the company’s managers judging that traffic would continue to increase, unabated. Indeed, despite criticism at the time that the extension was unnecessary, they perceived that it would be highly profitable in the future.[2]

Then, in 1900, the unimaginable happened and passenger (along with goods) traffic stopped growing rapidly on Britain’s railways. Between 1870 and 1900 the number of passengers conveyed grew by an average of 7.98% per year. Yet, in 1910 1,248,792,604 passengers were conveyed, a growth of only 9.32% over the decade. Indeed, the average yearly traffic growth between 1900 and 1910 stood at only 0.93%.

This change in the speed of traffic growth was because the street trams started to attack the railways’ short-distance third class passenger traffic. The increased numbers of railway passengers between 1870 and 1900 had principally travelled by third class accommodation. In 1870 they constituted only 67.88% of the total passengers conveyed in the country. Yet, by 1900 90.67% of all railway passengers travelled third class. Subsequently, many of the improvements to the infrastructure of the British railway network after the mid-1880s, and all the expectation of increased revenue and potential profits from future projects, had been built on this low-paying, short-distance, class of passenger.

Electric trams had been introduced into Britain in 1883 when Magnus Volk had constructed the Brighton Tramway, which still exists today. By 1885 the first street tramways were installed in Blackpool. Yet, it should also be remembered that there was not just an increase in electric trams in the period, and horse-drawn trams also played a significant role in urban transport. Thus, after 1885 the trams spread like wildfire. While I have not found statistics for tram mileage growth before 1900, between then and 1910 it grew from 1,041 to 2,434 miles, a 133.81% increase.[3] Thus, by 1896 street tramways in Britain carried 759,466,000 passengers. Yet, by 1910 this had risen to 2,907,177,000, an overall growth of 282.79% or an average 20.20% per year. Indeed, it was in 1900, the year in which passenger growth on the railways slowed, that more individuals travelled by tram than bought third class railway tickets.[4]

Short distance travellers had always existed between 1870 and 1900, and, as Cain pointed out, the majority of commuters did not use public transport. For example, by 1900 in South London only 1 in 10 individuals used public transport to get to work.[5] Yet, as the tram network spread, and access to them was widened in urban areas, their speed, comfort and reasonable ticket prices provided people with a service that the railways could not match easily for very good reasons.

With fixed routes, aged technologies and heavy costs to modify the infrastructure, the railways were in a very difficult position. The heavy investments in infrastructure of the 1890s, which made sense at the time as the railways had little competition in the transport market, looked far more foolhardy after it. None of them were made to deal with the new challenge to their business and most were to address capacity problems or make further profits. Indeed, many investments in improving stations and yards for future use were found to be unnecessary after 1900 as traffic growth slowed. Furthermore, after 1895 railway profitability, through rising costs, government legislation and poor management practices (See my PhD, when finished), had declined significantly, and after 1900 the companies found it hard to raise enough capital to respond to the tram challenge through defensive investment.

Yet, faced with calls from passengers after 1895 for faster, more frequent and more comfortable services, the railways developed responses to the challenge of the trams. These will be covered in part 2.

------

[1] Board of Trade Returns.
[2] Harris, Michael, ‘The Great Central Railway,’ The Oxford Companion to British Railway History, (Oxford, 1997), p.188-189
[3] Munby, D.L. and Watson, A.H.(eds.), Inland Transport Statistics, Great Britain, 1900-1970, (Oxford, 1978) p.338
[4] Board of Trade Returns.
[5]Cain, P.J., ‘Railways 1870-1914: The maturity of the private system,’ in Freeman, Michael J. and Aldcroft, Derek H. (eds.), Transport in Victorian Britain, (Manchester, 1988), p.101

Public Opinion and Railway Managers - A Victorian Case Study

In my work on the London and South Western Railway (L&SWR) I am acutely aware of the fact that after 1870 the railway company’s business was affected by external forces such as rising costs, government legislation on safety, fluctuations in the trade cycle and the growth of unions. Indeed, much of the literature on the late 19^th century railway industry has focussed on how these factors affected companies’ profitability. Another area of interest is the effect that public opinion had on companies and whether they may have tailored their services to the needs of the public, rather than engaging in ruthless profit maximisation. However, rarely has this been studied in detail. Thus, it was with this in mind that I decided to have a look at The Times online archive to ascertain whether I could find linkages between public opinion of the L&SWR and its policies. I did in part, but my discovery wasn’t what I expected, in that I found a storm that was blowing around one man.

Archibald Scott was born in Dundee in 1821 to a Tanner, also by the name of Archibald.[1] Information Scott’s early life is unknown, apart from the fact that he was employed by the Edinburgh and Glasgow, Edinburgh, Perth and Dundee, and North British Railway companies. In 1852 he was appointed as Traffic Manager of the L&SWR, after the previous holder of the post, Cornelius Stovin, absconded to the United States with a fair amount of the company’s money. In 1870 he was promoted to the position of General Manager with control over all the company’s operations.[2] Thus, by 1884 Scott had been the company’s most senior manager for 32 years.

From the mid-1870s the complaints against the speed and unpunctuality of the L&SWR’s train services began to grow. The May 1876 issue of The Pall Mall Gazette published a letter from ‘Quaerens’ complaining that the L&SWR, amongst other companies, halted the regular trains in favour of ‘specials’ bound for the race meetings at Epsom and Ascot.[3] In an edition of Funny Folks magazine of October 1878, it mentioned the case of a season ticket holder who had brought an action against the company because of delays to his journey. He lost his case, which the publication lamented.[4] In September 1880 a letter to The Standard from a ’victim’ complained that the ‘unpunctuality of the [L&SWR’s] trains was notorious’ and that he ‘had never in my life arrived at Waterloo at the proper time.’ He placed the blame at the feet of the management.[5] Lastly, in the late 1870s the residents of Hounslow formed an ‘Acceleration Movement Committee,’ and under the leadership of Peter Watson they frequently petitioned the company for improved train services. In some cases, trains arriving at Waterloo arrived 20 to 30 minutes late.

Many of the delays in the train service can be attributed to the fact that between 1870 and 1880 the company’s passenger traffic increased by 126%. In 1870 the company hauled 13,387,357 passengers. By 1880 this number had risen to 30,294,406, and this caused the infrastructure of the company to come under strain, especially at bottlenecks in the system like Waterloo. The lines into that station were narrow and the station was small, only possessing four platforms in the mid-1870s. The company attempted to ease the pressure by expanding the station in 1878 and 1885, adding a further eight platforms.[7] Yet, these changes were unsuccessful in slowing the steady flow of complaints about the company's train services. As always, the blame was laid squarely at the feet of ‘the management.’[8] Then in late 1884 a storm broke.

It is where this storm broke that was important. It was in the country’s most prominent newspaper, The Times. On the 9^th October five prominent passengers, Lieutenant-Colonel S.E. Orr, Colonel Clifford Parsons, Lieutenant-Colonel R.H. O’Grady Haly, Edward H. Halsey J.P. and George Fry, wrote to The Times to complain about the unpunctuality of the L&SWR’s train services. All lived about 35 miles from Waterloo and travelled on the same train daily. While according to the timetable they were expected to arrive at 10.24, they always arrived later, sometimes after 11 am.[9] This was followed on the 11^th October by another letter from D. Radford who complained about the ‘extreme unpunctuality’ of the company’s services.[10] On the 16^th three more letters were published from ‘A Resident,’ ‘A Victim’ and ‘Viator.’ The ‘victim’ laid the blame for the unpunctuality of trains at the feet of ‘the utter incapacity of the management of the London and South Western Railway.’ But it was not all criticism, and while the ‘Resident’ did acknowledge the problems, he defended the company on the grounds of that increased traffic had caused the delays in trains. Also, ‘Viator’ was positive about trains on the ‘Thames Valley Line,’ (to Shepperton) stating that were never more than 10 minutes late.[11]

However, any defence of the company was quickly nullified by the letters that the paper printed on the 21^st October. Of six letters printed only one supported the company, with almost all attacking the unpunctuality of the company’s trains. Indeed, the first, from H. Stopes, went further in criticising officials at Waterloo who he claimed were ignorant and lacking in courtesy. Lindo S. Myers stated that he had travelled in Europe and that ‘there is not one [company] so badly managed as the South-Western nor is there any time table which is so purely the work of supposition.’ The only support for the company came from J.M.D. who stated that the trains between Exeter and London were always punctual.[12] Yet, this defence was called into question by a letter printed on the 23^rd October in which H.T. Edwards wrote that the punctuality on this service proved ‘that even the London and South Western can be punctual when they come into competition with the Great Western.’ He called this fact the ‘last nail in the coffin’ for the ‘disgraceful management’ of the L&SWR.[13]

What effect this had on the L&SWR General Manager is unknown. However, it cannot be a coincidence that on the 10^th November, only two and half weeks after the last complaint in The Times, Scott sent a letter to the L&SWR board tendering his resignation.[14] While other factors may have been involved in this decision, such as the worsening financial situation of the company and Scott’s increasing age, the high profile nature of the complaints, combined with the increasingly poor image of the company because of them, no doubt helped Scott decide that it was time to go.

Therefore, this case overall raises the question as to the extent external pressure played in shaping the careers of Victorian railway managers and the decisions they made. This, subsequently, is an area that needs more work.

---

[1] The National Archives [TNA], Unknown Reference, 1841 Census Return, Dundee, Forfarsh, p282

[2] TNA, ZPER 11/28, South Western Gazette, January 1911, p.8

[3] The Pall Mall Gazette (London, England), Monday, May 22, 1876; Issue 3512

[4] Funny Folks (London, England), Saturday, October 26, 1878; pg. 338; Issue 204

[5] The Standard (London, England), Wednesday, September 15, 1880; pg. 3; Issue 17521.

[6] Williams, R.A., The London and South Western Railway – Volume 2: Growth and Consolidation, (Newton Abbot, 1968), p.48

[7] Chivers, Colin and Wood, Philip, Waterloo Station circa 1900: An Illustrated Tour – South Western Circle Monograph No.2, (London, 2006), p.2-17

[8] TNA, ZPER 11/3, South Western Gazette, December 1884, p.3

[9] The Times, 11th October 1884, p.7 Issue 31262

[10] The Times, 15th October 1884, p.7 Issue 31265

[11] The Times, 16th October 1884, p.10 Issue 31266

[12] The Times, 16th October 1884, p.12 Issue 31270

[13] The Times, 23rd October 1884, p.12 Issue 31272

[14] TNA, RAIL 411/7, Court of Directors Minute Book, Minute No.1547, 13^th November 1884

Decisions based on what? Information Upcoming in the L&SWR

At the core of the operations with large businesses is communication. Smooth and accurate communication is vital to make sure that many different operating units, dispersed over large distances, coordinate their actions. Being the first major industry to have large scale, geographically spread operations, the Victorian railways were the first to develop and evolve complex information transfer systems up and down their organisations. ‘Upward’ forms of communication developed to enable senior management could make astute decisions. It is these latter forms of communication that I am working on at the moment.

While not the most engaging subject that I have to deal with in my PhD, the development of upward communication within the London and South Western Railway (L&SWR) is very important for my study. The matter of what information managers had is central to my overarching question of how the company’s managers made decisions, and how good those decisions were. Did they go ‘lets have an extra siding here, a station there, or an extra waiting room’ based on large or small amounts of information, and how did the level of information feed into the quality of decision-making?

I am quite lucky with this part of the study, in that I am graced, unusually, with more information on upward information flows in the earlier part of the L&SWR’s history, than the flows in the late-Victorian period. I suppose this is because before 1870, after which the company was in its mature phase, everything was still developing, and as such a greater number of edicts were made that defined exactly what communications were required. However, by the later period, there was less need to inform junior managers, particularly station agents, of what forms and returns they were required to send to the headquarters regularly, as these had been ingrained in the fabric of railway life for some time and were ‘common knowledge’ amongst the staff. Thus, there is, in the case of the L&SWR, a paucity of information about information flows in the later Victorian period.

My main sources of evidence from the early period of the L&SWR’s history are the rule books, that were issued to each employee (in 1845, 1852, and 1864), and the ‘Abstract of instructions which have from time to time been issued to the Station agents’ (from 1858 and 1865). These laid down what information senior managers should have been sent by station agents from stations and yards. These communications took three forms; statistics, regular operating returns and correspondence dealing with other pertinent matters, and most were sent by train to officials at the company’s headquarters.

The range of statistics that junior managers sent to senior management developed very quickly, and they were a way for the latter to observe long term trends in traffic volumes, but also to regulate costs. So, by 1864 these included the tonnage of goods traffic arriving at stations, the number of passengers carried, the type of goods traffic carried, the amount of money taken, the wages paid, the amount of coal (or coke) used by locomotives, the amount of tickets issued, and the volume of stores used. From these, senior management made decisions as to the policies that the company would pursue, or where economies needed to be made.

In addition to this, there developed a number of returns that related to the operating procedures of the company, allowing senior management to monitor how well the organisation was functioning. These included returns of damaged roiling stock that arrived at stations, sent to the Locomotive Superintendent, a daily return of lost property found, forwarded to the Lost Property Office, and most importantly, a general return that encompassed any other issues at the stations. This return, sent daily by the first train, included anything from suggestions regarding safety, right through to ideas for improving company operations or the need for increased accommodation for traffic at stations. Thus, these communications showed senior managers how the company was functioning and where improvements needed to be made.

Lastly, there were ad hoc forms of upward communications. Of course, there were the occasions when senior management was required to be immediately notified of an occurrence, as in the case of an accident, but letters were also to be sent up to headquarters on other matters that could not wait until the regular morning report. These included when signals were out of repair, a staff member that was suspended for infringing the rule, or a response to when information was requested by senior management in a hurry. These communications, I presume, were rare, and were less associated with decision making, than with reporting something that had gone wrong.

Thus, by the 1860s the L&SWR had developed many procedures, so that information of different types could move up the company hierarchy to inform decision-making. Whether that decision-making was any good, well, that is the question of my PhD.

When decision making changed for Britain's railways - The L&SWR's Decisions in the early 20th Century

In the late 1800s the railways were still dominant in the transportation market. If you wished to move yourself, your luggage or your goods, the railways were only way to do it quickly and efficiently. However, the railways’ profitability and performance was declining in this period. This was possibly for a number of reasons such as declining management quality, ingrained working patters, managerial empire building and intrusive and costly and governmen legislation. While I wouldn’t like to go into these factors in detail, it was clear that the railways weren’t doing as well financially as in their formative years. In short, something needed to be done to get the profitability back up, and the London and South Western Railway (L&SWR), who had suffered like most railways, set to work in the early 20^th Century. In this blog entry I will describe briefly the reasons for two major decisions that the L&SWR took to attempt to secure the profitability of their passenger service between 1898 and 1922. These are the rebuilding of Waterloo station and the suburban Electrification project. I will show that the initiating factor for investment changed on the L&SWR, as it did within many companies in the early twentieth century, because of a change in the business environment.

But why should I just focus on the company’s passenger traffic? Despite having a booming goods business, the majority of the company’s revenue came from passenger services. Thus, if we take 1900 as an example, while the goods revenue of the company came to £1,356,209, the passenger revenue was £2,997,274 (or 68.8% of overall revenue). Thus any decisions regarding the company’s passenger services were vital to its profitability.

Waterloo Station

Has anyone ever read Jerome K. Jerome’s 1889 book Three Men in a Boat? In it he described the problem with Waterloo Station in the late 19^th Century.

“We got to Waterloo at eleven, and asked where the eleven-five started from. Of course nobody knew; nobody at Waterloo ever does know where a train is going to start from, or where a train when it does start is going to, or anything about it. The porter who took our things thought it would go from number two platform, while another porter, with whom he discussed the question, had heard a rumour that it would go from number one. The station-master, on the other hand, was convinced it would start from the local.”

While I won’t go into great detail as to why the station was so difficult to navigate, in short, it had been built up bit by bit over the years since 1848. The L&SWR hadn’t conducted complete rebuilds of the station as more capacity was required to accommodate the traffic, but rather had just ‘bolted on’ new platforms, canopies and facilities every now and again. Thus, in 1898 Waterloo actually had three stations that were all connected; Central, which was the old 1848 structure, South, added in 1878 and North, dating from 1885. This was confused by the fact that the 18 lines running into the station only shared ten platform numbers.

In the 1890s the company was facing a capacity problem at Waterloo as passenger traffic had grown at a very rapid rate. The table below shows the growth in the number of passengers carried, the number of passenger train miles run and the revenue from passenger traffic between 1890 and 1900. Therefore, the rebuild it was a direct response to the fact that passenger traffic had grown at a very rapid rate in the 10 years and that more accommodation was required. Thus, the move to rebuild the station taken in 1898 was reactive to the physical constraints of the company’s infrastructure.

In a sense, this was the last of the L&SWR’s great projects that was reacting to the physical constraints of the company’s infrastructure. To look at any business decisions before 1900, the majority were made because the continually rising traffic meant that the company required extra facilities to deal with that fact. Thus, the company were never exceedingly worried that the expense would be unnecessary as in the long run the expected revenues from passenger growth would eventually cover the cost of construction. This was essentially because the railways were operating in a period when they had monopolies on transportation in most places and did not see any challenge to their unique position. Thus, the Waterloo rebuild was continuing this pattern of decision making, but, it was the last large-scale investment that adhered to it.

The station was completed in 1919 and on the 21^st of March 1922 was officially opened by Queen Mary.

The Electrification Scheme

There were a number of things that affected the way that the L&SWR viewed their suburban passenger services in the early 20^th century, most of which involved electricity. Firstly, the company opened its long-awaited extension to Bank Station via the Waterloo and City line. Electrically run, this was a good testing bed for electric trains within the L&SWR’s sphere of influence. Yet, at this point the L&SWR showed little interest in using the technology on its overground services. Further, up to 1905 the company cooperated with the Metropolitan District Railway Company when they electrified their lines to Richmond and Wimbledon. The Chairman of the L&SWR, Campbell, said he would watch how the new services did with interest. Indeed, the result was that passengers deserted the slow L&SWR steam hauled routes to the city in favour of the clean electric trains. The most important event came when the London United Tramways Company (LUT) started extending into the L&SWR’s suburban region. They reached Hounslow in 1901, Twickenham in 1902 and Hampton court in 1903. Further, in 1902 the LUT received permission to extend to Sunbury and Wimbledon and was looking at building lines to Staines. Finally, in 1906-07 the LUT extended to Kingston, Surbiton, New Malden and Wimbledon.

Thus, the L&SWR started to suffer in its suburban zone. According to Faulkner and Williams in 1902 the L&SWR lost 64% of its receipts on the Hounslow route because of the LUT’s activities. Indeed, if we consider the table above we can see that in the 10 years after 1900 the growth in the number of passengers, passenger train miles and passenger revenue slowed considerably in contrast with the 10 years before. Thus, there were worrying signs that underlying idea that had endured for decades, that the growth number of passengers would continue unabated, was probably doubted. Indeed, at the 1913 General Meeting, the investors were told that the company had lost £100,000 in revenue and the passenger numbers were by then falling by a million per year. Thus the company’s had, by that point, become a reality.

The first stage of the electrification plan was confirmed by the board in December 1912. The proposed routes to be electrified are shown in the picture. The move was therefore different from the rebuilding of Waterloo. Waterloo was rebuilt based on the assumption that Passenger traffic would continue to rise and that there would be no alteration in this fact. However, the Electrification scheme was adopted because of exactly the opposite reason, a fear that passenger traffic, and profits, would decline. Therefore, the attack on passenger traffic by the company’s first real competitors in the suburban passenger market must have been unexpected given the prior history of the L&SWR. Thus, they were made the decision because they were trying to protect their business.

The company completed the planned suburban electrification in the years after 1912, connecting to Wimbledon, Kingston, Hampton Court, Hounslow, Claygate and Shepperton by 1915-16. It was the Southern Railway that would continue the L&SWR’s work.

Conclusion

In the context of the profitability and performance problems of the British Railway industry in the late Victorian period, what could be said about these two events? Firstly, it is evident that despite the failing profitability of the period 1870 to 1900, it wasn’t substantial enough to change the company’s reaction to the increased passenger traffic and the need for greater facilities. Faced with capacity problems they did not try alternative ideas to solve them, for example reducing the number of trains running into Waterloo or closing stations to reduce the number of passengers carried. Instead, they continued with the long-standing pattern of rebuilding existing facilities so every passenger would be accommodated, confident in the knowledge that the cost would, eventually be covered. However, they were shocked into action when the passenger growth, that had always been expected, did not materialise because of new and unexpected competed forms of passenger transport. As such, they were forced into reacting to their business environment by trying to protect the traffic they did have.

Thus, what these two large L&SWR investments symbolise is an important moment in the history of Britain’s railways. The early 1900s were when companies stopped considering that Traffic would always continue to rise, but rather, tried to protect what they had because the business environment had changed. In essence, the period was when Britain’s railway’s would start their long decline towards Beeching.

Bibliography

Faulkner, J.N. and Williams, R.A. The LSWR in the Twentieth Century, (London, 1988)