…A journey of transformation. Rick Eagar, Russell Pell, Philip Webster of Arthur D Little discuss the five key challenges for urban railways as they strive to meet future mobility needs

For those of us who live and work in big cities – well over half the world’s population today, a figure projected to increase to 70 per cent by 2050 – metro railways are an ever-present part of daily life. Today there are 148 cities with metro operations carrying over 150 million passengers per day, with about one-third in Asia, one-third in Europe, and the rest split between the Americas, the Middle East and Eurasia. Metros are critically important assets for the world’s cities in order to meet the huge challenges of maintaining urban mobility in the coming decades.

Key issues and solutions for metros
In our work with metro companies we find that the key issues and solutions to drive the necessary changes can be usefully categorised in terms of what we would call the Five Cs.

The first three of these, customers, capacity and cost, represent the well-established central concerns of any public transport service provider – but all of them need to be managed differently to meet the demands of the future. The last two, co-innovation and cooperation, represent newer areas of focus that most metros still need to get to grips with.

Customers – becoming truly customer centric
Customer centricity is becoming the top priority for metro operators in the developed world. Customers have more choices around preferred modes of transport, travel more frequently, and are increasingly digitally savvy and connected to the world around them. No longer do they just expect trains to run on time. They now have much higher expectations around a seamless journey, comfort and facilities. They now have many more channels to voice perceptions, make complaints and influence each other, and in many cities, such as Hong Kong, metro disruptions become literally front-page news.

Consistent poor performance can even result in a loss of a license to operate – metros typically have performance standards set by their respective governing bodies. For example, the Hong Kong government requires a minimum of 98.5 per cent ‘passenger journeys on time’ from metro operator MTR, a level it consistently exceeds.

Creating a favourable customer experience requires a clear vision and strategy, aligned across the organisation and implemented through a set of principles and actions aimed at building a world-class sustainable offering. This includes:

  • Designing the experience – what the passenger experiences is the heart of it, based on demographics, segmentation, persona analysis, and getting a full understanding of the end-to-end customer journey, critical touch points, and hot spots where issues need resolving
  • Voice of the customer – having a dynamic approach to gaining genuine customer insight. Traditional methods of market research should be integrated with other techniques
  • Organisation and governance – having one team responsible for driving forward the customer agenda, along with the right metrics and governance structures, to ensure the rest of the organisation is aligned and working with them to deliver change, and
  • Customer-oriented culture – everyone in the organisation should feel they can influence the customer experience.

Capacity – managing patronage and network growth
Managing the growth in metro networks is a key challenge for many operators. As network capacity is more highly utilised, there is less margin for error and operators are forced to work smarter, predicting and reacting faster to changing needs or operational challenges. It is important not only to make optimal use of existing assets and lines, but also to effectively manage the development of line extensions and new lines, including their integration with the existing railway. In terms of managing existing capacity, there are several factors to consider, such as focusing on maintaining capacity availability and looking for smart ways to improve capacity, especially during peak hours.

And it is not just the train service itself. Stations need to be designed to manage passenger flows on a day-to-day basis, and there is an array of new tools and innovative technologies available to help operators do this.

Cost – achieving cost-effective operations
In building new metro capacity, new assets need to incorporate future demands and customer requirements. In the past the response was simply to build something that was fit for purpose with sufficient capacity. However, today this is much more about optimisation, achieving a balance with the needs of customers and other stakeholders. It means being much more explicit about trade-offs between meeting ever-increasing expectations and providing a cost-effective metro railway:

  • Full automation is one key way to achieve costeffective operations, provided that customer expectations and operational risk can be adequately managed
  • Value engineering is crucial. Effectively replacing assets at the optimal time with value-based, costeffective solutions, while considering all the options, is critical for those metros with aging asset bases, for which asset replacement costs can mount up, and
  • The way maintenance is delivered, and who delivers it, can make a substantial difference. There may be different options available to outsource maintenance, and these should be fully evaluated.

Co-innovation – progressively co-develop new technologies to maximise effectiveness
Metro rail operators continually need to replace assets that are life expired or becoming obsolete, as well as build new infrastructure to support network expansion. Given the costs and complexities of asset installation and replacement programs, obtaining the right technology at the right time which delivers the best solution the first time around, is critical.

In most cases, metro operators do not conduct their own research and development, and are reliant on procuring new technologies from original equipment manufacturers (OEMs). A turn-key, off-the-shelf solution is seldom available, and considerable testing and trialing may be needed before a metro operator is confident that a technology is fully ready for operational use.

As a result, the pace of technology evolution in the metro rail sector has historically been slow, though this is now changing. Digital technologies in particular are becoming increasingly important to the modern metro, which have much faster technology development cycles and obsolescence rates. To overcome this growing challenge, the world’s leading metros are becoming very good at being intelligent customers for new technologies. They have done this by:

  • Taking a whole-systems approach to planning for new technologies by drawing together the needs of different parts of the operating railway into a single overview, and understanding where synergies and trade-offs lie
  • Becoming very good at proactively engaging with OEMs to help jointly set technology direction, so that new assets are ready on time and fit for purpose
  • Progressively building up new capabilities in both organisations so that the skills are already in place for when the technology arrives
  • Ensuring a single point of coordination for describing technology needs
  • Putting in place in-house R&D and technology management resources, and
  • Conducting technology-scanning activities, in particular to identify partially developed technologies from adjacent sectors such as aerospace.

Cooperation – developing an integrated approach with transport providers
The urban mobility challenges of the future require closely coordinated and integrated action from a variety of stakeholders, including transport authorities, planning authorities, transport providers, telecoms providers, utility/ infrastructure companies, property developers, retailers and businesses. A strategic approach is needed which takes into account both transport demand and transport supply.

Metro operators differ considerably in their ownership and governance structures. Whatever the structure, metro operators are having to significantly change the way they approach their strategies for the future, for example:

  • Becoming much smarter at managing multiple stakeholder relationships, including both authorities and peer companies
  • Building capability in multiple transport modes beyond metro, including bus, personal transport, bike, etc, and
  • Acquiring entrepreneurial and technology skills to work with external partners and innovators to develop new and innovative end-to-end journey solutions, especially in the digital sphere.