Public transport operators use shared services

Although most transport organisations operate within tight margins and are exploring ways to cut infrastructure costs, the adoption of shared services – the centralisation of administrative functions – has not taken off to the same extent as in local government.

The model is more prevalent among public sector transport operators than elsewhere in the industry, but it is still not widespread because of the difficulty of winning over multiple stakeholders, especially if they work for rival companies.

One organisation that has managed to juggle this issue is the Rail Settlement Plan (RSP). The RSP is a subsidiary of the Association of Train Operating Companies and is owned by the UK’s 25 train operators (TOCs).

RSP acts as a bank for the national rail network, handling £4bn-worth of transactions each year and allocating revenues from the annual sale of 600 million tickets to the TOCs.

The organisation also distributes fare, reservation and timetable information to retail outlets and maintains 6,000 of the UK’s 10,000 point-of-sale installations. RSP accredits and manages all systems and services that support such activities.

RSP has only 25 permanent staff, but employs about 50 contractors and outsources development and operation of its IT systems to a number of suppliers, including Atos Origin, Capgemini and Fujitsu Services.

So far, RSP has undertaken six key IT projects, including a £4m ticket-on-departure system; revenue capture and settlement applications for £80m and a reservations system for £90m.

Once a project has been decided on and funding approved by an investment panel, a TOC steering group is set up, reporting to Antony Lain, RSP chief executive.

The steering group governs the project, coming up with the initial specification, assigning budgets, deciding on resourcing needs and managing risk.

Beneath this layer, each TOC also establishes its own expert user group. These groups are kept abreast of developments by means of weekly project updates and monthly review meetings, and are expected to provide input and feedback.

‘It is critical to let people know where the system is and what you expect to deliver, so that when it is delivered there is not an enormous amount of resistance to change,’ says Lain.

In the case of the reservation system, user group representatives attended more than 50 workshops during the three-year development, and were pivotal in firming the final specification..

In the final stages of the project RSP also staged a roadshow to ensure that stakeholders knew what to expect, how to use the system and who to contact about any problems.

‘It is about checking constantly and being vigilant, ensuring that all the managing directors and finance directors, users and your own staff are all moving in the right direction,’ says Lain.

One organisation coming at the problem from a somewhat different angle is Transport Direct, the government body that operates a web portal to enable people to plan journeys using different modes of transport.

Funded by the Department of Transport, the Welsh Assembly and the Scottish Executive, the initiative aimed to comply with the egovernment programme to put services online, and Deputy Prime Minister John Prescott’s 10-year integrated transport plan.

The site was developed, and is now run, by a consortium of suppliers led by Atos Origin, and was officially launched in December 2004.

But from the outset, the transport industry made it clear that, while it supported the idea, the proposal would not become reality unless government took the lead, as individual operators were not prepared to advertise the services of rival organisations.

So Transport Direct was left to take into account the views of up to 500 stakeholders, about 50 of whom were deemed key. These included public and private sector operators, 141 local authorities and the organisation’s fund-holders.

Nick Illsley, Transport Direct’s chief executive, says the biggest challenge was not the IT but winning stakeholder support.

‘If even one major player said no, it would have taken away much of the unique selling point of the site,’ he says.

‘So stakeholder engagement was core, and we also had to ensure that people remained engaged with the project.’

Key to this was the organisation’s corporate governance structure, which comprised two stakeholder boards of about 15 people providing regular input and feedback.

The first board was a transport group that focused on strategy, and included representatives from the Local Government Association and the Confederation of Passenger Transport. The second concentrated on delivery issues and consisted of operations and marketing directors from various transport companies.

Both bodies met every three months and were also sent monthly progress reports to ensure that interest did not wane and they continued to feel involved in the process.

Critical factors behind project success include adopting a partnership approach and maintaining open lines of communication at all times.

‘Having a huge number of stakeholders is difficult because there is a complex mix of agendas,’ says Illsley.

‘But you can make it work as long as you remember that it is all about relationships.’

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