March 14, 2018

Change your mindset or risk losing out in the new digital world

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“YOU need to think like you are the Google of transport, or you will be dead.”

Mr Oliver Wolff's bold statement was met with nods of approval during the opening session of the International Association of Public Transport's (UITP) IT-Trans conference and exhibition on March 6. His words were also repeated throughout the three-day event. Presenters and contributors were keen to push home his point that the sector's traditional way of thinking is holding it back.

Indeed, Wolff who is managing director of the Association of German Transport Companies (VDV), which represents around 600 public transport and rail freight companies from across Germany, was responding to a fellow panellist's view that as they are subsidised, public transport authorities and operators have no need to make a profit and that it is unnecessary to explore additional ways of generating revenue.

“If we are able to sell ads and other things that reduce the subsidy from the public, and which helps public transport companies to pay money to the public, that is fine,” Wolff said. “Anyone who is working in a competitive marketplace should be forced to be the best they can be. And to be the best, we have to do this. If we don't meet this challenge with the kind of understanding and passion that is necessary, we are in deep shit.”

Despite the growing liberalisation of the operations market, too many public transport authorities and rail operators still subscribe to these old ways. And, critically, there is a reluctance among many to change.

Rail's strong emphasis on safety has often prevented changes to safety-critical operations. And rightly so. Why risk breaking what doesn't need to be fixed? But new innovations are opening up more efficient ways of doing things which can reduce overheads dramatically while improving safety. New technologies are also providing new ways of serving passengers - epitomised in the rapid growth of on-demand transport provided by disruptive operators like Uber. In order to survive, as Wolff points out, agencies must react, become more tech-savvy and provide the services their passengers want. If not, they risk losing them altogether.

Digitalisation is now widely accepted as the means to achieve this change. The Internet of Things, machine-to-machine technologies and concepts such as block chain are the processes by which digitalisation is achieved. At the heart of each is data, the oil of the fourth industrial revolution, which when extracted from people and from assets can provide an in-depth understanding of exactly what is happening, helping to improve the efficiency of operations and serving the passenger more effectively.

The supply sector has been onboard in this area for a number of years now and it is already bearing fruit for the operators around the world which have signed up. A walk of the exhibition hall in Karlsruhe revealed a range of technologies available. From operations management systems that are helping to make paper records redundant in New Jersey, to the latest remote condition monitoring technologies. There were also a spate of platforms and systems designed to enable Mobility as a Service (MaaS), a concept which integrates different public transport services including public transport, taxis, car-hire, walking, and car, ride, or bike-sharing into a single on-demand mobility service.

Sessions on MaaS held throughout IT-Trans revealed the extent that it is now being developed in cities around the world - from the early pioneers in Gothenburg, Helsinki and Manchester, to upcoming projects in Catalonia and Athens. However, as much as technology is driving the development of MaaS, with these projects not set to mature for two to three years at least, it is important the developers do not lose sight of the fact that it is a service, and a service which should meet passenger's needs and expectations, which continue to change all of the time.

As Mr Olivier van Duüren, founder of The Dualarity, and a former Microsoft executive, emphasised during his keynote address, the customer of today is very different from that of 20 years ago. The customer of 2040 will be very different again.

It is essential then the flexibility to change and adapt is at the centre of both these technologies and the mindset of the people overseeing the transition. Unfortunately, the reported lack of delegates from public transport companies visiting the exhibition indicates that too few are able to engage and understand how new innovations might benefit them in the short and medium term. Seeing is believing.

Just as important as changes at the board room level, are alterations of the skillsets of employees. Data scientists are critical to understand the reams of data public transport companies now have available and how it might be best utilised. Many of the pioneering agencies and operators have also employed chief technology officers, who are tasked with overseeing the adoption of new technologies and innovative digital working practices within their institutions.

Combining this understanding with a deep understanding of who the modern public transport passenger is and what they want the best recipe for success. To truly become the Google of transport, you must know who you are customers are, and understand what they want now and in the future. After all, without them, you are dead.

Kevin Smith

Kevin Smith joined IRJ in 2009 as features editor and since then has travelled the world reporting on developments in the world's railways. Before joining IRJ, Kevin worked for several local newspapers in the United States and as a freelance technical writer for a university engineering magazine. Kevin graduated with a first class honours degree in American Studies from Lancaster University, Britain, in 2006, and with a Master's degree in American Studies from Purdue University, United States, in 2008.

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