October 15, 2017

MTR drives up customer satisfaction and staff morale

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MTR has steadily expanded its Swedish portfolio since it won its first concession to operate the Stockholm metro in 2009, and is now poised to bid for concessions in neighbouring Nordic countries, as David Briginshaw reports from the Swedish capital.

GREATER Stockholm Local Transport I (SL) awarded MTR an eight-year concession to operate the Stockholm metro in January 2009 and MTR took over in November that year. In 2015, SL exercised an option in the contract to extend the concession for another six years from this year until 2023.

One of the first things MTR had to tackle was a lack of initiative and customer-focus among staff. “When we started the perception among the staff was that the only time they would speak to a manager was when they had done something wrong,” says Mr Henrik Dahlin, CEO of MTR Tunnelbanan (metro).

Sweden 069This is echoed by Mr Peter Viinapuu, CEO of MTR Nordic: “When I introduced myself to staff they would say their employment number first and then their name. The attitude was ‘do what you are told and don’t take any initiatives.’ So we started by making the metro part of the MTR family and improving performance.”

In order to weed out people who find it difficult to adapt, MRT has replaced 15% of the first level managers and a greater proportion of senior managers since 2009. As a result of this and other initiatives staff satisfaction has rocketed from 32% to 92%.

MTR’s philosophy throughout all of its businesses is to put safety at the heart of its operations. “But you don’t become world class by just being safe,” Viinapuu says. He cites four key areas which MTR focuses on:

  • customer satisfaction
  • having employees that are engaged and empowered to make improvements
  • maintaining profitability for both the shareholder and operator so that there is sufficient money for investment, and
  • ensuring that the company is better than its competitors.

Dahlin says MTR has also worked hard in the passenger environment. “We are here for the customers and taxpayers of Stockholm,” he says. “Between 2013 and 2015 we had 800 actions to improve customer performance. About 100 were tweaks to the organisation structure, but some actions were more major. We provide coaching for the full-time staff every seven weeks, and make an effort to explain why we are making changes.” Dahlin says customer satisfaction rose by 10% in three years from 75% to 85%. “We want to get to 90% by 2021 even though the target is 85%,” he says. “But it will be much tougher to achieve this next increase.”

When MTR took over, station ticket offices were only selling tourist tickets, so it convinced SL and local politicians that it made far more sense for the staff to sell its full range. “We introduced this in 2015 and that change alone contributed to a substantial increase in traffic and revenue,” Dahlin says.

MTR has managed to improve punctuality during the last five years from 93.5% to 97.7% this year, despite operating 5% more vehicle-km and reducing the size of the fleet by 10% or 52 cars. Passenger traffic has grown from 300 million journeys in 2009 to 348 million in 2016.

Cleanliness on the metro was only at 37% but this has now been increased to 100%. “Our staff are extremely satisfied,” Dahlin says. “The challenge now is how to improve when we are already good.”

When the concession started, MTR only faced penalties if it failed to meet targets set by SL, but since then bonuses have been introduced for exceeding targets. Dahlin would like MTR to have greater control of some of the things which affect performance but which are outside the scope of the contract with SL, such as station escalators. “We have added 16 supplementary agreements, but we have reached the limit in the existing contract apart from some small changes,” Dahlin says.

“We have a strategy up to 2026, although our focus is on 2021,” Dahlin says. This is when MTR will start to prepare its bid for the next concession. “We want to become as efficient as possible in order to win the contract,” he says. “This is the biggest contract in Scandinavia so a lot of people want to win it.”

The metro concession includes rolling stock maintenance and this is carried out by MTR Tech, which became a fully-owned subsidiary of MTR Nordic in spring 2016 following the purchase of Norwegian State Railways’ (NSB) 50% stake (through its subsidiary Mantena) in the original maintenance company Tunnelbaneteknik Stockholm (TBT).

The maintenance contract covers light and heavy maintenance, cleaning and graffiti removal and asset management support on the fleet 497 metro cars, which are leased from SL along with four depots and a workshop. “We receive a fixed remuneration per vehicle-km,” explains Mr Gustav Sjöberg, head of business development with MTR Tech. MTR Tech has managed to reduce the number of vehicles out of service from a peak of around 37 trains in 2010 to a peak of 14 trains in 2016 and an average of about five.

SL has ordered 96 C30 cars from Bombardier for the Red Line with delivery expected to start by the end of the year or in early 2018.

MTR Tech has won a contract to upgrade the 271-car C20 fleet, in addition to installing new signalling on the Saltsjöbanan commuter line in Stockholm for Siemens, and carrying out vehicle damage repairs for Arriva and SL.

Sjöberg is keen to build on this. “We do not have many competitors in Scandinavia and we are at the beginning of the process to get ourselves known,” he says. “Sweden has purchased a lot of EMUs in the last 10-15 years, and a lot will be due for overhaul.”

Commuter rail

In December 2015 MTR was awarded a 10-year contract to operate the Stockholm Pendeltågen commuter rail network starting in December 2016 with an option for a four-year extension. The 241km 53-station network carries around 87 million passengers per year.

However, SJ launched an appeal against the award of the contract to MTR which was finally overturned in May 2016. “We started preparations to take over the concession at our own risk while the appeal was underway, although we managed to follow our plan with some slight changes,” explains Mr Anders Åhlén, programme manager with MTR Pendeltågen.

The commuter rail contract includes a penalty-and-incentive system from the outset with SL measuring MTR Pendeltågen’s performance monthly. “We have 177 key performance indicators, so we are very much focussed on measuring everything,” says Mr Dan Hildebrand, CEO of MTR Pendeltågen. MTR is evaluated on service quality, whether the stations are clean and functioning efficiently, whether the passenger information is correct and being provided quickly enough, as well as punctuality.

However, as Hildebrand points out, infrastructure failures and trespassing on the track are the main causes of delays. “SL wants us to talk to Trafikverket because it does not have the capacity or knowledge to find improvements,” Hildebrand says. “We have a joint project team to deal with unauthorised track access. Trafikverket is aware of the problems and is now getting more money for the next few years as the politicians recognise that not enough has been spent on infrastructure.”

MTR Pendeltågen faces similar problems to those faced by MTR Tunnelbanan when it took over operation of the metro. “We are working with the staff to encourage them to work better with the customers,” Hildebrand says. “They come from a culture where it is about driving a train and not dealing with passengers.” Hildebrand believes MTR’s experience in trying to improve staff motivation and attitude on the metro will enable MTR Pendeltågen to implement change faster than was possible on the metro. “We can’t make changes too quickly because we are dealing with human beings,” Hildebrand says. “We will put a lot of effort into education and leadership, but it will take about two years to get to a position where it is fine tuning.”

MTR took over the commuter rail network while the SKr 17bn ($US 2.1bn) Citybanan project was under construction. This project is designed to double capacity through the centre of Stockholm and solve the problem of the so-called “wasp’s waist” - the double-track line south of Stockholm Central over which all trains heading south had to pass. The two tracks were carrying around 600 trains per day and the slightest delay could snowball across a large part of Sweden.

Citybanan involved building a new 6km double-track tunnel from Stockholm South to Tomteboda and two new stations at Stockholm City and Odenplan. Stockholm City has four tracks and is 45m below street level in order to pass beneath the existing metro lines. The station is connected to the metro at T-Centralen and main line services at Stockholm Central. Odenplan station has two tracks and is 30m below ground level. It also provides an interchange with the metro, and a second double-track tunnel has been bored so that capacity can be increased relatively easily in the future. The project also entailed the construction of a 1.4km flyover at Årsta to reduce conflicting train movements in southern Stockholm. The new line is prepared for the introduction of ERTMS.

MTR took over the operation of the new stations ahead of the opening of the new line on July 10, but Åhlén says there was only a relatively short time in which to train the drivers. The new stations have platform screen doors, but the operation of these doors is not linked to the signalling system. Instead, laser sensors above the doors ensure that the platform screen doors do not open unless the train doors are correctly aligned. Train drivers need to be able to stop within ±75cm and have to judge it themselves. Åhlén says there were a few teething problems prior to the line opening, but the system has worked well since day one.

It was originally intended to introduce a new timetable when Citybanan opened, but Hildebrand says common sense prevailed and this has been delayed until December. The new timetable will extend the morning and evening peak periods and see the introduction of peak limited-stop express services for the first time, with journey time reductions of up to 10 minutes. Eventually it is hoped to be able to operate 24 trains/hour/direction on Citybanan.

Future prospects

MTR submitted a bid for the Skåne county commuter rail Pågatåg concession in December 2016, but was unsuccessful despite receiving the best quality scoring out of all seven bidders.

“If the transport authority is only looking for the lowest price then we are not the right option, but if it combines the price with a desire to improve the service then we are competitive,” Viinapuu says. “The contract has to be a certain length to enable us to invest and effect change. Contracts in Sweden used to be just for five years which was too short. We want responsibility for as much of the value chain as possible, and at least for the operation and maintenance.”

MTR is now looking at potential train operating concessions further afield, as Viinapuu reveals. “Deregulation started first in Sweden and now it is happening in the other three Nordic countries because of the Fourth Railway Package. The first tender in Norway will be in October or November. Finland is preparing for its first tenders in the next couple of years as is Denmark.”

MTR also sees an opportunity to use its experience gained in Hong Kong with property development at stations and depots. It was shortlisted in June by Upplands Väsby local authority to proceed with negotiations to participate in a redevelopment project around one of the Stockholm commuter rail stations. The result is expected to be announced in 2018.

MTR is already the largest rail operator in Sweden in terms of passenger traffic, but it clearly wants to use its Swedish base as a springboard for growth in the future.

 

Stockholm metro set for expansion

STOCKHOLM plans to start construction of three underground extensions to the metro in 2018, with two located in the north of the Swedish capital and the other in the south.

The two northern extensions will take around six years to complete. One will run 4.1km from Odenplan on the Green Line via Hagastaden and Hagalund to Arenastaden and will be operated as the Yellow Line, while the other is a 4km extension from the current Blue Line terminus at Akalla to Barkarby.

The 11.5km southern extension is more complex and is expected to take between seven and eight years to complete. It will extend the Blue Line from its existing city centre terminus at Kungsträdgården to Sofia where it will split. One branch will run east to Sickla, Jårla and Nacka Centrum, while the other will head south to Gullmarsplan and then take over the Green Line branch to Hagsätra.

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