Fare Management for High Performance— a strategic approach to ...

As a result, those responsible for
taking key decisions often have
insufficient evidence to validate their
choices. And in projects like these,
which involve so many stakeholders,
this omission can prove fatal. As Jeroen
Kok, CEO of Trans Link Systems (TLS),
the company that was established to
bring a nationwide eTicketing system
to the Netherlands, observes: “These
projects don’t fail on the technology;
they fail on decision making.”
Define value
It’s critically important to define not
only why the organization might want
to undertake the journey to develop
more advanced fare management
capabilities, but also what the final
destination might look like for all
stakeholders in the initiative. Because
most public transportation systems
are not fully commercial, self-funding
ventures, new structures should
incorporate an evaluation framework
that reflects public service value, as
well as the shareholder value methods
more appropriate for private entities.
The key here is to determine what the
scheme’s end users value most highly,
as well as what will deliver optimum
value for the organization.
When the Finnish Ministry of Transport
and Communications was considering
a charging system that would reduce
road use at peak periods—congestion
charging—in Helsinki, Accenture worked
with them to develop an evaluation
framework that incorporated and
balanced the desired outcomes of all
stakeholder groups. Similarly, in Italy,
we worked with Trenitalia, the national
rail company, to evaluate not just the
potential economic benefits of an
integrated fare management initiative,
but also the broader public costs
and benefits—passenger safety and
satisfaction, as well as the impact on
Trenitalia’s accessibility goals.
Explore options
If an organization is to establish a
compelling business case to secure
stakeholder buy-in before proceeding
with a fare management transformation,
it’s vital to take a long-term view of
what available solutions can achieve,
as well as likely future developments
and requirements. Technologies, after
all, are constantly changing.
This approach should encompass
people, processes and technology—and
proceed in harmony with a solutions
design for the business organization
and operations. Critically, the design
should include clearly defined
specifications for both current and
future fare management solutions so
that organizations can move forward
in the knowledge that they are wellpositioned
to manage developments
in fare media technology and security,
as well as constantly evolving
customer demands.
In 2006, for example, Accenture spent
five months conducting a global
market and vendor benchmarking and
analysis exercise for Societe Nationale
Chemins de Fer Francais (SNCF), the
French national rail operator, which
was reviewing eTicketing technologies.
The exercise confirmed the volatility
of the market and, by helping the
client understand the full range of
options, reduced the risk of adopting
technologies that could rapidly
become redundant.
Develop strategy
Fare management systems are huge
undertakings, with significant long-
term implications for business
processes, organizational structures
and customer relationships. And there
are many issues to consider.
Resistance to change is just one
aspect of the challenge that fare
management systems pose. Failure to
review and update business models
impacted by new technologies is
another. Introducing multi-operator
smartcard ticketing without adequate
revisions to fare and tariff structures
between operators, for example, could
confuse customers as well as alienating
operators.
If organizations want to avoid these
threats to their business, they must
take actions beyond merely selecting
a strategy and instead move to fully
enable that strategy by developing the
detailed implementation plans and
operational frameworks to support
success. Strong governance models are
crucial. In fact, they are an ongoing
necessity, from the early stages of
bringing together different viewpoints
and coming up with a workable longterm
strategy, all the way through
delivery to the actual operation.
The Trans Link Systems (TLS) project,
for example, was the Netherlands’
fifth serious attempt to introduce a
nationwide electronic ticketing and
payment system. Its predecessors all
failed to reach agreement between
the country’s nearly 20 different, and
often turf-conscious, public transport
operators. So TLS was careful to get
its governance structure right upfront.
The company also helped ensure
operator buy-in right through to the
launch of what became the world’s
first “single card access” to all forms
of public transport, by holding regular
workshops and meetings for all the
participating agencies, and sharing
progress reports and key issues with
all relevant decision makers.
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