Tick TOC

Tick-TOC: Times are changing for train operating companies

nick Comment, engagement, Homepage, Transformation Leave a Comment

Nobody said it was easy being a ToC. Consumers hate them, yet ToCs are at the mercy of government (and neither side of the political spectrum has managed to structure the ideal system), their advisors from the big consultancy firms, and all sorts of unpredictable socio-economic changes.

We’ve been lucky enough to work with a TOC recently, and a few very simple things have become apparent.

First, no matter what happens, TOCs are under pressure from dramatically competing priorities, which will not be resolved anytime soon:

  • Short term: Quarterly earnings reports and market pressure
  • Mid-term: The franchise bidding cycle
  • Long-term: Infrastructure commitments or availability

Second, the government’s Strategic Vision for Rail (published last November) lays out some of the directions in which rail is moving; all of which affect TOCs, but which are as much influenced by changing consumer expectations of experience as much as infrastructure or getting from A to B. Smart ticketing, compensation (delay/repay) service, accessibility for all and the deployment of technology in general are all major experiential upgrades mandated by the Vision, and which are much harder to implement than customers realise.

Underneath all this, franchises are now often managed by consortia, which requires multiple train operators with different cultures and objectives (for example, national and nationalised operators alongside wholly commercial entities) to work together under a collective banner.

How hard can it be to roll out smart ticketing? Well, how hard can it be to get two companies to share technical, commercial and physical infrastructure for only a seven or fifteen year commitment, establishing shared processes and one version of the truth, and meeting ever-changing customer expectations? The answer is: very.

The Vision also rightly prioritises a “Modern Workforce” and a “Productive and Innovative Sector”. The £40m allocated to competitions is a start – but a pretty sparse one. In Rail (rather like pharmaceuticals), £40m doesn’t actually go particularly far – no pun intended. And the modern workforce section is extremely short, carefully glossing the bumpy industrial relations which have characterised the sector for decades.

The Vision rightly mentions the ‘One Team’ approach which has always generated dividends, but making it work is genuinely hard. An “us and them” attitude is often the natural starting point, and it takes leadership and commitment to jump that hurdle towards effective collaboration. But as we can see, those hurdles are designed structurally into the franchising system from the start.

Elsewhere on this site, you’ll see that we bang on about collaboration, professionalisation and the harnessing of the ample latent talent across the workforce. Rail is artificially designed to make these breakthroughs to motivation and engagement more challenging. Today, with highspeed commitments, technology rollouts and new financial unpredictability, it’s never been more important to make these breakthroughs, in order to align commercial strategy to customer demand.

nickTick-TOC: Times are changing for train operating companies

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