- Email: [email protected]
Workshop 6 report: Reassessing public operations
Research in Transportation Economics xxx (2016) 1e4
Contents lists available at ScienceDirect
Research in Transportation Economics journal homepage: www.elsevier.com/locate/retrec
Workshop 6 report: Reassessing public operations Laurel Paget-Seekins a, *, Jackie Walters b a b
Massachusetts Department of Transportation, Boston, USA Department of Transport and Supply Chain Management, University of Johannesburg, Auckland Park, 2006, South Africa
a r t i c l e i n f o
a b s t r a c t
Article history: Available online xxx
A diverse group of public transport (PT) stakeholders agree that increased quality and quantity of service is needed to meet the multiple economic, environmental, and social goals for public transport. Achieving these goals often requires changes to the existing sector. There are multiple means and opportunities to drive change, including a new regulatory framework, a transition to an integrated network, or more funding and service types. A conceptual framework illustrates how the relationships between users, government authorities, and operators should guide decision-making at the strategic, tactical, and operational levels. Any type of stakeholder can be a change agent. While change is needed, examples from multiple cities illustrate that there is significant risk in the change process. Changes need to be managed with realistic planning and adequate levels of funding. A key component is accounting for all costs, including internalizing any externalities and paying for social and environmental goals. Stakeholders need to be included in the process since their power can shift over time and to manage expectations. © 2016 Elsevier Ltd. All rights reserved.
JEL codes: H4 H410 R4 Keywords: Managing change Stakeholders New regulatory frameworks Social and environmental goals Country comparisons
1. The need for change The goal of a Thredbo workshop is to generate new knowledge by bringing together researchers, representatives from the public sector (transport authorities, policy makers, and regulators) and operators, to delve deeply into issues facing the land passenger transport sector. Workshop 6 of Thredbo 14 benefited from having a wide range of participants including academic researchers and staff from transport authorities, bus industry associations, bus operating companies, software development companies, non-governmental organizations, and transport workers unions. There was also a mix of participants from countries in the Global North (US, UK, Sweden, Malta) and Global South (Australia, South Africa, Brazil, Chile, Colombia). This diverse group agreed that there is a need for change in the public transport sector to increase both the quantity and quality of public transport service. The papers presented a variety of reasons for why change is needed. Gordon, Salvucci, and Attanucci (2015) discussed how changing the regulatory constraints on public service provision could increase service in Boston, Massachusetts. A ~o, and Yamashita (2015) explained paper by Morais, Dourado, Araga
* Corresponding author. E-mail addresses: [email protected] (L. Paget-Seekins), [email protected] (J. Walters).
the impact of regulatory capture in Brasilia. Huefner (2015) discusses how demographics are impacting the need for service in more rural areas. Walters and Manamela (2015) provided background on the need to build institutional capacity to accomplish public goals in the informal transport and SME sector of the South squez (2015) examined the Africa economy. Hidalgo and Vela transition from more informal bus service provision to a formal bus network as a way to reduce negative externalities. The need for change can be in a variety of areas like more funding, a new regulatory regime, different operators, better coordination between agencies and operators, and between different modes, and different service types (for example, service in more rural areas). 1.1. Forces for change The workshop group recognized that there are multiple forces and opportunities for change to the status quo. Opportunities can ~o, Silva, Yamashita, and Filho (2015) come from big events. Araga discussed the push for transportation investments due to megaevents such as the World Cup and Olympics in Brazil. It can also come from changes in political leadership or a crisis in service delivery. Bajada and Titheridge (2015) examined how the failure of a new regulatory model for a bus service in Malta led to more changes. Participants from Boston explained how the large amount
http://dx.doi.org/10.1016/j.retrec.2016.10.009 0739-8859/© 2016 Elsevier Ltd. All rights reserved.
Please cite this article in press as: Paget-Seekins, L., & Walters, J., Workshop 6 report: Reassessing public operations, Research in Transportation Economics (2016), http://dx.doi.org/10.1016/j.retrec.2016.10.009
2
L. Paget-Seekins, J. Walters / Research in Transportation Economics xxx (2016) 1e4
of snow the previous winter (2014e2015) created a crisis in the transit service and political momentum for change. Climate change or natural disasters create the need to rebuild infrastructure. The workshop also discussed how new technology is forcing change to the existing models of service provision. A lack of funding can provoke changes. Kavanagh (2015) discussed how international agreements, like free trade agreements, can force change. Finally, workers, riders or coalitions of stakeholders can work to create change.
1.2. Conceptual framework The group modified a theoretical framework presented by Paget-Seekins and Tironi (2015) to represent the different stakeholders involved in the decision-making processes and provision of public transport (See Fig. 1). Fig. 1 illustrates the relationships between Users, Government Authorities, and Operators of public transport. Borrowing from the model of strategic, tactical, and operational decision-making, the framework suggests that strategic decisions should be made along the Users and Government axis; often the tactical decisions take place between the Government and Operators (either public or private); and operational decisions take place on the axis between the Operators and the Users. The Workers are placed in the middle of the diagram because they are involved in all aspects of the service provision. The workshop generated examples of types of decisions that take place along each axis (See Fig. 2). The framework in Fig. 1 helped the workshop participants think about the roles in effecting change, especially the need for a broad coalition and in-depth participation along each axis. The workshop discussed the need to take advantage of opportunities, be they strategic about timing, and have vision and leadership.
The broad conclusion is that, whilst certain types of decision or issue are generally made in accordance with the structure of the framework, change can be driven or promoted by any and all of the groups identified in the framework. Factors such as timing (e.g., imminent elections), urgency (e.g., to complete projects within a political cycle), opportunity (e.g., major weather events or an Olympic Games), and populist sentiment, will have an important impact in determining when different user groups are likely to be more (or less) effective in driving change. User groups can be more effective at driving change by forming coalitions. Public transport champions need to find common ground with a wide range of “single issue” activists, to increase their influence in the debate.
2. Managing the process of change Many of the workshop papers presented examples of change processes and their outcomes. These examples illustrated that there is a need to balance the risks and benefits of change. The examples of Malta (Bajada & Titheridge, 2015), Bogota, and Sansquez, 2015) showed that the plans do not tiago (Hidalgo & Vela always go according to plan. In Malta, the national government decided to open a competitive tendering process to procure bus services to replace an association of bus owners. The new service was implemented on a single day, using a ‘big bang’ approach, and the new provider was unable to comply with the contract. The existing government lost power and the new government took over the bus operations and negotiated for a new provider. The paper by Hidalgo and Vel asquez (2015) discussed the different change models used by Bogota and Santiago to transition to an integrated bus network. Santiago used a single day ‘big bang’ approach while Bogota's implementation has dragged on for years. Both methods cost more than expected. The big bang model proved
Fig. 1. Conceptual framework.
Please cite this article in press as: Paget-Seekins, L., & Walters, J., Workshop 6 report: Reassessing public operations, Research in Transportation Economics (2016), http://dx.doi.org/10.1016/j.retrec.2016.10.009
L. Paget-Seekins, J. Walters / Research in Transportation Economics xxx (2016) 1e4
3
Fig. 2. Types of decision-making at each level.
difficult to implement well, but the gradual model risked losing political momentum. The workshop discussed the need to learn from failures and the role of academics to assess the root causes of implementation failures. Strong oversight is needed in any transition and regulators benefit from having operating experience. The process requires checks and balances, including strong upfront participation by citizens. 2.1. Realistic planning for change The main conclusion from the evidence presented by the workshop papers is that there has to be a realistic planning process and that accurate cost estimates and available funding are central to implementation. Part of the failure in the transition in Santiago was designing the network on the false premise that subsidies would not be required. There are costs of internalizing the negative externalities in the creation of a formal integrated network; it ends up being less costly to factor these costs in at the beginning than working out how to account for them in the middle of the implementation or after the new system fails. Other participants pointed out that factoring for rising costs is needed in all situations. n and Lidestam (2015) examined costs in Sweden in nine Came categories. Two areas focus on costs from accessibility for all and environmental specifications for vehicles. This points out that the costs for environmental and social goals for public transit also need to be accounted for. The examples from Malta and Santiago illustrate that governments need to assess the cost of disruption when implementing a new network design or changing providers. They also point out that governments need to manage expectations about new services, be transparent about the processes as well as potential uncertainty. Morais et al. (2015) examined the stakeholders in the procurement process in Brasilia. They discuss the power of different stakeholders as a risk factor that needs to be taken into account by the authorities managing a change process. One important observation is that the power of stakeholders can change over time, so it is important to assess and engage at the onset of the process. Lindau, Albuquerque, Arioli, and Facchini (2015) report on the outcome of the Brasilia BRT project suggesting that while there were barriers to implementation there were also benefits. squez (2015) suggest a hybrid model between Hidalgo and Vela the big bang and gradual implementation that orders the
interventions over a medium timeframe in an attempt to minimize the costs. Gordon et al. (2015) also suggest a hybrid model, but for contracting of services. They propose the MBTA in Boston can increase its service given its constraints by contracting for new routes only. The institutional capacity of governments to manage change and implement new policies or regulatory frameworks is an important constraint. Walters and Manamela (2015) illustrate how the South African government policy to support small business owners in the bus sector is stymied by the complexity of the contracting system and lack of training and support of small business owners. 3. Recommendations There is considerable more research and discussion needed on how to create and manage change in public transport systems throughout the world. Suggestions include: - exploring the decision-making processes for change at the strategic, tactical, and operational levels to leverage lessons learned from previous projects - effective stakeholder engagement to form coalitions to drive change - how to do realistic cost accounting for major change processes and transport projects - including the risks and cost of disruption in evaluating the cost and benefit of competitive tender processes The impact of technology on creating change in the industry was acknowledged as an issue of increasing importance with the rise of Transportation Networking Companies. Future Thredbo's should cover the regulatory frameworks for new mobility providers and the use of technology to improve service and stakeholder engagement, as well as being a potential source of revenue to fund PT. Finally, the issue of regulatory capture was raised. More discussion is needed about how regulatory capture manifests and how to ensure oversight over both public and private providers. References ~o, J., Silva, L., Yamashita, Y., & Filho, R. O. (2015). BRT in Brazil: Designing serAraga vices in function of given infrastructure projects or designing infrastructure in function of established service quality patterns?.
Please cite this article in press as: Paget-Seekins, L., & Walters, J., Workshop 6 report: Reassessing public operations, Research in Transportation Economics (2016), http://dx.doi.org/10.1016/j.retrec.2016.10.009
4
L. Paget-Seekins, J. Walters / Research in Transportation Economics xxx (2016) 1e4
Bajada, T., & Titheridge, H. (2015). To contract or to operate publicly? Observations from the bus service reform transition process in Malta. n, C., & Lidestam, H. (2015). Dominating factors contributing to the high(er) costs Came for public bus transports in Sweden. Gordon, M., Salvucci, F., & Attanucci, J. (2015). Using increased private sector involvement to allow for resource-constrained transit growth. Hidalgo, D., & Vel asquez, J. M. (2015). Evaluating public transport integration scenarios. Huefner, L. (2015). The mobility challenge for regional communities: Approaches to delivering sustainable public transport in sparse populations.
Kavanagh, P. (2015). Obtaining a fair go for existing bus operators in a world of free trade. Lindau, L. A., Albuquerque, C., Arioli, M., & Facchini, D. (2015). Transforming bus transit in Brasilia: From conventional bus lines to a BRT integrated system. ~o, J., & Yamashita, Y. (2015). Analysing Stakeholders at a Morais, A., Dourado, A., Araga procurement procedure for urban services: Study case of Brasilia. Paget-Seekins, L., & Tironi, M. (2015). The publicness of public transport: The changing nature of public transport in Latin American cities. Walters, J., & Manamela, L. (2015). Are South African small bus operators ready to participate in the formal public transport contracting system?.
Please cite this article in press as: Paget-Seekins, L., & Walters, J., Workshop 6 report: Reassessing public operations, Research in Transportation Economics (2016), http://dx.doi.org/10.1016/j.retrec.2016.10.009
Contents lists available at ScienceDirect
Research in Transportation Economics journal homepage: www.elsevier.com/locate/retrec
Workshop 6 report: Reassessing public operations Laurel Paget-Seekins a, *, Jackie Walters b a b
Massachusetts Department of Transportation, Boston, USA Department of Transport and Supply Chain Management, University of Johannesburg, Auckland Park, 2006, South Africa
a r t i c l e i n f o
a b s t r a c t
Article history: Available online xxx
A diverse group of public transport (PT) stakeholders agree that increased quality and quantity of service is needed to meet the multiple economic, environmental, and social goals for public transport. Achieving these goals often requires changes to the existing sector. There are multiple means and opportunities to drive change, including a new regulatory framework, a transition to an integrated network, or more funding and service types. A conceptual framework illustrates how the relationships between users, government authorities, and operators should guide decision-making at the strategic, tactical, and operational levels. Any type of stakeholder can be a change agent. While change is needed, examples from multiple cities illustrate that there is significant risk in the change process. Changes need to be managed with realistic planning and adequate levels of funding. A key component is accounting for all costs, including internalizing any externalities and paying for social and environmental goals. Stakeholders need to be included in the process since their power can shift over time and to manage expectations. © 2016 Elsevier Ltd. All rights reserved.
JEL codes: H4 H410 R4 Keywords: Managing change Stakeholders New regulatory frameworks Social and environmental goals Country comparisons
1. The need for change The goal of a Thredbo workshop is to generate new knowledge by bringing together researchers, representatives from the public sector (transport authorities, policy makers, and regulators) and operators, to delve deeply into issues facing the land passenger transport sector. Workshop 6 of Thredbo 14 benefited from having a wide range of participants including academic researchers and staff from transport authorities, bus industry associations, bus operating companies, software development companies, non-governmental organizations, and transport workers unions. There was also a mix of participants from countries in the Global North (US, UK, Sweden, Malta) and Global South (Australia, South Africa, Brazil, Chile, Colombia). This diverse group agreed that there is a need for change in the public transport sector to increase both the quantity and quality of public transport service. The papers presented a variety of reasons for why change is needed. Gordon, Salvucci, and Attanucci (2015) discussed how changing the regulatory constraints on public service provision could increase service in Boston, Massachusetts. A ~o, and Yamashita (2015) explained paper by Morais, Dourado, Araga
* Corresponding author. E-mail addresses: [email protected] (L. Paget-Seekins), [email protected] (J. Walters).
the impact of regulatory capture in Brasilia. Huefner (2015) discusses how demographics are impacting the need for service in more rural areas. Walters and Manamela (2015) provided background on the need to build institutional capacity to accomplish public goals in the informal transport and SME sector of the South squez (2015) examined the Africa economy. Hidalgo and Vela transition from more informal bus service provision to a formal bus network as a way to reduce negative externalities. The need for change can be in a variety of areas like more funding, a new regulatory regime, different operators, better coordination between agencies and operators, and between different modes, and different service types (for example, service in more rural areas). 1.1. Forces for change The workshop group recognized that there are multiple forces and opportunities for change to the status quo. Opportunities can ~o, Silva, Yamashita, and Filho (2015) come from big events. Araga discussed the push for transportation investments due to megaevents such as the World Cup and Olympics in Brazil. It can also come from changes in political leadership or a crisis in service delivery. Bajada and Titheridge (2015) examined how the failure of a new regulatory model for a bus service in Malta led to more changes. Participants from Boston explained how the large amount
http://dx.doi.org/10.1016/j.retrec.2016.10.009 0739-8859/© 2016 Elsevier Ltd. All rights reserved.
Please cite this article in press as: Paget-Seekins, L., & Walters, J., Workshop 6 report: Reassessing public operations, Research in Transportation Economics (2016), http://dx.doi.org/10.1016/j.retrec.2016.10.009
2
L. Paget-Seekins, J. Walters / Research in Transportation Economics xxx (2016) 1e4
of snow the previous winter (2014e2015) created a crisis in the transit service and political momentum for change. Climate change or natural disasters create the need to rebuild infrastructure. The workshop also discussed how new technology is forcing change to the existing models of service provision. A lack of funding can provoke changes. Kavanagh (2015) discussed how international agreements, like free trade agreements, can force change. Finally, workers, riders or coalitions of stakeholders can work to create change.
1.2. Conceptual framework The group modified a theoretical framework presented by Paget-Seekins and Tironi (2015) to represent the different stakeholders involved in the decision-making processes and provision of public transport (See Fig. 1). Fig. 1 illustrates the relationships between Users, Government Authorities, and Operators of public transport. Borrowing from the model of strategic, tactical, and operational decision-making, the framework suggests that strategic decisions should be made along the Users and Government axis; often the tactical decisions take place between the Government and Operators (either public or private); and operational decisions take place on the axis between the Operators and the Users. The Workers are placed in the middle of the diagram because they are involved in all aspects of the service provision. The workshop generated examples of types of decisions that take place along each axis (See Fig. 2). The framework in Fig. 1 helped the workshop participants think about the roles in effecting change, especially the need for a broad coalition and in-depth participation along each axis. The workshop discussed the need to take advantage of opportunities, be they strategic about timing, and have vision and leadership.
The broad conclusion is that, whilst certain types of decision or issue are generally made in accordance with the structure of the framework, change can be driven or promoted by any and all of the groups identified in the framework. Factors such as timing (e.g., imminent elections), urgency (e.g., to complete projects within a political cycle), opportunity (e.g., major weather events or an Olympic Games), and populist sentiment, will have an important impact in determining when different user groups are likely to be more (or less) effective in driving change. User groups can be more effective at driving change by forming coalitions. Public transport champions need to find common ground with a wide range of “single issue” activists, to increase their influence in the debate.
2. Managing the process of change Many of the workshop papers presented examples of change processes and their outcomes. These examples illustrated that there is a need to balance the risks and benefits of change. The examples of Malta (Bajada & Titheridge, 2015), Bogota, and Sansquez, 2015) showed that the plans do not tiago (Hidalgo & Vela always go according to plan. In Malta, the national government decided to open a competitive tendering process to procure bus services to replace an association of bus owners. The new service was implemented on a single day, using a ‘big bang’ approach, and the new provider was unable to comply with the contract. The existing government lost power and the new government took over the bus operations and negotiated for a new provider. The paper by Hidalgo and Vel asquez (2015) discussed the different change models used by Bogota and Santiago to transition to an integrated bus network. Santiago used a single day ‘big bang’ approach while Bogota's implementation has dragged on for years. Both methods cost more than expected. The big bang model proved
Fig. 1. Conceptual framework.
Please cite this article in press as: Paget-Seekins, L., & Walters, J., Workshop 6 report: Reassessing public operations, Research in Transportation Economics (2016), http://dx.doi.org/10.1016/j.retrec.2016.10.009
L. Paget-Seekins, J. Walters / Research in Transportation Economics xxx (2016) 1e4
3
Fig. 2. Types of decision-making at each level.
difficult to implement well, but the gradual model risked losing political momentum. The workshop discussed the need to learn from failures and the role of academics to assess the root causes of implementation failures. Strong oversight is needed in any transition and regulators benefit from having operating experience. The process requires checks and balances, including strong upfront participation by citizens. 2.1. Realistic planning for change The main conclusion from the evidence presented by the workshop papers is that there has to be a realistic planning process and that accurate cost estimates and available funding are central to implementation. Part of the failure in the transition in Santiago was designing the network on the false premise that subsidies would not be required. There are costs of internalizing the negative externalities in the creation of a formal integrated network; it ends up being less costly to factor these costs in at the beginning than working out how to account for them in the middle of the implementation or after the new system fails. Other participants pointed out that factoring for rising costs is needed in all situations. n and Lidestam (2015) examined costs in Sweden in nine Came categories. Two areas focus on costs from accessibility for all and environmental specifications for vehicles. This points out that the costs for environmental and social goals for public transit also need to be accounted for. The examples from Malta and Santiago illustrate that governments need to assess the cost of disruption when implementing a new network design or changing providers. They also point out that governments need to manage expectations about new services, be transparent about the processes as well as potential uncertainty. Morais et al. (2015) examined the stakeholders in the procurement process in Brasilia. They discuss the power of different stakeholders as a risk factor that needs to be taken into account by the authorities managing a change process. One important observation is that the power of stakeholders can change over time, so it is important to assess and engage at the onset of the process. Lindau, Albuquerque, Arioli, and Facchini (2015) report on the outcome of the Brasilia BRT project suggesting that while there were barriers to implementation there were also benefits. squez (2015) suggest a hybrid model between Hidalgo and Vela the big bang and gradual implementation that orders the
interventions over a medium timeframe in an attempt to minimize the costs. Gordon et al. (2015) also suggest a hybrid model, but for contracting of services. They propose the MBTA in Boston can increase its service given its constraints by contracting for new routes only. The institutional capacity of governments to manage change and implement new policies or regulatory frameworks is an important constraint. Walters and Manamela (2015) illustrate how the South African government policy to support small business owners in the bus sector is stymied by the complexity of the contracting system and lack of training and support of small business owners. 3. Recommendations There is considerable more research and discussion needed on how to create and manage change in public transport systems throughout the world. Suggestions include: - exploring the decision-making processes for change at the strategic, tactical, and operational levels to leverage lessons learned from previous projects - effective stakeholder engagement to form coalitions to drive change - how to do realistic cost accounting for major change processes and transport projects - including the risks and cost of disruption in evaluating the cost and benefit of competitive tender processes The impact of technology on creating change in the industry was acknowledged as an issue of increasing importance with the rise of Transportation Networking Companies. Future Thredbo's should cover the regulatory frameworks for new mobility providers and the use of technology to improve service and stakeholder engagement, as well as being a potential source of revenue to fund PT. Finally, the issue of regulatory capture was raised. More discussion is needed about how regulatory capture manifests and how to ensure oversight over both public and private providers. References ~o, J., Silva, L., Yamashita, Y., & Filho, R. O. (2015). BRT in Brazil: Designing serAraga vices in function of given infrastructure projects or designing infrastructure in function of established service quality patterns?.
Please cite this article in press as: Paget-Seekins, L., & Walters, J., Workshop 6 report: Reassessing public operations, Research in Transportation Economics (2016), http://dx.doi.org/10.1016/j.retrec.2016.10.009
4
L. Paget-Seekins, J. Walters / Research in Transportation Economics xxx (2016) 1e4
Bajada, T., & Titheridge, H. (2015). To contract or to operate publicly? Observations from the bus service reform transition process in Malta. n, C., & Lidestam, H. (2015). Dominating factors contributing to the high(er) costs Came for public bus transports in Sweden. Gordon, M., Salvucci, F., & Attanucci, J. (2015). Using increased private sector involvement to allow for resource-constrained transit growth. Hidalgo, D., & Vel asquez, J. M. (2015). Evaluating public transport integration scenarios. Huefner, L. (2015). The mobility challenge for regional communities: Approaches to delivering sustainable public transport in sparse populations.
Kavanagh, P. (2015). Obtaining a fair go for existing bus operators in a world of free trade. Lindau, L. A., Albuquerque, C., Arioli, M., & Facchini, D. (2015). Transforming bus transit in Brasilia: From conventional bus lines to a BRT integrated system. ~o, J., & Yamashita, Y. (2015). Analysing Stakeholders at a Morais, A., Dourado, A., Araga procurement procedure for urban services: Study case of Brasilia. Paget-Seekins, L., & Tironi, M. (2015). The publicness of public transport: The changing nature of public transport in Latin American cities. Walters, J., & Manamela, L. (2015). Are South African small bus operators ready to participate in the formal public transport contracting system?.
Please cite this article in press as: Paget-Seekins, L., & Walters, J., Workshop 6 report: Reassessing public operations, Research in Transportation Economics (2016), http://dx.doi.org/10.1016/j.retrec.2016.10.009