Monitoring Key performance indicators

Ruud van der Ploeg EMTA GM 11-12 november 2010

Quality in Amsterdam public transport contracts

2

Stadsregio Amsterdam in Randstad area

3

Running contracts in Amsterdam region

Zaanstreek€9 mio subsidy€5 mio revenue

Cost coverage 36%

Waterland€11 mio subsidy€22 mio revenue

Cost coverage 67%

Amsterdam€221 mio subsidy€129 mio revenue

Cost coverage 37%

Amstelland-Meerlanden

€30 mio subsidy€21 mio revenue

Cost coverage 41%

2004

2005

2007

2011

2004

2005

2007

2012

responsabilities and risk sharingRisks linked with the production hold by

The Authority The Operator

Rev

enue

s ris

ks h

old

by

Management contract (M)

Gross cost contract (GC)

Net cost contract (NC)

M with productivity bonus

M with productivity and revenue bonus

M with revenue bonus

GC with shared production risk

GC with revenue bonus

NC with revenue bonus and shared production

risks

NC with shared revenue risk

NC with shared production risks

GC with shared production risk

and revenue bonus

Source: MARETOPE

5

Need to haveNeed to have

Want to haveWant to have

Wish to haveWish to have

Basic QualityBasic Quality

ExperiencExperiencee

SatisfiersSatisfiers

DissatisfiersDissatisfiers

QualityQuality of a tripof a trip

Minimum QualityMinimum Quality

6

Trust:Safe and secure journeyGet what you expect

Mental Mental effort:effort:No hassle, no stressNo hassle, no stress

Travel time door to door:Travel time door to door:The faster, the betterThe faster, the better

Physical effort:Personal convenience

EmotionsTime is money

Reliability Reliability

EaseEase

SpeedSpeed

Comfort

Experience

Safety

‘‘must’: must’: travel travel fastfast

‘‘lust’: lust’: travel relaxedtravel relaxed

Pyramid of Customer NeedsPyramid of Customer Needs

7

Minimum Quality

Basic Quality

Experience

EmotionsEmotions(Lust)(Lust)

FunctionalitiesFunctionalities(Must)(Must)

Emotions..Emotions.. ..and Functionalities..and Functionalities

8

Amsterdam concessionPerformance indicators

Punctuality (departures times)

Trips cancelled

Accessibility

Vehicle capacity

Incidental under capacity

Key performance indicators

bonus and fines

Customer judgment (KKM*)

Only fines

bonus and fines

9

Looking back from figures 2006-2010

Development of Bonus/fines

Development of main KPI’s

• Punctuality

• Trips cancelled

• KKM (Passenger Satisfaction)

Methods of monitoring (1)

• Concession Amsterdam City

– In Amsterdam: making use of quarterly data base performance information; (a minimum of 95% of trips is checked)

– Operator management reports send to the transport authority

– Outcomes of the reports are randomly checked

– Apart from these reports, mystery guests are brought into play

– Operator earns a bonus for the % of performance within the standard and is fined for the % of performance above the standard.

Methods of monitoringConcessions (3) outside Amsterdam

– Carrying out quarterly surveys (observations i.e. with cameras and mystery guests)

– Representative random check (every day of the week; in and outside rush hours) in respect to the total network

– Random checks faults assessed fines imposed

– Independent consultant carries out the surveys (outsourced)

Administrative fines imposed for a range of quality insufficiencies

12

Contract incentives regional buses

1. Revenue based contract

2. Bonus/Fine arrangement onPassenger satisfaction

–Yearly report by independent institution–Rise of figure results in Bonus–Decrease of figure results in Fine

3. Fine policy on Key Performance Indicators

13

• 2006-± mid 2008: – animosity and tiresome discussions on contract clauses

imposing fines (“malus”) for insufficient reporting on performances and poor level of operations;

• Mid 2008 – 2009: – Improvement of relation and mutual understanding

(mediation); GVB meets standards of reporting and succeeds better in meeting (key) performance indicators less fines

• 2009 – now: – growing towards a joint effort of GVB and PTA

(Stadsregio), aiming to improve customer services (transition to customer oriëntation)

Looking back on GVB-concession 2006-2011

14

Results

Suburban transport contracts (bus): - Considerable growth of both productivity and

ridership (from 15-60% more driving hours);- National barometer customer satisfaction:

stable (on average 7,5).

Urban transport (GVB):- Step by step a better performance on the

main kpi’s for quality: less fines and more bonuses.

15

GVB delivers more driving hours (dru) for less subsidy

16

RecommendationsTo the PTA’s

• Generate a level of trust between commissioning authority and operator • Define a starting level of reliability of service in your tender documents (indicating that the level of performance has to move up each year)

• Think of fines/bonuses as a means to an end: just a trigger to get better quality

• Create a reliable and trustworthy monitoring system

• Be transparent, consistent and straightforward

• Quality is reflected in customer surveys appreciation!

To the operators

- mind the comfort and style of driving (bus)

- grant friendliness to passengers

- don’t take the passenger for granted!

17

bonus/fines

-6.000.000

-5.000.000

-4.000.000

-3.000.000

-2.000.000

-1.000.000

0

1.000.000

2.000.000

3.000.000

4.000.000

2006 2007 2008 2009 1/2 2010

years

be

dra

g bonus

fine

sum

18

punctuality

40

50

60

70

80

90

100

2006 2007 2008 2009 2010 2011 2012 2013 2014 -2017

years

pe

rce

nta

dg

e

punct metro

norm metro

punct tram

norm tram

punct bus

norm bus

19

trips cancelled

0

0,5

1

1,5

2

2,5

2006 2007 2008 2009 2010 2011 2012 2013 2014 -2017

years

pe

rce

nt

trips canceled metro

norm metro

trips canceled tram

norm tram

trips canceled bus

norm bus

20

KKM

60

65

70

75

80

85

2006 2007 2008 2009 2010

years

cu

sto

me

r ju

dg

me

nt

metr W

metro S

tram W

tram S

bus W

bus S

21

Customer appreciation yardstick