International Bus System Benchmarking: Performance Measurement Development, Challenges, and Lessons Learned
International Bus System Benchmarking: Performance Measurement Development, Challenges, and Lessons Learned
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Paper submitted for Transportation Research Board 86th Annual Meeting (2007)
Corresponding Author
Eric R. Randall
Senior Research Associate
Imperial College London
+44 (0)20 7594 6095
[email protected]
Co-Author
Ben J. Condry
Senior Research Associate
Imperial College London
+44 (0)20 7594 3486
[email protected]
Co-Author
Mark Trompet
Research Associate
Imperial College London
+44 (0)20 7594 1519
[email protected]
Mailing address
Department of Civil & Environmental Engineering
RTSC, Centre for transport Studies,
Imperial College London
South Kensington Campus
London SW6 2AZ, UK
www.rtsc.org.uk
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International Bus System Benchmarking:
Performance Measurement Development, Challenges, and Lessons Learned
Abstract
This paper reviews the development of a standardized measurement system for the purposes
of benchmarking the performance of a group of major urban bus systems from around the
world. The set of performance measures, known as Key Performance Indicators (KPIs),
identifies bus systems who perform exceptionally in their operation. Developed from past
benchmarking experience and a literature review, and modified based on member input, the
KPIs provide a means of comparing performance and identifying best practice for the
participating bus systems. Practical experience with the KPIs has identified a variety of
challenges in collecting consistent and comparable data. Overcoming these challenges,
producing comparable data, and conducting research to identify and understand the basis for
good performance has been a process that offers lessons for other benchmarking efforts. This
paper reviews (1) the principles of the group’s benchmarking process, (2) the performance
measurement system’s process of development, (3) general issues with data collection and
compatibility, and (4) some results of the benchmarking.
Randall, Condry, and Trompet. 1
INTRODUCTION
This paper reviews the development of a standardized measurement system for the purposes
of benchmarking the performance of major urban bus systems. The International Bus
Benchmarking Group is comprised of 10 major urban bus organizations from around the
world. The group has developed a set of performance measures, known as Key Performance
Indicators (KPIs), to compare performance across the business. Developed from past
benchmarking experience and a literature review, and modified based on member input, the
KPI comparisons highlight organizations who perform exceptionally in their operation. Once
these organizations are identified, case studies are undertaken so that the ‘best practices’
contributing to these high levels of performance can be shared among members of the bus
benchmarking group.
History
RTSC, a transportation research group within the Centre for Transport Studies at Imperial
College London, is involved in a number of international benchmarking projects. Since 1994,
RTSC has facilitated the Community of Metros (CoMET) metro benchmarking group by
providing research and analysis for the participating metros. Based on the interest generated
by the CoMET group, a second metro benchmarking group, Nova was established in 1998.(1)
Annually, data is collected from each member of the benchmarking group according to
precise definitions. A data model is then used to produce the KPI measures for performance
comparisons. Organizations review trends and explain their performance. From the KPIs,
topics for further study are identified.
Case Studies
Annually, the benchmarking group conducts two to four in-depth case studies, consisting of
detailed research and analysis with the objective of providing a comprehensive and detailed
analysis of the study topic. Case study topics may be identified from KPI findings that
identify major differences between member organizations that justify more detailed
examination or may derive from areas of particular concern. Final reports summarizing the
research findings with an emphases on practical lessons learned are distributed as a permanent
resource for the use and benefit of the members.
Clearinghouse Studies
The clearinghouse study system is a mechanism used for quick response on issues of interest,
frequently in response to questions from stakeholders or senior management. Any member
organization can initiate a clearinghouse study, Examples of past studies include: fleet
replacement strategies, smart card fare / ticket applications, advertising contracts, and many
others.
Sharing Experiences
The benchmarking group typically meets twice a year, once to set the agenda for the coming
twelve months and once to present and discuss the work that has been undertaken. These
meetings also provide a forum for participants to share experiences and exchange
information, as well as to visit the projects of the host organization. Informal discussion
identifies common challenges, occasions discussion, and frequently leads to clearinghouse or
case studies being conducted by the benchmarking group.
Confidentiality
The data provided for use within the benchmarking group is often sensitive, including labor,
financial, and safety information. The guiding principle of data confidentiality is “complete
openness within the benchmarking group, complete confidentiality to the outside”. All parties
are obliged to adhere to an agreement that any information and reports made available outside
the benchmarking group must be anonymized to protect proprietary information and data.
The Key Performance Indicator (KPI) system is the basis for analytical measurement and
direct comparison within the benchmarking group. The KPIs enable performance to be
compared on a consistent and understandable basis between organizations. The KPIs are
chosen to be comprehensive and yet concise. In addition, data is collected on an ongoing
basis providing a time-series database that illustrates improving or declining performance. By
using objective KPIs that are agreed upon by all member organizations, comparability of
Randall, Condry, and Trompet. 3
The framework for the KPI system was developed based on the success dimensions identified
in the Harvard Business School Balanced Scorecard model: Financial, Customer, Learning &
Growth, and Business Processes (2). In addition to the four standard Balanced Scorecard
Success Dimensions, it was decided that two other Success Dimensions should be included
for bus benchmarking. Though overlapping both the Costumer and Internal Processes
dimensions (the latter renamed from Business Processes), the importance of ‘Safety and
Security’ was considered important enough to warrant its own dimension. Additionally, the
importance of being environmentally–friendly was regarded as meriting an independent
success dimension for KPIs measuring the ‘Environment’.
The objective of the KPI development process was to develop and agree on a unified set of
indicators for measurement and comparison across the group. The KPI system was developed
through a combination of means and sources of information, as shown in Figure 1.
Balanced International
Scorecard Standards and
Framework Guidelines
Draft KPI System
While the above figure shows the initial development process, the KPI system also offers
flexibility for change and evolution over time, and periodic reviews have changed both the
KPIs and the relevant data items and definitions based on review and group member input.
Some performance indicators have been adjusted or excluded due to the difficulties in
obtaining adequate or comparable data.
Safety and • Safety – freedom from Measure the degree to which the bus
Security accidents. organization provides a safe and secure
• Security – freedom from environment for:
crime. Customers
Staff
Non-users (e.g. motorists and
pedestrians)
Literature Review
A literature review of multiple sources was conducted to identify other experiences in bus
benchmarking and relevant standards and guidelines. Three primary sources provided much
of the external basis for the bus benchmarking group KPIs: the EN13816 standard (3), the
Randall, Condry, and Trompet. 5
work on bus transit performance evaluation by Fielding, Babitsky, and Brenner (4), and the
EQUIP project report (5).
The European Committee for Standardization (CEN) EN 13816 standard was produced with
the aim of promoting a quality approach to public transport operations, and to focus interest
on the needs and expectations of customers. Areas of measurement based on the categories in
the European Standard EN 13816 were integrated into the KPI system. In addition, many of
the benchmarking group members are adopting this standard within their business.
The primary work on measuring the financial performance of bus public transport was
identified as Performance Evaluation for Bus Transit (Fielding et al). Three areas of
measurement for evaluating productivity and cost performance are identified in this work:
• Cost Efficiency – how efficiently an operator is able to provide a certain level of
service (e.g. in terms of vehicle km) for a given cost. It does not relate to whether that
service provides what customers require (or whether they use it). Therefore a service
which is efficient, may not always be an effective service if that which is produced
efficiently is not what is demanded (and therefore probably not consumed).
• Cost Effectiveness – relates the level of service consumption by customers to the cost
of the service inputs.
• Service Effectiveness – relates to how effectively the service provided meets the need
of customers.
The measures used by Fielding were reviewed and provided the basis for the financial
efficiency and effectiveness KPIs.
The most comprehensive list of performance measures found during the literature review was
that developed for the EQUIP project. The list covers all aspects of bus operations and was
used to ensure coverage across all of the balanced scorecard areas by the bus benchmarking
group KPI system.
their organization; both internally and externally (to government or other stakeholders). These
measures were then used as one of the primary inputs for the development of the proposed
KPI system for the group.
The number of performance measures used ranges from around 20 in KMB (Hong Kong) and
Trambus (Rome) to over 40 in LBSL (London) and STM (Montreal). Overall, the group
members generally focus their performance measures on the Success Dimensions of
‘Customer’ and ‘Internal Processes’.
Within the ‘Customer’ Success Dimension, almost all organizations measure the degree to
which the actual service they operated conforms to the scheduled service, both in terms of the
vehicle km operated (reliability) and the on-time performance (punctuality). Within ‘Internal
Processes’, common indicators include reliability and availability of the fleet as well as the
proportion of the fleet used in the peak hour.
‘Safety’, when covered, is usually represented by ‘accidents per 10,000 vehicle km’, while
‘Security’ is almost never covered by the members’ performance measures. ‘Growth &
Learning’ and ‘Environmental’ are the two Success Dimensions least covered within the
performance measures of the group members. The greatest variation was found within the
‘Financial’ Success Dimension. Some bus organizations record a high number of financial
performance measures, while others have comparatively few, in one case measuring only
revenue performance and not measuring internal cost performance at all.
The KPI measures are calculated from data items collected annually. Upon data being
incorporated into the data model, initial comparisons are made. This process inevitably
highlights possible discrepancies which require investigation. Issues with data collection and
comparability span a number of areas of data. The following section highlights some of these
areas and the general issues experienced during data collection. At a higher-level, the varying
nature of the business of bus public transport can have some important impacts; these are
discussed as well for their influence on data comparability.
During the initial KPI data collection, it was found that not every organization collected all
kilometer data. More importantly, the full range of hours data is only collected by
approximately half of the members, though hours are generally recognized as being the
primary cost factor for bus operation (9). In addition, organizations that still use manual
methods for data collection had data that was generally less comprehensive and less accurate.
Hours data especially tends to require investigation and follow up questions with the
supplying benchmarking group members.
Randall, Condry, and Trompet. 7
Labor Hours
Data requested for labor hours is divided between time spent on primary duties for major
functional categories and paid time for other reasons, both work and non-work related. The
labor data is used for labor productivity comparisons of several types. However, several
organizations have labor structures, whether due to work requirements or compensation
schemes, that limit the collection of comparable data. For example, TMB (Barcelona) pays
drivers a flat fee for fare revenue turn-in, and the time expended for this duty is not tracked.
Other organizations fail to distinguish between overtime hours for work (i.e., due to a late
return to the garage) and overtime paid for statutory reasons such as weekend or holiday
work. Overtime records are also questionable; for instance, one organization typically records
and pays an hour of overtime for any driver more than 15 minutes late back to the garage.
Safety
Safety data availability and comparability vary considerably. One organization has very strict
requirements for safety reporting with any vehicle scratch recorded. For passengers, the
organization has drivers distribute a claim ticket that will give the passenger priority service at
a hospital. For these reasons, reported vehicle and passenger accidents rates are considerably
higher for this particular organization.
Service Quality
Very few common comparators were found across the member organizations in measuring
service quality. While it was expected that more subjective indicators, in the areas of
information, driver courtesy, comfort and cleanliness, etc, would vary, it was surprising to
find little commonality in measurement of time-based performance.
Other indicators for measuring service to customers included lost kilometers - the most
common data element recorded. But again, not all organizations record this data. Another
common indicator, missed trips, is measured by only half of the bus organizations.
Capacity Normalization
In subsequent KPI development, it was decided that variation in vehicle size among the
member organizations was influencing performance measures. Specifically, Dublin Bus,
LBSL (London), and KMB (Hong Kong) operate fleets consisting largely of double-decker
buses. A variety of comparisons considering passengers per vehicle and fuel consumption
were therefore skewed by failing to consider vehicle size. Additional data collection on
numbers of vehicles, kilometers traveled, and seated and total person capacities was carried
out to improve KPI comparability.
While data collection is an issue in terms of availability and definitions of the specific data
items, the types of data that bus organizations generate and their comparability is impacted by
a number of more strategic factors.
services by eliminating the differences in price levels between countries. However, they only
cover overall national data. Conditions in major cities can be substantially different, with
different labor prices and other factors. These will not be reflected in the PPP conversions,
sometimes making the resulting financial measures appear lower than anticipated.
Outsourcing / Contracting
Outsourcing impacts data comparability among the members, requiring the collection or at
least estimation of the resources used for common functions if comparability is to be
worthwhile. Outsourced or contracted functions range from advertising, fare media
production and sales, and advanced technology support / maintenance, to general and
administrative support services. Productivity measures require comparable labor data across
the bus organizations; outsourced or contracted labor time is thus requested for the KPI data.
In addition, the intent of the measurement system must be considered. Value Added Tax
(VAT) regimes are common throughout Europe, with passengers paying VAT for the fares
they purchase. However, typically bus organizations leave the impact of VAT out of all
accounting, including figures for fare revenue. The questions this poses are: is the
measurement system supposed to look at fare revenue that the bus organizations are collecting
as income? Or the money that passengers in each city have to pay for their fares (for instance
as a percentage of average wages)? Depending upon the purpose of the benchmarking
analysis, either figure may be appropriate.
Business Environment
Competition, regulation, and corporate structure are changing the responsibilities and
functions of bus organizations. Restructuring can impact financial and performance data,
including such items as infrastructure ownership and property rents, cost allocation among
functional units, and commercial income. Externally, a parent transport agency or authority
may also assume responsibilities common to other bus organizations, such as responsibility
for bus stop and shelter upkeep. Functions such as advertising or fare media production,
distribution, and sales may also be performed by a separate party, limiting the bus
organization’s access to data requested in the benchmarking process and impacting data
availability and comparability.
Randall, Condry, and Trompet. 9
100%
95%
90%
85%
80%
75%
70%
65%
60%
55%
50%
A B C D E F G H I
2001 2002 2003 2004 2005
Alternatively, KPI data can be shown in different ways. Key to this is testing various
methods for evaluating the data collected; ‘choosing the right denominator’ can by crucial in
normalizing for different types of bus operations and in comparing across the different urban
environments.
m m km
2000 10000
1800 9000
1600 8000
1400 7000
1200 6000
1000 5000
800 4000
600 3000
400 2000
200 1000
0 0
Barcelona Berlin Dublin KMB Hong London Madrid Montreal Paris Rome Sydney
Kong
Both passenger boardings and passenger kilometers are data items that are part of the Growth
success dimension of the KPIs. Contrasting the two measures can demonstrate additional
information, as shown in Figure 3 for the year 2005. Bus organizations in Dublin, Hong
Kong, and Sydney have relatively longer passenger trips than Berlin, London, or especially
Paris. This customer utilization of the bus services has consequences for operations and
planning of bus service in each city.
Other measures involve the use of data that is anonymised for confidentiality. Figure 4 shows
the results of a the KPI collecting for absenteeism of bus drivers. Though absenteeism is
largely a product of work place rules and culture, trends or changes in performance that may
provide lessons learned for other bus organizations are evident.
?
?
The KPI results can be used to provide internal motivation within an organization, proving
that things can be done better. Studies and sharing of experiences provide information for the
member organizations. For this purpose, variations in data accuracy are generally minor and
immaterial.
The results of the benchmarking to date have focused on success in each success dimension in
turn. No one organization is the best – or even second best – in all business areas. Some key
findings from the KPI analysis include:
• Only one of the member bus organizations has reduced real unit costs over the least
five years. In addition, this organization also increased ridership while reducing
Randall, Condry, and Trompet. 11
Now that the group has started a third annual phase, it is expected that best practices will be
identified and shared with increasing ease and to greater benefit from the KPIs. However,
just as important to member organizations is being able to understand – and explain – their
reasons for relative performance. This understanding is key in international comparisons, due
to the variation in practices and regulations in many areas. Additionally, the members have
also befitted from the other aspects of the benchmarking, sharing information through the in-
depth case studies and the multiple clearinghouse studies commissioned.
Within the United States, the largest depository of information is the Federal Transit
Administration’s National Transit Database. The published reports and databases make
available a considerable amount of data; however, the NTD is not specifically designed for
comprehensive performance comparisons across the transit industry, though it is used
extensively for this purpose. Several important areas lacking from the published NTD
information include data on capacity provision (i.e. passenger space (seat/stand) miles) and
subcontracted or outsourced labor and costs, while safety & security data (which is collected
under a separate process) is not published.
The Transit Cooperative Research Program (TCRP) Report 88, “A Guidebook for Developing
a Transit Performance-Measurement System” provides a comprehensive summary of
performance measures possible for all aspects of public transport. Also profiled are
experiences from the U.S. and around the world on implementation and use of performance
measurement systems at sample organizations. Most of the International Bus Benchmarking
Group’s KPIs can be found within the list of almost 400 measures (10). However, the
guidebook does not provide specific definitions for the data measures. Development,
agreement on, and adherence to the data item definitions has been a considerable part of the
work of the international bus benchmarking group.
REFERENCES
(1) Richard Anderson. Lessons from an International Railway Benchmarking Study: Process
and Benefits. 2001 APTA Rail Transit Conference. Boston, June 2001. See also: Richard
Randall, Condry, and Trompet. 12
Anderson. Metro Benchmarking Yields Tangible Benefits. European Rail Outlook, March
2006, pp. 22-25.
(2) The Balanced Scorecard Institute, http://www.balancedscorecard.org. Kaplan and Norton,
Harvard Business School. November 2004.
(3) European Standard EN 13816. Transportation – Logistics and services – Public passenger
transport – Service quality definition, targeting and measurement. European Committee for
Standardisation, Brussels, 2002.
(4) Gordon J. Fielding, Timlynn T. Babitsky and Mary E. Brenner. Performance Evaluation
for Bus Transit. Transportation Research Part A Vol. 19A No. 1, February 1985, pp. 73-82.
(5) Benchmarking Handbook: Extending the Quality of Public Transport (EQUIP).
Commission of the European Communities, Brussels, 2000.
(6) London Buses Strategic Review - Comparable Cities Study. London Buses. Final Report,
August 2003. Also see International Benchmarking Study. Transport for London (TfL). Draft
Report, October 2003.
(7) Monitoring of Overseas City Bus Services. Hong Kong Central Government, 1996.
(8) Benchmarking of public bus transport in 4 major Danish cities. The Danish Transport
Council, 2000.
(9) Hensher, David A; and Daniels, Rhonda. Productivity Measurement in the Urban Bus
Sector. Transport Policy, Vol. 2., 1995. pp. 179 -195.
(10) Kittelson & Associates, Inc., et al. Transit Cooperative Research Program (TCRP)
Report 88, A Guidebook for Developing a Transit Performance-Measurement System.
Transportation Research Board. 2003. pp. 338-344.