Saturday 20th October 2018
Monday’s ‘Business Announcement’ outlining proposals to centralise even more of Arriva’s UK bus business mysteriously landed anonymously in my inbox. I’m told it’s a legacy plan left over from recently departed UK Bus MD Kevin O’Connor (formerly Regional MD of G4S) who’s now moved on to pastures new.
I thought I’d give some friendly feedback about the plan to Arriva Chief Executive Manfred Rudhart……
In a nutshell DON’T DO IT!
I know it’s tough running buses at the moment with ‘fewer people in the UK choosing to travel by bus every year and the overall bus market shrinking’ as Iain Jago, Interim Managing Director UK Bus explains in his letter to Arriva’s staff announcing the proposals. But when you’ve mistakingly got your foot on the accelerator heading towards a brick wall you don’t press down even harder; you realise what’s causing the problem and switch to the brake pedal for an emergency stop.
Here are three reasons why Arriva needs to hit the brakes on another bout of centralisation which will do nothing to halt the decline in passengers and only disconnect Arriva further from that elusive market growth you’re seeking.
1. The most successful bus companies in the UK realise the local bus market needs locally based management teams engaged and embedded in their communities, impassioned and empowered to make decisions. Commercial, marketing and operations (all key components of a successful bus company which your proposals aim to centralise) can only be effectively managed locally in the bus market.
The market for bus travel in North Wales is completely different to the Medway Towns and different again from Teeside. Locally based managers understand this best; centralisation may well ‘eliminate duplication’ (as the proposal boasts) and therefore save costs but it will be a classic false economy with unintended consequences. Far from ‘improving efficiencies’ as proposed it will lead to waste and inefficiencies.
Look at your Group’s introduction of a fleet of Mercedes Sprinter minibuses to Hemel Hempstead’s bus routes last November. It might have looked a sensible innovation to a remotely based central commercial ‘expert’ but anyone in tune with the local market should have pointed out it’ll never work and would end in tears, as it did.
The Go-Ahead Group’s companies, Transdev Blazefield, Wellglade Group, Nottingham City Transport, Reading Buses, Lothian Buses, Ensign Bus to name some of the UK’s most renowned bus companies have one thing in common: they all have locally based autonomous commercial, marketing and operational teams. Imagine if Arriva was lucky enough to acquire all those award winning companies into the Group portfolio, the absolute last thing that should be done is eliminate all that management ‘duplication’ in the name of corporate efficiency. You’d destroy those companies within months; just like Hemel’s bus routes.
The history of centralisation/mega-regionalisation in the bus industry is not a happy one. Stagecoach tried it many years ago (creating a massive south east region stretching from Margate to Andover and along the south coast) as did First Group (their infamous 3 Ps Region: Porthcawl to Portsmouth to Penzance). Both hair-brained schemes designed by Directors parachuted into the bus industry from outside thinking they knew out to save costs and introduce efficiencies; both unmitigated disasters and thankfully put back to more sensible locally managed arrangements as soon as the scheme architect had left to cause mayhem in another industry.
2. You want Arriva to be the ‘mobility partner of choice’ but meaningful partnerships for the local bus market are with local authorities, local enterprise partnerships, locally based business groups and local community groups. The clue is in the word ‘local’. Centralisation in the pursuit of eliminating duplication will not endear Arriva to influential locally based politicians, executives and community leaders.
Giving buses priority is often about a whole host of small schemes such as traffic light phasing at key junctions, maybe just by a few seconds; extending yellow lines by a few yards; improving roadworks coordination etc. These are the stuff of local detailed knowledge which locally based bus managers pick up, not from remote regionally or centrally based staff hundreds of miles away.
I was shocked to hear a local authority traffic engineer tell how he’d called a meeting of all the major bus operators in his county to draw up a list of congestion hotspots which would benefit from small scale improvement schemes. Guess the only operator which failed to attend?
3. The track record of centralised customer facing activities already in place at Arriva is not particularly encouraging. Customer Services taking a week to reply to a fares enquiry; inappropriate tweet replies with no knowledge of local issues; no helpline phone numbers promoted online; a clunky website which calls for a region to be specified only to ignore it when delivering timetables, with maps (where they exist) hidden under tickets, and no fares information by journey …. to highlight just a few shortcomings.
In summary, increasing centralisation is simply the wrong way to go. You’re blessed with some first class managers and great up and coming young people in the business with passion for the industry – give them the authority and autonomy to make decisions locally and you’ll find any costly management duplication will soon be more than compensated by achieving the very market growth you’re seeking.
20th October 2018