Transport giant looks to IT to stop rail franchise from hitting buffers

National Express will rely on IT to drive revenues

IT takes centre stage at the East Coast franchise

Transport group National Express is relying on the deployment of innovative customer management technology as it looks to cut costs and drive up revenues in the face of debilitating financial commitments.

Maintaining passenger loyalty while reducing operational costs has become an urgent priority at the transport group as it struggles with the burden of financial obligation for the East Coast rail franchise.

Consequently, National Express is introducing an innovative new text message analysis service. The new system captures passenger feedback via SMS, providing executives with a real-time view of the company’s performance and service requirements. This information, which could be about anything from overflowing bins to faulty reading lights, is then fed into a web dashboard, which can be accessed by facilities and engineering teams.

“The system is an extremely useful tool for analysing customer comments and enables us to measure improvement. It has been easy to implement and cost effective for our organisation,” said Brian Elliott, customer service development manager at National Express.

The hosted platform, provided by Rapide Communication, enables commuters to provide comments on levels of service on the East Coast line while travelling.
Once the feedback has been sent by the customer, the data is relayed to a text analytics system, which identifies the topics within comments or complaints.
Functions included in the platform mean National Express can identifty the callers sending texts, but the information is not being used to sell extra products or services.

“This is a communication between the customer and the company and we will not be using mobile numbers for anything other than collecting their feedback and improving the service,” said Elliott.

Another project geared at gaining visibility of customer activity as well as reducing operational costs at National Express East Coast is an electronic gating application, which will process fare information and report any maintenance needs. It is expected to be rolled out in the third quarter of 2009.

But whether the transport group will manage to hold on to its East Coast franchise ­ which is potentially the UK’s most lucrative franchise ­ is open to doubt. The group admitted it cannot sustain the £1.4bn owed to the government for the running of the seven-year franchise.

The progress of any IT plans is therefore uncertain, as the company drives a “significant reduction” in capital investment and aims to renegotiate the terms of the East Coast franchise ­ which it says will be essential for it to be able to refinance its £1.2bn debt. “The terms of our East Coast franchise were agreed in a very different economic climate in 2007,” the firm said.

Nevertheless, the government appears unsympathetic. Rail minister Lord Adonis said last week: “We’re not in the business of renegotiating contracts that were freely entered into.”

The rail and bus group said in an interim statement released ahead of its annual general meeting last week that turnover on the London to Edinburgh route grew by only 0.3 per cent in the first quarter as passenger numbers fell by between two and five per cent.

National Express’s original bid for the franchise was based on significant rises in passenger numbers. If its franchise has a future, the IT projects under way will be essential.