Introduction
The case study of Torpedo Trains portrays a company that had previously achieved success but subsequently underwent a notable decline in its performance and customer satisfaction levels. This is a conspicuous illustration of how business pursuits can have adverse consequences. The enterprise had successfully positioned itself as a dominant force in high-velocity railway transportation. However, as time has passed, the organization’s operational efficacy and client satisfaction have experienced a downward trend.
According to Page’s (2015) research, inadequate employee engagement, employee burnout, insufficient employee training, and recruitment of unsuitable personnel are the primary factors contributing to substandard levels of customer satisfaction in most organizations. Conversely, a decline in a company’s performance can be attributed to inadequate strategies, ambiguous objectives, deficient communication and marketing, and insufficient resources and personnel (Wang et al., 2018).
This report aims to identify the underlying cause of Torpedo Trains’ decline in performance and customer satisfaction levels by applying Foster’s (2018) 5 Whys methodology. The segment will also utilize pertinent and current scholarly sources and studies to identify the probable primary commercial factors contributing to the issue. The study also aims to evaluate the levels of performance and customer satisfaction.
Data Collection
The primary methods employed to collect data on the decline in customer satisfaction and business performance are interviews and surveys, as stated by South Western Railway (2020). Annually, Torpedo Trains administers a customer satisfaction survey to evaluate various crucial aspects of service provision within their stations and trains, which hold significance to their clientele. The data from the most recent two surveys indicate a decline in the overall satisfaction level of the journey, with a decrease from 86% in December 2018 to 83% in December 2019 (Scot Rail, 2022).
Based on the annual customer satisfaction survey table, it can be concluded that the customers’ overall satisfaction with the journey potentially decreased from 86% to 83%. Based on the survey, the drop in this number clearly suggests that the train and station facilities experienced a dramatic shift, affecting customer satisfaction. The data analysed was also collected using the Public Performance Measure, with the Intercity route measured for arrival within 5 minutes. Based on the headline PPM chart presented for the last 18 months, it is clear that the curve is experiencing a drastic decrease over time. (Department for Transport, 2021).
Literature Review
Current literature and research on the high-speed railway sector substantiate the primary business factors. According to Connor (2017), a study carried out by the European Commission has indicated that the prosperity of high-speed train corporations is contingent upon the investment made in novel trains and infrastructure. According to the research, insufficient funding poses a considerable obstacle for firms operating in this sector, as it curtails their capacity to allocate resources towards effective technologies and sustain their current assets.
Similarly, a 2018 study conducted by the Office of Rail and Road revealed that inadequate management practices are a prevalent factor contributing to failures within the transportation sector. The decline of transportation companies can be attributed to several key issues, including a dearth of strategic foresight, suboptimal decision-making, and insufficient performance management.
Empirical studies have shown that prioritizing customer needs and preferences is essential for achieving favorable outcomes in high-speed railway enterprises. According to a 2020 study conducted by The Guardian, a strong correlation exists between the quality of service of high-speed train companies and customer satisfaction. Ibrahim et al. (2020) identified several crucial factors in customer satisfaction, including reliability, comfort, and safety. The study findings indicate that a dedicated management team is necessary to improve service delivery and increase customer satisfaction.
Performance and Customer Satisfaction Levels
A 5 Whys analysis has identified the root cause of Torpedo Trains’ decline in performance and customer satisfaction levels. The analysis revealed the lack of proper maintenance, inadequate funding, and poor customer centricity as contributing factors. The issue can be attributed to various business-related factors, including insufficient funding, inadequate investment in new trains, suboptimal management, and inefficient operation, as reported by the Office of Rail and Road (2022b).
Torpedo Trains exhibited suboptimal operational performance, resulting in delays, cancellations, and other service disruptions. Delays, cancellations, and other service delivery issues may be attributed to malfunctioning train facilities (Mind Tools, 2022b). The organization’s absence of efficient procedures and frameworks failed to guarantee punctual train schedules and meet the passengers’ service expectations.
5 Whys Analysis
The 5 Whys is a method that uses a series of questions to drill down into successive layers of a problem. The basic idea is that each time you ask why, the answer becomes the basis of the next why. (Mind Tools, 2022a). In the case of Torpedo Trains, the 5 Whys are as follows:
- Why did the performance and customer satisfaction levels of Torpedo Trains decline? Due to a shift in existing service patterns (Timetable change).
- Why did Torpedo Trains shift the existing service patterns? To increase revenue while reducing costs associated with it.
- Why was the company aiming to increase revenue and reduce costs? Increase revenue and reduce costs to improve efficiency and service delivery.
- Why did Torpedo have to increase efficiency and service delivery? To cater to the rising cost of maintenance.
- Why did the cost of maintenance increase? The trains were aging because Torpedo Trains had not invested in new trains in a long time. There was also a lack of proper maintenance due to inadequate funding (Foster, 2018).
Root Causes:
- Lack of Proper maintenance resulting in delays.
- Inadequate funding.
- Lack of customer focus.
According to the study, the concession’s business plan is set to increase revenue and reduce costs spent on various aspects. However, the company aims to increase revenue over the concession’s life using some business plans that appear to affect customer satisfaction levels. For instance, the business plans to reduce the journey times between Blue City and Purple City by 15 minutes. This, in turn, will affect customer satisfaction, as most customers’ schedules will be impacted (Connor, 2017).
As evidenced by the case study, introducing a 7-day timetable for intercity services will also result in poor satisfaction levels, as the timetable has reduced journey times by nearly 5 minutes a day, especially in areas with a high volume of customers. Additionally, to reduce costs, the business has implemented stringent measures that may lead to poor customer satisfaction. For instance, increased unit efficiency and mileage from the feet may likely result in lower customer satisfaction. Also, reducing the overall budget allocation will result in insufficient funding for maintenance and fuelling (Zhen et al., 2018).
Since assuming control of the company in 2017, Torpedo Trains has refrained from procuring additional trains. The lack of investment in the company’s train fleet led to increased maintenance and depreciation costs, which hindered its operations. Transport Focus (2019) states that older trains exhibit reduced fuel efficiency and reliability, resulting in increased breakdowns and delays.
Torpedo Trains faced challenges competing with other high-speed train companies due to its inadequate investment in modern trains, resulting in its inability to keep pace with the industry’s technological advancements. According to the Torpedo Trains Case study (2022), High City’s population was 8,982,000 in 2019. The proposed business plan seeks to decrease travel time between Yellow City and High City. Furthermore, the duration of intercity travel between High City and Yellow City has been decreased as per the executed corporate strategy.
Underlying Issues
Lack of Proper Maintenance Resulting in Delays
According to the case study presented, the Torpedo fleet comprises 34 10-car Electrical Multiple Unit (EMU) trains for intercity services. However, based on the case, the Intercity fleet should be predominantly maintained at its Train Maintenance depot at Blue City, which is not always the case. This area seems congested because there is only a capacity for two EMUs to be serviced and 18 more EMUs to be cleaned in the area, despite the number being 34.
Additionally, there is limited stabling at the High City, which is operated mainly by local suppliers, with access guaranteed for 3 EMUs overnight. However, no cleaning, tanking, and controlled emissions tanks (CET) facilities are associated with the area. The case also highlights a situation in which all local fleets navigating Pink, White, and Orange Towns must return to Purple City for refueling and maintenance. There are also a few maintenance spares (4) available for the net position, with the same remaining for the May 2019 fleet and the Pre-May 2019 fleets.
Inadequate Funding
Funding also appears to be a core underlying issue facing the Torpedo Trains company. Based on the case study, it is evident that the company requires funding and regular progress appraisals from sponsors to deliver improved service to its customers. The study also indicates that with sufficient funding, adequate transportation of commodities and people to their respective areas can be achieved without causing any damage or harm (Palacin, 2018).
Based on the case, it is also evident that the newly adopted business plan, effective as of May 2019, has made significant changes to reduce costs and increase revenue. For instance, the journey time between Blue City and Purple City, which was initially +90 minutes with a change at White Town, had to be adjusted to provide a 60-minute direct journey without any change. Additionally, the 90-minute journey times between Yellow City and High City clearly suggest that there may be a lack of funding to cater to the wait times and changes at different cities in the intercity services.
For Torpedo Trains to solve this problem, it must create a workable financial strategy that guarantees the company’s continued access to the resources it needs to function at peak efficiency (Drucker, 1993). Doing so can enhance organizational effectiveness, improve performance outcomes, and increase customer satisfaction levels. A proper framework for allocating and managing financial resources is essential, and it can be accomplished by establishing an appropriate framework.
Lack of Customer Focus
Based on the current business plan, Torpedo only focuses on increasing revenues and reducing the costs of its services. The company does not place a strong focus on understanding customer needs and working towards ensuring an effective customer experience. To increase revenue, the company aims to reduce the journey time between Blue City and Purple City by 15 minutes. In the long run, this approach will impact customers who may delay reaching the pick-up stations (Transport Focus, 2020).
Additionally, the 7-day timetable for intercity services aims to reduce journey times in the area, despite most of its customers residing there. According to the case study, the business has no plan to increase its fleet size despite implementing a framework aimed at cost-effectively delivering additional services. These aspects clearly show that the company does not have a customer focus program in place. The business needs to take steps to boost future consumer satisfaction. For instance, the recently implemented timetable needs to be modified in a way that will aid in eradicating the unfavorable service-to-population ratio (Network Rail, 2021).
Similarly, strategies should be implemented to lengthen travel times, particularly for those leaving densely populated places like High City (Department of Transport, 2021). To ensure that passengers get the most out of the train services, it is important to consider increasing the travel time at the extra stop at Quebec on the High City to Purple City route. If the new intercity services are to be delivered efficiently, the corporation may need to increase the size of its fleet.
Proposed Changes
Torpedo Trains must implement several changes with specific timeframes to address the core underlying issues. These changes will improve the maintenance program, provide a sustainable financial plan, and create a customer-centric approach to service delivery. An additional strategy for augmenting customer-centricity at Torpedo Trains could involve forming a specialized team devoted to customer support.
The proposed team would function as a primary liaison for clients, offering prompt support and addressing any concerns or queries that may arise. The customer support team’s provision of various communication channels, such as phone, email, and live chat, facilitates convenient and effective customer interaction.
Expected Management Arrangements
If Torpedo Trains wants to see success from the proposal, it will need to implement detailed management mechanisms to monitor all of the anticipated improvements. First, it will choose a maintenance crew to handle the entire maintenance schedule. The crew will be in charge of performing routine maintenance on all trains and ensuring they always run smoothly. The group will work under the supervision of the COO.
Instead, Torpedo Trains will hire a chief financial officer (CFO) to oversee the creation of a long-term fiscal strategy (Transport Focus, 2019). According to the Chartered Institution of Railway Operators (2019), the CFO’s job description includes “reviewing the company’s financial performance, assessing funding options, and developing a long-term financial strategy.” In addition, he or she will be responsible for assigning sufficient funds for maintenance programs to get rid of customer service delivery delays and problems.
To oversee the development of the customer-centric approach, Torpedo Trains will appoint a Chief Marketing Officer (CMO). The CMO will be responsible for conducting customer feedback surveys, providing customer service training for staff, and developing new customer-focused products and services (Department for Transport (UK), 2017). They will also ensure a follow-up on all the issues raised by customers and workers, especially when they impact the overall performance of the company.
Impact on the Business Plan
The implementation of the above proposed improvement plan is expected to have a positive impact on Torpedo Trains’ business plan. By addressing the core underlying issues, the company will be able to improve its performance and customer satisfaction levels (Palacin, 2018). This, in turn, will lead to increased revenue, improved brand reputation, reduced cost, and create a stronger competitive advantage. Currently, the recently adopted business plan has resulted in a decline in performance and customer satisfaction levels. However, with the adoption of the proposed improvement plans, key business plan changes are expected.
By implementing a comprehensive maintenance program, Torpedo Trains will reduce breakdowns, delays, and cancellations, improving the company’s on-time performance metrics (Irish Rail, 2022). This, in turn, will also lead to increased customer satisfaction and improved brand reputation. Thanks to the preventative maintenance program, the company will save money in the long run by delaying the need to buy new, more expensive equipment.
Additionally, Torpedo Trains can be more successful if it creates a long-term financial strategy to attract investors and acquire the required funding. Company investments in new machinery and infrastructure will enhance service dependability and security (Department for Transport (UK), 2017). Torpedo Trains’ credit rating will rise due to the financial plan’s execution, allowing the company to qualify for better financing arrangements in the future (Palacin, 2018). Torpedo Trains will be able to stand out from the competition and gain repeat business by tailoring their products and services to each consumer, thanks to the customer-centric strategy they will be able to execute.
Freight Proposal and Its Impact on Operations
The freight proposal being considered for implementation could have significant implications for the Torpedo Trains operation.The passenger and freight sectors of rail transportation are different in many ways, including the nature of the cargo, the operating characteristics, the infrastructure required, and the regulatory environment (Giangregorio, 2020).This section aims to identify the key characteristics of the freight sector that differentiate it from the passenger sector, and to examine how these differences will be reconciled to deliver an efficient mixed traffic railway. Additionally, the section will assess any potential impact on Torpedo Trains’ contractual obligations.
Usually, the transportation of goods requires distinct infrastructure requirements when compared to the transportation of individuals. Due to their increased mass and length, freight trains necessitate sturdier railway tracks, bridges, and wider turning radii. The spatial requirements for freight terminals and sidings to facilitate the loading and unloading of cargo exceed those of passenger terminals.
According to Giangregorio (2020), providing exclusive rail lines for freight trains and installing dual tracks to facilitate bidirectional travel are imperative. According to Network Rail (2022a), the infrastructure must possess the capacity to accommodate the extended lengths and reduced velocities of freight trains while also being capable of withstanding heavier loads on the rails. Cranes and forklifts are among the specialized equipment required in the freight sector to facilitate the efficient loading and unloading of cargo.
Additionally, the size and composition of freight consignments can exhibit significant variability. According to Harris and Schmid (2003), it is common practice to transport bulk materials such as coal, iron ore, and grain in large quantities. Conversely, consumer goods and perishable goods are typically transported in smaller quantities. The weight, shape, and dimensions of freight consignments can vary.
The freight sector exhibits significant variability in the size and composition of consignments, which is contingent upon the nature of the cargo being conveyed. The transportation of bulk commodities, including coal, iron ore, and grain, is commonly executed in significant quantities, frequently utilizing specialized railcars or bulk carriers, as per Oliveira et al. (2019). The transported consignments exhibit a wide range of sizes, varying from a few hundred tons to several hundred thousand tons. These consignments are frequently transported over extended distances across national or international borders.
Consequently, timetables for trains are crucial to the efficient running of the railway system. The schedule is essential for the on-time arrival of any train, whether it is carrying passengers or cargo. Different schedules are used for freight and passenger trains to accommodate the needs of each group of passengers (Harris & Schmid, 2003).
When compared to passenger trains, freight trains operate on their own timetables. They operate primarily at night when passenger volumes are lower and their routes frequently take longer because of loading and unloading stops at many ports (Monios, 2019). The arrival times of freight trains are also less reliable than those of passenger trains, which might lead to schedule changes.
Freight train schedules tend to be more fluid than passenger train schedules. The main reason is that, unlike passenger trains, freight trains are not required to keep to a strict schedule because their clients are less concerned with punctuality. Passenger trains take precedence over freight trains and must be given the right of way. Because of this, freight trains frequently face long delays while waiting for passenger trains to pass.
The Rail Safety and Standards Board recommends scheduling freight train operations outside rush hour wherever possible. As a result, they tend to run when there are fewer people on the roads, such as late at night or early in the morning (Miandoab et al., 2020). The effectiveness of the train system is enhanced while congestion is decreased thanks to this method.
Reconciling the Differences
To deliver an efficient mixed traffic railway, there will be a need to ensure infrastructure upgrades, consignment prioritization, and improved communication channels between various managerial personnel. The railway infrastructure must be upgraded to accommodate the heavier and longer freight trains. This could include the strengthening of tracks and bridges, and the widening of turning radii. Additionally, new sidings and terminals will need to be built to accommodate the loading and unloading of freight (Betarelli et al., 2020). This infrastructure upgrade will require significant investment, and careful planning will be necessary to minimize disruption to passenger services during the construction phase.
To reconcile consignment size and composition differences, the railway can prioritize certain types of consignments to minimize disruption to passenger services. For example, bulk materials could be transported at night with less passenger traffic. In contrast, smaller consignments could be transported during the day (Catalano et al., 2019). Additionally, the railway can work with freight shippers to ensure that consignments are packaged in a way that is compatible with the passenger railway, minimizing the risk of damage to infrastructure or delays to passenger services.
Similarly, to reconcile the difference in the train schedules, the railway management team can develop a coordinated scheduling system that considers the different operating requirements of the passenger and freight sectors. Real-time tracking technology can provide accurate information on freight trains’ location and expected arrival time, enabling passenger train schedules to be adjusted accordingly (Irish Rail, 2021). Additionally, contingency plans can be developed to minimize disruption in the event of unforeseen delays or disruptions to either sector.
Impact on Contractual Obligations
The impact of the freight proposal on Torpedo Trains’ contractual obligations could be significant. Adding freight trains to the railway could result in schedule changes, delays, disruptions, and additional operating costs. Firstly, introducing freight trains could result in changes to Torpedo Trains’ schedules to accommodate the different operating requirements of the mixed traffic railway. This could result in additional costs for the company if the changes are not accounted for in the original contract (Management Study Guide, 2021). For example, if Torpedo Trains is required to run services at different times or with different frequencies, this could result in additional staffing costs, as well as costs for fuel and maintenance of trains.
Consequently, adding freight trains could also delay and disrupt Torpedo Trains’ services. This could occur if freight trains are given priority over passenger trains or if freight trains are delayed and cause knock-on effects to the passenger services (Rail Magazine, 2021). If Torpedo Trains cannot meet its contractual obligations due to delays or disruptions caused by freight trains, penalties could be imposed on the company.
Additionally, the introduction may result in increased operational costs. These could include the need to purchase new rolling stock to meet the increased demand and hire additional staff to manage the increased traffic on the railway (Office of Rail and Road, 2022a). There may also be greater long-term expenditures associated with maintaining the system due to increasing wear and tear on the tracks and other infrastructure.
Conclusion
In conclusion, to ensure the efficacy of the Torpedo Trains accord, it is crucial to consider the potential ramifications and facilitate seamless incorporation of freight trains onto the railway system. To attain this objective, it is imperative to integrate provisions into the agreement that consider the particular demands and complexities linked to freight and Torpedo Trains cohabitation.The provisions, as mentioned earlier, should delineate the least amount of time required for notification in the event of any alterations to the schedule or operational adjustments.
Furthermore, it is recommended that the contract incorporate provisions delineating the consequences imposed if Torpedo Trains cannot discharge its contractual duties owing to impediments or disruptions arising from freight trains. Including these provisions within the agreement can facilitate efficient coordination and minimize potential disruptions, thereby ensuring the dependable and effective operation of Torpedo Trains and the integrated cargo trains on the railway.
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