What is the GCC-wide rail project lacking? Apparently it's 'inspiration'
The national rail networks under construction in the GCC provide a unique chance to build railway systems of the future and, as with most major developments in the region, they are expected to be world-class.
Etihad Rail in the UAE is full steam ahead, starting freight operations in 2014 within the Abu Dhabi region, and expanding its network in future stages to build into the other Emirates and connect to Oman and Saudi Arabia. The passenger services offering is still under way, but may get accelerated and turned into a high priority on the political agenda considering the upcoming global events in the region.
Like most transport systems, rail networks globally are facing an array of changing dynamics, which are impacting the industry overall, and operators that redefine customer needs and variances will create a real competitive differentiation, not just in markets that have competing rail operators but in markets where consumers have a choice of transport options such as the GCC.
With cars and petrol prices being among the cheapest in the world, the dependence on road transport in the GCC is unanimously heavy. Rail has limited resources to differentiate itself and compete with the well-established trucking industry, but also to break into local customs, perceptions and individual behaviors around transportation.
GCC railways will need to position themselves in a highly competitive market, and deliver high quality of service while balancing operational efficiency and effectiveness.
In this regard, rail operators will be well-advised to look for inspiration from other sectors with a strong customer focus such as retailers, hotels and even banks that often have to fight for every customer.
Indeed, even within the transportation sector itself, rail operators can draw from a number of lessons learned, trends and best practices applied at global and regional airlines.
Innovative railway operators will seek to find competitive advantage, whether it be a "no-frills" model, such as the low-cost airlines and basic hotels, or full-service offering facilities such as wireless Internet and other business services, or even a combination of both.
Today’s rail customers, passengers or businesses, have distinct behaviors, needs and expectations that operators have to cater for through relevant service mixes, as well as consistent and differentiated distribution strategies for each segment.
Improved customer service, pricing incentives and loyalty programs have all become essential to face an increasingly empowered and demanding customer base. Changes in the external environment are altering the way individuals think, behave and consume; customers are more and more fragmented, interconnected, savvy and hungry for information.
Hence, new entrants to the industry as well long-established operators will have to adapt their business models to meet changing consumers and move to their speed.
Time is the new currency for the modern traveler, so travel times need to be minimized not only through high quality of service but also through the integration of high-speed rail services and better interconnectedness between rail and other modes of transport.
Furthermore, railways of the future must incorporate the latest technologies at each stage of their value chain to remain relevant to the modern consumer. For passenger services, technologies such as mobile- and e-ticketing give customers the flexibility to order, pay, and use tickets while on the go.
These digital payment channels would need to be flexible enough, offering choices to customers and accommodating a broad and continuously expanding array of media devices.
Electronic payment and distribution channels are also very relevant for freight customers, who are increasingly seeking higher flexibility in booking and order management, as well as efficient and streamlined business-to-business integrations with rail operators.
Other advanced technologies like biometrics, digital interactive signage and kiosks should be also integrated into railway stations and facilities, which are the neuralgic center of rail operations from a customer standpoint.
For example, increased passenger traffic in stations can be a growing source of security concern for authorities, and biometric technology could change the way security is handled.
For passengers, the onboard experience can also be enhanced by maintaining connectivity and interaction during the journey, allowing users to read tips about destinations, write short messages to others using the network, search reviews and rate content from fellow passengers.
Other examples of new technology developments include the use of augmented reality to display information for travelers, geolocation to provide directions and guide passengers in the stations, as well as interactive journey planning and travel information.
In a fiercely competitive transport market, rail needs to redefine its product offering to ensure it is an attractive transport option in terms of price, facilities and service offerings.
As the UAE develops its much-anticipated railway network over the next decade, there is every reason to believe that it will be one of the best transport services in the world.
— Jan Tellefsen is Accenture’s managing director for transportation and infrastructure in the GCC.
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