Restructuring Mass Transit in Singapore Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Restructuring Mass Transit in Singapore Case Solution

Restructuring Mass Transit in Singapore is a huge project which needs to be planned and implemented carefully. The main reason for this is that there are many different stakeholders involved in this process. Having a thorough understanding of all of these stakeholders is the key to achieving success. Therefore, it is crucial that the restructuring process be conducted in a way that focuses on reducing costs and enhancing efficiency.

Problem Statement

The recent breakdowns of two of Singapore's five mass transit rail lines have left commuters stranded in dark tunnels, waiting for hours on end. Both operators blame faulty signaling for the mess. This amounted to a small miracle, though, given that the city-state's population has increased by more than 5 million since 2000. It's not surprising that the government has been keen to overhaul its infrastructure to cope with the urbanisation boom.

For example, SMRT Corp., which operates the North-South Line, has been testing out a new signaling system to fix a series of recurring glitches. The company is also using big data technology to detect potential problems before they happen. And it's not all bad news for commuters. They've been advised to make allowances for extra travel time on Friday night.

In fact, it's hard to imagine a better time to start investing in smart transport technologies. In fact, the government is so receptive to these innovations that it's launching a new proof-of-concept competition. Using a slew of industry experts as judges, the top 20 finalists will be awarded a cheque for up to S$200,000.

Among the winners, one will be selected to participate in a pilot scheme to create a "big data" system for the MRT that will help identify potential problems, while the rest will be offered the courtesy of a series of one-on-one sessions with senior government officials.

Case Study Solution

Restructuring mass transit in Singapore is not a new idea. As countries across Asia and North America realize the economic benefits of mass transit, they are developing new transportation systems to cope with this growing demand.

Before reorganization, the average number of buses operating in a given area was six during weekdays and four during weekends. One small, one medium-sized and three medium-sized buses operated during the afternoon.

A DRT (distributed regional transport) system was introduced to replace the local buses. It is a cooperative bus operating system. The reorganization facilitated the increase of operation frequency and the elimination of long routes.

In order to ensure the smooth operations of the new system, a team effort of private and government entities was essential. Five bus stops were built in areas with poor transportation infrastructures. This helped improve access to the buses for elderly people and children who would use the van as a school bus.

Reorganization also increased the number of drivers and bus vehicles. During weekdays, two drivers ran the bus alternately. During the weekend, one driver operated the bus.

After the reorganization, the total number of buses increased by ten percent. The reorganization also shortened the distance between bus stops. Similarly, bus stops were made accessible once every two hours.

The reorganization also changed the timetable. National holidays were shifted to a weekend/holiday timetable. Moreover, the length of routes was reduced to reduce the number of connections within 15 minutes.

PESTLE Analysis

One of the best things about living in Singapore is that it is a place with a lot of things to do and see. While Singapore isn't an exotic locale, it is a place with a unique combination of factors that create a favorable environment for those looking to relocate or start a new life. This includes a healthy economy, a low cost of doing business, a robust infrastructure, and an enlightened government. Unlike many modern nations, Singapore isn't short on resources, a fact that helps it keep costs down. The low cost of labor from neighbouring nations is also a win for the Singaporean taxpayer. Among the country's other attractions is its cosmopolitan culture, which is not to be sniffed at. Moreover, Singapore is a place where it is possible to get a degree in a matter of months. Hence, there is a strong demand for professionals of all stripes. For that reason, the number of Singaporeans is on the rise. However, with the burgeoning population, the city has been plagued with the dreaded "affordable housing." So, if you are looking to relocate or start a new life in the city, you'll need to consider everything from the cost of housing to the location of your office.

Financial Analysis

In the pursuit of making air travel cheaper and more rewarding, the Singapore government embarked on a plan to restructure SMRT. The plan called for the sale of SMRT assets for $1 billion. These assets would include the city's MRT and other mass transit services. After the halcyon days of the 1980s, SMRT's fleet was dwindling, and passengers had to wait hours in dark tunnels.

Despite these setbacks, SMRT was not restructured in a manner that slowed operations down. Instead, the company adopted a more modern business model, and retooled its product offerings and marketing strategies to take advantage of the post-recession renaissance. This paved the way for a newer, shinier SMRT.

Aside from the restructuring of the nation's public transport system, Singapore Airlines also got in on the act. In the past, the airline used to operate its own routes, but has since consolidated these with a few other members of the Singapore Airlines Group. For instance, the airline transferred its Penang route to Silkair.

During the process, it was also able to shift flights to more cost-effective carriers, and re-equip its older equipment with the latest and greatest in aircraft technology. Finally, it had a say in the SMRT merger. It's now a fully-owned subsidiary of the Singapore Airline Group.

Lastly, the Singapore Airlines Group took the opportunity to improve its Tigerair operations. By combining the two, the airline is better able to compete with its peers in the low-cost arena.

Recommendations

The Singapore government has made great efforts to develop a world class mass transit system. However, a more ambitious vision is needed. This paper argues that the public sector should play a greater role in planning and regulation. In particular, it calls for the implementation of a real competition model in the public transport market.

Using gross cost service contracts, which are common in developed countries, would allow the Singapore government to improve efficiency. By transferring production risk to private operators, gross cost contracting can reduce costs by 20-30 percent compared to a public monopoly. Moreover, this type of contract is compatible with high levels of system integration.

A more customer-oriented approach is also needed. This article proposes the introduction of a competitive tendering process, combining the strengths of the two previous options. Competitive tendering allows the Government to direct public service providers to better meet customers' needs and to push for more ambitious reforms. It can also help to accelerate the integration of the local public transport industry.

Currently, there are two operators operating in the Singapore public transport market. Each has a monopoly in its zone. With this arrangement, the government cannot force innovation through an open entry into the public transport industry. Moreover, the rivalry between the companies hampers the integration of the existing transport system.

For the poor, a long travel time is a major constraint on employment. Their choices are often limited to slower transport modes. They spend as much as 9.8% of their household income on transport costs.

Restructuring Mass Transit in Singapore Case Solution

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