Navigating digital: Transforming transport

Tiny Hansen
15 July 2015

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Twenty of the UK’s transport leaders gathered for a frank and vigorous roundtable discussion on the impacts of digital on the transport and infrastructure sectors earlier this month as part of the Global Infrastructure Initiative (GII). McKinsey's Tony Hansen assesses to outcome.

The context is clear. Across industries, customer experiences are being redesigned to be “omni-channel”, personalised and seamless. Simultaneously, we are seeing massive efficiency gains in operations, driven by big data, advanced analytics, sensors, and hyper-connectivity. 

So how can transport leaders successfully navigate digital transformation and capitalise on the opportunities, while managing the threats from new disruptive businesses? Some key themes emerged.

"There are relatively few experienced digital managers in the UK and many are reluctant to work in ‘old economy’ companies. Attracting millennial staff is a challenge and linking purpose to job opportunities is worth pursuing."

Optimising digital investments requires clearly defining the problems we are trying to solve. The customer is the obvious place to start by managing reputation, digitising ticket sales, and loyalty programs. However, digital can also help reduce the cost of managing assets over their lifecycle. 

The bar on managing reputation and customer information online is very high. Service disruptions are tweeted and shared quickly online so staying ahead requires significant and dedicated resources. 

Digital could be powerful in smoothing peak demand. Real-time travel information can educate customers about how and when they should travel and work, but the information must be truly multi-mode and designed to the needs of passengers, not the transport providers.

The business case for digital is often negative, but companies still need to invest. Investing in well-defined digital initiatives is often a necessary cost of staying in business. Companies should think 30 years ahead to prepare for changes that are likely to play out over the next five years.

There are relatively few experienced digital managers in the UK and many are reluctant to work in ‘old economy’ companies. Attracting millennial staff is a challenge and linking purpose to job opportunities is worth pursuing. Transport leaders need to get digital into the DNA of their organisations by embracing a digital culture.

Finally, leveraging social media to communicate with customers and stakeholders is a massive opportunity to engage public support for projects and policies. Yet no one is doing this well thus far. 

Tony Hansen is director of the Global Infrastructure Initiative, McKinsey & Co.

The GII is a community of infrastructure leaders committed to improving the delivery of critical infrastructure convened by McKinsey & Company in partnership with the Albright Stonebridge Group and Spencer Stuart.  The conversation will be continued at the global GII event, to be held in San Francisco on November 18-20, 2015. For details, please visit www.globalinfrastructureinitiative.com