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10 transport issues that can make or break your organisation – Part 3

|December 11, 2017
Bicycle wheels repeated on background
Written by
Darran Messem

Darran Messem

Transport underpins everything we do. Transport is also undergoing one of the most radical upheavals of any sector, and the stresses and strains of this upheaval manifest themselves in a plethora of issues and controversies, ranging from industrial disputes to radical technology development, from restructuring huge manufacturing systems to conserving scarce resources, and from integrated transport systems to individuals’ bicycles and roller skates. To manage this complexity, insightful and clear communication is key.

Madano has identified ten key issues impacting the transport sector: decarbonisation; air quality; electrification; infrastructure; congestion, efficiency and productivity; disruptive technology; new entrants; safety and services; trade and jobs; transparency, ethics and trust. All or some of these impact all economic sectors, all organisations and all people in one way or another. All need to be managed, in whatever sector an organisation operates.

In this third and final article, we look at the last five of these issues: new entrants; disruptive technology; safety and services; trade and jobs; transparency, ethics and trust. These are five ‘softer’ issues that are only just beginning to re-shape the global economy.

1. New entrants

Among the 10 best-selling electric cars in the first six months of 2017 were the Zhi Dou D1/D2 and the BJEV EC180. Heard of them? The top 10 also included the Tesla Models S and X. Ten years ago, who would have bet on that? If recent press reports are to be believed, within the next 10 years, Google and Dyson will be selling electric cars, EasyJet will be flying electric planes, Boom will be the market leader in supersonic passenger jets, most parcels will be delivered by Amazon drones, and most taxis will be hailed by App. No company involved in transport can afford to think it cannot be put out of business by a new entrant.

2. Disruptive technology

Disruptive technology presents us with choices like semi-autonomous vehicles, driverless cars, car-sharing, App-based ordering and drone delivery. These changes in vehicle technology and interactive systems linking to vehicles will in turn change the nature of vehicle design, use and ownership, as well as the components and software that go in to the vehicles. Products will be delivered differently, and people will travel differently. Disruptive technology in transport therefore has the potential to render your entire business model obsolete. Or it can transform your business to a world leader in less than a decade.

3. Safety and services

Expectations of customer service and passenger safety are shifting. Road transport has for decades been a big killer; for many companies their number one safety risk. But added to the RTI (Road Traffic Incident) in Health and Safety Reports are now vehicle hacking, data misuse, phone use and vehicle software failure. In contrast, some new technology services are so reliable that expectations of service are being recalibrated. New vehicles are no longer ‘worn in’, execution should be instantaneous, issuing (like tickets, care hire keys and boarding passes) should be on demand, connectivity (on board, mid-sea, in-flight, underground) should be constant. Companies not meeting these rising expectation will at some point be caught off-guard by a customer complaints backlash. And don’t expect it to be in the form of a letter; it will be in the firm of a Tweet addressed to millions. Can your customer service team cope?

4. Trade and jobs

In any transformation there are winners and losers. And thus there is conflict. The recent transatlantic spat over Bombardier’s production of a perfectly decent aeroplane and Boeing’s concern to safeguard its domestic market is as much a reflection of the transformation of transport technology as it is of protectionist nationalistic ideologies in central Government. The fallout from Monarch’s collapse, PSA’s purchase of GM’s Vauxhall/Opel division, Ryanair’s flight cancellations and the recent fall in UK car production have been amplified in all cases by the anxiety of jobs and trade.

5. Transparency, ethics and trust

The VW emissions scandal hit the company and sector hard: $20 billion in provisions for fines according to most reports, and trust in large corporations is at an all-time low. It wasn’t just Volkswagen. Audi, Mitsubishi and Suzuki stand accused too. Yet while the bottom-line has been impacted by fines and compensation payments, the impact did not manifest itself in sales. This is arguably because consumers can no longer bother to care, and in the short term don’t know where to turn. Likewise in transport industrial relations disasters like Ryanair’s flight cancellations, Royal Mail’s industrial action, and Tube and Rail drivers’ strikes, customers bounce back. But over the longer term this creates huge opportunities for the careful operators who do manage with integrity and do manage brands well.

These five issues affect all organisations, not just those directly engaged in transport. They have the potential to render your car, your fleet, your business model, and even your industry, obsolete. They offer the potential to transform productivity and to create life-changing disruption, as well as life-changing opportunity. They are each therefore worth making a plan for. Yet many organisations treat transport as an activity outside their operation, not fully realising that their own activities require it, their own business models are dependent upon actively managing it, and their own risk-reward profile (and therefore shareholder value) is inextricably linked to it.

Transport underpins everything we do, and it is going through a transformation that presents both risk and opportunity for everyone. In this series of three articles Madano has identified ten key issues impacting the transport sector:

  • Decarbonisation – the ongoing quest to reduce greenhouse gas emissions from transport
  • Air Quality – the health imperative to reduce concentrations of oxidants of nitrogen and of particulates in the air
  • Electrification – the accelerating trend towards electric vehicles and electric re-charging points
  • Infrastructure – an array of key construction projects targeting increased connectivity and economic growth
  • Congestion, efficiency and productivity – the interlinked challenges of increased congestion and static productivity
  • New entrants – non-traditional competitors threatening established business models
  • Disruptive technology – new technologies creating new channels of communication, distribution and delivery
  • Safety and Services – changing expectations of safety and service in transport operations and services
  • Trade and Jobs – the battle for growth and employment
  • Transparency, ethics and trust – the increased risk/reward profile resulting from technological and social change.

Organisations have a responsibility to define their position on these issues in their transport policy and strategy. They owe it to their shareholders, employees and customers to be clear on the strategy they are pursuing to navigate the ten transport issues we’ve identified. Failure to get this right not only neglects potential financial opportunity from the unfolding transformation of the transport sector, but also presents operational and strategic risk from being wrong-footed by developments. It adds to the risk of serious and life-threatening damage to our climate, air quality, economy and social services. All organisations, not just transport ones, should be analysing these issues, and findings engaging and creating ways to communicate about them to their staff, customers, investors and stakeholders.

Part 1 Part 2

——— Darran Messem is a former Director at Madano, sister company of NATIONAL Public Relations