Modernizing Public Works — Lessons Learned from MetroCard
Prior to the 1990s, the New York Metro Transit Authority still used a fifty-year-old fare collection system of metal tokens, lagging behind cities like London and Paris which had long since turned to digital cash. It was a fragile system fraught with fare evasion and fraud, increasing the cost of public transportation throughout the region and resulting in long lines that delayed buses and crowded stations.
But more than that, it lacked the flexibility and data collection necessary to a modern transit system- least of all one that moves 8.5 million people a day. It did not support fare policy changes, make it easy to offer discounts, or provide any ridership data that could be used for forecasts and decisions on routing and scheduling changes.
Something new was needed.
The MetroCard, as it would come to be called, was one of the largest public works projects that had been attempted in New York. It had lofty goals, including shifting more people out of their cars and onto public transportation as well as reducing the cost of operations in the face of reduced government subsidies. But it also would require upgrading all existing systems including buildings, equipment, maintenance capabilities, and sales models, and it had to do all of that without impacting current riders. It was a project that would drastically change the NYCTA’s structure.
The project required both the organization and the riders to accept a new fare medium, a new structure and a bit of chaos for a time. The amazing employees of NYCTA and our incredible riders were a key to its adoption and success- and some of the lessons we learned are useful for any large-scale capital project.
Identify why change is necessary
Large capital projects need funding and that is heavily dependent on the political administration believing in rebuilding the country. It’s easier to develop this funding, and determine a plan for going forward, if you can make a clear argument about why the status quo isn’t working. In the case of the MTA we had identified that the high cost of operation, lack of automation, increased fare evasion, the lack of flexibility in fare policy, and the lack of information about fare operations indicated that the time for change had come, and new innovation was needed.
Be clear about your goals
In addition to collecting better data, reducing costs, and lowering fare evasion, one of our primary goals was to improve customer service in order to encourage people to move from cars to public transit. In order to facilitate that we knew that we wanted our riders to get their MetroCard anywhere and efficiently.
We understood early on that cash sales and management were costly and inefficient, and new sales outlets had to be created. Therefore, new point-of-sale centers outside the stations were a key part of the new model. Other programs such as online sales, vending machines, credit card purchases, and joint railroad and subway fares were a key part of the plan. Innovative fare policy options and incentives have helped riders move to monthly and weekly cards, reducing one-time purchases, cutting back lines and reducing costs.
Examine existing systems
In order to ensure success we looked to existing digital cash transit systems in order to determine the right technology and design for NYC. NYC has one of the largest transport systems in the world and a major infrastructure upgrade requires all the supporting systems to work in harmony. One small problem could delay thousands of riders heading to work and invite severe criticism by the press. Managing such a large initiative while the system was running was complex and challenging, and looking at existing systems helped us to anticipate some of the potential issues.
Partner with the private sector
The MetroCard project would have been much more difficult without our partnership with various agencies and partnerships outside of the NYCTA. I believe that these sorts of projects must be done through joint public-private partnerships where both sectors benefit from improving the social fabric of the cities and the country.
There is a role for the private sector to contribute to all essential city infrastructures, especially with advancements in technology and automation. Without such partnerships, much of the infrastructure that the private sector depends on will decay, and eventually have a severe impact on the society at large.
Manage Cost and Quality
We had many oversight groups as well as resident inspectors at the vendor sites testing all systems before they arrived in NY for implementation. The NYCTA president also had daily 7 a.m. meetings to go over the system deployment, including bugs and glitches. That type of leadership, with strong oversight from AT Kearney and solid quality assurance was critical for good deployment.
Choose a team and leadership that can embrace change
Large capital projects need strong visionary leaders who take risk and believe in transformation and customer service as well as a strong committed and passionate team.
I had the honor to work with a MetroCard team that embraced disruption and change, which became very important as the project moved forward. Change starts well, but very soon the old way of working breaks apart and loses its momentum. Managing and leading change is critical in any large transformational work. It is never about the technology. It is always about the citizens, the customers and the employees.
Phase Deployment as Necessary
In the end we decided on a phased deployment in which helped ensure minimum impact to riders even as some riders were forced to use two fare systems to travel. That was not easy for them, but I learned that New Yorkers may be tough, but they are forgiving. A system this large could not be deployed all at once and still be successful, so a phased approach was necessary. The phased approach also allowed us to partner effectively with various MTA entities to create joint programs around ticket sales, fare policy initiatives and vending machine design- as well as ensure we had proper quality assurance.
Train and Communicate
Change barriers are the same in any entity. As the old ways of working break apart, power shifts within the organization. There is learning anxiety about the new technology. Automation reduces layers and processes and it ultimately impacts people. The organization managed this well through communications, training and change management. MetroCard necessitated extensive training for all members of the organization from railroad clerks and money room personnel to mechanics.
