Opinion Pieces: The need for a set of effective performance measures

Professor David Hensher
Professor David Hensher

Opinion Pieces: since 2007, Prof. David Hensher has written an opinion column in the Australasian Bus and Coach magazine, where he monthly discusses a lot of different transport-related hot topics. In this section we are revisiting these columns.

Photo: zimbio.com

February 2012

One of the challenges of public transport service delivery is the measurement of performance and compliance with contractual conditions. These challenges were the main focus of a workshop on performance measurement and compliance at Thredbo 12 (Durban South Africa September 2011). The types of performance measures, incentive and penalty regimes, benchmarking and the associated risks in performance measurement were discussed. Other relevant issues included items such as public transport sustainability, transparency in decision making, innovation (e.g. engineering choices regarding technologies), and the overall benefit of public transport to society. It was also pertinent to consider what evidence exists about the wider impacts of transport interventions on macro policy goals (e.g. the environment, reduction in accident rates, traffic volumes, mode switch etc.); the benefits of integration within the transport system and between transport and related economic sectors.

After 3 days of debate and discussion a number of key recommendations were put forward which I believe represent a healthy direction for performance measurement and benchmarking in each State in Australia. The workshop identified nine critical key responsibility areas (KRA) and a key example of a key performance indicator (KPI):

Area (KRA) Example KPI
Cost efficiency $/km
Service quality and customer Satisfaction Service quality index
Safety and Security Incidents/km
Network efficiency/effectiveness Pax/km
Environment CO2/pkm
Social inclusion/Affordability/Welfare % of public transport by socio group
Accessibility Generalised cost (time and money)/capita
Compliance Contract fulfilment
Revenue management/protection Fare loss/pax

The workshop concluded that stable frameworks lead to partnerships and trust (and this is where the government sector should take the lead). In terms of KPIs it was concluded that a simple and relevant KPI regime when implemented leads to informed design of contracts which leads to feedback / continues process (government sector). However, it is recommended that the set of KPIs need to be in the contract but levels need to be in schedule (government sector). Setting up appropriate structure to manage performance regime (government sector) is not just for compliance but also to assist operators.

This lead to a series of recommendations:

  • Performance measures should be simple and practical but still informative
  • Who has control over these KPIs? Policy, regulators expectations? Who bears the risks?
  • We need to understand the relationships and obligations of parties / trust
  • There should be minimum standards to address the backlog with respect to establishing performance measurement regimes, particularly in the context of creating a formal market which encourages public transport measurement and compliance
  • There remain fundamental issues of data availability / integrity / relevance
  • Further work is required to establish how much information can be released back in to the market


I acknowledge the contribution of John Nelson and Rico Merkert who co-chaired the workshop.

Food for thought.

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