INTRODUCTION

Transport Industry overview & Current Scenario Transportation, like all industries is largely influenced by information and communication technologies with the focus being on knowledge of customer needs and value added services. Surface transport is provided by the Road and the Indian Railways (primarily for carrying low value bulk commodity, mostly for the government sector). Cargo Road Transport is entirely in the hands of the private sector. An estimated 1.2 million trucks (9 tons capacity) crisscross the country covering more than 80,000 kilometers of roads. In India road transportation is preferred for cargo movement, where flexibility of routing assumes importance. It facilitates door-to-door delivery, overcoming unnecessary delays, which normally take place in the other modes of transportation. Transport volumes in India remain much less than those in the developed countries. India has still to go a long way in strengthening its transportation network. The countries transportation network suffers from several inadequacies and, in particular it has little resilience to deal with unforeseen demands. Department of Road Transport and Highways in the Ministry of Surface Transport is constitutionally responsible for Planning, Development and Maintenance of National Highways in the country. All roads other than National Highways in the various states fall within the jurisdiction of respective State Governments. Ministry being an Apex Organization in the Highway Sector makes specifications placed down on codes of practice for all items and activities related to construction of roads and bridges. There is 52010 km length of National Highways in the country distributed over various states. Efforts are made to improve the existing National Highways not only by strengthening and rehabilitation of existing assets but also by constructing new

roads and bridges over missing links, improvement of low grade sections and widening to 4 lanes. The work of modernization of the system through construction of some Expressway is also in progress. With the changing economic scenario, factors such as globalization of markets, international economic integration, removal of barriers to business and trade and increased competition have enhanced the need of transportation. It is one of the most important infrastructure requirements, which is essential for the expansion of opportunities and plays an important role in making or breaking the competitive positioning. Faster movement of goods characterizes a road-based freight transportation system. Goods can be moved in smaller quantities and there is no need to wait for a full wagonload before dispatch. Hence for lighter weight valuable commodities, a road-based system is often more economical. The economic development of the country and the consequent surge in the demand for transport services, and also the strategic needs of the country necessitated expansion as well as improvement of the road network. The country took up this uphill task in a planned manner. During the period 1951 to 1994, the average yearly growth of traffic has been of the order of 8 to 10%. The freight traffic has increased from 6 billion tones kilometers (BTK) in to 800 BTK in last 5 decades upto the year 2000. Such a rapid growth has occurred mainly owing to the flexibility and accessibility offered by road transportation. During the same period, the number of buses increased from 34,000 to 4,25,000. Also the total vehicle population swelled from 3,06,000 to nearly 302,87,000. India is a land of diverse culture and Indian Railways play a key role in not only meeting the transport needs of the country, but also in binding together dispersed areas and promoting national integration. Truly, Indian Railways have emerged as the

sinews of the Indian economy and have reached out to bring together the great Indian family. Railways traverse through the length and breadth of the country covering 63,140 route kms as on 31.3.2002, comprising broad gauge (45,099 kms), meter gauge (14,776 kms) and narrow gauge (3,265 kms). As the principal constituent of the nations transport system, Indian Railways own a fleet of 2,16,717 wagons (units), 44.000 coaches and 7,739 number of locomotives and manage to run 14,444 trains daily, including about 8,702 passenger trains. They carry: 14 lakh metric tonnes of goods and about 14 million passengers daily. Indian Railways have been the prime movers to the nation and have the distinction of being one of the largest railway systems in the world under a single management. Railways being the more energy efficient mode of transport are ideally suited for movement of bulk commodities and for long distance travel. As compared to road transport, the railways have a number of intrinsic advantages. Railways are five to six times more energy efficient, four times more efficient in land use and significantly superior from the standpoints or environment impact and safety. Indian Railways, therefore, rightly occupy pride of place in the growth and development of the nation. Today, the Indian Railways is organised into nine zones and Metro Railway, Kolkata, which are coordinated and managed by an apex body - the Railway Board. The railways in India being a State enterprise, the Railway Board is also known as the Ministry of Railways. Each of the nine zones covers a large geographical area and has a route kilometrage ranging between 4,000 and 11,000.

The Indian Railway system is managed through zones and operating divisions. There are also six production units engaged in manufacturing rolling stock, wheels and axles and other ancillary components to meet Railways requirements. With more than 7000 stations, the Indian Railways is a catalyst of Indias growth and existence. It ranks first with regard to the number of passenger coaches; second in terms of

the employees; and third in terms of freight wagons, number of passengers carried and the number of locomotives. Keeping in view the current trends of economic liberalisation, the Railways is gearing itself for providing better customer services to the passengers and the people involved in goods traffic. In addition, there has been a great emphasis on faster movement of trains which has been possible with the introduction of the diesel and electric hauling of the trains. The Container Corporation of India (CONCOR) deserves special mention for running faster and fixed-schedule goods trains carrying containers. A container train from Delhi to Mumbai now takes less than 40 hours. The Corporation is also providing door-to-door transportation of goods through containers. Information technology and computers are increasingly being used by the Indian Railways to keep a track of movements of goods traffic and to regulate its operation in an economical, optimal and efficient manner. It is also a declaration of the Indian Railway Administration to provide the highest possible passenger care and to continuously strive to improve the standards of services offered. Research, Designs and Standards Organisation (RDSO) is the sole research and development wing of Indian Railways, functioning as the technical adviser and consultant to the Ministry, Zonal Railways and Production Units. RDSO has been reorganized with effect from 1.1.2003 by elevating its status from Attached Office to Zonal Railway to give it greater flexibility and a boost to the research and development activities.

PROFILE OF INDIAN RAILWAYS

Indian Railways operate on continental and gigantic dimensions with nearly:

63140 route kms 44000 coaching vehicles 7739 locomotives 4

2.17 lakh wagons 6850 block stations 15.10 lakh work force 1.2 lakh bridges 16550 manned level crossings 21800 unmanned level crossings 97 loco sheds 50 workshops and production units 318 carriage wagon and coach maintenance depots Rs.52 crores expenditure on staff per day Rs.99 crores revenue expenditure daily

And their daily transport output is approximately:

2 Million Train Kms 14 Million Passengers 1.4 Million Tonnes freight loading 8702 Passenger trains run 5742 Freight trains run

IR virtually carry passenger volumes equivalent to combined population of over 40 countries, everyday! IR's trains cover the round trip distance between earth and moon, four times a day!

PROFILE OF BEST
Bus Depots Bus Stations Total Buses. 25 45 3380

Single Decker Double Decker Vestibule Luxury Air Condition CNG Low Floor Poly Carbonate Midi Bus Routes Passengers Per Day Kilometers Per Day Longest Route Shortest Route Total Bus Drivers Total Bus Conductors Daily Earnings

2868 390 8 0 51 45 2 63 335 42,31,993. 6,48,109. 524 Borivali (E) To Vashi 44 Km 248 Andheri (W) To Ramesh Nagar. 12,800. 10,600. Rs 94,55,415 approx

PUBLIC AND PRIVATE SECTOR COMPARISON IN ROAD TRANSPORTATION

The difference between the companies operating in public sector and private sector

can be seen through more examples than one.

The first and the most important such aspect is empowerment of the employees

both at lower level, as well as managerial level. The most evident difference is in their decision making, flexibility to bend certain rules as per demand. It is the main underlying factor which can be attributed to, for the inability to provide good quality and satisfactory supplementary services of the public sector companies Nor can these companies resort to much customization. This is a major factor that determines the attitude and willingness to work on the part of the employees. On the legal front, the public sector companies have an advantage over their private

sector counterparts that they do not have to undergo the tedious procedure of acquiring various permits and other legal formalities. However on the other hand they also face a problem of too much legal interference and restrictions. Price is a very sensitive issue anyways in the entire industry. While in the private

sector, the prices are set on the demand and can be high when the demand is high; the public sector operators cannot price their services high because it is supposed to be at a highly subsidized rate so as to make the services available to general public at large. The penetration is a major factor that makes a company select its transport service

provider. However, the private sector has a discretion of selecting their roots, locations, penetration. The public sector however has to cover up even remote areas

whether profitable or not or whether it is viable or not. This accounts for major losses in such companies. The very basic underlying purpose of the service sector is service to public at

affordable prices to all. This is also the factor that undermines their competency to face the tough competition from private players and MNCs. The profits are too low to meet high maintenance, marketing and promotion costs.

PEST ANALYSIS - ROADWAYS

POLITICAL/ LEGAL FACTORS The political situation of any country strongly influences any industry that wishes to flourish in the framework of the country. The Heavy Motor Vehicle industry is also 8

affected strongly by the action and decisions taken by the men with authority. Following are some of the problems: 1. Permits: There are basically three types of permits that are required to be taken by any transporter. They are: National Permit This is the permit issued to the transporter, permitting him to

move in minimum 5 states. If more states are to be covered then respectively the permit fees has to be paid. Here the Government takes a consolidated tax payment at the time of issue of permit and thereafter the transporter does not require paying tax at each and every permitted state. It is renewed every six months. State Permit This is a permit allowing the transporter to move freely within a

particular state. The tax payments and the privileges enjoyed are same as National Permit but the only distinguishing factor is that it can move only within one particular state. It is renewed every six months. Temporary Permit This is similar to National Permit but instead of the period of

6 months it is allowed only for 15 days for all the states but the transporter here has to pay individual taxes for each state unlike Consolidated in National Permit.

2. Laden weights On the basis of the size (dimension) and the maximum weight carrying capacity as specified by the truck manufacturers, trucks are permitted on the basis of laden weight. This is regulated under the RTO rules. The standard weight is 12-14 kg of goods per cubic feet. Any weight heavier than this is heavy cargo and lighter than this is light cargo. 3. Check Posts

At the various check posts at every state trucks are to be weighed against the weighing standards to avoid overloading. 4. Depreciation policy The government decides the amount of depreciation that can be charged on the use of Heavy Motor Vehicles. Since corporate and institutional customers normally purchase the Heavy Motor Vehicles, they rely heavily on the depreciation that can be provided for tax shelters since it helps show a lower net profit and higher notional expenses. The increase in depreciation rates therefore can help push the sales since it will spur more Heavy Motor Vehicle buying on account of the tax shelters received. In the past, the GOI changed the depreciation norms to control the tax collection from corporations. 5. Laws and legislations The government is instrumental in the passing of the various laws and acts, which govern the working of the industry, and has a very strong bearing on the success of the industry. The motor vehicle act came into existence in 1989 and had clauses, which if strictly adhered to would have had a great impact on the Heavy Motor Vehicle industry. The Act contains clauses like action to be taken against any person who overloads any vehicle beyond its recommended capacity. This means that any person who would attempt to use a Light Weight Commercial vehicle in case of a Heavy Motor Vehicle would be penalized. This would have surely deterred the defaulters and led to an increased demand for Heavy Motor Vehicles but since this never happened people happily replaced Heavy

Motor Vehicles with Light Weight Commercial vehicles. - Also the clause of disallowing the use of old vehicles would have lead to an increased demand for the Heavy Motor Vehicles. For example it has been estimated that the recent Supreme Court verdict to pull off any vehicle more than 15 years from the road is expected to increase the demand by about 15000 units.

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- Until 1986, trucking was a regulated activity with truck operations restricted to short-haul intra-state transport. Multi-state trucking permits were issued by states, subject to certain ceilings. The ceiling on national permits was removed in 1986, resulting in adequate availability of trucking capacity in the economy. 6. Infrastructure development The government is primarily responsible for undertaking infrastructure activity. A lot of the infrastructure activity relies heavily on logistics and hence freight charges increase leading to an increase in the demand for the Heavy Motor Vehicles used for the transportation like trucks and trailers.

ECONOMIC FACTORS It is a known paradox that the economic condition really affects the economic condition. This is shown by the fact that all the industries in any economy are interconnected and an increase or decrease in the activity of any one industry has a direct or indirect bearing on the activity of the other industries. 1. Trade cycles Trade cycles such as recession or prosperity have a direct impact on road transport services. When there is recession or slowdown in the economy and other industries such as travel and tourism, exports-imports, the level of economic activities are low as a result there is low demand for transportation services such as cargo or passenger transport. This has a direct impact on the operations and profitability of this industry. It is during this time that the transporters need to effectively manage demand and supply and market their services to retain their customers. 2. Pricing The fair prices for passenger and goods transport is directly regulated by government

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incase of public transport like BEST and indirectly incase of private such as cargo or private bus contractors. Incase of private transporters the government fixes the min and max limits for the prices. So government has a direct impact on the price mix of road transport. 3. Fuel Prices The cost of diesel accounts for nearly 40% of the total cost of the truck and so even a marginal hike in the price of diesel, adversely affects the demand for trucks since fleet operators would have to incur heavier expenses on diesel. Earlier government regulated and directly controlled the prices of fuel and thereby had a direct impact on the fuel prices which determined the cost. Thus the price offered by the road transporters was directly influenced by governments pricing policy. Due to this involvement private transporters were aloof from the fluctuations in international fuel prices as the prices were highly subsidized before supplying to the pumps. But after the decontrol of fuel prices transporters have to bear the costs due to fluctuations. If there is an increase in price in the international market it has a direct impact on the prices of these services thereby affecting the prices of basic commodities thereby leading to inflation. 4. Poor infrastructure facilities: This has also increased problems in road transporters especially resulted in the wear and tear of their vehicles thereby increasing the overall cost in maintenance and repairs of the vehicles.

5. Economic Growth The freight industry revenues depend largely on the movement of materials across the country. There is a direct correlation between the movement of goods and the GDP of the country. This would indicate that since there are a lot of goods being manufactured in the country there is a lot of movement of raw materials and finished goods. Hence if the country is in a recession or in a state of boom will determine the demand for Heavy Motor Vehicles in the country

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6. Cost of credit In India, the normal business is conducted on credit basis most of the times. The Heavy Motor Vehicle manufacturing companies need to give a credit period to the buyers because the fleet operators pay off the amount only after a little part of the amount is recovered. Hence when the companies extend credit, they themselves have to incur a cost of credit as the working capital increases. This cost of credit on account of the higher operational capital, reduces the profitability of the company.

SOCIAL FACTORS 1. Strike/War/Communal riots These incidents directly affect the service delivery process. This may result in low demand, loss of property and many cases injury to the PEOPLE customers and employees. 2. Holidays/Vacations This is another time of the year when the road transporter can face low or high demand depending on the sector he is catering to.

TECHNOLOGICAL FACTORS Age of the vehicle P.U.C under the RTO regulations all vehicles over 50 yrs of age are to stop running on roads, taking into consideration the environmental and the pollution factors. The emission of gases from these vehicles is hazardous to the environment.

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Emission based on the distance It has been noticed that the emission factors not only depends on the age but also the distance traveled by the buses and the maintenance of such vehicles over their life. This aspect is completely ignored by the RTO authorities. IT Just as integration of IT in all business activities, transportation sector has not been an exception to it. More and more logistical software are being used for jobs like keeping track of the vehicles on the move, the goods being carried by them, maintaining inventory, organizing database of the customers, maintaining relations with the customers etc.

PEST ANALYSIS - INDIAN RAILWAYS

Indian railway is the backbone of public transport. It has the second largest network of railway lines in the world. It celebrated its 150 years of service this year. From covering a distance of just 33km from Mumbai to Thane to a massive network of 63,800 route km spread across has been a long journey and dedicated service to the nation. Railways is not merely a mode of transport. It is a small revolution in itself which has changed our social, cultural and economic life in a number of ways. It is a symbol of unity in diversity. It runs 14,444 trains everyday and have many costs associated with it, but it is

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not generating the required revenue to bear maintenance costs and the new platforms and stations built. Thus, the PEST Analysis will help us find out the problems associated with Indian Railways and will help to solve them. Doing a PEST analysis will help us to know the political issues affecting Indian Railways, the governmental policies, rules and regulations. It also helps to know how it is affecting the Indian economy as a whole, the socio-cultural issues and the technological advances being made. Let us go further with the PEST Analysis.

POLITICAL ENVIRONMENT Railways are owned and managed by the Government of India and thus profit is not the main motive. It is meant to serve all the sections of society, more so the economically and socially backward regions. The GOI lays down policies to be followed by the employees. The GOI decides the fares but has decentralized certain powers. The General Managers of Zonal Railways are given to finalize tenders and contracts up to a value of 15 crores at their own level.

The GOI has adopted proactive strategies for railways aimed at income generation and cutting costs. Passenger awareness programmes are also being taken up through public announcements, posters, films, etc

The public sector undertaking of Indian Railways such as IRCON, CONCOR, Konkan Railway Corporation has helped to create an international corporate image.

Privatization: the GOI was deciding to privatize the Indian Railway but did not, since the general public started protesting against the decision to privatize, because 15

if the private companies entered the consumers would suffer. We can see the problem Britain is facing by privatizing its railways.

ECONOMIC ENVIRONMENT Conserves foreign exchange: Indian Railways have a number of production units spread all over the country, with modern electric and diesel locomotives and other equipments which they are able to export through aggressive marketing and foreign tie-ups which help to conserve the much needed Foreign Exchange. Indirectly affecting the economy: The Government is not generating revenue from the Indian Raiwlays since it cannot increase the fares and so has to resort to other measures of earning revenue and has to mainly cut down its expenses, only then will it be able to contribute something to the economy. Growing economic burden: To fulfill the demands of growing population, new stations and platforms are build which increases the cost of infrastructure and its maintenance. Thus it can reduce the economic burden by earning revenue through other sources like setting up of LCD projectors on various railway platforms which features

commercials which acts as a source of income. Also, hoardings on the platforms help to generate revenue.

SOCIAL ENVIRONMENT

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Railways have played a very important role in social revolution as it is gradually wiping out the socio-economic disparities and bringing the people of various regions close to each other.

Railways are an environment-friendly mode of transport as it uses the energy more efficiently than road transport.

Its share in total transportation has declined from 89% to 40% in freight and from 70% to 20% in passenger traffic.

Safety: a non-lapsable Special Railway Safety Fund of Rs 17,000 crores is created to wipe out the backlog of replacement of over-aged assets and safety enhancement within the next 5 years.

Social status: It plays a very important role because people choose to go by train which suit their status.

Eg: the middle class would prefer superfast trains like Shatabdi, Rajdhani Express while the poor class will have to travel by the local trains which will take days together to reach the destination. TECHNOLOGICAL ENVIRONMENT The reservation systems have been computerized which helps people to book the

tickets from any station. People can also book tickets on the internet, but people face problems while buying season passes if the computer fails.

There are coupon validating machines on most of the railway stations. Now, the Indian railways have the best of the facilities, improved engines,

machines and technology. 17

Super fast and express trains have been introduced. There are also metro rails in

many cities like Kolkatta, Delhi. The Konkan Railways have developed the anti-collision devices. Better and improved signaling systems. Palace on wheels in Jaipur can be taken as the best example for technological

advancement or innovation.

THE 4Is
The four basic Is, i.e. Intangibility, Inventory, Inseparability and Inconsistency, which apply to all services, are applicable to the transport sector too. These four qualities set services apart from the physical goods. Many a times, these four qualities of services is what makes the service more difficult to deliver and evaluate. However, these should be taken as challenges rather than impediments. Following is a brief explanation of how these factors affect the transport industry Intangibility

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Intangibility means that a service cannot be physically seen or verified. Unlike physical goods, where one can see and satisfy himself of its quality and utility, a service cannot be evaluated in the same way. One cannot decide whether he is satisfied or dissatisfied with a service until he has actually undergone the service delivery process. However, tangibility is very vital in order to help an individual to assess the quality of service. Hence, all service providers strive to provide a physical evidence of their service. In case of transport industry, tangibility is a must, too. As far as cargo transport is concerned, tangibility can be created through good and well maintained vehicles, good condition of warehouses, well furnished and managed offices and a well-trained and well-groomed staff. Of these, the condition of the vehicles is of prime importance because it is the most vital thing that a customer would look for in the service. Well-trained staff would definitely create a good impression in the minds of the customer. Warehouses that are well maintained ensure the customer that his goods are in safe hands. In the case of passenger transport, too, the condition of the vehicle is of primary importance. A customer, who walks into the office of a transporter for enquiry, would definitely form his first impression from the companys office, the way it is furnished and managed and from the behavior of the staff. These are the places where he would look for tangibility of services. In case of railways, the logos and slogans would be tangibles, also the railway stations and how they are maintained acts as tangibles, but a person can judge the service only after he has experienced traveling in the trains. The railway time-tables and magazines also act as tangibles.

Inventory Inventory is usually maintained in case of physical goods to meet unanticipated and unexpected demands, so that the customer does not have to go back empty-handed. But how does one maintain inventory in case of services? In the transport industry, the demand for trucks and other commercial vehicles fluctuates to a great extent. It may be low in one month and there may be a sudden rise in demand, due to various reasons. If the transporter

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does not have the required number of vehicles, he would lose out on business. Hence, what most transporters do, both in case of cargo and passenger transport, is that they own a few extra vehicles (trucks, buses, tempos, etc) which they utilize in case of a rise in demand for them. One may quite rightly ask that what does he do when there is no demand for them? The answer is pretty simple. He leases them out to smaller transporters who need them. This way, he gets to earn rent and his money is not blocked in unutilized capital. Moreover, he also has extra vehicles whenever he needs them. Most transporters maintain their inventory in this manner, i.e. by maintaining a mix of owned and rented vehicles. Over the years, it has proved to be the most feasible solution for maintaining inventory. In case of railways, the demand does not fluctuate to a great extent .The demand exceeds during holidays for which the railways have introduced special trains running during the holidays in order to meet the demands of people and to meet the extra rush. In order to meet the increasing demands of people the Indian Railways is introducing trains almost every month.

Inseparability In case of passenger transport, this factor holds much more importance than in cargo transport. The various reasons being that passenger transport is a part of people processing since it involves more interaction between the customer and the employee. The latter, on the other hand, is more of a form of possession processing, as it is concerned with transportation of peoples possessions. Thus we see that the production process of the service in passenger transportation is more in sync with both, internal and external peoples presence. However, in case of cargo transport, the production process of the service is restricted to internal people. The involvement of the customer is very low in this case. Even though railways come into the category of people processing, inseparability does not play a very important role since the people do not interact much with the employees .The interactions take place only while booking of the tickets, which is further reduced because

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of online ticket booking, bookings done through travel agents, etc. The other interaction is with the ticket checker .Thus even though people are involved in the production process the interactions between the people and the employees is less, while in case when goods are transported by railways the people are involved only to make a contract for the goods being transported.

Inconsistency Inconsistency in services is a major factor that makes evaluation difficult for the customers. Inconsistency means that the same service provided to two different customers may differ, unlike physical goods where all of them can be manufactured in the same size, color, dimensions etc. However, in services, this is not possible because a service is provided by human beings and the customer is present during the service delivery process. These two factors quite obviously, lead to inconsistency in services. But service providers should try their best to maintain a certain level of consistency and certain standard in their services. This can be done by providing certain basic facilities to all customers in case of passenger transport. In case of cargo transportation, the inconsistency factor that comes to light is providing timely and safe delivery of the customers goods. However, it is not always in the hands of the transporter to overcome these inconsistencies. The services of railways are quite consistent since the railways run on fixed routes and predetermined schedules. In case of road transport the services provided cannot be consistent due to factors affecting it like the traffic ,the people etc.

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CLASSIFICATION OF SERVICES
On the basis of Customers Passenger transportation is basically the movement of people from one place to another. Passenger transport could be within a city, a state or inter-state. Buses are both private and government owned. Again the private buses also have to obtain permits to operate throughout the country. These permits have a stipulation that they cannot carry persons below the legal limit at any point of time for travel or tourism purposes. In the public sector government buses run within the city as well as inter-state. These are called ST buses (state transport). In the case of railways, we have general passenger trains.

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Cargo transportation is of three types Liquid, Gaseous and Solid. In case of roadways, the first two are transported through tankers and Solids, on trucks, trailers, LCV, HCV and tempos. However for railways, there are goods carrying trains (maalgadis) which carry all three types of cargoes. Nature of service process On the basis of the type of service activity delivered i.e. analyzing the customer involvement in the production process and evaluation of service process, road and rail transport can be classified into two types: People Processing Incase of passenger transport, the customer involvement in the service process is very important. To receive such a service, customers must physically enter the service systemthey cannot deal at arms length with the service provider. In this peoples co-operation is required while performing the service. It requires physical presence of customers at every stage while transportation. The customer incurs non financial cost such as he spending time, taking efforts to avail the service, etc. Possession processing Incase of cargo transport the service provider transports the possession of the customers. Hence the possession undergoes services. It involves minimum customer involvement. Here, customer is more conscious about the service provided because he is physically absent while the service is being provided. The service provider has to ensure safety of his possessions.

People

Possesion

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Tangible Actions

Passenger Transport

Cargo Transport

Methods of service delivery In this the service is categorized on the basis of interaction between customer and service organization and the availability of service outlets.

Nature of interaction

Availability of Service outlets Single Site Multiple Site Customer goes to service Passenger transport organizations Service organizations comes to customers BEST, Railways Cargo transport

eg.

Railways and BEST provide standardized services to the customers and the customer has to go to the service provider in order to avail the services. People who wish to avail their services can go to the nearest railway station or the nearest bus stop, while in case of cargo transportation the service provider may come to the people to offer the services. Railways also provide customized services to certain companies to carry their goods which directly enter the factories. Nature of demand for the service related to supply Extent to which supply is Extent of demand fluctuations over time Wide constrained Peak demand can be met Cargo transport without a major delay Peak demand regularly Passenger transport eg. BEST, Railways exceeds capacity Narrow

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Incase of BEST its most challenging as demand fluctuations occur on a regular basis and it generally exceeds capacity. It can simply try to manage such fluctuations by managing the frequency during peak and lean periods. Same is the case with the railways where demand exceeds supply on a regular basis. Incase of cargo transport though the fluctuations are wide they can be easily handle with limited capacity as they can hire extra the additional capacity at an extra cost to satisfy the customers. However this cannot always be assured incase of BEST. In case of railways the demand generally fluctuates during holidays which can be met by introducing holiday special trains thus managing the rush.

Attributes of service experience Extent to which equipments are part of service experience Low Extent to which people are part of service experience Low High Passenger transport BEST, Railways(Local High Cargo transport Trains) The Royal Orient, Palace On Wheels, Limouzine Buses, Volvo Buses , A-1 Buses Incase of passenger transport, the extent to which people form a part of the service experience is always high. However, the extent to which equipments are a part, may vary depending upon the kind of service offered. For e.g. In case of Trains like Palace on Wheels, The Royal Orient and other such luxurious trains, the involvement of equipment eg.

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is high because there are more physical facilities offered. The same can also be seen in the case of roadway transportation. In case of passenger transport the people are very much involved in the process of transportation, so they form a part of the service experience to a much greater extent .Same is the case when people travel by railways. On the other hand when goods are to be transported, the equipments and facilities form a very important part of he service experience since people are not at all involved in the process except for asking for the services. So the way the goods are stored and transported and the material handling equipments used form a very important part of the service experience. Thus here facilities play a very important role.

Relationship between provider and customer Nature of service delivery Continous service delivery Discrete transactions Cargo transport Passenger transport Type of relationship with customers Membership relationship No formal relationship

Incase of passenger transport, like BEST, there is continuous demand for their services but no formal relationship is maintained as it is only a one time relationship. However in case of cargo, there is discretion of the transporter to either accept the order or reject it. Also, the relationship with the customers is on a long term basis and is also continuous. . In case of railways the relationship can be formal as well as informal .The services provided are continuous where people may have an informal relationship when they travel by buying a ticket.

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Customization and judgment in service delivery Extent to which customer- Extent to which service characteristics are customised High contact personnel exercise Low judgment in meeting Passenger transport BEST, Railways High e.g. Cargo transport individual customer needs Low

Incase of passenger transport, there are constraints to the transporter in customizing the services, at the same time it is difficult and there are many constraints to the customer to evaluate the extent to which the service is customized. However for cargo, the transporter can customize his services according to customer requirements but it is difficult to evaluate the extent of customization as the customer is not directly involved in the service process. It is the goods that are directly handled by the service provider. The services of railways in case of passenger transport are highly standardized since the railways have to run on fixed routes and predetermined schedules. Trains carrying freight have a type of customized services for certain companies wherein they enter the factories.

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THE SERVICES MARKETING TRIANGLE

The Company (BEST, Indian Railways)

Internal marketing Enabling promises

External Marketing Making Promises

Providers (Employees) Interactive Marketing Keeping promises

Customers (Passengers)

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The service marketing triangle shows three interlinked groups that work together to develop, promote and deliver services .In this case the parties involved in the triangle are the Railways, BEST, (company) ,the general public and industries (customers) and the employees as the providers of the service. The three types of marketing that should be successfully carried out are the internal, external and the interactive marketing which helps in building and maintaining relationships. All the activities revolve around making and keeping promises to the customers. External marketing: Through external marketing the company makes promises to its customers regarding what they can expect and how it will be delivered .The railways make promises to the customers which it communicates through various media. The

slogan of railways Always at your service is external marketing. The service providers must make promises which they can meet. Interactive marketing: Promises made must be met Interactive marketing is the most critical from the customers point of view .Service promises are most often kept or broken by the employees of the firm or by third party providers most often in real time. Interactive marketing occurs when the customer interacts with the employees or staff of the organization and the service is provided and consumed. The moments of truth in case of railways is very less since the customer interacts with the employees only while booking the tickets which encounter is further reduced due to online booking facilities but they are still high in case of road passenger transport. Internal marketing: In order to keep promises the service provider should have skills, knowledge, abilities .tools and motivation to deliver the services. Since internal marketing is based on the assumption that employee satisfaction and customer satisfaction are linked it becomes very important to first satisfy the employees and provide them adequate training so that they are motivated to provide the services to the customers and satisfy them. Railways are giving adequate compensation and training of two months to their employees.

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THE SERVICE MARKETING MIX (THE 7 PS)

PRODUCT
Product mix: It refers to all the product lines offered by the service provider. Product line: A product line is a group of closely related items offered by the service provider. The product line for the railways will be Passenger trains and Goods trains (maalgadis)

Product depth : Product depth refers to the number of items in each product line. Product depth of passenger trains: 30

 Local trains Express trains Fast and super fast trains The metros of Kolkatta and Delhi Tourist trains (palace on wheels, the royal orient) International tourists Product depth of goods trains: The various types of Maalgadis.

Product consistency: It refers to the relationships of the product lines in terms of sharing the end use i.e. customers, markets, prices, etc. Although the purpose of both the passenger and the freight is transportation the consumer segments are different for both, where passenger trains is meant for the general public while the consumers for the goods trains are the industries. The pricing methods are different for both. Services are all the actions and reactions that the customer perceives they have purchased. In case of both goods and services, the core product sooner or later becomes a commodity. Thus there is a need to enhance or augment them with supplementary services which will be the competitive advantage .If this is not done, the firms business will be lost. This is the reason why service firms add supplementary services which act as a competitive advantage for the service.

THE CORE PRODUCT AND SUPPLEMENTARY SERVICES:

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The service provider always offers a package to its customers involving delivery of core product and supplementary services. It is a group of supplementary services added to the core product to make a service package. In case of railways, the augmented product are the supplementary services provided by railways like information, consultation, hospitality, etc.

Provisio n of THE PRODUCT PACKAGE credit

Concessions for certain strata of public

Helping in time Zero Prompt planning the plans waiting Safety of Proper Delivery Goods planning of the complete Brand Service of structure of the name of procedure. Automatic Fare The Core Product: train for easy transportation providerFree For e.g. the Flexibility in collection Brand entry and exit of of people Service the core name of will be Insurance of In case of both roadways product transportation. packaging to operations and railways goods being according to transport of be used, time transportation of both passengers provider where the passengers could be It involves and cargo, goods change in transferred Proper ticket periodSpecial seats for etc those who travel goodsby local trains orCheap daily tourists. dispensation and Helping price of in checking ladies and transported preparing handicapped Acceptabl travel e prices document The Expected Providing Product: persons s loans The expected product refers to what the customer actually expects from the service Softer seats and Payment of provision for provider. The expected product is safety, comfortable seats, best service till the customer Disaster management Octroi Air condition Providing facilities reaches the destination. charges for instant tracking of the truck by facilities like wireless etc 32
Total Total Product Concept For Passenger Transportation Product Concept For cargo transportation

Provisio n of Timeliness online of Safety passengers booking

Provision of online booking

The Augmented Product: It includes the benefits added to the core products to enhance their appeal .In railways the augmented product will be information through the speakers in the trains and also in long distance BEST buses. E.g. Bus Route No 4 ltd, information about expected minutes for the arrival of the train on the railway stations in big cities. A classic example of this would be: PALACE ON WHEEL An extraordinary train for extraordinary people. A train with historic charm and modern conveniences. A royal train beckoning you to step aboard for a week of splendor. It takes you on a royal odyssey. Bringing alive the luxury of princely travel of the age of the Rajasthan. The Palace on wheels has been designed to suit modern needs with central air conditioning, shooting four channel music, interconnected telephone system in the train, a separate pantry and lounge in each coach, comfortable coupes with the privacy of attached bathrooms, two special bathrooms, two special restaurant - Maharaja and Maharani, serving exotic Indian, continental and Rajasthani cuisine, a well stocked bar, a reading and relaxing coach and friendly smiling attendants serving you round the clock. The Potential Product: The potential product is the one, which the service provider can offer to hold the existing customers. Since railways have a monopoly they need not provide the potential product. Although railways are not privatized, they face competition from roadways, thus they need to improve their services. But railways have a good competitive advantage in terms of roadways i.e. railways are much cheaper in relation to road transport .The railway fares are much lower than roadways. In the case of roadways, the potential product would be construction of more and more express ways and developing the overall infrastructure to quicken the time taken for road transportation. The government should aim at reaching the international standards whereby any place within a city should be reachable from any other place within 20 minutes through

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roadways. However we can see this is too far for us to achieve, but the construction of MumbaiPune Expressway seems to be a first step in this direction. Where it takes 3.5 hours to reach Pune from Mumbai in an express train, it only takes 2.5 hours to cover the same journey via this new expressway. This is a good achievement. In order to identify existing supplementary services, it becomes important to develop a flowchart of service delivery which will help the service provider know the gaps between the services. We can observe that in most of the cases, the core products may differ widely, but the supplementary services are almost the same, from information to billing and payment. It is very important to perform these services in a proper manner so that the customer is happy at every stage of the service i.e. throughout the service delivery process. Railways need to provide the customers with all the related information and all the other supplementary services should be provided very efficiently. The service encounter of the customers with the railways begins as soon as the customer inquires about the trains, the timings and also the availability of tickets. Then the customer proceeds with the reservation of the tickets, confirming the reservations, payment for the tickets which may be online or through the traveling agents, followed by the whole journey of the customer till he reaches the destination. Since railways and roadways come into the category of people processing and possession processing services it needs to be accompanied with more number of supplementary services.

THE SUPPLEMENTARY SERVICES IN DETAIL Information

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Whenever a customer buys a service, he needs to be provided with relevant information. Since railways are service oriented or customer oriented, they need to provide customers with information about is services, ticket fares, special trains during the holidays. All this is provided with the help of railway time tables, railway magazines, newspapers etc. They also have inquiry centres which help the customer obtain necessary information and confirm reservations. The Indian Railways have strengthened their information systems continuously. Interactive Voice Response System (IVRS) has been installed at 100 stations and is being extended to other stations, so that passengers can get Train Running position as well as Reservation status, on telephone. The number of incoming calls received in Delhi has increased from 50,000 to 1.25 lakhs per day on IVRS. There are 12.5 lakh hits on the Internet everyday. Indian Railways have implemented the National Train Enquiry System (NTES) where position of Trains Running on Real Time basis is fed to computers after every half an hour in 61 control offices all over the country. Thus, when a train starts from a starting station, position of its running is known, all over the country and is supplied to enquiries and IVRS. Continuous efforts are being made to improve quality of information.

Information is being given on cell phones in Kolkata and Delhi. Availability of reservation and status is also being given on the Indian Railways website www.indianrail.gov.in. They are also planning to give train running position on this site in future.

CENTRE FOE RAILWAY INFORMATION SYSTEMS

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In 1982, Government decided to set up a Freight Operations Information System (FOIS). Later in 1986, Ministry of Railways established the CENTRE FOR RAILWAY INFORMATION SYSTEMS (CRIS) - an umbrella for all computer activities on Indian Railways (IR). They also entrusted it with the task of design, development and implementation of the FOIS, along with its associated communications infrastructure. The Centre started functioning from July, 1987.It is an autonomous organization headed by Managing Director. CRIS is mainly a project oriented organization engaged in development of major computer systems on the Railways. CRIS has acquired special knowledge and expertise in the field of informatics. With such a rich practical experience, a dedicated team of professionals and its own R&D effort, CRIS aims to be a leader in this fast developing field. Indian Railways is one of the most advanced ministries in India, with an innovative and extensive IT environment. The following are the main projects that are handled by CRIS: Passenger Reservation System (PRS) National Train Enquiry System (NTES) Internet Enquiries Booking of Tickets on Internet Unreserved Ticketing System (UTS) In the case of road transportation, information is provided by the various travel agents, who indulge in these activities. The goods carrier companies also provide information about availability of vehicles, routes, capacity, applicable charges, taxes, etc through various mediums like print media; also the enquiry about the same can be done through telephone or even via internet.

Consultation

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In railways, the inquiry centres also act as consultation centers which guides the customers. In roadways, travel agents provide consultation to the customers regarding the choice of vehicles, fare, etc Order taking The booking of the tickets by the railways if done face-to-face should be polite, fast and easy. Railways are now able to provide a better service since they have online booking facilities which help in reducing the service encounter with the customers. After the booking of the tickets, the reservations are confirmed. CONCERT - (COUNTRY-WIDE NETWORK FOR COMPUTERIZED )

ENHANCED RESERVATION AND TICKETING - developed by CRIS is a total networking solution to Indian Railways Passenger Reservation System. Indian Railways computerized Passenger Reservation System (PRS) currently operates from five regional centres located at Delhi, Bombay, Calcutta, Madras and Secunderabad. CRIS was assigned the task of development and implementation of the new software incorporating networking for Indian Railways thereby interconnecting the five PRS centres. The new On-line Passenger Reservation System -CONCERT - developed using client-server model for distributed computing is a total solution to the networking of the PRSs. Thus PRS network of the Indian Railways will enable reservations in any train, date, or class, between any pair of stations to the travelling public on about 2000 terminals across the country. Under the network environment it is proposed to provide "Universal Terminals". Universal Terminals are those from where any reservation activity on network can be done transparently.

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TELE BOOKING SCHEME Rail Credit Card You can get Rail Credit Card, which is issued by Standard Chartered Bank for Delhi only, at present. The scheme will be extended to Bangalore, Chennai, Calcutta, Mumbai, Secunderabad and Ahemdabad in future. This Rail credit Card has all the features of a global credit card and is operated with secret Personal Identification Number (PIN). Many major travel companies like the Raj Travels do their booking via the telephone or even do online bookings. Hospitality and Caretaking When the journey is long, it is very important to provide facilities like washrooms, toilets, good and comfortable seatsat the platforms so that they can enjoy the whole journey. To improve the hospitality they need to prepare a flowchart of service delivery system because the journey doesnt end until the customer reaches the destination. RETIRING ROOMS FACILITIES AT STATIONS

The Indian railway provides retiring rooms at many stations where passengers have a overnight halt or a halt for a few hours. These retiring rooms are air-conditioned rooms with one bed or 2 bed facilities. They even provide dormitory rooms. The best example of hospitality is the Palace on Wheels.

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Safe-keeping Indian railways provide enough space to take care of the customers luggage .The trains have space above the berths where the customers can keep their bags .There is also a disadvantage, because all the trains do not have these facilities. In case of trains carrying freight this is not the case, since the whole train is meant for the goods and has the necessary facilities. Exceptions There are no exceptional cases in case of railways since the services of the railways are standardized. These trains run on fixed schedules and predetermined routes. Refunds in exceptional cases, legal settlements. TATKAL RESERVATION SCHEME Tatkal means urgent. For the benefit of the genuine passengers who plan their journey at short notice, a Tatkal Scheme for reservation has been introduced on Indian Railways. This facility provides confirmed accommodation to the needy passengers on payment of nominal premium on first come first serve basis. There is a premium to be paid for getting reservations against Tatkal Quota. Tatkal Scheme reservation starts only from one day in advance at 8.00 hours. After preparation of charts, the reservation in Tatkal coaches will be done on the current counters specifically earmarked if berths are available. For getting reservation under this scheme the passenger has to produce a photo identity card/Credit card with proper serial number or a voter card with photograph of the passenger or a driving license or a Ration card with photograph. The identity card number of the passenger will be printed on the ticket as well as on the Tatkal coach reservation charts. No refund is permissible against confirmed tickets issued under this scheme.

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The passengers booked under this scheme are required to carry the same identity card/credit card on which the Tatkal reservation has been obtained, as the same is checked by the checking staff during journey, failing which they will be treated as travelling without ticket and charged as per extent rules. At present the system has been introduced in certain selected trains only. Billing and Payment As soon as the tickets are booked by the customer they need to make the payment on the spot, but it depends on whether the customer physically comes to the stations for reservations or they are booking the tickets online or through the traveling agents. Major credit cards are accepted by travel agents nowadays.

PRICE
In the Indian setting, where the uses of transportation services have high expectations, with limited paying capacities, the task of formulating sound pricing strategy is found much more difficult. In case of public transport, companies have been facing the problem of cost price squeeze. They have no freedom while adjusting and deciding on the price structure or tax rates in both cargo and passenger transport. Penetration Pricing Penetration pricing is a strategy in which new services are introduced at low prices to induce trial and gain widespread acceptance. The strategy is useful when: 1. The demand for the service is price sensitive even in the early stages of introduction 2. It is possible to attain economies in unit cost by operating at large volumes 3. The service is highly vulnerable to intense competition. 4. There is no class of customers who are willing to buy more of the service

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Cargo Cargo transport is a very price sensitive industry. There is usually high fluctuation in demand which is an implication of recession and prosperity phases. At such situations the price is highly demand driven. There is no other single factor, more influential than this one. This is evident from the fact that the pricing cannot be cost-driven (i.e. fuel, labour, inventory, maintenance, etc.) at all. This exists even when they are running into heavy losses. Only those who are highly efficient or those who find means to break laws are the ones who can sustain the losses. Few steps that can be and are being taken are hiring vehicles during peak demand and leasing out during sluggish demand. The method of fixing price: In the transportation industry they follow a golden rule for the determination of price for both people transport and cargo transport. This is common for both railways and roadways. To understand this methodology let us consider a hypothetical example. Let the route be A to B and let a, b, c, d, e, f, g, h, I, j, k, l, m, n be the halts each at a distance of 1unit from the last halt. The same is diagrammatically expressed as follows:

STAGE I

STAGE II

STAGE-III

A a b c d e

f g

h i

j k

m n

Fig. : Route map from A to B

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Now this is the route map showing the route AB (15 units) comprising of 3 stages Ag( 7 units); gk( 4 units); kB (4 units). The prices shall be determined on the basis of the stages. Lets say the minimum fare price for a distance of 7 units is Rs. 7.00 so the price of ticket from A to any destination upto g will be Rs.7.00. Lets us further assume that the price from A to k is Rs. 9.50 ( It cant be greater than or equal to Rs.11.00 because as the distance increases the prices also rises but in a lesser proportion ). Similarly the fare for a journey from A to B has to be less than Rs. 12.00 using the same principle; lets say it is Rs 11.00. Generalizing the above example, we find out that the minimum fare from any place upto a distance of 7 units is Rs 7.00 (may it be from a to d or f to h ) then, progressively for the next 4 units it is an additional Rs 2.50 and Rs 1.50 for the next stage of 4 units of distance. Further as the distance goes on increasing the price increment will be lesser in proportion to the price for the last stage. Finally after one stage the increment will stabilize to a standard rise. Thus we can infer that while fixing prices the cost is not taken into account. This is one of the most important reasons for the BEST. to run into losses. The variants such as the price of fuel, labor, maintenance, repairs, etc. do not show a direct effect on the fare rates. Thus, as a measure to cover costs and earn revenue, BEST provides space for advertisements behind the ticket and also on the outer body of the bus. All the pricing policies are discussed and finalized by the Central Government. And in the case of Indian Railways the Ministry of Railways determine the fare in the Parliamentary budgetary session. Generally these rates are fixed for a period of 5 years but however, they can be revised in between. At present, the minimum fare charged by BEST is Rs 3 for ordinary buses and Rs 3.50 for ltd buses. The maximum fare is Rs 20. Presently Indian Railways follow administered uniform prices for entire network. They have to resort to dynamic pricing (In truck industry in India daily price is published in papers.) not on cost plus basis but based on market prices for similar products. The basic principle for pricing should be based on two things: Peak pricing and off peak pricing and Prices should be linked to product features for each service product. 42

PLACE
A very obvious and effective manner for wider reach and deeper penetration is to have more pick-up points for customers and cargo. In case of Cargo another important factor is the availability of good warehousing facilities. That is to say that a customer may require to store the goods for some time between two places. The transporter, in such cases, should be in a position to provide good warehousing facilities to his clients. In case of passenger transport, customer requires more pickup points closer to their houses. Thus, efforts have been initiated to built more and more railway stations near small villages. And in case of roadways the idea is to have bus stands which is easily accessible by everybody. However achieving the above is difficult with lack of infrastructure facilities in India. Bad condition of our roads, which become worst during the monsoons, proves to be a major impediment that restricts the scope for achieving these targets. This can be done effectively only when our basic road infrastructure improves. And to set up railway track in all the regions faces various geographical hurdles for the same.

PROMOTION
It says We make the journey of life more comfortable. Promotion not only means selling but also creating awareness about your services through various advertising campaigns, various communication materials, and also by using various media mix. In order to sell the services in the market you need competition but Railways in India is not facing competition since it has a monopoly and the services are also standardized.

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Promotion means making the general public aware of all the services provided by the service organization. For Indian Railways, people are already aware of the services provided by it. Railways is in fact the lifeline of India. It makes aware of its services to the general public through all possible ways and through all possible Medias. The main objective of Indian railways is to make the people aware of all the services provide by it so that the people can make full utilization of the services i.e. it can exploit these services to the fullest extent. Railways, apart from the general public also have promotional programmes for their employees to motivate them so that they can serve people better. It conducts a special two months training programmes for these employees .They motivate the employees to write articles in the internal newsletter which are meant for internal promotion. This newsletter is named Spectrum. The employees who wish to write articles in the spectrum are encouraged and the articles then go to the PRO who decides on which articles will be published and which will not. It has always been a saying that Some amount of promotion should be targeted towards the employees so as to motivate them to serve the customers better. In the execution of any kind of consumer promotion scheme, one should carefully consider the six basic elements i.e. the product scope , market scope, value ,timing, identification of beneficiary and protection against competition. But these elements cannot be applied to railways till the time it is enjoying a monopoly .Railways make people aware of their services through newspapers, magazines ,T.V. on the railway stations, etc. They have special issues of railway magazines for the public. Whenever a new train is introduced by the railways it informs the people through various media. Announcements are also made on the railway stations almost ten to twenty days in advance so that people can make use of the service.

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Recently there was a one hour programme on NDTV about the services of the railways and its facilities all over India and its vast network also describing its social importance to the public. Indian railways also have their own online fan club association known as Indian Railways Fan Club Association where they provide information about the innovations, new technologies and even encourage suggestions and feedback given by their members. Public Relations And Publicity: Public relations and publicity also play a major role in promotion of services. Now-a-days service industries are concentrating on public relations as an important tool for promoting its services. Railways undertake many public relations activities. They are as under: Media relations

Whenever an accident takes place on any railway line , the PRO is informed about the incident who in turn sends the rescue teams to the accident site and after knowing all the 7facts , informs the media and the press. He gives all the necessary factual information to the press and other media .In this case they need to take care that the media gives the right kind of information to the public and for this reasons they need to maintain good relations with the media. At such times the PRO informs to open customer inquiry centre. Editing

The PRO also performs functions like editing where he decides which articles are to be published, those written by the employees. He also decides on the motivational programmes for the employees.

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Participation in the trade fairs and exhibitions:

The PRO of the railways participates in the trade fairs and exhibitions held in India as well as abroad. It promotes its locomotives, wagons, etc in the international market through these trade fairs and exhibitions. This is one way of making the people aware of the services of the railways internationally .Many such PR events are organized all over India and abroad. After completing 150 yrs of establishment of the Indian Railways, they came out with - exhibition on wheels an exhibition inside the train. Thus it can be seen that Public relations turn out to be the most important and effective tools for promotion of any service.

PEOPLE
Employees In any services, the personnel interaction with the customer is very necessary and it strongly influences the customers perception of service provided. In the case of BEST, the personal interaction between customer and the firms employee is only while taking tickets; similarly in railway the interaction with the personnel is limited i.e. while doing reservation, pantry car employees and the Train Ticket Examiner (TTE). In order to give maximum satisfaction to the customer it is very necessary to recruit right people for the job. Therefore the management faces a tremendous challenge in selecting and recruiting these people. BEST and Indian Railway give advertisements in the newspaper which specifies the eligibility for that particular job. Training and Development is very essential for the employee inorder to increase the service quality. The same is done by BEST, it gives 2 months training at Dindoshi Depot to all bus drivers and conductor. Another interesting part is that the staff (bus driver and conductor) get rewards if they dont have any accidents for atleast 5 years. They are rewarded with a medal. After

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completing 25 years of service in BEST they are rewarded with a wristwatch. All the working staff of the BEST get free traveling in the BEST buses. In Indian Railway, they have several zones like Mumbai, Delhi, Kolkatta, Chennai and Secunderabad. All these zones have zonal training centres, which gives training to freshers. They also have a Basic Training Centre that gives training of technical service. This training may extend to a period of 12 months. At CST they have a staff recreational library which enables employees to make use of, during shift hours and halts. Both of them have their inhouse journal inorder to motivate their employees. After every 6 months Indian railway comes out with their Inhouse Journal called SPECTRUM. RAILWAY RECRUITMENT CONTROL BOARD (RRCB): Railway Recruitment Control Board (RRCB) was set up in 1998 in Railways (Railway Board) with the objectives:

the Ministry of

Of formulation of policy in regard to recruitment procedures. To monitor the activities of all Railway Recruitment Boards (RRBs) including To evaluate the performance of RRBs and advice them on priorities as required. To organize a management information system for monitoring work done by RRBs

expenditure incurred for recruitment.

A total overhaul of Railway Recruitment Boards has been undertaken and the quality of staff being recruited has correspondingly improved. A total transparency in the system has been brought in by computerization and abolition of interviews. Complaint Handling Method Surprisingly both these sector have a very similar method of handling customer complaints. BEST has a more systematic way of handling customer complaints. The main source of receiving complaints is from periodicals and newspaper. At the same time personal letters is also playing an important part for the same. They collect all the possible complaints from newspapers daily, sort them and are dispatched then to the

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concerned department. They slowly but surely try to reply to the received complaints and if possible try to make the necessary changes, which are replied through newspapers. In the case of railways, they have a separate organization set up known as the Public Grievances Organization. This organization is responsible for redressal of all the complaints. The complaints are handled at zonal and divisional levels. The sources for these complaints maybe either direct or indirect, viz. telephones, newspapers, etc Customer In BEST, they have variations in the fares for certain categories of people. Students uptil Class 12 or uptil the age of 18 years, whichever is earlier are eligible to seek concessions in their bus ticket fare. For the same, they have to fulfil certain formalities and get a students concession pass issued from various depots all over the city. For the blind people, tickets are issued to them at half the price. For the other physically challenged people they have only reserved seats. Also there is reservation of seats for women and senior citizens. If in case, a passenger has any complaints regarding the conductor or the driver, he must just note down the bus number, and the conductor/drivers batch number and report the same to the BEST office.

PHYSICAL EVIDENCE
Physical evidence refers to all the physical facilities provided by the service provider or the service organization to convey the message to the target audience .It helps the customers to evaluate the services. Since the services are intangible, the customer cannot see the service but can depend on the tangible cues like the facilities, communication materials, objects, employees, other customers, price, etc to evaluate the services.The physical evidence provided by the railways are the communication materials like the railway magazines, time-tables and also the stations, the trains form a part of the physical evidences.

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It is said that physical facilities are important in facilitating the delivery of

services.

For e.g. When a passenger travels by train ,he not only wants to reach the destination but also enjoy the entire journey .This is the most important reason why physical facilities form an important part because the customers/passengers experience is greatly affected by these physical facilities. For e.g. A passenger may irritate the co-passengers in the whole compartment, this affecting the experience of the fellow customers or the co-passengers. The servicescape in railways would be the trains; the seats etc.The stations would form the exterior tangibles/physical facilities, while the seats in the trains would form the interior tangibles/physical facilities. The service organization, while providing tangible cues should know its target audience .For e.g. The Palace on Wheels of the railways is targeted to the rich and elite class of people. The ambient factors in case of the railways are the stations, the reservation counters, etc. The design factors are the trains, the seats, etc. The social factors relate to the interactive environment comprising of people. In railways it is the interaction of the passengers while booking the tickets, or while making some inquiries. It also refers to the passengers and the co-passengers. The service environment has an impact not only on the customers but also the employees which makes it necessary to provide tangibles to the employees. The Bholu Guard To celebrate its 150 glorious years of service the Indian Railways have released its mascot, Bholu-a young and energetic elephant dressed up elegantly as a guard.Symbolising the size and strength of the mammoth Indian Railways. Bholu projects the big and friendly image of the railways.

In case of roadways, tangibles are: Good quality seats

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Eatables Route maps Road directions on highways Television and music in deluxe buses Travel magazines and newspapers (comics, puzzle books, etc) Instructions to be followed during emergencies

Service encounter It is a period of time during which a customer directly interacts with the service provider. It may be the interaction between the customers and the service equipments or the interaction between the customers and the service personnel or the employees. The service encounter in railways between the customers and the employees is very less. The customer may interact with the employees only while booking the tickets, while if the booking is done online then even this interaction will not be possible. The other interaction can be the interaction between the passenger and the ticket checker. So the number of interactions between the customers and the employees is the least i.e. the moments of truth are very less.But the critical incidents turn out to be many since the customers experience is greatly affected by many other factors like the facilities, the booking services, then interaction with the co-passengers etc. Blue-printing of services Blue-printing of services is not possible since the services are delivered on the spot. Blue-printing is done to Identify the critical incidences Avoid service failures Balance quality and productivity.

Role of other customers in the service encounter Railways is meant for general public and the services are standardized and the customers

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are not targeted considering their age groups and other factors .Thus all types of passengers travel by the local and passenger trains and all types of critical incidences are possible mainly because of the co-passengers.

PROCESS
Numerous customer interface processes / management processes exist in complex railway systems for example Reservation Process Refund process Claim process Communication process Entraining / Detraining process Loading / Unloading process.

These are the different processes where the customer is a part of the service. He has service encounters with the service provider all throughout these processes. The basic principle to follow is to mechanise, rationalize and simplify the processes but there is no need to over capitalize. The time taken for all these processes is very critical and hence should be kept to be minimum possible. This is a major determinant of the overall service experience. In case of roadways, the actual delivery steps the customer experiences or the operational flow of service serves as evidence, on which the customer makes his judgment about the quality of service. In the case of transport services, process constitutes -the time of arrival of the vehicle at the appointed place, the time taken to load cargo in the vehicle & the safety assured to the service hirer. Transport services are one of the few services, which if they fail, can cause irreparable damage to the customer & the transport operators reputation.

THE FIVE QUALITY DIMENSIONS

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RATER These are the five dimensions that need to be considered while providing quality service. 1) Reliability: It is the ability to perform the promised service dependably and accurately. The customers believe that the services of the railways are quite reliable because they are using its services since many years. The services of the BEST are also very reliable as inspite of heavy traffic in the city of Mumbai the buses do run on time. However, due to the recent bomb blasts which have taken place in the buses, may not affected the commuter traffic but they are surely gripped with this fear at the back of their mind.

2) Assurance: It refers to the knowledge and accuracy of the employees and their ability to convey trust and confidence. This dimension is of great significance when the customer perceives high risk and is not sure of the outcome. In case of travelling or transportation of goods through roadways or railways the customer does not perceive a high risk as the railways is the safest mode of transport .The railway employees are well trained to handle all types of situations.

3) Tangibles: Tangibles are the appearance of physical facilities, equipments, personnel and communication materials. The customers evaluate the quality of services on the basis of tangible features. Thus the service providers should provide tangibles. The mascot-Bholu guard of railway can be termed as the most important tangible which stands as a guard to protect the people apart from the time-tables, the railway magazines etc.

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4) Empathy: It is the ability to provide caring individualized attention that the firm provides to its customers. Although the railways provide a caring service to the people it does not provide customized services. Since a very large amount of people travel through railways it becomes very difficult to keep personal tracks of the people.

5) Responsiveness: It is the willingness to help people and provide prompt service. The railways and BEST respond to the complaints of the customer but the response is not prompt, but it shows that they are willing to help the people.

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RECENT INITIATIVES FOR ROADWAYS AND RAILWAYS

Special Railway Safety Fund (SRSF)

A non-lapsable fund of Rs.17000 crores has been set up by the Government with effect from 1.10.2001 for replacement of overaged assets viz track, bridges, rolling stock, signaling gears and for some safety enhancement works. Over 16000 kms of track, 2700 bridges, 1500 signalling installations will be replaced, renewed or rehabilitated by 2007. These overdue assets had accumulated over the years for inadequate allotment from Depreciation Reserve Fund. Anti-Collision Device (ACD)

The indigenous development of Anti-Collision Device is a historic milestone for the Railways. It will unfold its full potential in the few years in conjunction with track circuiting and data-loggers. Extensive field trials of the revolutionary invention by Indian Railways have been successfully conducted from August, 2002 to January, 2003. The project is now at take- off stage. Provision and installation of ACD over 1750 Route Kms and ACD survey for 10,000 kms. have been included in the Budget proposals. The approximate cost is Rs.190 crores for already sanctioned and proposed works of ACD, of which work Rs.50 crores, over Northeast Frontier Railway is already approved. Continuous Track Circuiting between Stations

To facilitate detection of discontinuity of rail, rail fractures and cases of vandalism and sabotage, projects of continuous track circuiting costing about Rs.425 crores have been included in the Budget proposals for 2003-2004 on selected sections of A, B & C routes. This will be a major achievement, as at present only 1375 Route kms. are working with continuous track circuiting with automatic signalling system.

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Introduction of tight lock Central Buffer Coupler and anti- climbing features on coaches

Tight lock couplers are being introduced in place of screw couplers. In case of an accident, these couplers do not permit the coaches to separate and climb over each other and thus minimising casualties. In case of accidents, the anti-climbing property of these tight lock couplers almost eliminates the chances of a pile up such as the ones witnessed in the past in Firozabad, Gaisal, and Khanna accidents etc.

An accident of a train provided with tight lock couplers, not permitting the coaches to climb over each other. Disaster Management System

The system of disaster management on the Railways has been in place for over 100 years. It has been thoroughly reviewed and a plan has been made out for total overhaul of the existing infrastructure and for mitigation of disaster. The recommendations made by the high-level committee have focused on adopting `Golden Hour' rule, augmenting Accident Relief Trains and Accident Medical Relief Vans, formation of crack rescue and relief teams and intensive training in Disaster Management. BEST has a 24 hrs Bus Running Control. It is located at Dadar. This department is set up to meet with the emergencies, problems, urgencies, disasters, etc.incase of any

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mishap, the bus conductor informs the Bus Running Control Department, which further passes the information to the local police, ambulance and also sends their breakdown vans to the accident site. Empowering Safety Department

Safety department has recently been empowered with `teeth' in deciding the administrative actions against the staff/officers causing accidents or committing safety- related failures. Safety funds

Indian Railways has started a new fund known as SAFETY SURCHARGE FUND from the ticket. In this small amount of your fare is transferred to the safety department. The money collected from this fund is utilized for various safety purposes like renovation and maintainance of tracks. In second class, out of the ticket fare, a surcharge of Rs1 is transferred to the safety department while in long distances a surcharge of Rs 10 is charged. They also came out with a unique campaign known as SAFETY SAMVAD. In this public was made aware of the recent bomblast happened in train and safety measures adopted by Indian Railway. Through public paintings and hoardings they made people aware of the steps to be taken to avoid any such incidents in future, thereby ensure customer safety. Anti-Sabotage measures

Following steps have been taken to reduce sabotage related accidents: (i)Development of anti-theft fitting and fastening.

(ii) Elimination of fish-plated joints by welding of rails

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(iii) Patrolling of track in the sections identified as sabotage prone, specifically on important bridges, deep cutting, tunnels and their approaches (iv) Burring fish-bolts on vulnerable sections Modernization of Bridge management system

The bridge management system will be modernized in association with leading specialist agencies with emphasis on use of non-destructive testing equipment. Innovative and modern technologies for faster rehabilitation of bridges such as Helifix grouted steel anchors are being introduced, which do not require any speed restriction. Funds for rehabilitation of bridges have been increased from an annual average of Rs.59 crores prior to 2001 to Rs.310 crores in the year 2003-04. Crashworthy coaches

Indian Railways have embarked upon a project to make the passenger coaches crashworthy. This would ensure minimum risk to the travelling public even in case of the worst railway disaster. Coaches are being redesigned without any sharp corner in the interior, duly padding up vulnerable areas. Fifty-one modifications to coach interior have been adopted to minimize the chances of injury to passengers from sharp edges, corners or protrusions within the coach. Most of these modifications have already been adopted for new coaches. The periodic overhauling workshops will also adopt these modifications fully within next six months with the aim of modifying all coaches within next two years. In addition, to improve external crash worthiness of coaches, the coach bodies will be redesigned so that the coach ends take the full impact of the collisions and the entire impact will be dissipated in the non-passenger carrying areas.

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Prevention of "roof travel" Quite often, roof travel had resulted in passengers falling off and succumbing in the process. Nine modifications have been carried out on the end walls of coaches to prevent passengers from climbing on to the roof. The passenger emergency alarm resetting valve has been lowered down to enable the train crew to reset the same without having to climb up. The ladder provided for doing so has also been removed as it was assisting the roof-top travelers. Strengthening of Railway Protection Force and Railway Protection Special Force This will be done by recruiting over 3500 constables through RRBs during the year 200304. Safety Organization

Safety organization has been made broad-based. Earlier, Safety organization was manned mainly by officers of traffic department. Now it has also been decided to broaden the base of safety department, by opening it to five major disciplines on the Railways. Display of reservation charts

Recently a system has been developed for displaying the reservation charts of the train involved in an accident on website in order to pass on immediate status of passengers on board. This is the fastest means of communicating updated position of the passengers

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Introduction of ATMs

The Indian Railways have started Automated Teller Machines (ATM) from May 2002 on trail basis in CST. Through these machines you can confirm a season ticket without actually paying the cash. All you need is a credit card of State Bank of India. However, the performance of these machines isnt quite satisfactory. The machine has connecting problems and it hangs. Introduction of Vending Machines

From 15 August 2003, Indian Railways have also started a Coin Operated Vending Machine only in CST which is only for platform ticket. In this you can get a ticket by depositing the exact fare of the platform ticket through coin. Reduction In Travel Time

From 1 July 2003 they have taken steps to reduce the travel time. Whereby, they have increased the speed of the train and also reduced the halt time at every station by 3 seconds. Blocking the space under the last seat in BEST

After the recent Ghatkopar Bomb blast, the BEST authorities have taken this initiative of packing the space under the last seat in the bus, so as to prevent the anti-social elements to use the same for the wrong means.

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OUR SUGGESTIONS
After an in depth analysis of the transport sector, we have thought of a few steps that can be taken in order to improve the existing service levels and integrate into logistical service providing firms. They shall prove to be beneficial not only to the service provider, but also to the customers at large. Increase in the number of superior quality of buses furnished with modern amenities and facilities. They should introduce electronic systems in the buses which would show the next stop and any other necessary details. Introduction of new design of bodies for buses and trucks maintaining the safety provisions and adequate accommodation. Expansion of transportation facilities to and fro to the tourist resorts. Concentration on the national highways and linking the lateral roads with the highways. Speeding up in the construction of highways. Expansion of insurance facilities to both the goods and passengers transportation services. Making provisions for civic amenities and facilities at the bus stations and railway stations. Behavioural training to the front line staff to make them aware of the instrumentality of behavioural management in promoting the business.

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Offering a package during a particular season keeping in view the needs and requirements of different segments of users.

Developing shopping complexes at the important bus stations. Cushioned seats for more comfort to the travelling passengers. Intensifying the safety provisions and strengthening the protective measures to protect the passengers, vehicles against robbery and snatching.

Due to inability to generate adequate cash flow, the numbers of over aged buses in the fleet of the STUs are in great numbers. Good maintenance and timely disposal of such vehicles is a very good option.

Introduction of seat belts in luxury buses to ensure safety. The railway bogies should be maintained well and kept clean and hygienic, especially the washrooms.

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FEW UPCOMING ROAD PROJECTS

BANDRA WORLI SEA LINK PROJECT

BACKGROUND Bandra Worli Sea Link Project has been one of the most highly recommended project of all the transport studies done for the metropolitan region during the last thirty years. At present, Mahim Causeway is the only link connecting the western subways with the island city of Mumbai. Therefore this existing North - South traffic corridor is very congested and during the peak hours results in a bottleneck at Mahim Causeway.

Construction of the project link will provide an additional fast moving outlet from the island city to the western suburbs & thereby providing much needed relief to the congested Mahim Causeway. This link will also form a part of the western freeway.

THE EXISTING PORTION.

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THE IMAGE OF THE PROPOSED FLYOVER

FEATURES The new link will be a eight - lane facility for the exclusive use of fast moving vehicles with limited access (only four wheelers and above). 2 lanes are proposed to reserve for buses Considerable savings in travel time due to increased speed and reduced delays at intersections Modern toll plaza of 16 lanes with automated toll collection system. The link is developed as a "Intelligent Bridge" with a "State - of - the - art" system for system monitoring, surveillance, information guidance and emergency support. Single tower supported 500 meters long Cable Stayed Bridge. Viewing gallery located on top of a 158 meters high tower with capsule elevator will be the new tourist attraction of Mumbai. Development of Water Transport Terminal at Bandra, for approach by boats to capsule lift located at tower base. Development of promenade and landscaping to enhance the environment.

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A minimum clearance of 20 meters will be provided below the main spans for marine traffic State - of - the - art technology used for construction Emergency crossovers and Disaster Management Program.

PROJECT BENEFITS Savings in vehicle operating cost to the tune of Rs. 100 crores per annum due to reduction in congestion in the existing roads and lower vehicle operating cost on the bridge. Considerable savings in travel time due to increased speed and reduced delays at intersections at existing roads. Ease in driving with reduced mental tension and overall improvement in the quality of life. Improvement in environment especially in terms of reduction in carbon monoxide, oxides of nitrogen and reduction in noise pollution in areas of Mahim, Dadar, Prabhadevi and Worli. Project to have no adverse effect on fisheries, marine life and livelihood of fisherman. Reduced accidents. Proper landscaping measures along the approaches and promenade along waterfront to enhance environment of the area.

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MUMBAI TRAFFIC IMPROVEMENT MEGA - PROJECT (THE 50 FLYOVERS PROJECT)

INTRODUCTION In Mumbai city there is a urgent need to cater for the traffic specially quick entry and exit from the city. The industrialization and growth of traffic has resulted into congestion which has raised the pollution at various traffic junctions. MSRDC has aimed to alleviate the traffic congestion in the city of Bombay or Mumbai by constructing 50 flyovers. The attempt is to maintain a highway character of the important roads in the city and also to reduce congestion at key junctions. APPROACH Flyovers are located on major traffic corridors, namely:

Sion - Panvel Expressway Western Express Highway Eastern Express Highway Major roads in Mumbai city

The flyovers are planned with a corridor development approach. This fast corridor will make it possible to move from Thane, Vashi or Borivali and reach South Mumbai faster.

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TECHNOLOGY Latest technology used for the construction will make the quality of construction of high standard and also minimize the time factor for the completion. The tender condition for incentive for earlier completion and penalty for delayed construction are helpful in maintaining strict time schedule. ESTIMATED COST The total cost of project is Rs. 1500 crores which will be financed from resources mobilised through bonds, loans from MMRDA, financial assistance from PWD, MCGM and TMC. By adopting advanced technology, modern machinery and simplified tender procedure, saving is resulted in project cost. Till today 36 flyovers are completed and 2 flyovers works are in progress. Travel time on three highways in Mumbai is reduced by 20 to 25 minutes. To recover the cost of the project, Government of Maharashtra has authorized MSRDC to levy a toll on major roads at five locations in Mumbai. SUBWAYS Government of Maharashtra has entrusted work of construction of 5 subways to MSRDC. These subways have been constructed as part of flyover program. The work includes Subways at :

Chembur on Eastern Express Highway Kurla on Eastern Express Highway Rajaram Nagar on Western Express Highway Agripada on Western Eastern Highway Mankhurd on Sion Panvel Road

All the above said have been completed and opened to pedestrians. The subways are constructed by box pushing technology and completed within the period of 10 to 12 months.

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