1 Module 5 Transit ManagementOrganizational Models and Transit System Stakeholders
2 Overall Context Transit management is highly varied in terms of organizational models and the specific functions performed. This variety reflects transit’s unique challenge to be efficient and businesslike, but also to provide a public service. Different organizational models and structures also reflect the history, funding, and politics of transit in each region.
3 Learning Objectives Recognize the various organizational models among transit systems List the various functions performed by transit management Describe how management interacts among various internal and external stakeholders, and how the interests of those stakeholders may conflict with one another. Explain what ethical challenges are faced by a transit system CEO. Effectively use statistical indicators to measure and benchmark transit system performance. Identify the role of organized labor in a transit organization.
4 Organizational ModelsManagement reports to a board of directors Management reports to a state, regional, or local agency Management reports to an independent Administrator Transit operates as a municipal or county department Some transit operations are outsourced to a private operator or operators Full turnkey operations Transit operated by social service agencies in small urban and rural areas Boards are typically appointed, but there are some places where board members are elected, or where elected officials serve in an ex officio capacity. When a transit authority service area covers a number of municipalities, it is common for each to be represented, usually with proportional voting. Interesting statistics regarding the composition of transit boards of directors: 11% of transit systems do not have a board, 60% of boards are composed of appointed volunteer citizens, 17% are elected officials only, 5% are a combination of elected officials and appointed citizens, 3% are directly elected, and 4% are appointed by non-elected officials (need source). Transit is managed statewide in Maryland, Delaware, Rhode Island, and New Jersey with a hybrid arrangement in Connecticut. Transit management in Minneapolis-St. Paul reports to the Metropolitan Council, the regional MPO. Management reports to Administrator: This is the model for all regional transit authorities in Massachusetts (except Boston). San Francisco MUNI and Dade County, FL are examples of transit operating as a municipal/county department. Denver RTD; paratransit in many cities is outsourced to private contractors North County Transit outside San Diego and Las Vegas are examples of full turnkey operations.
5 Typical Board of Directors FunctionsResponsible for overall policy direction Determines the organization’s mission, vision, and purpose Sets policy; defines and measures success Adopts important program strategies; sets fares Adopts the annual operating budget and work plan Adopts capital plans Maintains communications with elected officials and other external stakeholders Adopts ethics policies Hiring of transit system CEO Acts as the “Voice of the Owners” This comes from a board of directors’ training program developed by the RGRTA (Rochester, NY).
6 Sample Means/Ends Mission Statement[From the Rochester-Genessee RTA] MEANS MISSION: To be a responsible employer, providing quality transportation services in a cost- efficient manner. ENDS MISSION: To provide efficient, sustainable, public transportation that takes people where they want to go when they want to go there, with a commitment to customer satisfaction and to maintaining reasonable fares. Mission statements reveal organizational values. Note the emphasis on cost-efficiency. As we’ll see when we talk about performance measurement and benchmarking, the RGRTA board and its CEO will need to strike a balance between efficiency, effectiveness, and quality measures. For example, no transit system can possibly be cost-efficient if it is truly “taking all people where they want to go whenever they want to go there.” On the other hand, a system can make itself more “cost efficient” by eliminating late night and weekend service, but doing so may significantly undermine the duty to serve the transit-dependent population. Mission/vision statements are aspirational. Good class exercise is to compare and contrast mission/vision statements from several transit systems. Do they focus mainly on operations (“Our mission is to operate buses in an efficient, safe, and reliable manner”) vs. focused on transit’s role in the community (“Our mission is to provide mobility in a manner that enhances regional goals for improving air quality, reducing traffic congestion, and conserving energy.”)
7 Transit Management FunctionsThe actual functions performed by transit organizations differ widely from one to another. As a result, the skill sets required for transit system GM’s/CEO’s have evolved. Examples of functions that may be performed by another agency include grants administration, service planning, marketing, paratransit, bus stop and shelter maintenance, payroll processing, etc. Transit systems may also outsource functions such as insurance and claims administration. Historically, transit system CEO’s mainly rose through the ranks in operations. Today, there is more emphasis on financial management, contracting, grants administration, marketing, planning, and political skills. On smaller transit properties, the transit manager truly needs to be a jack of all trades. Again, a good class discussion or outside assignment would be to compare and contrast organizational charts from different transit agencies.
8 Internal Functions Maintenance Finance Purchasing TransportationHuman Resource Training Information Technology
9 External Functions Landscape Assessment MarketingCommunity Interaction Planning Public Relations Service Delivery
10 Transit System StakeholdersInternal Stakeholders may include: Employees Union Operating and administrative departments Safety committees Compliance units Board members Project managers This and the following slide are derived from a chart developed by Jerry Premo, former Federal transit official, former transit system CEO, and currently a consultant.
11 External Stakeholders May Include:Elected Officials City and county councils, state legislature, congress Mayors, selectmen, governor Agencies Federal Transit Administration Metropolitan Planning Organization State and regional transportation and planning agencies Other Federal /state regulatory agencies (DOL, DOT, DOJ, EPA, etc.) Interested Parties Passengers and rider groups Interest groups (e.g., Sierra Club, AARP, disability advocates, etc.) Vendors, contractors, and consultants Press and news media Community/neighborhood organizations Business community Associations (local, state, and national)
12 Management ChallengesBuilding consensus among stakeholders Managing conflict between stakeholders Business leadership Good class discussion question would be what are some issues on which a transit CEO would need to build consensus among stakeholders (e.g., support for a dedicated funding source for transit, support to for a rail project, support to finance new technologies). Another good class discussion question would be what are some issues that create conflict between stakeholders that the transit CEO has to manage: Inner city vs. suburbs, pressure to reduce cost vs. pressure to increase service, improving compensation for employees vs. cutting expenses, whether to use different technology [a new propulsion technology may cost more to operate but provide benefits in terms of reduced emissions], etc.) Business leadership includes team-building, developing and communicating mission and vision to stakeholders.
13 Ethical Challenges Board politics Hiring decisions ProcurementsSocial justice and diversity CEO may be forced to choose sides if the board is split. Pressure to hire an individual who may be less qualified but has support from an elected official. Federal procurement rules are designed to maximize competition and choose the best product with the lowest cost. Ethical challenges may occur, for example, if management feels pressured to hire a local contractor, even if their price is higher (or quality lower) than an out-of-town competitor. How to resolve a situation in which a vendor offering superior quality also has the highest price. Preventing operating departments from writing specifications that limit competition or clearly favor a particular vendor.