Why I Want to Commute to Work in Hong Kong

I live in a major German city and commute daily to work. Eventually, I stopped trying to rely on the official schedule. Why? Because, especially during rush hours, the schedule is hardly dependable. Delays and cancellations are, unfortunately, more of a rule than an exception, and even the platform display boards seem to redefine “three minutes” from time to time. To understand that it can be different—and better—one only needs to look toward Asia.

Hong Kong, the Commuter’s Paradise

In Hong Kong, the rail network is operated by MTR Corporation Ltd., of which the Hong Kong government owns about 77%, while various financial service providers and funds, such as BlackRock and The Vanguard Group, hold roughly 33%. Why is this company such an example of stellar infrastructure? Quite simply, it doesn’t just promise excellent service; it delivers it. MTR has been recognized multiple times and is one of the world’s best rail operators in terms of safety, reliability, customer service, and cost efficiency. Don’t believe me? Here are some facts: between July and September 2017, 99.9% of all trains were on time (with just minutes between arrivals). In the same period, there were only 13 delays longer than 20 minutes among roughly 500 million passengers. On average, trains travel almost 4.5 million kilometers before a technical issue causes a delay of more than five minutes. Escalators and elevators are 99.9% reliable, and the MTR Corporation ensures that train temperatures are maintained at a comfortable 26°C, achieving this goal 99.9% of the time. Trains are also cleaned daily inside and about every other day outside. This level of quality yields impressive customer satisfaction: there are only 1.74 complaints per million passengers. Despite considerable maintenance costs, the MTR Corporation has steadily paid growing dividends to its shareholders for over ten years; in 2014, for example, it paid 2.69 HKD per share.

Germany, the Commuter’s Nightmare

For work commuters, Hong Kong’s MTR is excellent for another reason: it offers various monthly passes, such as for individual subway lines, meaning you only pay for the routes you actually use, with additional trips affordably available on demand. By comparison, Germany is lightyears behind in providing such a transportation option. The quality of German public transit leaves much to be desired in countless areas. The structure and infrastructure framework often prevent operators from delivering satisfactory service. Complex permitting processes, disconnected ownership, bureaucratic structures, and the view of public transportation as merely a basic public service instead of a customer-oriented service all contribute. This perspective is shared by many customers, who think it should be heavily subsidized, low-cost, and regard it as subpar anyway. These factors ultimately lead to delayed, overcrowded trains that frequently get canceled without replacement, dirty compartments and stations, and broken escalators and elevators. Who would want to take public transport in these conditions? Moreover, German public transit companies lag financially compared to the top performer in Hong Kong: no German public transit company can stay afloat without public subsidies. With constantly overcrowded trains, one wonders why operators are not profitable and consider a €90 million loss a success. For operators, it seems as though the problems are insurmountable.

The key to success is not buried deep

There are, however, success stories showing that the MTR model can work for European transit systems: London Overground, a metro-like rail network in London, has been operated by MTR Corporation since 2007. Since then, train frequency has tripled, ridership has quintupled, punctuality has risen from 91% to 96%, and customer satisfaction has increased from 69% to 92%. Stockholm’s metro has been operated by MTR Stockholm, an MTR Corporation subsidiary, since 2009. With more efficient maintenance processes, 10% more passengers can be transported with 10% fewer trains; train punctuality has improved from nearly 93% to 96%, employee satisfaction has increased from 32% to 86%, and customer satisfaction has remained steady at 80%.

These success stories show that it’s entirely possible to enhance infrastructure performance through modern infrastructure management while operating sustainably and profitably. But how exactly does this work? The answer lies in value-based asset management. Value-based asset management is a holistic approach to aligning infrastructure operators with stakeholder requirements. MTR Corporation has mastered this principle, maintaining an ongoing and intensive dialogue with its stakeholders to create sustainable value for the city’s infrastructure. MTR employs a comprehensive, stringent, and strategic asset management plan that includes condition assessments and analyses of every maintenance measure. This approach was evident after MTR took over London Overground. After the takeover, significant funds were invested to understand the network and all its components thoroughly. Every modification, every screw tightened, was meticulously documented and analyzed. If a failure occurred, the question was raised: was it the screw, a wrong nut, the timing of the change, or perhaps the wrong tool? This meticulous attention to detail is the essence of MTR’s success.

There’s still hope for us

Can this model be applied to German public transportation? Absolutely. First, we must tackle the problems at the core rather than starting from the end. This requires two fundamental changes: first, a cultural shift among rail operators toward recognizing that they must evolve from a basic public service provider into a service company; and second, a commitment from operators to invest in their network to understand it thoroughly. Only then can the right conclusions be drawn at all levels of the company. Stakeholder involvement is crucial—from employees to service providers to customers. Additionally, there must be more trust in the operating companies, with public-private partnerships leading the way. Let companies take the reins. A recent example from North Rhine-Westphalia shows what not to do: in the bidding process for the operation of the Rhein-Ruhr-Express, all operations and maintenance for the next 30 years were predefined in the contract, leaving operators with little room for flexibility.

How can this important issue be tackled? Various questions must be asked: who are my stakeholders? And what do they expect from me as a rail network operator? What value do I want to deliver as a rail network operator? And what measures are needed to achieve this? With my company, Meliorate, I have been supporting infrastructure owners and operators with these and other questions related to professional asset management since 2011.

Author: Lars Overdiek