Image: LNER.
Digital transformation is about making change, so how do you do that in an industry traditionally associated with large-scale infrastructure and integrated business processes?
For Danny Gonzalez, Director of Digital and Innovation (CDIO) at London North Eastern Railway (LNER), the answer is to put technology at the heart of everything the company does.
“We strongly believe that digital is absolutely crucial,” he says. “We need to deliver experiences that meet or exceed customer expectations. »
Streamline and integrate the different modes of transport
Adhering to this program is not an easy task. According to Danny Gonzalez, train travel is “absolutely full” of elements that can go wrong for a passenger, from buying their ticket to arriving at the station, to train delays and difficulties. to leave the station once you arrive at your destination.
LNER aims to solve obstacles in customer journeys, but it must bring these changes to an industry where old systems and processes still proliferate. According to Danny Gonzalez, many of the technologies used are over 30 years old.
“There is still an incredible amount of paper and spreadsheets used in large parts of the rail industry,” he says. “Our job is to look at how things like machine learning, automation, and embedded systems can really transform what we do and what customers receive. »
A team of 38 experts
Danny Gonzalez says this job involves focusing on the ways technology can be used to improve the way the company operates and provides services to its customers.
This manifests itself in a detailed digital transformation plan, which Danny Gonzalez calls LNER’s Polar Star: “It allows everyone to focus on the important things to do. »
As CDIO, he created a digital leadership of 38 people, made up of skilled specialists who step out of traditional railway processes and governance to focus on innovation and generating creative solutions to intractable problems. . “It’s quite unusual for a railway company to allow people more to try things and fail,” he argues.
15 PoC in two years
Since 2020, the digital direction – in combination with its ecosystem of partner companies and start-ups – has launched more than 60 tools and tested 15 proofs of concept (PoC).
One such concept is an in-station avatar, which was developed alongside German national rail company Deutsche Bahn AG.
LNER also conducted a trial in Newcastle, which allowed customers to interact in open conversations with an avatar in a dedicated cabin at the station. The avatar connected to LNER’s booking engine, so customers could receive up-to-date information on service availability. After this successful trial, LNER is now looking to procure a final solution for wider deployment.
The company is also working on what Danny Gonzalez calls a mobility application as a “door-to-door” service. It will allow customers to keep up to date with the status of their trip and provide them with links to other suppliers, such as taxi companies or car or bicycle rental specialists.
“It’s about making sure the whole journey is seamlessly integrated,” he explains. “As a customer, you feel in control and know that we make sure that if something goes wrong during the process, we fix it. »
ML concepts in production
When it comes to operational activities behind the scenes, LNER invests heavily in machine learning technology. Danny Gonzalez’s team has implemented some important concepts which are now moving to production.
One is a technology called Quantum, which processes massive amounts of historical data and helps LNER employees reroute train services in the event of disruption, and minimize the impact on customers.
“Quantum uses machine learning to learn from the past. It looks at decisions that have been made in the past and the impact they have had on rail service,” he explains. “It calculates hundreds of thousands of potential contingencies of what might happen when certain decisions are made. It completely transforms the way our service delivery teams manage trains in the event of a service disruption. »
To identify and exploit new technologies, Danny Gonzalez’s team adopted consultant McKinsey’s three-horizon model, providing transformation in three key areas that allows LNER to assess potential opportunities for growth without neglecting performance in the here.
Find long-term profitability
Horizon 1 focuses on “big products”, essential to day-to-day operations, such as reservation systems. Horizon 2 encompasses the emerging opportunities that the company is studying.
According to Danny Gonzalez, much of his team’s activity is now focused on Horizon 3, which McKinsey says includes creative ideas for long-term profitable growth.
He explains that this process involves giving teams a lot of freedom to jump in and try things, prove concepts, and really understand where the technology works.
A crucial part of this work is an accelerator called FutureLabs, where LNER works with the start-up community to see if they can help push digital transformation in new and exciting directions. “We’re articulating key issues across the business and asking innovators to come and help us solve our challenges — and that’s led to some of the most important things we’ve done as a business,” says Danny González.
Set goals and priorities
FutureLabs has already produced pioneering results. The Quantum machine learning tool and door-to-door mobility service were both developed alongside start-up partners, JNCTION and IOMOB respectively.
The LNER continues to seek new inspirations and has just launched the third cohort of its accelerator. Selected start-ups receive mentorship and funding opportunities to develop and scale technology solutions.
According to Danny Gonzalez, this targeted approach helps structure LNER’s interactions and investments in the start-up community, giving it a competitive advantage.
“It’s not like what I’ve seen elsewhere, where innovation initiatives tend to be all about spray and pray,” he notes. “The start-ups we work with are clear about the problems they are trying to solve, which leads to a much higher success rate. »
Clarify the problems to be solved
Danny Gonzalez advises other professionals to be crystal clear about the problems they are trying to solve through digital transformation. “Know what the priorities are and bring the business with you. It is really important for the company to understand the opportunities that digital can bring in terms of the way the organization operates,” he defends.
“We are lucky to have a board that understood that the railways were not up to speed in terms of a digital proposition. But we put a lot of effort into understanding the existing problems and the solutions we needed to be competitive in the future. »
Source: ZDNet.com