ECML franchise to be broucht back under Public Ownership

[Hobby]

My question is about how many people are actually changed - I know most employees just transfer over to the new business.

 

Let's put some numbers on it. Are there 5 people at the top who are replaced by 5 people (or 3 or 7) from the new franchisee?

 

...R

 

That would be up to the new owners, so impossible to answer. The day to day level Management, Control, On Board and Station staff will stay the same until the new management decide to change things. It was a few years before cutting back started on many franchises and even then it was middle management that took the brunt of the cuts as far as i was aware... Whether that was due to BR overstaffing or Private Cos costcutting depends on your personal point of view and, like the Graph can be argued in many different ways, all valid of course...

 

There's Lies, Damned Lies and Statistics springs to mind!

[Coryton]

That would be up to the new owners, so impossible to answer. The day to day level Management, Control, On Board and Station staff will stay the same until the new management decide to change things.

 

OK but at what level are people changed on day 1?

 

The top management level I presume...but how many people is that usually?

[Hobby]

Not a clue, it depends on the company as i suspect all will have different set-ups.

 

As I said before it's impossible to answer!

[Hobby]

They don't. It is not allowed under ORR rules.

 

A TOC (or FOC) can pay a premium for obtaining paths in the timetable planning process, and a negotiation ensues on the resulting performance penalty/premium payable, but can only obtain those paths if they are available and do not inflict damage to the existing paths "owned" by other companies, if those companies do not agree. There have been occasions where other companies have suddenly agreed to a voluntary worsenment of their entitlement, to let East Coast have a better slice of the cake - GNER were expert at achieving this but nobody officially knew what had gone on behind closed doors with other TOCs, I do but I cannot tell.

 

But in real time operations, if NR are found to have given undue preference to any one operator's trains when making decisions about late running services, they are in trouble. They were accused of this (when it was Railtrack) some years ago on the East Coast, but it was not found to be systemic, just poor judgement by some signallers at one or two locations, who were "suitably advised" as a result.

 

Mike, that makes sense, but isn't a reflection of what happens in Real Life which is why those of us who work for other TOCs and get shafted quite often do wonder if there is something else going on. When you have a class 1 with the same stops and equally as quick getting delayed over 5 minutes for a late running Virgin service you do start to question things, if you speak to the guards and drivers of other TOCs you will find the view pretty universal for those who run the same routes as the red trains...

 

Conspiracy theory perhaps, plenty of them around on this thread already, no harm in adding another!!

Edited May 17, 2018 by Hobby

[Coryton]

Not a clue, it depends on the company as i suspect all will have different set-ups.

 

As I said before it's impossible to answer!

 

The franchise specifications must determine who and what gets taken over at day 1 by the incoming company, I would have thought.

 

Maybe there is no fixed rule, but I am curious as to what level of management belongs to the outgoing company and which goes with the franchise, so to speak.

 

This reminds me of when Wales and Borders split into Wales and West and Wessex Trains. The format of the timetable books for the two new companies looked surprisingly similar. Both started with the same 'personal statement' signed by their respective (different) CEOs. Both word for word the same...

[Hobby]

I've already said what will happen, as have others, Coryton.

 

It's impossible to say as each company is different in set-up at the top. The chances are even the senior management will stay the same, after all they weren't responsible for losing the franchise and they are running the current one, you don't change things on Day 1 and put in people who know nothing of that particular business, you take over and then gradually change things as you go. On many Franchises the same senior management were still in place years later as they were doing the job to the satisfaction of the new owners. So i suppose you could say, no change on Day 1 and then gradual change if needed...

 

That do?

[Robin2]

The point of my question about how many people at the top change is to get some data to help us understand what is the value of spending (wasting ?) £millions on a bidding and re-branding process.

 

If there were no changes at all it would seem to be a complete waste.

 

...R

[Coryton]

The point of my question about how many people at the top change is to get some data to help us understand what is the value of spending (wasting ?) £millions on a bidding and re-branding process.

 

If there were no changes at all it would seem to be a complete waste.

 

 

Even when franchises remain in the same hands there is usually change because they have signed up to a new contract with the government.

 

Things changed quite a bit the last time the Great Western franchise was (properly) re-tendered.

 

And even if only the person at the top changes on day 1, that doesn't mean there won't be big changes later on once they can be implemented.

[bike2steam]

Right, but there is a very big difference between having one owner for track and trains, and one 'owner' for track and some of the trains, but not the others.

 

OK well in the pre-nationalisation days we had trains from one company running over other company's lines. But I believe that in most cases the track owner operated the majority of passenger and freight trains over their track - letting the "LNER" control the track along the ECML would be a rather different story.

 

I meant, perhaps should've said, 'trains' meaning both passenger and freight.

[Hobby]

Things changed quite a bit the last time the Great Western franchise was (properly) re-tendered.

 

 

At XC things stayed much as they were for a few years, though. As I said it's impossible to say. The new company in charge may have different plans that they want implemented with their own "branding" such as Virgin so staff changes may happen quite quickly, however others may well be happy with the way it's running and do things more gradually. The whole point in changing franchisees, surely, is to try to do things better (or differently, dependant on your point of view) so things like company "values" and ideas on how to run it will change over time.

 

How long's a piece of string!

Edited May 17, 2018 by Hobby

[Coryton]

I meant, perhaps should've said, 'trains' meaning both passenger and freight.

 

I haven't seen any suggestion that LNER should include freight....and since freight companies don't operate under franchises I don't see any legal mechanism to move freight from DB and other operators to a vertically integrated one, though possibly it could compete with existing operators to obtain contracts.

[Coryton]

At XC things stayed much as they were for a few years, though. As I said it's impossible to say. The new company in charge may have different plans that they want implemented with their own "branding" such as Virgin so staff changes may happen quite quickly, however others may well be happy with the way it's running and do things more gradually. The whole point in changing franchisees, surely, is to try to do things better (or differently, dependant on your point of view) so things like company "values" and ideas on how to run it will change over time.

 

How long's a piece of string!

 

I think we're at cross-purposes here.

 

My question (and, perhaps, the original one) is not what changes are brought in during the franchise, but what happens the instant the franchise changes.

 

Clearly drivers and station staff just carry on as before (maybe even starting their shift working for one company and finishing for another). 

 

There is presumably at least one layer of management that does the same.

 

But as you go up the structure where do you get to what you called the "new company in charge"? There must be a set of people who go out the instant the franchise changes and another set that come in, surely?

[Robin2]

Even when franchises remain in the same hands there is usually change because they have signed up to a new contract with the government.

That could easily be done without spending £millions on tendering and re-branding.

 

...R

[caradoc]

Mike, that makes sense, but isn't a reflection of what happens in Real Life which is why those of us who work for other TOCs and get shafted quite often do wonder if there is something else going on. When you have a class 1 with the same stops and equally as quick getting delayed over 5 minutes for a late running Virgin service you do start to question things, if you speak to the guards and drivers of other TOCs you will find the view pretty universal for those who run the same routes as the red trains...

 

Conspiracy theory perhaps, plenty of them around on this thread already, no harm in adding another!!

 

Delaying an on-time service for a late Virgin train might be a result of the focus nowadays on PPM (Public Performance Measure), which requires long-distance trains to arrive less than 10 minutes late by the passenger timetable to be classed as 'on time'. So an 8 minute late (say) Virgin service might get preference over another on-time train to ensure it makes PPM; As long as the second train is not delayed so much as to fail PPM, it is a positive result for the performance figures. However if a company's trains were regularly being wrongly regulated in favour of Virgin (for example) I would expect them to ask serious questions of Network Rail.

[Bruce Depot]

When I was involved with regulating trains,  it was often a no win situation, whoever got the short staw would soon be on the phone moaning...

Virgin where by far the worst for kicking off at any chance, and where not unknown to ring up in advance to try and get a favour with their

service over someone else....

[Bruce Depot]

Going back to the ECML, Seem to think/remember GNER where the best after ICEC, forget now why GNER stopped but if it was down to not bidding enough

then makes you wonder if they would still be running the ECML now if they had won.....

['CHARD]

My question is about how many people are actually changed - I know most employees just transfer over to the new business.

 

Let's put some numbers on it. Are there 5 people at the top who are replaced by 5 people (or 3 or 7) from the new franchisee?

 

 

The point of my question about how many people at the top change is to get some data to help us understand what is the value of spending (wasting ?) £millions on a bidding and re-branding process.

 

If there were no changes at all it would seem to be a complete waste.

 

Generally around half a dozen, at director level and senior strategic positions, not unsurprisingly.

 

Almost always the following: Managing Director, Finance Director, Head of Retail/ Sales, and possibly some from Engineering Director, Stakeholder Manager, Production Director, HR Director etc.

 

It depends to a large extent on the criticality of the changes expected of the senior team by the incoming franchisee.  For example, can you realistically expect senior incumbents (Abellio) to sign-up to the delivery of targets (Arriva) that they most likely would not have supported in their own parent company's bid to retain the franchise?  Also, individuals who retain a particular 'house style' or values for doing the job which is unique to that transport group (Govia), may not be a good fit in a markedly different culture (Abellio).

 

Inevitably, senior managers who are company people to their core (e.g. time-served with many years in the pension of one or other transport group and not necessarily in a position for TUPE to protect them, as is the case for many senior figures) will be moved within group (Stagecoach), possibly moving up or back into Group HQ, where they may later be redeployed onto future franchise bids or into another TOC.

 

 

Even when franchises remain in the same hands there is usually change because they have signed up to a new contract with the government.

 

And even if only the person at the top changes on day 1, that doesn't mean there won't be big changes later on once they can be implemented.

 

I think we're at cross-purposes here.

 

My question (and, perhaps, the original one) is not what changes are brought in during the franchise, but what happens the instant the franchise changes.

 

Clearly drivers and station staff just carry on as before (maybe even starting their shift working for one company and finishing for another). 

 

There is presumably at least one layer of management that does the same.

 

But as you go up the structure where do you get to what you called the "new company in charge"? There must be a set of people who go out the instant the franchise changes and another set that come in, surely?

[Robin2]

 

 

 

Generally around half a dozen, at director level and senior strategic positions, not unsurprisingly.

 

That's what I suspected. It seems a ridiculously expensive way to make such a small change.

 

...R

['CHARD]

That's what I suspected. It seems a ridiculously expensive way to make such a small change.

 

...R

 

Inevitably, as the changes to franchise shape and components/ resources are implemented, new roles are created in the so-called 'Mobilization' team. 

 

This has the usual characteristic of importing a guiding mind (possibly to the time-bound role of Transition Director) from the new owner, and she/ he in turn may well draft in trusted accomplices to manage critical 'change' projects, be they involving fleet, stations, staff conditions etc etc..., leaving prior managers to continue in their (non-strategic) day to day, routine delivery roles.

Edited May 17, 2018 by 'CHARD

[Clearwater]

On bid costs/transaction/transformation costs of says£20m, they need to be considered relative figures of the business. I’ve read it reported that under public ownership, the franchise returned c£200m to the Gov. in the year to 31/3/17, out of turnover of £820m, the franchises paid £272m to HMG. Issue here is that they committed to pay even more in the future. As such, is spending £15/20m reasonable to secure an extra £70m in revenue?

[009 micro modeller]

Reading about this suggests it is not exactly Directly Operated Railways but an 'operator of last resort'.

['CHARD]

Reading about this suggests it is not exactly Directly Operated Railways but an 'operator of last resort'.

 

DoR is no more.

[Mike Storey]

Going back to the ECML, Seem to think/remember GNER where the best after ICEC, forget now why GNER stopped but if it was down to not bidding enough

then makes you wonder if they would still be running the ECML now if they had won.....

 

GNER's first franchise went ok, as passenger growth rates and revenue rose faster than even their ambitious bid had forecast.

 

When they bid for a second term, they over-bid, but growth was slower than forecast, competition was greater and costs were higher. They had been seriously over-optimistic, but argued that some of these factors had been impossible to predict. The High Court disagreed. Their parent company (Sea Containers) was in financial trouble anyway, for many reasons well beyond their one rail franchise, and filed for bankruptcy in the USA (Chapter 11 - which allowed them to continue trading for a period whilst their finances were sorted out). Sherwood (the original founder) and Garnett (the original CEO of GNER) both resigned (the latter allegedly because he disagreed with the cuts that had to be made, but more likely because he was Sherwood's "man" - he had been with him since Sherwood bought BR's part of Sealink in the 1980's). They were therefore unable to carry on paying the enormous premia to govt to which they had committed, and the franchise was taken back under DfT control, but GNER remained as a management contractor to operate the route, until National Express won a new franchise competition for the route, a year or so later (until they too had to relinquish the franchise, and so on, ad infinitum.......). 

 

Sea Containers sold all its companies within a few years and ceased to exist. The present "SeaCo" container operation is a Chinese company now. Orient-Express Hotels Ltd, which ran the VSOE plus many other luxury train and hotel operations around the world, was sold in 2006 to Belmond Ltd, a British-registered company listed on the New York SE, who kept using the OE brand name until a few years ago.

[rodent279]

Roger Ford isn't too impressed with the revival of the LNER name. He calls it "pitiful" in his Twitter account.

[Mike Storey]

DoR is no more.

 

Not strictly accurate. DOR Ltd was originally managed directly by the DfT as a "non-departmental government organisation", when it ran East Coast Trains the last time. They basically used First Class Partnerships (FCP), a consultancy formed by John Nelson, one of the last BR General Managers of the Eastern Region, to staff and operate the senior roles.

 

Effectively DOR was "privatised" in 2016, and is now run by a partnership of Arup/Ernst&Young/SNC-Lavelin (the old Interfleet, now Canadian owned), and it is this team which will now adopt LNER and run the services on behalf of the DfT. FCP have known about this since January (according to their news feed), so it is clear that a lot of preparation has been underway before Grayling's formal announcement. It would appear therefore that all the effort put in by Stagecoach/Virgin to renegotiate the franchise had been dismissed (or at least thought improbable) some time ago.