Something wrong in the land of VR

Anyone who's been a customer of VR (Valtion Rautatiet, the Finnish nationalized railway monopoly) in the past few years can fairly easily attest to the fact that the company has gone to hell. The most recent episode has been their failure in implementing a new IT system that has reached epic proportions as of late. But let's start at the beginning...

Operating a railway company isn't really rocket science. There are multiple facets to it, but let's stick to the transportation of people from point A to point B as that is the service that I mainly use. From my perspective I pay the company a certain amount of money so that it gets me from one geographic location to another in a specific temporal window. I don't care what the method is exactly, but I imagine that teleportation would revolutionize this business thanks to the radical reduction of time of travel. But anyway, my train trips consist of essentially two fundamental components: ticket procurement and the actual transport. On both dimensions VR has been fumbling with the ball.

Starting with the actual transport, to my recollection VR was decently good at operating its trains within the schedules that they had a decade or so ago. But over the past few winters, the quality has deteriorated. I mainly use the Helsinki-Turku track and more often then not jump off at the Salo station roughly three fourths from Helsinki to Turku. The travel time is typically around an hour and 25 minutes. It is not uncommon for the train to be 50 minutes behind schedule on a trip like that, which already brings it closer to 60% behind schedule. And that is when the train actually materializes and gets on its way. It's not also entirely uncommon for trains to not even show up, which leads us to another problem directly related to the business of transporting me from A to B...

Communication is in essence very much irrelevant as long as you provide me exactly the service that you promised and I can trust you to perform. If I can look at the schedule and platform information and trust that it is true, I don't really need other forms of communication with the operator. But when a train fails to materialize, there is a problem. VR has been getting the stick as of late for its inability to transparently communicate situations to the customers. It's normal that every once in a while something happens and causes problems. But then you should openly communicate what the situation is, what is being done about it and most importantly what is the impact that I have to endure. If you tell me that the train broke down and it will take 45 minutes to arrange another train, that is fine. I can then use the time to go do something else; purchase a magazine or get a beer at the station. But when you don't tell me what is going on, I have to work with the assumption that a train might materialize at any moment of time and hence I can't do anything else asides from waiting next to the track. More annoyingly there have been some occasions in which they have communicated a delay of e.g. 20 minutes. In one case I decided to pop by a store at the station and get a soft drink, only to return less than 10 minutes later to barely catch the train which had indeed showed up and was about to leave only 10 minutes into the 20 minutes given. I understand that these two demands of communication, if interpreted at face value, lead to a situation where the company will tell you every three minutes that the train will be three more minutes late ad infinitum. But if you actually think about it, VR should be an expert on operating a train network and hence one would assume that they would have the ability to give educated estimates on how long it will take to fix something. I've lived in Helsinki now for eight or so years and I'm able to give fairly good estimates on how long it will take to get from A to B with public transport at a certain time of day, assuming that A and B are within the areas I often go to. So VR shouldn't have a problem assessing how long it will realistically take to rectify the situation.

Related to the operation of the train network, VR has also fumbled with the procurement of new vehicles. They purchased a number of Pendolino trains, but those have been nothing but a source of grief ever since they started operating them. On the Helsinki-Salo route the Pendolino is only 5 minutes faster than the regular trains, and even that is only due to the fact that the Pendolino skips one stop on the way. Which raises the question of why even operate the Pendolino on that segment, since the Helsinki-Turku journey is not any faster with it. It has its uses on the longer trips to up north which actually do receive a fair amount of time savings due to the increased speeds... That is when the Pendolino is working. It appears that the train is unable to function properly when it sees snow. Also, it appears that VR is having its fair share of trouble in general from the weather phenomenon known as winter. Winters in Finland aren't anything new, so it is somewhat amazing that a "wrong" type of snow can severe the operations of a company that was founded in 1862 and most likely does know that winters occasionally happen.

Then onto the procurement of tickets. I absolutely hate to interface with humans in simple transactions such as purchasing tickets. Airlines have done a brilliant job of ensuring that these days I can even check in via a kiosk or even online with my phone at best and not have to endure the impotence of humans behind the counter. VR has, amazingly enough, had a fairly functional online ticket system from which I could send tickets to my phone or print them out and not have to endure additional pain. Unfortunately as of late I've been put into a situation where I receive free (as in beer) train tickets. Unfortunately I can only get the tickets by queueing at the station and talking to the lady behind the plexiglass. Standing in the queue today got me somewhat annoyed and I started measuring times. The five people on front of me in line took over 35 minutes to be served. That is 7 minutes per person, on average. There is no reason why it should take this long. If you use the kiosks (which aren't, by the way, working as of now due to VR botching up its IT system) buying a ticket typically takes you 30-60 seconds. It shouldn't take much more to tell a person behind a plexiglass to do the same. So that leads me to think that a) the system that the lady behind the plexiglass uses is too complicated or slow or b) the lady behind the plexiglass is too incompetent and slow. That normally wouldn't really bother me as I would never interact with her, but due to these "free" tickets I now must interact with her. Ultimately the problem should sort itself out as companies tend to make things more efficient over time to save money and increase revenue and it appears that the lady behind the plexiglass is a severe bottleneck. So you either automate her or lay her off and replace her with a more productive individual, who might be able to reduce the transaction time from 7 minutes to something a bit more decent. But, in the case of VR this won't happen because...

... VR is in fact a state-owned monopoly. Because of this status, VR will of course be a responsible employer and instead of having to be accountable to its private shareholders and make as much profit as possible, it will attempt to serve the "public interest" (see previous blog entry) better and offer safe employment and whatnot. And because of the monopoly, there is not competitive pressure to keep VR improving itself. In fact, the only pressure comes from VR's incompetence and the fact that at some point people will just decide that it's a better idea to use a car rather than a train to go from A to B. In fact, factoring in the delays and incompetent people, airplanes may actually start being significantly faster on domestic trips... And at best they are also cheaper already when going to e.g. Lapland.

Recently VR has decided that it wants to be an airline. Or at least use similar pricing systems. That should be a relatively positive note for anyone who has a degree in applied mathematics as you've just received another potential employer who will now employ you to tweak the algorithms ad infinitum. The rationale for this is of course quite clear: certain trains are especially popular. Like the 5 PM train out of Helsinki to Turku. This is always very full and unless you've reserved a ticket in advance, chances are that you'll get to stand or sit in the corridors. At the same time there are routes which are operated with half-empty trains, possibly due to the fact that VR needs to perform a function that is in the public interest and hence operate routes at times which may at best be uneconomical. So naturally VR wants a system to encourage people who can travel at off-peak times to use those trains and then charge significantly more from people who want to travel at peak times. Nothing wrong with that per se. The issue I have with this is that because it is a state-owned company and technically looks to do the whole "public good" thing, then I have an issue with the pricing scheme. People who are willing to pay more do not get preferential treatment in Finnish public healthcare and neither should that be the case with VR, if we strictly interpret it. If you want to act like a profit-seeking entity and leverage these types of approaches, then I feel that we should inflict some competitive pressure on VR as well by opening the railway system up for other companies as well. You shouldn't be able to cherry-pick in this way.

However, this brilliant plan to switch over to dynamic pricing models and new IT systems in fact failed very visibly. The system VR bought turned out to not scale, meaning that the whole ticket system has been in a state of havoc as of late with the primary companion, our old friend Accenture, coming out into the public media and giving statements along the lines of "We have no idea what is going on." So, again the plague of the public sector, i.e. the incompetence of playing the role of customer in IT projects, has hit again. To be fair, many private sector companies also fail in these types of large operations, but fortunately then they feel the whole impact themselves. With the case of government-owned monopolies, it's the tax-payer who ultimately foots the bill for this type of ass-hattery. I wouldn't say it's so much a problem with Accenture as it is with VR. Accenture is a profit-seeking company which of course lies and cheats in the offers it makes and ultimately churns out endless amounts of billable hours. That is precisely why you want to be very much on top of things and keep your consultants on a very tight leash if you're the customer. Otherwise they will bend you over the table and let you have it. Additionally, what kind of moron doesn't stress-test a system thoroughly, and more importantly what kind of moron does a complete roll-out of a new system all at the same time? If there's one thing I've learned about IT systems, it's that you want to do rolling launches where you start with updates to certain parts and see how it goes from there. At any point of time if things go wrong, you immediately revert to the old system to contain and mitigate the impact of your incompetence. But how does the super-team of VR and Accenture go about it? Yes, in the same way as our other old friend, Danske Bank... Hilarity ensues.

I guess I could continue onwards with this, but as one final note, I truly enjoy the pain that the lady behind the plexiglass inflicts on me. After waiting for over 35 minutes, she tells me that the ticket voucher I have from the Ministry of Labor is not valid. It has been made invalid overnight with no type of grace period. Then when I decide to pay with actual money, she is unable to comprehend a simple statement such as "1 student ticket to the 7 AM train on next Monday from Salo to Helsinki". Then when she finally is able to produce the ticket and I tell her to just give it to me, she insists on printing receipts and then placing everything in a paper sleeve before giving the pile of paper to me. Which is rather interesting as VR brands itself as a green company. I merely want the ticket and nothing else: why do you insist on throwing so much paper at me which I anyway will throw away...