The First Digital Strike of 2014?
As I write, London's 48 hour tube strike is in full flow, directly impacting nearly 4m commuters per day, alongside countless more whose coveted personal space on bus or train is infringed upon by refugees from the underground network. Needless to say, it has resulted in absolute bedlam, but has also precipitated a blitz-like spirit amongst weary travellers as Zone apartheid is briefly forgotten.
This is, of course, no real crisis for Londoners. By the time you read this, we'll have moved on to our next obsession. However, the reasons behind the strike reveal a trend that will be felt for a long time to come. Under proposals from Transport for London (TfL), the capital’s transit authority, by 2015, there will be 950 fewer staff on the underground network, anticipated to save upto £40m per annum. And although 200 jobs could be created when the proposed 24-hour service goes ahead on weekends in the same year, this still represents a significant net loss in terms of employees.
The proposed staff cuts will be achieved through the closure of 268 ticket offices. On the surface, this could be viewed as a simple cost-cutting measure, or an example of the unequal nature of Britain's financial recovery; after all, these are real people losing their livelihoods. But if you peel away the outer layers, it becomes painfully apparent that, at its heart, this is also a story of how technology and the utilisation of digital channels in industry have become so pervasive that they are changing the very fringes of business operations.
As I see it, there are three technological imperatives behind these changes. Firstly the fact that commuters, tourists and anybody else using the underground network, have shifted away from seeking relevant knowledge through personal contact, in the guise of a manned ticket office or information point, towards knowledge retrieval via their personal electronic device. A plethora of apps, services and social media tools are now available, providing a combination of real-time and legacy data, from official and unofficial sources. I use Twitter for real-time travel info, Google Maps for journey-planning and there is now even an app that will make automatic refund claims for delayed journeys on my behalf.
The second imperative relates directly to the automation of electronic ticket purchasing and renewal, in the guise of Oyster. Whilst London was not the first city to adopt a contactless smartcard system for public transport, the breadth of its usage is staggering. In the nine months to 2014, over 227m purchases were made, but only 42% were carried out at underground stations. A mere 3% of transactions are fulfilled through ticket offices.
TfL’s third imperative, I believe, is the opportunity to transform the physical spaces of ticket offices, from what I might hazard have become cost-centres, to profit-centres through their reassignment to click-and-collect points for busy online shoppers who prefer not to take time off work for an Amazon delivery. Already, Asda, Tesco and Waitrose have signed up to begin services later this year, and talks are being held with InPost, the parcel locker operator, all of which form part of a commercial strategy to boost TfL’s income to £3.5bn over the coming years.
Taken together, these technological imperatives amount to nothing short of an organisation responding to the unstoppable force that is digital change. Whilst the emotional cost of job losses should not be underestimated, it can come as no surprise that the metropolitan transportation system of a global city should respond to changing norms and embrace technology. Public transit innovation will continue to evolve, with the advent of self-driving vehicles, congestion management, urban tolling and sensors to monitor car parking spaces. Now the world's population is mostly urbanised, cities will become smarter by default, their inhabitants demanding more from civic infrastructures.
But, far from being an isolated incident, TfL’s actions should be viewed as a trajectory for all businesses, irrespective of sector or geography. There are numerous, albeit less high-profile or newsworthy, examples of how responsive organisations are being to the challenges thrown up by digital transformation. Given the fact that no industry is immune from the technology-induced change we are beginning to experience at the fringes of industry, there will be many more.