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Valuing Customer Experience – How KPIs can distort investment decisions by focusing on economic aspects obscuring secondary benefits

Hainz, Svenja and Kristoffersson, Ida and Kurt, Filiz and Liu, Chengxi and Verrier, Antoine (2022) Valuing Customer Experience – How KPIs can distort investment decisions by focusing on economic aspects obscuring secondary benefits. World Congress on Railway Research 2022 (WCRR) 2022, 06.-10. Juni 2022, Birmingham, UK. (In Press)

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Abstract

The European Shift2Rail Initiative identified three high-level Key Performance Indicators (KPIs) “Life-Cycle-Costs”, “Punctuality” and “Capacity” to which Shift2Rail projects contribute in the three passenger use cases (high-speed, regional, and metro) and a mixed freight use case reflecting the overall railway transport system. The KPI methodology is carried out within the framework of the IMPACT projects and it supports investment decisions in railway innovation. However, investment decisions can only reach optimal resource allocation when the KPIs communicated to policymakers encompass the whole range of economic benefits generated by projects. The high-level KPIs which were primarily identified focused on the supply side (i.e. economic benefits for providers of mobility), omitting economic benefits associated with the demand side (i.e. improved customer experience when traveling by train). In the absence of KPIs associated with the demand side, the metrics would lead to distortions in investment decisions. A methodology integrating customer needs and customer behaviour has been developed within the framework of the IMPACT-2 project. The “Customer Experience Model” (initially presented at the 2019 WCRR in Tokyo) focuses on economic benefits associated with the demand-side of innovation projects, but does not take into account customer acquisition and increased modal share of train once these innovations have been deployed. The Customer Experience Model is based on multilevel weighting of data to bridge the gap between the availability of existing studies, and the need for a new methodology. This model feeds inputs for a modal shift calculation based on logit models whereby utility functions are set to include factors both known (e.g. travel time, travel cost, delay, customer experience factors, waiting time) and unknown. This paper highlights the importance of considering customer needs and to gain new perspectives when assessing investment decisions in innovative technologies for the railway system.

Item URL in elib:https://elib.dlr.de/187666/
Document Type:Conference or Workshop Item (Speech)
Title:Valuing Customer Experience – How KPIs can distort investment decisions by focusing on economic aspects obscuring secondary benefits
Authors:
AuthorsInstitution or Email of AuthorsAuthor's ORCID iD
Hainz, SvenjaSvenja.Hainz (at) dlr.deUNSPECIFIED
Kristoffersson, IdaVTIUNSPECIFIED
Kurt, FilizFiliz.Kurt (at) dlr.deUNSPECIFIED
Liu, ChengxiVTIUNSPECIFIED
Verrier, AntoineSNCFUNSPECIFIED
Date:7 June 2022
Refereed publication:Yes
Open Access:Yes
Gold Open Access:No
In SCOPUS:No
In ISI Web of Science:No
Status:In Press
Keywords:Key performance indicators, Customer experience, Modal shift, Railway innovation benefits, Shift2Rail
Event Title:World Congress on Railway Research 2022 (WCRR) 2022
Event Location:Birmingham, UK
Event Type:international Conference
Event Dates:06.-10. Juni 2022
HGF - Research field:Aeronautics, Space and Transport
HGF - Program:Transport
HGF - Program Themes:Rail Transport
DLR - Research area:Transport
DLR - Program:V SC Schienenverkehr
DLR - Research theme (Project):V - NGT BIT
Location: Braunschweig
Institutes and Institutions:Institute of Transportation Systems
Institute of Transportation Systems > Design and Evaluation of Mobility Solutions, BS
Deposited By: Hainz, Svenja
Deposited On:28 Jul 2022 11:15
Last Modified:28 Jul 2022 11:15

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