Case Study: Strategic Workforce Planning for Rail Infrastructure Managers
The Netherlands is ranked the sixth in the world in terms of the quality of railroad infrastructure. However, in order to prepare for the future, the currently existing infrastructure needs a 30% increase in capacity. This requires tremendous changes in the current workforce. In this case study, strategic workforce planning is applied to solve this national problem, impacting millions of commuters. Curious how? Read on.
The Dutch Railway system processes 1.3 million passengers and more than a million tons of cargo daily with high reliability and safety and a low CO2 profile. In the coming 10 years, the daily number of trains will need to grow 30% to enable train operators to deliver on the growing demand for Passenger and Cargo traffic. This is a major challenge for the Dutch Railway infrastructure manager, ProRail.
An obvious choice would be to change and grow the rail infrastructure within the Netherlands. But growing the infrastructure would require a multi-billion Euro investment and may take too much time and space in urban areas. So to meet this growing demand, ProRail Traffic Control needs to invest in technologies that make it possible to automate and digitize large parts of the now manual traffic control process. This way the transportation capacity can be increased with the current infrastructure. This article will focus on the strategic workforce challenges for the 700 Train Traffic Controllers and 150 operational planners whose jobs will change tremendously because of this.
Where we stand now
In the past decades, the level of automation at ProRail Traffic Control has increased. At the moment, the train schedule runs automatically if it fits into the pre-planned train schedule. However, the core of technology like signaling and safety systems has not had a fundamental upgrade in decades.
When the trains run as scheduled, the system requires minimal intervention by operators. But in case of a disruption, a lot of manual actions are required of the operators. This means all workstations are manned for handling disruption and result in extremes in highs and lows in stress on the operators.
Planning for the future
To achieve the projected capacity growth for the Traffic Control business unit, management and experts from the technical staff developed a 10-year vision on the required changes together with IT and the scheduling department. As the means of digitizing the traffic control process is central to this vision, it was dubbed ‘Digital Vision’.
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After the major steps of the Digital Vision were defined, the management from Traffic Control asked for a Strategic Workforce Planning to see what the impact would be on the workforce. They wanted to know what decisions and steps would be needed to align workforce requirements with the upcoming fundamental changes in technology and processes.
A few particulars in the context were important to understand how strategic workforce planning was approached. We defined these beforehand as they guided the scope of the project.
1. Business continuity. Business continuity is a hard requirement. That means that all workstations must be manned by a certified employee at all times, so 24/7.
2. Re-schooling. Parallel to this development, European governments, and national train management companies decided to unify the technology of train safety management to a European standard (ERTMS). This will require a re-schooling of large numbers of people. Timely planning for training and the capacity surplus to temporarily replace the operators in training will be required. Insight into the estimated numbers of employees involved at different stages and estimates of instruction time required were available.
3. Turnover. A mature system of Tactical Workforce Planning (TWP) was in place when working on SWP started. The TWP process is based on an integrated capacity management tool that includes rosters and capacity required for non-workstation related tasks, training, holidays, normally expected illness, and facilities for lighter rosters for older employees. The TWP process estimates the turnover in the coming 18 months to plan and execute required recruiting efforts, rigorous psychological testing, and 9 months of training periods for new employees. This meant that current operational personnel planning norms were available at the start of the process.
4. Capacity growth without rising costs. The major driver for the Digital Vision was enabling the required capacity growth without rising costs. Although in the end a lower count of operational personnel is projected, cost-cutting for personnel costs is not the major driver. Lower numbers of operational personnel needed were the consequence of the desire to be less vulnerable to the availability of people on the labor market. Especially people that need to fit the strict psychological profile (see the illustration) and are willing to work in a 24/7 roster.
5. Technology. The traffic intensity expected is not manageable by people without major support from technology. Monitoring a specific part of the rail network is already challenging, increasing the traffic volume and frequency without technological assistance to flag potential disruptions on the rails simply creates too much safety and logistical risks. This tightens the number of people that fit with the job, creating an even bigger labor market issue. ProRail aims at designing processes and jobs that fit a broader range of people to reduce labor market vulnerability.
HR was tasked with designing a Strategic Workforce Plan for both the Digital Vision and the deployment of ERTMS.
To create this quantitative data model, HR put a core team in place with the Senior Business Partner, a Business Partner, the data expertise from HR Operations, and people strategy and analytics experts from Bright & co, an HR consultancy.
Together we devised a plan where the Digital Vision and other developments would be analyzed and translated to workforce requirements for the years ahead. A data-driven approach was adopted to estimate the availability and composition of the workforce, based on available personnel data. The following steps were taken by the core team:
- Gain a shared deeper understanding of the context and developments at hand, mostly fuelled by documentation on vision and strategy and experience from the Senior Business Partner who is a member of the Management Team and had been involved during many discussions.
- Building a starting model for the workforce availability and composition, based on personnel data, in order to get some first prognoses for the scenario where there are no policy changes.
- A session with managers and experts to make a long list of factors that may influence the workforce demand (e.g. centralization of physical working locations), based on the Digital Vision and ERTMS, and to retrieve insights into what management needs in the SWP to steer the further developments.
- Analysis of the influencing factors from step 3 to find the shortlist of factors that have a major influence and weed out the ones with low impact.
- Deep dive session with managers to get more specific answers on the shortlist of factors with major influence on workforce demand. For example, we were looking to get really specific on the effects certain technological implementations would have on the workload of train service operators, in order to estimate how many were needed at any given point in time. Explore options together to fit demand and availability and gain more insights into interacting effects of the specific steps written down in the Digital Vision.
- Working out the model in an Excel-based SWP tool and presenting it to management.
- Finetune the model, based on feedback from the managers and organize and instruct staff on how to use and maintain the model.
In the end, the model turned out mostly quantitative, providing estimates on needed workforce FTEs at any given point in time. Estimated qualitative effects on the jobs and personnel characteristics, based on current insights, turned out to have limited impact, following discussions with the management team.
The quantitative model provided us with several useful insights:
First, the personnel data shows us that in the period from 2022 till 2028 many employees will leave the company due to retirement. The retirement age was added as a variable as the average age people leave tends to get more flexible.
Second, although a lower number of operators are projected in the long run (10 years), a major layoff is not to be expected. The natural turnover exceeds the projected reduction in required operators. This is a blessing in disguise. When the company would not change the IT and would need to recruit, school and certify the current numbers of operators, this would lead to impossible numbers to be recruited from the labor market.
Third, the model shows that the most feasible option, both from the viewpoint of operational continuity and job security, is to bring back the number workstations over the coming years. This means the number of operators required can follow the slope of natural turnover. This should be achieved by merging workstations as new steps in technology that reduce workload during incitements come available, maybe helped by specific efficiency improvements that are not useful in the current context.
The value of the insights the SWP model offers needs to be explored further and as the model evolves over time, more insights can be delivered. At this time, however, the value can be found in the following:
The Digital Vision allows, within certain limits, to prioritize the technical milestones to be implemented in the coming 10 years. By making these priorities, management can balance the speed of technological change and the availability of certified operators to ensure operational continuity. This is achieved by means of quantifying the workforce impact of the technical milestones and shedding light on interdependencies of these milestones,
The information we distilled from the project and processed into the model could be compressed into a few key messages:
- As a number of key technical milestones are dependent on one other achievement – nationwide planning- we cannot downscale the number of workstations drastically until the year 2027 based on the latest IT digital vision;
- From now until 2027 there are no tangible opportunities to downscale workstations based on technical advancements;
- Any reduction in workstations until 2027 needs to come from improving operational efficiency;
- If you delay the reduction of workstations and start reducing workstations drastically after 2027, you will have a hard time staffing position until 2027 and you will have an overpopulation of operators soon after that;
- Combined with the fact that there is a significant number of operators nearing retirement age in the coming 5 years it is wise to find ways to start reducing workstations sooner than 2027.
So, achieving the right number of certified operators requires the operation to gradually reduce the number of workstations. For this, active participation is needed by employees to design and test the scope of the net handled at each station. Normally there is natural resistance against steps to reduce the number of stations and enlarging the areas covered on each station, out of fear this will lead to a high workload. With the SWP results, insights can be given to employees and representatives of the Works Council and labor unions that it is in the interest of job security to gradually reduce the number of workstations.
In the SWP project input from several technical and planning projects were brought together for the first time. This resulted in more insights into the impact of workforce-related choices on the operation as management gained a shared understanding of what will be the overall impact of these technological and organizational developments. The other way around, management can now better estimate the integrated impact of all projects on the workforce.
Some factors that make up the productive hours like compensation for nightly shifts, retirement age and shorter workweeks for aging employees are regular subject of collective labor agreement negotiations. With this SWP approach and tool, the impact of certain proposals can be quickly analyzed.
The SWP calculations show that in most scenarios a major number of employees still need to be found on the labor market. To achieve this, large investments need to be made. For instance, the company invests heavily in publicity campaigns for the recruitment and schooling of new operators. When the scenario calls for a reduction in operators needed in the future, investing in the labor market is counter-intuitive. The SWP model helps to develop a business case for these investments.
Furthermore, because the SWP model was developed in an Excel-based SWP tool we have given management a tool they can regularly use to add new information to the model and make new projections.
The role of HR in the process
During the steps, a high level of trust and freedom was given to the project team to execute the SWP process. This was very helpful in the execution. The following factors also contributed to the effective execution of the SWP project:
- The urgency from the management to create a workforce planning probably stems from the fact that the availability of certified operators is the major risk for operational continuity. From time to time frictions arise in the availability of operators in certain regions that need immediate management attention and shortages on the labor market are a major issue on the MT agenda.
- Years back, the then active managers and HR advisors worked on a way of working where (tactical) workforce planning, recruiting and training is a shared responsibility. These processes flow quite freely between the line managers, technical staff, inhouse academy (which part of the business). and HR.
- Line managers, up and including the director and board are aware that the timely availability of qualified operators is one of the major factors for operational continuity. For some time it has been hard work to find the required numbers on the labor market and that risk is felt on all levels.
- There is a good level of ownership in line management for executing people management.
- HR invested in high-level quality advice with high standards in terms of advisory skills, organizational change knowledge, and business acumen. The advisors have fixed seats in the major MT’s, are expected to function as full team members and involve in subject matter issues as well as HR questions.
- The consultants were brought up to speed quickly about the core of the train management processes and technology, including a visit and tour of one of the operational centers.
So why was this a successful approach? An answer may be that this way of working creates a setting where management, HR, and consultants approach questions as SWP from the same business-driven perspective, adding their respective expertise to the same table. If this is the (or part of the) answer, then it would imply that getting into this way of working together is a process of years and not something quickly achieved in one project.
This article is authored by Daïm Willemse and Rob van Dijk.