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Update on the NTOC Business Case

By Peggy Tadej, Project Manager

On June 14, 2006, a progress report was provided to the NTOC members on the Business Case by Michael Morris, Ph.D., of the Department of Entrepreneurship at the Whitman School of Management at Syracuse University. Dr. Morris is leading a team comprised of experts in public policy, transportation management, marketing and entrepreneurship to help the NTOC members arrive at three major products that will help in communicating about effective Transportation System Management and Operations (TSM&O). The three major deliverables will be: Preparation of Strategic Marketing Plan for NTOC addressing Total Operations Concept; Development of Product Plan for one ITS innovation; and the Preparation of a Marketing Template for state/local use in gaining support for an ITS innovation.

The Syracuse team has conducted 13 focus groups and a series of 58 in-depth personal interviews during six association meetings. Each association invited their members to participate and a structured protocol was administered. The topics that were discussed by the focus groups and personal interviews were:

The key findings found many correlations between transportation and economic development; funding and aging infrastructure; lack of inter-operability and interconnectivity between cities/regions; the relationship of the lack of maintenance to the system to the higher construction costs; personnel shortages due to lack of funding, training and skills; construction versus operations; and trade-offs in rural areas between transportation spending and basic needs. The resounding overall issue that was not a surprise is funding. 

Maintenance versus Operations

The findings did not show a clear distinction between maintenance and operations; some interpret operations as system operations, while others interpret it as snow removal. A definition that came from the elected officials group: construction equates to creating the asset, maintenance equates to the condition of the asset, and operations equates to the performance of the asset. Due to the blurred separation between operations and maintenance, this allows the Department of Transportation discretion with budget allocation. The long-term effort of the budgeting cycles makes it difficult to go against the short-term cycle of construction needs. Historically, the role of the federal level has been to fund new construction and maybe some operations, while operations and maintenance has been funded at the local agency level. There was a sense that the political officials do not understand life-cycle investments. 

The Degree of Familiarity with TSM&O

The local agency officials seemed less aware of various TSM&O systems and services; did not associate TSM&O with safety; indicated a need for customized packaging to reflect unique locale needs; and felt once installed, they were left on their own to maintain the systems. The other groups comprising of the state DOTs and private sector vendors were more familiar and were found to be generally satisfied. There was a sense that the legislative groups lack awareness or depth of understanding of the TSM&O concepts. Other issues that the groups raised included: lack of inter-operability, the Legacy Systems of different regions that do not talk to each other, lack of standardization and the difficulty of integrating into one cohesive system to create synergies.

Major Obstacles to the Implementation of TSM&O

The majority of the larger metro areas have realized the benefits of TSM&O; however the smaller cities and regions find it harder to yield the same impacts. Changing the historical mindset from build and maintain to one of operate and maintain is going to take a shift in culture and thinking. A major difference is the lifespan of build and maintain, when dealing with rapidly changing technology you can not think in 20 year increments. The personnel needed have to come with a multi-disciplinary skill set, which is difficult to train and retain. The first adopter takes a big risk, while everybody waits for the refinement of the technology. The new terminology is complicated and hinders communication. Congress has not been educated to propose new legislation that would address many of these problems. 

Decision Processes and Players

The process is long, involving one to two years when only one jurisdiction is involved, and growing exponentially as more are added. Long term plans provide a general framework, emerging needs and situational funding actually determine what is adopted; Processes do not vary that much across TSM&O services but vary according to a region’s dynamics; the complexity of the decision process parallels size of the locality; and the technical assessment & support precedes political assessment & support.

Though the state DOT and MPOs were consistently cited as extremely critical in the decision-making process, the remaining composition and degree of influence among the different stakeholder groups showed greater signs of variance. Some examples of the various other players in the process included joint transportation committees, regional transit authorities and chambers of commerce. One of the reasons for the state DOTs central role is due to the flow of funding. Historically funding has passed through the State DOT from the federal government to local governments and then to municipalities or regional coordinating bodies. The findings reveal that champions do matter, but there is a difference between technical champions and political champions. There is a lack of political champions, they can be found as city manager/council at city level, MPO at regional level but harder to find at the higher levels. There is a tendency to react to what is working in other locales rather than trying to figure out what would work best in your region. 

Information and Decision Support Needs

The focus groups and interviewees were asked about the information and decision support needs. The findings revealed that there is a trust factor with the data because the collectors of the data had not been in the trenches. Part of the misconception was that the data was only about the benefits, success stories, and directed mostly at the larger metros. When asked about what information they trusted it was from the state DOT rather than from the federal government. They were more focused on seeing data on the cost-benefit analysis and associated human costs. There was some question on how to quantify the public benefits and make sure that they are transferable to other regions. 

The major information sources listed by the participants were: 1) consultants, 2) product information from vendors, 3) peers, 4) decision makers trade associations, 5)TRB, and 6) Federal Highway. The biggest need identified was the communications piece that provided the marketing tools and a strategy to assist with helping the general public understand. 

Perceptions of Marketing Materials & Communications

Several U.S. DOT marketing materials were shown to the focus groups for comment and the responses were:

The next steps to complete the business case are to do an internet survey of market segments during August/September. This survey will supplement the research including broad based market segment survey and will include additional interviews by phone. In October an initial draft of the marketing plan will be completed and the final draft projected for completion by end of November. A final presentation to NTOC of deliverables will be given in December at the NTOC meeting.