Integrated Product Service Offerings for Rail and Road Infrastructure : Reviewing Applicability in Sweden

Abstract

This research aims to explore and propose a more effective management of rail and road infrastructure and the possibility of a more resource-efficient road and rail infrastructure by applying business models based on performance and a life-cycle perspective.There is a lack of efficiency in the Swedish rail and road infrastructure industries -at the same time as the availability of the rail tracks and roads is essential. Rail and road infrastructure have long lifetimes, around 40-60 years, and during these decades regular maintenance and reconstruction are needed to ensure proper function. Large amounts of resources are required to construct the infrastructure, and the overall environmental pressure depends substantially on this.This research is largely based on interviews conducted with the buyer, contractors and design consultants for rail and road infrastructure in Sweden. Literature reviews have been conducted to develop the framework needed to analyze the empirical findings. This research contributes by building on theory in areas such as Integrated Product Service Offerings (IPSOs) and eco-design, and this abstract presents a brief summary of the overall conclusions.Several challenges for rail and road infrastructure in Sweden have been identified, such as the lack of information and knowledge transfer between different projects and actors. This is due to e.g. the use of traditional short-term contracts and conservative cooperate cultures, creating sub-optimizations in management. Increased collaboration, through e.g. partnering, seems to be a promising way to increase the information and knowledge transfer between actors by increasing trust and interaction. In this way, management would be more effective, and by involving contractors in the design phase, more efficient technical solutions could be developed and used. Additionally, increased involvement by the design consultants and an iterative information loop between design, construction and maintenance could also be beneficial. The research indicates that increased cooperation increases trust. In this way, there is a possibility to remove the detailed requirements that prevent new ways of working.Rail and road infrastructure have characteristics, such as the resources used and the importance of availability, that are well-suited for IPSOs. This performance-based business model with a life-cycle perspective provides incentives to optimize the use of resources and provide a holistic view for management that is lacking today for rail and road infrastructure.However, a long-term contract such as an IPSO creates uncertainties. The actors are riskaverse, which is an obstacle in the development of new business models and contract forms.Most of the risks and uncertainties identified are due to lack of experience. This implies that an implementation of IPSOs will have a steep learning curve. Additionally, risk allocation between the actors is important for effective management: too much risk for the suppliers iii will make them reluctant in developing ne...

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“…Procurement of maintenance is often made in the form of medium-term contracts based on fixed price on defined work in the Swedish railway (Esping and Olsson, 2004). These kinds of contracts are quite inflexible and can easily lead to negotiations for all activities not included in the basic contract (Lingeg ard, 2014). There is little if no incentives for improving neither maintenance internal effectiveness nor its performance, as the contract is regulated on detailed level (Lingeg ard, 2014;Abdi et al, 2014).…”

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