April 4, 2014
BC Ferries’ Automated Customer Experience (“ACE”) Program Reviewed
In April 2013, the commissioner released its policy on performance reviews of BC Ferry Services Inc. (BC Ferries). Under section 46.1 of the Coastal Ferry Act, the commissioner may conduct a performance review of one or more aspects of BC Ferries’ operations.
The purpose of performance reviews is to hold the company accountable, and by doing so to raise public confidence that the company is operating efficiently, making prudent use of its resources and operating in such a way as to keep ferry fares as low as reasonably possible. Topics involving safety and environmental protection are deemed to be out of scope for review by the commissioner.
In October 2013, the commissioner engaged the consulting firm of PricewaterhouseCoopers (“PwC”) to conduct a performance review on BC Ferries’ Automated Customer Experience (“ACE”) program. ACE is a complex set of initiatives and new information technologies to better enable point of sales, customer relationship management and demand management. The commissioner believes such set of initiatives has the potential to increase ridership, improve capacity utilization and reduce pressure on future price cap increases. The scope of work or project charter for the ACE performance review included the following:
- Review and assess the business case of the ACE program and all sub-projects;
- Review and assess key assumptions, cost estimates/potential benefits and determine their reasonableness;
- Review system and vendor selection process; review key contract provisions or negotiation strategies;
- Assess organizational competency to design, integrate and implement all projects within ACE;
- Assess program and project management capabilities;
- Review and assess project implementation plan and determine its reasonableness;
- Review and assess key project risks and mitigation strategies;
- Review and assess project governance model (including governance around customization) and identify gaps or areas of ineffective governance;
- Review and assess change management and communications strategy;
Upon completion of their work PwC provided the commissioner with a draft final report which in turn was provided to BC Ferries to check for any errors or omissions. BC Ferries was also given an opportunity to comment or respond to findings and recommendations contained in PwC’s report.
Based on his review of PwC’s report and BC Ferries’ responses to the findings and recommendations, the commissioner makes the following observations:
- The ACE program has the potential to enable transformational change in the business model for BC Ferries’ by better enabling its revenue generation capabilities and processes.
- By its very nature, the ACE program has a high risk profile and success will largely depend on an effective governance structure, well-structured project management and delivery functions and effective organizational change management.
- PwC has identified a number of key structural adjustments that should be implemented as the program transitions into the design and delivery phase, as well as a set of leadership recommendations to strengthen project processes and address other risk elements. BC Ferries has substantially agreed with all of the findings and has or is in the process of implementing the key recommendations. In considering any project adjustments which may be deemed necessary, BC Ferries should ensure that scope changes will not impair the transformational capability of the ACE program and its fundamental objectives.
- By implementing PwC’s recommendations, BC Ferries will lower the risk profile for this program by focusing on the key success criteria outlined in (2) above.
Click here for a copy of PwC’s final summary report with BC Ferries’ comments.