McKinsey & Company Home
Travel, Transport & Logistics
Report - February 2018
The rail sector’s changing maintenance game
By Elke Eisenschmidt, Stefan Reimig, Lisa Schirmers, and Sebastian Stern
Full Report (PDF–1MB)
Article Actions
Share this article on LinkedIn Share this article on Twitter Share this article on Facebook Email this article
How can rail operators and OEMs benefit from the disruption brought on by digitization?
The rail sector is no exception when it comes to disruptive changes through digitization. In a sector where fleet reliability is a key lever for increasing efficiency and reducing the total cost of ownership (TCO), big data and advanced-analytics solutions, such as condition-based maintenance and predictive maintenance, represent a great opportunity to yield the next big efficiency leap in maintenance—reducing the number of failures, the amount of unplanned maintenance, and, eventually, the required level of reserve asset capacity for operators.
Stay current on your favorite topics Subscribe
From a traditional perspective, this seems to be good news—above all, for rail operators. It might be positive for rolling-stock OEMs as well, which increasingly experience pressure from new entrants and heavy consolidation in the new-fleets business. Offering innovative (turnkey) maintenance solutions based on condition-based and predictive maintenance can help rolling-stock OEMs address the issue of rising competitive pressure.
Against this backdrop, and based on the findings from extensive research, we developed a new report, The rail sector’s changing maintenance game. We discuss the following in its three chapters:
why the sector’s maintenance game is changing or can be expected to change
what digitization of the maintenance regime in rail is all about and how it will affect the sector’s maintenance ecosystem and overall landscape
how individual companies can prepare effectively for capturing value from the new opportunities in the emerging maintenance ecosystem
In doing so, we mainly focus on the perspective of European rail operators but also include examples from around the world—and incorporate the perspective of rolling-stock OEMs where relevant.
Would you like to learn more about our Travel, Transport & Logistics Practice?
Visit our Rail & Public Transport page
Some of our key findings:
Advanced analytics are going to make condition-based maintenance an attractive lever to increase maintenance efficiency. With 10 to 15 percent efficiency gains expected, it is estimated that the global maintenance market can save up to around €7.5 billion per year by moving toward condition-based maintenance.
Jumping from a condition-based scheme to a predictive-maintenance one, however, requires further investments. The additional savings is not significant enough yet (currently estimated at a maximum of 10 percent) to be pursued aggressively.
Roles in the new maintenance ecosystem will change, as a significant share of maintenance-related activities will be automatable.
To compensate for a flat value pool in the new-fleets business and to address consolidation, rolling-stock OEMs will find it increasingly attractive to enter the service business, in particular, through offering fleets and guaranteeing their availability simultaneously.
An overhaul of their maintenance system through condition-based maintenance is a must for regional or urban rail operators and cargo operators, as increased competition will be felt most prominently in these rail segments. An efficient maintenance system is key to remaining competitive.
To prepare for these changes, a few pragmatic recommendations could help operators:
Defining the desired strategic target state and deriving a partnering strategy up front is key to success with respect to (condition-based) maintenance. An assessment along key parameters, such as market position, fleet characteristics, and operating contexts, can help to assess the fitness for condition-based maintenance.
Success in the new maintenance scheme is all about which party owns what kind of data and what they can do with it. Thus, operators and rolling-stock OEMs need to negotiate data access with one another and build the analytical capacities that enable success within their chosen operating models.
Operators and rolling-stock OEMs need to find a way to effectively couple and colocate rail-engineering expert knowledge and analytics power to develop powerful analytical models.
The entire value chain in maintenance needs to be addressed to realize impact; equipping locomotives and cars with sensor technology and building analytical capabilities is only the first step.
Only for business-case-positive components should a component-by-component rollout of condition-based or predictive maintenance be pursued.
Download The rail sector’s changing maintenance game, the full report on which this article is based (PDF–1.21MB).
Stay current on your favorite topics Subscribe
About the author(s)
Elke Eisenschmidt and Lisa Schirmers are consultants in McKinsey’s Munich office, Stefan Reimig is a consultant in the Cologne office, and Sebastian Stern is a senior partner in the Hamburg office.
The authors wish to thank Andreas Behrendt and Isabel Schwerdt for their contributions to this article.
Article Actions
Share this article on LinkedIn Share this article on Twitter Share this article on Facebook Email this article
More on Travel, Transport & Logistics
Article
How advanced industrial companies should approach artificial-intelligence strategy
November 2017 – Leaders need to determine what AI can do for their company by looking at potential applications and scenarios and then building their approach around those findings.
Article
Manufacturing: Analytics unleashes productivity and profitability
August 2017 – High uncertainty and low growth have already forced manufacturers to squeeze every asset for maximum value. The next target is their own data.
Report
How rolling-stock manufacturers can lay track for profitable growth
September 2016 – The character of the global rolling-stock industry is shifting from a product to a lifecycle business. Our new report sketches a strategic road map for rolling-stock manufacturers to master these changes.
Most Popular
Article - McKinsey Quarterly
Why digital strategies fail
Interactive
An executive’s guide to AI
Report
The five trademarks of agile organizations
Interactive - McKinsey Quarterly
Five Fifty: Strategy vs execution
Article - McKinsey Quarterly
Strategy to beat the odds
Podcast
Rethinking customer journeys with the next-generation operating model
McKinsey&Company
Sign up for email alerts
Select topics and stay current with our latest insights
Email address
LinkedIn
Twitter
Facebook
YouTube
RSS
Contact us
FAQ
Privacy policy
Cookie policy
Terms of use
Local language information
Download on the App Store Download Android app on Google Play
McKinsey Insights - Get our latest thinking on your iPhone, iPad, or Android device.
© 1996-2018 McKinsey & Company
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment