{"id":7466,"date":"2015-12-09T23:28:19","date_gmt":"2015-12-10T04:28:19","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/revolutionizing-intercity-passenger-travelmega-head-ache-or-mega-deal\/"},"modified":"2015-12-09T23:28:19","modified_gmt":"2015-12-10T04:28:19","slug":"revolutionizing-intercity-passenger-travelmega-head-ache-or-mega-deal","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/revolutionizing-intercity-passenger-travelmega-head-ache-or-mega-deal\/","title":{"rendered":"Revolutionizing intercity passenger travel\u2026mega head-ache or mega deal?"},"content":{"rendered":"<div>We all have a Megabus story &#8211; bus broke down, driver reached maximum working hours half way through the journey and left you stranded at a rest stop (ahem&#8230;this happened to me over Thanksgiving) and whats with the elusive $1 fare that\u2019s plastered all over their busses as if it were commonplace.<\/div>\n<div>\u00a0<img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-7415 alignright\" src=\"https:\/\/i4tsk12in2b2y7uts14c528g-wpengine.netdna-ssl.com\/wp-content\/uploads\/sites\/4\/2015\/12\/A4C9FD7C-E281-413D-8627-583170E65545.png\" alt=\"A4C9FD7C-E281-413D-8627-583170E65545\" width=\"201\" height=\"211\" \/><\/div>\n<div>Contrary to what I thought\u00a0I would find, Megabus\u00a0business and operations strategies are\u00a0actually quite aligned. Megabus prides itself on its value proposition:\u00a0providing safe, convenient, low cost, daily express bus service in the US and Canada. A subsidiary of Stagecoach Group in the UK, Megabus US is operated in by Coach USA and\u00a0part of a rapidly growing portfolio that includes a UK rail\u00a0business and\u00a0bus lines across the UK, and Europe. \u00a0This decentralized\u00a0operating model across a diversified portfolio of transportation alternatives has enabled them to capitalize on the significant growth in the intercity bus market. They are creating value for customers (30% of whom are college students) by adding routes that are currently underserved by conventional bus lines, offering comfortable\u00a0buses with wifi, recharging outlets, wheelchair-accessible service,\u00a0convenient stop locations, frequent travel times. Megabus extracts\u00a0value through a an online booking system and\u00a0dynamic pricing model that increases closer to the day of travel, they cut costs by avoiding cost of waiting rooms doing curbside boarding on public streets, parking lots, college campuses.<\/div>\n<div>\n<div><span style=\"color: #252525;font-family: sans-serif\">\u00a0<img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-7416 alignright\" src=\"https:\/\/i4tsk12in2b2y7uts14c528g-wpengine.netdna-ssl.com\/wp-content\/uploads\/sites\/4\/2015\/12\/5EA667C1-34F1-4D4C-AE6A-A1C30323B5E8-300x139.png\" alt=\"5EA667C1-34F1-4D4C-AE6A-A1C30323B5E8\" width=\"300\" height=\"139\" srcset=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2015\/12\/5EA667C1-34F1-4D4C-AE6A-A1C30323B5E8-300x139.png 300w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2015\/12\/5EA667C1-34F1-4D4C-AE6A-A1C30323B5E8-600x277.png 600w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2015\/12\/5EA667C1-34F1-4D4C-AE6A-A1C30323B5E8.png 919w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/span><\/div>\n<\/div>\n<div><b>Operational strategy &#8211;\u00a0<\/b><b>Tangible and intangible investments:<\/b><b><br \/>\n<\/b><\/div>\n<div><\/div>\n<div><b>Strategic planning of routes to ensure maximum utilization. Verdict: #megadeal<\/b><\/div>\n<div>Megabus has transitioned from a pure hub and spoke model (in the Midwest) to incorporate\u00a0a point to point model (East and West Coasts) &#8211; by making additional stops along a single journey they are able to cut the costs of having additional hubs.<\/div>\n<div>\u00a0<img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-7403 alignright\" src=\"https:\/\/i4tsk12in2b2y7uts14c528g-wpengine.netdna-ssl.com\/wp-content\/uploads\/sites\/4\/2015\/12\/0BCF3303-8C97-4440-94CB-BB5EC75841BB-300x279.png\" alt=\"0BCF3303-8C97-4440-94CB-BB5EC75841BB\" width=\"300\" height=\"279\" srcset=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2015\/12\/0BCF3303-8C97-4440-94CB-BB5EC75841BB-300x279.png 300w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2015\/12\/0BCF3303-8C97-4440-94CB-BB5EC75841BB.png 364w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/div>\n<div><b>Scope &#8211; rapid expansion through partnerships and organic growth. Verdict:\u00a0<\/b><b>#megadeal<\/b><\/div>\n<div>Capitalizing on the liberalization of the French coach industry\u00a0by the french government, in Sep 2015\u00a0Megabus announced it is doubling\u00a0its work force in France investing $2.7 million Euros in fleet of 10 buses, 75 employees\u00a0to reach a\u00a0total of 27 domestic routes. In\u00a02009, they purchased two Chinatown bus companies,\u00a0which enabled them to meet demand for increased routes as they expanded throughout US. This explains why theres a mix of start of the\u00a0art double-decker coaches and old livery coaches.<\/div>\n<div><b>\u00a0<img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-7418 alignleft\" src=\"https:\/\/i4tsk12in2b2y7uts14c528g-wpengine.netdna-ssl.com\/wp-content\/uploads\/sites\/4\/2015\/12\/566197E5-DDDA-4DFB-BCE8-9E1CC8D2F61B-300x200.png\" alt=\"566197E5-DDDA-4DFB-BCE8-9E1CC8D2F61B\" width=\"300\" height=\"200\" srcset=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2015\/12\/566197E5-DDDA-4DFB-BCE8-9E1CC8D2F61B-300x200.png 300w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2015\/12\/566197E5-DDDA-4DFB-BCE8-9E1CC8D2F61B-600x399.png 600w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2015\/12\/566197E5-DDDA-4DFB-BCE8-9E1CC8D2F61B.png 968w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/b><\/div>\n<div><b>Investment in Human Capital and <a href=\"http:\/\/https:\/\/youtu.be\/gkkJMJgM9yI\">safety<\/a>.<b>\u00a0Verdict:<\/b>\u00a0<\/b><b>#megadeal<\/b><\/div>\n<div>Staff go through intense training and background checks before they hit the road. Drivers are only allowed 10 hours of drive time daily and must comply with off duty and night driving policies. Buses are tracked in real time and coordinates\/footage from on board cameras are monitored in central support center in Paramus, NJ. This is positive news compared to the bad safety reputation\u00a0of players such as Fung Wah, which was shutdown after the\u00a0Federal Motor Carrier Safety Administration crackdown in 2013.<\/div>\n<div><\/div>\n<div><b>Quality and user experience. Verdict: #mega head-ache <\/b><\/div>\n<div>You know you have a customer service quality\u00a0problem on your\u00a0hands when you are a top contender on pissedconsumer.com with only 3 resolved issues and over $130k worth of claims<b>.\u00a0<\/b>Megabus is lacking in process controls that would enable them to provide a more streamlined customer service experience.<\/div>\n<div><\/div>\n<div>Megabus has achieved strategic alignment in key areas across its business and operational model\u00a0&#8211; this has certainly fueled their growth. I wish I could say the poor customer service is something they should watch out for, but I fear it wont make a dent in their business. People will still ride Megabus. I know I will!<\/div>\n<div><\/div>\n<div><\/div>\n<div><strong>References:<\/strong><\/div>\n<div>http:\/\/www.stagecoach.com\/~\/media\/Files\/S\/Stagecoach-Group\/Attachments\/media\/publication-financial-reports\/ar2015.pdf<\/div>\n<div>http:\/\/www.stagecoach.com\/media\/news-releases\/2015\/2015-09-22.aspx<\/div>\n<div>\n<div><a href=\"https:\/\/en.wikipedia.org\/wiki\/Megabus_(North_America)\">https:\/\/en.wikipedia.org\/wiki\/Megabus_(North_America)<\/a><\/div>\n<div><a href=\"http:\/\/www.bloomberg.com\/bw\/magazine\/content\/11_16\/b4224062391848.htm\">http:\/\/www.bloomberg.com\/bw\/magazine\/content\/11_16\/b4224062391848.htm<\/a><\/div>\n<div><a href=\"https:\/\/www.bostonglobe.com\/business\/2015\/05\/25\/lack-local-stop-may-shut-down-fung-wah\/u8uYk7XlpAWbKqGPaEB8qK\/story.html\">https:\/\/www.bostonglobe.com\/business\/2015\/05\/25\/lack-local-stop-may-shut-down-fung-wah\/u8uYk7XlpAWbKqGPaEB8qK\/story.html<\/a><\/div>\n<div><a href=\"http:\/\/megabus.pissedconsumer.com\/\">http:\/\/megabus.pissedconsumer.com\/<\/a><\/div>\n<div><a href=\"http:\/\/www.bloomberg.com\/bw\/magazine\/content\/11_16\/b4224062391848.htm\">http:\/\/www.bloomberg.com\/bw\/magazine\/content\/11_16\/b4224062391848.htm<\/a><\/div>\n<\/div>\n<div><\/div>\n","protected":false},"excerpt":{"rendered":"<p>We all have a Megabus story &#8211; bus broke down, driver reached maximum working hours half way through the journey and left you stranded at a rest stop (ahem&#8230;this happened to me over Thanksgiving) and whats with the elusive $1 [&hellip;]<\/p>\n","protected":false},"author":907,"featured_media":0,"comment_status":"open","ping_status":"closed","template":"","categories":[326],"class_list":["post-7466","hck-submission","type-hck-submission","status-publish","hentry","category-travel-services"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/the-tom-challenge-tom-winners-and-losers-assignment\/","yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Revolutionizing intercity passenger travel\u2026mega head-ache or mega deal? 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