INTEGRATED PROGRAMME IN

MANAGEMENT

MARKETING RESEARCH

Report on Customer Satisfaction with AiCTSL

Submitted By:

Deksha IPM2015027 Nikhil Kumar IPM2013127 Shaurya Saxena IPM2014083 Tanya Jakhar IPM2014102

CONTENTS

1. ACKNOWLEDGEMENT

2. INTRODUCTION AND THEORY

3. GOAL OF RESEARCH

4. METHODOLOGY

5. QUESTIONNAIRE

6. RATIONALE BEHIND THE QUESTIONS

7. RESPONSES

8. INFERENCES

9. SUGGESTIONS

10. CONCLUSION

Acknowledgement

We would like to extend our heartfelt thanks to AiCSTL, Industry Interaction Cell, IPM, IIM Indore and Professor Ranjit Nambudiri for giving us an opportunity to work on this live project. We would like to thank Prof. Sushant Kumar Mishra for being our mentor and guiding us throughout the project. Big thanks to all of the participants for being a part of the survey. Special thanks to Mrs. Mala Thakur for her guidance, support, suggestions and encouragement. Without her, this project would not have taken its present form. This project helped us in learning a lot of things over and beyond the scope of theoretical knowledge. It helped us apply all that we’ve learnt in real life situations and grow from them. We are grateful to everybody who helped make this project a reality. Thank you

Introduction and Theory

Indore, the largest metropolitan city of the state of Madhya Pradesh, is fast emerging as a centre of trade and commerce. In the context of rapid growth of the city, increasing mobility, high travel demand, increasing intensity of traffic, congestion, delays, accidents and other such problems, public mass transport system of the city stands out as the most critical issue. The intra-city public transport system is essentially road based with 500 private minibuses, 550 tempos and 10000 auto rickshaws. Since there was no specialized and effective regulatory agency to monitor the system a special purpose vehicle in the form of public limited company "Atal Indore City Transport Services Ltd." was set up to operate and manage the public transport system in Indore with private sector participation to overcome financial constraints.

The aforesaid company has identified and took permission for 18 high travel demand routes from RTA and has already started operation of its 37 ultra-modern low floor buses. These city buses with 2 broad doors are allowing passengers to board and alight quickly and easily, save time and fuel, and give better run-times and improved economy to the bus operators. Real time vehicle tracking and fully computerized ticket vending

system are some other highlights. O&M and other regulatory measures are being exercised by the company.

The main sources of revenue for the system are the fair box collection, advertising, passes revenue and bidding amount by private participants. The optimum fare structure has been decided to meet twin objective of Equity access to poor and incentive for upper middle class to prefer these buses over their own vehicles. The fares have been kept reasonable to give healthy competition to existing minibuses and tempos, low enough to secure fullest utilization and high enough to ensure viability of the system within the government norms. System of monthly, weekly, employee and student passes will ensure the fullest utilization of the new system.

Financial evaluation of the project was carried out with the objective of determining its financial viability and assessing its potential for implementation on a commercial format. At this stage, projected financial analysis estimates the likely returns to the operators, company and people at large.

Cities with population of more than one million should have urban bus Transport Corporation that owns 30 percent of its own buses and contracts 70 percent of buses from private contractors and operators. Motivated by this World Bank recommendation note on 'India's Transport Sector, The Challenges Ahead (2002)' Mr.

Vivek Aggarwal, Collector and District Magistrate, Indore conceptualized a financial model of public transport system through private partnership where in every player whether Government, the spv, local administration, operators and people are mutually benefited.

Looking to the high potential for development of competitive bus transport market through contracting or franchising arrangements, a Special Purpose Vehicle as a public limited company was formed which specifies the role of the market and government. It was felt that cities like Indore should develop their own regulatory and enforcement capabilities to promote city service competition and put in place a mechanism that will ensure financial viability of such operations.

The main source of revenue for the company is the monthly premium amount received from the bus operators, advertising revenue and the share of revenue generated through passes. The sources of revenue for the bus operators are the daily fare box collection, share of revenue generated through advertising on buses and monthly passes. Cost effective and substantial finances to the operators have been made available by the bank. Operators were financed 100% by the bank and an agreement has been executed between the company, the bank and the operators to have an escrow account.

Indore has a population of 2.72 million in 2001. There was an increase of almost 50 percent during the period 1991-2001. It has estimated 3.30 lakh workers in 1991

with 63.4% of the workforce in the tertiary sector. The workforce has increased at a growth rate of 3.64% per annum during the period 1961-91. The workforce participation rate was 28.9% in 1991.

It had a registered vehicle population of 0.48 million in 2000 increasing at an average annual rate of 8.8 percent. Currently total vehicle population is 732893. The intra-city public transport system is essentially road based with an estimated 550 private minibuses and 500 tempos.

On an average, 88423 vehicles move in and out, daily, at the outer cordon while 5,28,558 vehicles enter and exit, daily, through the inner cordon. Of the total traffic crossing the outer cordon, freight vehicles account for a share of 23% followed by slow vehicles and cars (14.4%). At the inner cordon, slow vehicles account for a share of 15 percent. While percentage of peak hour traffic ranged between 7.5 and 14.0 at outer cordon, it varied between 7.3 and 14.6 percent at inner cordon. Total no of registered vehicles

Type of vehicle No. of Reg. vehicles

Multi axle 1219

Medium heavy truck & lorries 29255

Light four wheelers 4970

Three wheelers 3964

MPSRTC Bus 1650

Private buses 1204

Deluxe 366

Omni up to 12+1 14023

Omni 12+1 to 30+1 2300

Motor cab 2219

Tempo 6+1 86

Tempo 12+1 572

Auto Rickshaw 9676

Motorcycle/scooter 488907

Moped 84818

Car 62689

Jeep 4337

Tractor 11211

Trolley 7714

Others 1713

Total 732893

1. An estimated 2,84,161 passengers enter and exit

the city daily by various modes. Minibuses and buses put together contribute to a share of 60 percent of passenger trips. Majority of trips are made for the work, business and education purpose together accounting for nearly 76% of total trips performed.

2. 71 percent of road length in central area had speeds less than 20 kmph. The average journey speeds on A B Road and Ring Road were observed to be 32.2 kmph and 40.1 kmph respectively.

3. The city is presently being served by an estimated 300 minibuses along with estimated 150 tempos. An estimated 22,469 passengers use the regional bus terminals daily. Of the four bus terminals in Indore City, Sarvate bus stand accounts for the maximum share of passenger flow (65.33%). An estimated 61,192 rail users use the station daily. In all, 49 trains service the rail movement needs.

4. Average household income in Indore is Rs. 7524. On an average, a household in Indore spends Rs.600 per month on transport, which is about eight percent of household income. The average vehicle ownership rate in the study area is 0.88 vehicles per household with two wheelers and bicycles being the most commonly owned vehicles.

5. An estimated 22.7 lakh trips are performed everyday in the city of which central area contributes 19.4 percent, while the rest of Municipal Corporation area contributes 76.4 percent and extension area's share being 4.3 percent only. The shares of personalized vehicles (cycles, two wheelers & cars) and public/IPT transport in the total trips are 51.1 percent & 16.4 percent respectively. Work /Business trips accounts for maximum share (38.1 %) followed by education trips (37.6 %). Shopping trips share was 28.4 percent. The average trip lengths observed were 3.8 km and 4.4 km including and excluding walk trips respectively.

6. A population size of 42 lakh is estimated for the city by the year 2025. For employment, it was estimated that 13.44 lakh workers would comprise the workforce in the study area by 2025 giving a work force participation rate of 32%. Further, it is assumed that by the year 2025, nearly 63% of the total workforce would be in the tertiary sector while the secondary sector will account for 33%.

7. An estimated 62,85,950, passenger trips have

been forecasted, for the year 2025, comprising 55,03,000 intra-city trips while the rest comprise of inter-city passengers. An estimated 27,51,825 trips

by public transport has been forecasted for the horizon year.

8. By year 2025, at modal split of 50% and with an estimated average trip length of 6.02 km, it is estimated that 16.5 million passenger km would be performed daily by public transport.

9. According to traffic estimates, a total of 5.5 million person trips would be generated every day by 2025, of which the share of public transport trips would be 2.75 million trips.

10. Travel Demand : The passenger demand per day, on the Bus System, in 2025, has been estimated as under: a. Direct Service : 5,97,330 b. Feeder Service : 6,25,580 c. Total : 12,22,910

In order to overcome the traffic problem of future, it was decided to introduce a better public transport system in the city. We, the students of IIM Indore’s Integrated Programme in Management did a market based survey to improve the services and increase customer satisfaction. AiCTSL is aimed at client service. There are several initiatives under its kitty already like passing tenders for new

routes, new buses, tying up with State Bank Of India for provisions of ATMs, having vending machines at the bus stops, having automated buses, free Wi-Fi at the bus stops etc. In order to assist them with the same we did an on ground study to get an in-depth analysis of the problems, requirements and needs of the people in relation AiCTSL bus services. Through sorting of the data, statistical analysis, on field intuition and severe discussion we reached a conclusion that, through its implementation benefits not only the clients but AiCTSL itself as people would use it more and it would set a precedence to all other such bus services throughout the country.

Goal of Research

Customers are the most important stakeholders in any business. Any service provider aims to focus on improving customer satisfaction over time. In addition to this satisfied customers lead to higher goodwill and improved reputation for the business. In this scenario, customer satisfaction gains higher importance. Thus, customer satisfaction is the parameter by which most service providers are judged in this competitive environment. The only way to differentiate various, similar services is to improve the customers' experience. Improved customer satisfaction also leads to word-of-mouth publicity. It would not be wrong to conclude that investment in customer satisfaction is worthwhile and necessary if the current business environment is kept under consideration. AiCTSL is a service provider which aims to improve customer satisfaction. This makes market research very important. Market research aims at scientific collection of data and its interpretation to form valid and relevant policies and strategies.

The goal of this research was therefore market and customer oriented. The main aim of the researchers was to 1. Examine the existing level of customer satisfaction 2.Establish a baseline for customer satisfaction levels 3. Find out the areas in which improvement can be made 4. Explore avenues for innovation in improving the customer service 5. Understand additional services that the customers need

Questionnaire

1. Respondent’s age

2. Respondent’s gender 3. Respondent’s occupation

4. According to the respondent, should the frequency

of buses be increased? If yes, then in which time slot (hourly)?

5. Does the respondent feel the need for a water

cooler at the stop? 6. Rate on a scale of 1-5

[1-Highly dissatisfactory, 2-Dissatisfactory, 3-Neutral, 4-Satisfactory, 5-Highly satisfactory] a) Behavior of Conductors b) Comfort of stops c) Cleanliness of the bus d) Safety of passengers 7. Rank the aforementioned factors in order of priority

for improvement

8. According to the respondent how many people should be allowed to board the bus at any given time

9. According to the respondent, should the number of stops be increased? 10. Suggestions for any two new stops and the reasons for the same

Rationale behind the questions

4. The rationale behind this question is very simple. A number of customers face problems in the rush hour as the number of seats is limited. High frequency of buses is necessary to ensure that people are able to travel comfortably and that if they miss a bus, they do not have to wait for a long time before the arrival of next bus .A long time gap between the arrival of two buses( or low frequency of buses) can often reduce the effectiveness of any transport system. If the frequency of buses is too low, customers end up getting late for various appointments. On the other hand, if the frequency is too high, it leads to inefficiency. It is clear for all to see that the frequency needs to be adjusted according to the time slot. Thus, this question focuses not only on whether the customers feel the need for an increase in the frequency of buses but also which slots should the frequency be increased in. 5. Asking customers whether they feel that there should be water coolers at the stop is because many times people commute from end of the city to another and usually directly from their home to their destination. The journey can often be tiring and our aim is to maximize customer satisfaction by fulfilling their comfort needs.

Having a water cooler at select places helps us in doing so. 6. This question is related to how the customers rate various, basic facets of the AiCTSL iBus experience. The objective behind this question was to understand how people perceive the behavior of the conductors, the comfort level of stops, the cleanliness of the bus and safety of the passengers. This question is important as it seeks to examine how highly the various factors of customer experience rated are and to therefore establish a baseline for the ratings and to know which factors need to be improved upon.

Behavior of conductors The behavior of conductors can play a large role in determining the level of customer satisfaction. Conductors interact with a huge number of people on a daily basis and therefore have the power to influence the perception that the consumers hold towards the iBus service.

Cleanliness of the bus This factor is very basic in nature. It is also not very hard to implement or improve upon. In addition to that cleanliness is one of the main factors that influence the impression of the bus that the customers hold.

Comfort of the stops The stops are the first points of interaction that

the customers encounter when they begin their bus experience. They also have to wait at the stops for some time. A clean and comfortable stop can therefore go a long way in improving customer satisfaction.

Safety of passengers Safety is a factor that has seen its importance increase over the time. The safety of the bus as judged by passengers is presented below.

7. This question is in continuation to the previous question. We asked the respondents to rate the order in which the improvement of factors should be focused upon. This was done so that we give the required importance to each of these areas which still have scope for improvement.

8. The rationale behind this question is related to the overcrowding of the buses. This question is also related to the frequency of buses in an hour. Overcrowding leads to discomfort for customers. At the same time, it is very hard to restrict the number of people who climb aboard a bus. Thus, this question aims to test whether there is a limit of intake which will not cause any discomfort to customers. This question also seeks to establish the aforementioned limit (if it exists). 9. AiCTSL aims at connecting all the practically possible places of Indore to ensure connectivity as well as to

increase its scope for catering to more people. Therefore, we asked the regular users of the bus services whether they felt the need for increasing the number of stops.

10. The last question aims at exploring newer options for stops. It seeks to take inputs from the users on the best possible stops. This question is also related to the comfort and satisfaction of customers as they will benefit from improved connectivity.

Methodology

The methodology behind any research is a very important factor. It requires a great understanding of the purpose and context of the survey to select the appropriate method. Various factors such as time available for interaction, literacy level of respondents and the nature of questions play a great role in this decision. Keeping all this in mind, we decided to conduct our survey by approaching people, asking them a set of predefined questions and recording their answers. The questions were prepared to test the existing level of customer satisfaction and to take inputs from the customers as to what could improve the satisfaction level. A detailed analysis of the questions and the results obtained has been presented in the subsequent parts of the report.

Responses

1. Respondent’s Age

The above frequency plot shows that teenagers and youngsters are the most frequent travelers of i-bus. The i-bus service has made the students’ life easier .College students and coaching centre students benefit a lot from it. Most of the people in the 21-30 age group are daily users of i-bus service.

2. Respondent’s Gender

The survey was administered to 67 different individuals.

Out of

these, 37 (55.2%) were male and 30 (44.8%) were

female. This shows that there was fair participation from

both males as well as females in the survey

3. Respondent’s occupation

4. According to the respondent, should the frequency of buses be increased? If yes, then in which time slot (hourly)?

More than 75% of the participants believe that the number of buses which arrive at a particular stop in an hour should be increased. The hours in which this aforementioned frequency should be increased were also discussed with the customers.

5. Does the respondent feel the need for a water cooler

at the stop?

The data very clearly indicates that more than 80% of the people feel that there should be a water cooler near the bus stops. Water is a necessity and water coolers can therefore be placed at least some of the major stops like MR-09, Bhawarkuan.

6. Satisfaction level of people (Due to discrepancies in the data these results were derived from a subset of the total data. This data included 46 respondents) Behaviour of coductors- More than 50% of the people rated the behaviour of conductors at a satisfactory or higher level. Comfort of stops- More than 50% of the people rated the comfort of stops at a satisfactory or higher level Cleanliness of the bus -More than 50% of the people rated the cleanliness of the bus at a satisfactory or higher level Safety of passengers - More than 50% of the people rated the cleanliness of the bus at highly satisfactory.

The people were asked to rate four factors on the basis of their satisfaction level. It is quite evident that that most of the people are not very satisfied by the behavior of the conductors. On the other hand, most of the people consider i-Bus to be a safe way to commute between the major stops of the city.

7. Rank the aforementioned factors in order of priority for improvement

People felt that the AiCTSL management needs to really focus on the Human Resources part of its services. The behavior of conductors needs to be improved. Only once that is done should focus be shifted to the comfort of the stops and cleanliness of the buses. Safety is already being taken care of, so that should continue on. The order of priority for improvement after talking to the people was settled to be

(i) Behavior of Conductors (ii) Comfort of Stops (iii) Cleanliness of Buses (iv) Safety of Passengers

8. Should there be a limit on the number of people

boarding the bus? If yes, how many people should be allowed to board the bus at any given time?

The biggest problem faced by passengers of i-bus is the overcrowding of buses. 94%of people want the number of people who board the bus to be limited. According to 65.67% (44 out of 67) people the number of people boarding the bus should be equal to capacity and the

remaining believed that letting 10-12 people stand would be okay. 9. According to the respondent, should the number of stops be increased?

Suggestions

1. Appointment of lady guards: Although there is much conflict about appointing female guards in i-buses due to the hectic nature of the job, we still recommend this because most of the female passengers are more comfortable to share their problems with a lady guard.

2. Seating capacity at the stops should be increased;

Due to excessive crowding passengers has to wait on the stops for the next bus; since the seating capacity is limited many people have to stand. We can also reserve seats at the stops for senior citizens so that they are at a greater ease.

3. Announcements should be made more informative at

the bus stop as well as in the bus; it should mention the next bus timings, name of the next stop and the approximate time that will be taken to reach the next stop.

4. The bus conductors, ticket checkers and issuers

should be trained professionally as during our survey we encountered a few cases of misbehavior on their part. This can be a month long training where the

AiCTSL authorities can conduct workshops for training their employees about basic hospitality skills and dealing with a crowd patiently. The training can also be done on practical grounds by sending new employees to work with the senior employees for 2-3 weeks, so as to let them understand their work and duties better. Also, while hiring the employees they should be tested on their patience and endurance skills because working for AiCTSL is a very tiring job and one is bound to get tired and frustrated by the end of the day.

5. There should be orientation programs for the workers of AiCTSL so that they can be motivated to work for AiCTSL more sincerely. This orientation can also include yoga sessions for them so that they can relax. This would also help in increasing the job satisfaction among the employees and increase the employ turnover.

6. There should be a strict check on drivers for rash driving.

7. The customers also gave suggestions for stops that include MR-10,Annapurna,Collector’s office, Rau-Pithampur road, a stop beyond LIG,a stop before Treasure island mall on MG road, Sitawa chauraha, Ring road,Rajendra nagar, Choithram, Rajwada, Regal

cinema, Meghdoot,Suklia,CAT road,Railway station,Bichow mardana,Bengali Stop,Khajrana,Madhumitra chauraha ,Manglia,Singapur township and Panchvati.

There is need of

washroom at major stops

like Bhawarkuan, Palasia

and MR9. We took an

inference from an article in

News Today and asked

people at the above

mentioned stops about

problems due to

unavailability of

washroom. Many of them

strongly agreed with the

idea of having washroom

nearby bus stop. Ticket

issuer and guard at

Bhawarkuan stop said that

they have to go to nearby

hospital for toilet while that

of MR9 go to nearby

offices and banks. But one

of the problems was of

non availability of proper

place to construct portable

washroom. So, we went to

the field and spotted some

place near Bhawarkuan,

Palasia and MR9. But we

couldn’t find any proper

place at MR9 and Palasia.

Conclusion

We suggest placing a portable bathroom trailer

nearby each stop during operation hour of

AICTSL. This can also help building Indore a

smart city.

The i-bus has evolved as a Sustainable, Affordable, Reliable and Technology-based solution for mobility. People across Indore consider it one of the top features of Indore. However, like all good things it must be constantly evolving to keep up with needs and expectations of the people it serves. Based on our own experiences as well as after interacting with the i-bus customers we found a little scope for improvement in some key features like the behaviour of conductors and ticket checkers. Focus needs to be laid on the driving of the bus. People want the frequency of the buses to be increased and more stops for the bus service to reach all parts of Indore as well as neighbouring areas. The general perception of the bus is extremely positive. The customers feel that issues about safety are extremely well addressed which a very important question is given today’s scenario in the country. We also had some suggestions of our own regarding portable toilets, orientation programs, workshops, more modernisation etc. If these small things are worked upon then i-bus has the potential to become one of the best transport services in the country.

References

http://www.citybusindore.com/

News Today

AiCTSL Data