Strategic procurement management of railroad rolling stock in the European Union

Abstract

Purpose – Like a well-designed procurement strategy, a well-designed rolling stock strategy promotes the development of a railroad company and contributes to its competitive advantage. Effective implementation of the rolling stock strategy enhances the likelihood of enjoying the benefits of the strategy’s design. A successful implementation relies on the strategy being known, understood, controlled and communicated to the entire organization. Design/methodology/approach – The research consists of an extensive literature review as well as a series of workshops with rolling stock suppliers, railway authorities and representatives and rail users. Findings – This paper presents a collection of solutions for passenger rail rolling stock procurement. The authors offer guidance to the strategic procurement of rolling stock in the European Union (EU) and propose key performance indicators to measure the effectiveness of a rolling stock strategy. Research limitations/implications – While this study presents a thorough evaluation of rolling stock procurement practices, it is limited by its geographic isolation. Future studies should compare the procurement practices discussed here to others in the EU, as well as in North America, South America and Asia. Additionally, this study focused on the passenger rail segment. Passenger transport is an important function of the rail network in the EU, but future research should expand the assessment of rolling stock procurement strategies to freight rail as well. Originality/value – Overall, this work provides visibility into common rolling stock procurement practices in complex EU railway markets. This work expands the literature through a review of these practices and through enabling research into best practices or a commonly accepted procurement model.