Train Operations: Company Has Improved Management of Intercity Trainset Acquisition and Can Improve Stakeholder Engagement on Major Capital Programs

Our objective for this report was to assess the company’s oversight of the Intercity Trainset program. We found that the company experienced early challenges with stakeholder engagement on the ICT program, leading to scope changes, cost increases, and schedule delays in its trainset acquisition and maintenance facility modification workstreams. For example, the company did not consult with its food and beverage personnel, along with officials from product development, on the design of a food service car before it signed the contract with Siemens. This resulted in a company-initiated change order that increased program costs by $42.5 million and will delay the delivery of the first trainsets by up to five-and-a-half months. The company has since taken steps to address these issues, including establishing an ICT program management framework that closely aligns with company and industry standards such as additional cost and change management controls. The Capital Delivery department is in the process of identifying any controls needed to manage its major capital programs, but it has not yet established and implemented a control to require stakeholder input on all major programs going forward. We recommended the company establish and implement controls to require program personnel to identify and engage all relevant stakeholders to specify requirements early and modify those requirements as program needs and assumptions evolve. The company agreed with the recommendation and is taking corrective action.