WHEN Mr Desmond Kuek went from being permanent secretary at the
Ministry of the Environment and Water Resources to heading rail
operator SMRT Corp three years ago, some of his close friends told
him he was either brave or plain crazy.
"I said there's a fine line between being brave and crazy," the
52-year-old former chief of defence force quipped.
As it turned out, the retired general's mettle was put to the
test immediately.
Within weeks of his appointment on Oct 1, 2012, the new Circle
Line suffered a major breakdown.
The following month, a bus driver strike - Singapore's first
strike in 26 years - shook the company to its core.
More rail breakdowns followed, prompting Transport Minister Lui
Tuck Yew to express his disappointment publicly.
All these piled pressure on a company that was already in deep
crisis after two massive breakdowns in 2011 triggered a costly and
humiliating public inquiry.
Mr Kuek, who is not easily fazed, admitted that the task of
getting SMRT back on track is "incredibly tough and
challenging".
His earlier assessment of the company was damning, describing it
as having "deep-seated issues... managerial, structural, cultural
and systemic issues".
One of the first things he did was to assemble a team of senior
executives made up largely of former career soldiers. Then he
started beefing up the technical staff. In the past three years,
SMRT's team of technicians and engineers have grown by 21 per cent
and 59 per cent, to 2,169 and 278, respectively.
He reshaped the company's organisational structure and
streamlined processes to offer employees clearer career paths, and
for them to give feedback and voice grievances effectively. These
moves are bearing results, Mr Kuek said, noting that there has been
"a clear shift in our staff culture", even though this is "not yet
consistent everywhere".
SMRT's train withdrawal rate - where a train is withdrawn from
service because of faults - has come down from 3.3 for every
100,000km operated in 2012 to 1.05 last year.
"This is the lowest in seven years," Mr Kuek noted. "And we are
targeting to go even lower this year."
He admitted that reducing the number of major breakdowns, or
breakdowns that last 30 minutes or more, remains a challenge.
"We have made tremendous progress on many fronts... but there is
much more to be done to improve rail reliability."
Most of these works are arduous and span long periods.
SMRT has replaced all the rail sleepers on the North-South Line
(ahead of schedule), and is now replacing those on the East-West
Line. The Straits Times understands some of the wooden sleepers
were in such a bad shape that it looked like they would fall apart
when removed.
In the next few months, SMRT will start replacing the
power-supplying third rail on the two lines.
The overhaul of older trains has also begun. All these trains
will be fitted with new motors from Toshiba. SMRT tested them on
two trains last year and found that they used 30 per cent less
electricity.
Meanwhile, the network's 30-year-old train signalling system -
which determines how tight train service intervals can be - is also
being changed.
"This may not sound like anything exceptional to some, but
Thales, our contractor, tells me that this is its biggest project
on a 'live' system anywhere in the world," Mr Kuek said.
The North-South Line's resignalling is expected to be completed
next year, allowing peak-period intervals between trains to be
shaved to 100 seconds, from 120 seconds today.
When all the upgrading is done and with the "robust preventive
and predictive maintenance regimen" the company is putting in
place, Mr Kuek is confident SMRT will rise from its recent
chequered history to recapture its spot as one of the world's top
metros.
"Whatever has happened in the past does not faze us - it only
makes us stronger," he said.
The chief executive officer has also been busy transforming the
business. "Sustainability, not simply profitability, is our aim,"
he said. Since assuming the helm, he has set up a department to
look at mergers and acquisitions.
He started a rail engineering subsidiary, which has clinched a
deal to market Toshiba train motors, and tied up with France's
Faiveley Transport to supply train maintenance, repair and overhaul
services in South-east Asia.
In April, SMRT announced it was eyeing a stake in OMG, a new
company vying to be Singapore's fourth telco. But it dropped the
idea amid mounting criticism that the move might distract it from
its core business, even though it intended to be nothing more than
a passive investor.
SMRT is also bidding aggressively for new bus operating
contracts. Even as its failed bid for the Bulim contract,
Singapore's first public bus contract, raised eyebrows among
investors for being the lowest, Mr Kuek claimed it would have been
profitable.
The company is also negotiating with the Transport Ministry over
transitioning to a new rail financing framework that sees the
Government owning all operating assets. This will allow SMRT to
focus on service quality without being weighed down by huge and
lumpy capital expenditure.
Talks have been ongoing for well over a year now, and industry
watchers reckon the main impasse is the operating margin that SMRT
should enjoy in the new regime, which is deemed to have lower
risks.
But Mr Kuek would not comment on this, merely saying the new
model is more sustainable, and "we have made good progress in the
ongoing discussions".
And although he does not say it outright, it is clear he does
not think Singapore can support more rail operators.
"It takes five to 10 years to groom an experienced rail
engineer," he said. "The question of who will run upcoming new
lines does place some uncertainty on an operator. Should it invest
in growing the expertise for the future?
"There is a very real risk of incurring the cost of raising the
manpower but not winning the licence."
He looks to Hong Kong as one success story, where a tightly
regulated operator derives synergy from a fleet of trains that can
be deployed on any line.
"Hong Kong's MTR has a rail plus property model, and an
integrated design, build, operate, maintain arrangement that
presents it with great flexibility in network design, whole life
cycle asset management, and effective decision-making on a host of
rail-related issues," he added.
Nevertheless, he concedes that "each city evolves its own system
based on its socio-economic and political considerations", and
there is no one size that fits all.
"Within our own structure, we are determined to achieve as high
a level of operational excellence as MTR's. Our aim is to be the
people's choice - that people will take the train because they want
to, and not because they have to," he said.
ST