Project Management View from Rail Transit Programs and Projects

This article is collaboration between Lamont Ward, Senior Electrical Engineer at National Railroad Passenger Corporation (Amtrak), and Henry Hattenrath, Senior Technical Consultant – Parsons Transportation Group.    It was started with a simple question and answer to a posted article on Converting the Design-Bid-Build Contract Model for Design Build Delivery in the rail transit domain – see https://www.linkedin.com/pulse/converting-design-bid-build-contract-model-design-build-hattenrath/.  Or https://www.projectmanagement.com/blog-post/47557/Converting-the-Design-Bid-Build-Contract-Model-for-Design-Build-Delivery

This part continues to highlight the differences in project characteristics between construction and rail transit rolling stock purchases.  The characteristics are relative to a project management view as opposed to presenting the program Model showing the processes and life-cycle for development and production of rail transit vehicles.

Q15.    Does the Seller provide an operator cab mock-up for training by simulator?

A15.    Yes - If required by contract scope.    Most rolling stock Buyers have detailed curriculum for training and qualifying train operating engineers and train crews on the operation of the rolling stock, including passenger cars and locomotives.    For Buyers operating in North America, the regulatory agency-Federal Railroad Administration requires comprehensive training for employees.    Without an operating cab simulator, the training period can be lengthy until the employees learn the equipment operations and the performance characteristics of the rolling stock along the railroad right-of-way.   A cab simulator allows employees to be trained faster than the historic approach to ride the rails along each branch of the system network under supervision of a qualified employee.  

Q16.    In managing the contract, are there unique inputs the Buyer needs to coordinate with the Seller?

A16.    Since the Seller is completing the detailed design for the rolling stock, there are performance requirements that will be discussed and amplified to assure the Buyer’s expectations are satisfied.   In addition to tracking all Buyer inputs to Seller, the Buyer should provide the Seller with as much information on the existing operations and how the contract deliverables will be integrated as production deliveries commence.   The information may include: A) Braking performance of existing equipment and signal blocks in the wayside signal system.  B) Clearances and shop equipment locations in inspection and maintenance facilities and storage yards.  C) Planned vehicle arrangement used for customer exiting/loading at platforms for station stops.   D)  Drawings/samples of existing ADA bridge plates and amenities.   E)  Operator and vehicle data on handling performance on existing vehicles to train schedule.   F)  List of heavy shop equipment used to service and maintain exiting vehicles and to support on-board component changeouts.   

Q17.    How are costs of spare parts managed as part of the contract negotiations?   

A17.    Spare part requirements are normally defined by the Buyer in the contract.   During the contract acquisition, the Buyer and Seller will establish the anticipated spare part quantities  and costs to maintain the fleet over a defined period of time.    However, Buyer’s requirements may be limited in the spare parts that can be purchased as part of a contract with government funding or by Buyer’s internal funding requirements that may define a minimum value to qualify material as a spare part.   

Whether in the base contract or by a separate maintenance contract, the Buyer will need an inventory of major components for performing running repair within the capacity of equipment and throughput of the shop facilities.   Some of the components that will need to be inventoried include:   tracks, wheel sets, traction motors,  air compressors, batteries, AC/DC convertors, air condition evaporators, and air conditioning condensers.

Q18.    If a particular part is found unreliable and the railroad finds an alternative source how does the railroad recoup any losses for the poor performance of the part from the manufacture?  

A18.    The Buyer’s contract will define the metrics for monitoring and measuring the reliability of equipment during the initial testing of initial train sets  as well as the testing and operation of production sets.   Systems and components with failures that fall outside the baseline requirements, such as  Mean Time Between Failures or Mean  Miles Between Failures, are subject to corrective action and potential re-design and replacement by the Seller.  Based on the severity of the failures on performance, the Seller may be obligated to perform a re-call for implementing change-out of the system/components on the entire fleet of vehicles.   

The contract will identify the percentage of failures on in-service rolling stock, and the specific processes and remedies the Seller will follow throughout contract period and any Options for extended periods for performance monitoring and warranty.  

Q19.    How are reliability metrics determined and negotiated?   

A19.    The reliability metrics are developed by the Buyer based on the known range of performance data from manufacturers and equipment suppliers, and the Buyer’s internal Subject Matter Experts (SME)  and/or the Buyer’s contracted Engineer of Record (EOR).   The SME and EOR will prepare the drawings and specifications, which define the technical requirements in the contract documents.   The reliability metrics serve as the basis for evaluating the Sellers’ offerings pre-award and for verifying compliance with requirements post award.    

Q20.    If the vehicle manufacturer has a particular vendor in mind for a system, but the railroad wants to use a vendor of their choosing, how is this worked out between the two parties?

A20.    If the Buyer has known vendors with proven records, the requirements in the contract should identify the vendors that have demonstrated the ability to qualitatively meet the technical specifications.   The specifications do not need to identify detailed product information, but they do need to update quality requirement in the technical specifications to include the vendors used by the Buyer such as Vendor A, Vendor B or  Buyer’s approved equal.   

If the Seller uses other vendors with products equal in quality and with proven performance in the industry, the “or equal”  provides a mechanism for persuading the Buyer to accept or decline the Seller’s vendor.   If declined after the contract is awarded and underway, the Buyer will need to provide objective reasons for not finding the vendor is equal.   

Q21.    Great topic, but what about systems?

A21.    Rolling stock/vehicle project deliverables, as well as the corresponding fixed assets for their operation, are comprised a series of integrated systems.  Project management principles can be equally applied to systems in construction and product manufacturing.  Systems can cross the entire sphere of consumer and industrial project deliverables used world-wide, including air transport and auto transport.   The systems required for these deliverables include passenger/operator compartments, power, propulsion, safety, supervisory and control, suspension/vibration control/energy absorption, HVAC, communications, fire protection, energy conservation and security. 

This article is collaboration between Lamont Ward, Senior Electrical Engineer at National Railroad Passenger Corporation (Amtrak), and Henry Hattenrath, Senior Technical Consultant – Parsons Transportation Group.   It was started with a simple question and answer to a posted article on Converting the Design-Bid-Build Contract Model for Design Build Delivery in the rail transit domain – see https://www.linkedin.com/pulse/converting-design-bid-build-contract-model-design-build-hattenrath/.  Or https://www.projectmanagement.com/blog-post/47557/Converting-the-Design-Bid-Build-Contract-Model-for-Design-Build-Delivery

This part continues to highlight the differences in project characteristics between construction and rail transit rolling stock purchases.  The characteristics are relative to a project management view as opposed to presenting the program Model showing the processes and life-cycle for development and production of rail transit vehicles.

Q7.      How is the warranty period managed over the extended delivery period?

A7.      Buyer’s warranty requirements are typically effective at the time the Seller’s product is placed into operation after substantial completion is achieved.   The warranty period is 12 months and it can cover labor and material for implementing action to restore as-designed vehicle operation.    Rolling stock contracts become more complicated because each vehicle becomes a product with individual milestones and attributes for delivery, testing, acceptance and the start and end of warranty.   This becomes more complicated if the product is updated during production to incorporate Buyer/Owner Initiated changes or product updates initiated by the Seller.   

Q8.      Are the Operation and Maintenance Manuals different for vehicle purchase contracts?

A8.      Buyer’s Operation and Maintenance (O&M) Manuals for construction contracts are usually a compilation  of products from various vendors and subcontractors providing products and system that make up the constructed asset.    For rolling stock contracts, the Manuals are more similar to the Manuals published and supplied with production automobiles.   The Manuals are  integrated and edited for use by a wide and diverse range of  Buyers and users.    The O&M Manuals are also on integral part of the training documentation and program of course for training operating engineers, train crews, and the maintenance and repair  staff.

Q9.      Performance of building systems is more familiar to Buyer’s than for vehicles.   What is a unique performance attribute for rolling stock?

A9.      Mean Time/Miles Between Failures is a unique industry proven metric for describing the quality of rail cars and locomotives offered to Buyers.   Sellers are required to provide this historical data for vehicles supplied to other Buyers.   Sellers and Buyers use this data to measure performance on prototype vehicles and on production vehicles to as-designed specifications and to identify potential items that may need to be re-designed.   It also extends into the warranty period where upgrades are often incorporated for in-service modifications. 

Q10.    Most construction projects have requirements for training and operation and maintenance manuals.  How are the requirements handled on rolling stock contract?

A10.    Buyer’s training requirements can be extensive and go beyond the most common for initial operation.   The training scope may be individual train curriculums for Engineers, Train Crew, Car Inspectors, and Running Repair/Maintenance Mechanics. The training materials are coordinated assure that the O&M Manuals and the training are closely integrated to maximize effectiveness.

Q11.   How different are the training requirements from those on construction projects?

A11.    Buyer’s training requirements can be extensive and go beyond the most common for initial operation.    The training scope may be individual train curriculums for Engineers, Train Crew, Car Inspectors, and Running Repair/Maintenance Mechanics.  The training materials are coordinated to assure that the O&M Manuals and the training are closely integrated to maximize effectiveness. 

Q12.    What type of testing is performed on the prototypes?

A12.   Burn in-period for first production train set of vehicles is used to verify compliance with performance criteria including operator and passenger comfort attributes such as compartment temperature and forces under acceleration, braking and traveling over switches and interlockings.   Instrumentation and simulated passenger loading may be used on the train set during a specified total quantity of miles, such as 1,000 miles.

Q13.   I have heard Buyers indicate that system contracts are similar to rolling stock contracts but different from construction contracts.   Can you explain this statement further?  

A13.    Most construction contracts contain drawings and specifications that provide prescriptive requirements based on Buyer’s criteria, including selected materials, coverings, furnishings and colors, and proven, commercially available products, and means and methods anticipated by the Buyer’s engineer and approved/endorsed by the Buyer.   During execution, there is little flexibility to vary from the drawings and specifications

In rolling stock contracts, the specifications and drawings provide the performance, functionality and features the Buyer expects from the Seller.   Much like the automotive industry, the Seller will design and manufacturer the rolling stock to meet the Buyer’s requirements by modifying its proven and available materials, equipment, and subassemblies to build an integrated product meeting the Buyer’s requirements.  While these contracts are typically lump sum, they are executed by Sellers more as design-build.   This approach results in frequent interactions by the Seller with the Buyer to formalize the customizable features of the rolling stock and to  meet the expectation of both the Buyer and the Buyer’s customers. 

Q14.    What kind of staffing  is required by the Buyer to manage and execute the rolling stock contract?   

A14.    Regardless of the total number of rolling stock in scope, the basic team for the Buyer will include:  Project Manager, Document Coordinator, Quality Manager, Project Controller, Contract Manager, Equipment Engineer, Master Mechanic-Operation/Maintenance, Transportation Manager,  ROW-Signal Engineer, Training Manager, Commissioning/Warranty Manager, and Consulting Engineer.  The basic team for the Seller will include: Project Manager, Contract Manager, Design Lead, Materials Manager, Reliability Manager, Production Manager, Quality Manager, Testing Manager, and Warranty Coordinator.   For projects with government funding, the team may include:  Oversight Consultant and Independent Engineering Consultant. 

This article was started with a simple question and answer to a posted article on Converting the Design-Bid-Build Contract Model for Design Build Delivery in the rail transit domain – see https://www.linkedin.com/pulse/converting-design-bid-build-contract-model-design-build-hattenrath/.  Or  https://www.projectmanagement.com/blog-post/47557/Converting-the-Design-Bid-Build-Contract-Model-for-Design-Build-Delivery

Q1.      (October 2018-Ward) Thanks for sharing your insight on Project Management. Just curious if you can share your experiences with rolling stock acquisition. Is the methodology the same for these projects compared to fixed assets like station, signal projects, etc?

A1.      (October 2018-Hattenrath)  Many of the published articles can be applied to rolling stock projects, which are most similar to contracts for fixed assets such as rail signal systems and train movement operation centers.   But rolling stock projects have more stakeholders and normally involve heavy customer outreach and focus groups for customizing the travel compartment to meet the target commuter travel experience, comfort, and environment.   Rail commuters, like air travelers, are expecting amenities that will make their on-board time equally suitable for sleeping, working, socializing, enjoying a movie or video game on a computer, or using a smart-phone feature while connected to on-board power or wifi network.

This article is collaboration between Lamont Ward, Senior Electrical Engineer at National Railroad Passenger Corporation (Amtrak), and Henry Hattenrath, Senior Technical Consultant – Parsons Transportation Group.   In a Q&A format, it covers items in the rolling stock contract acquisition and the Buyer and Seller interaction on contract elements.  

Ward has 19 years of combined experience with Amtrak and LIRR while holding technical engineering positions in the mechanical department responsible for modification, maintenance and repair of rolling stock.   Hattenrath has over thirty year experience on capital projects with LIRR and MTACC while holding project management positions on rolling stock modifications for ASC and event recorders, and fixed assets for track, signal and communications and power systems.

In theory, the vehicle purchase project is a successor to a Seller’s program for developing a ready for production vehicle that can be customized to individual Buyer’s requirements.   While not the same volume, rail transit vehicles follow a process used by automobile manufacturers.

This article highlights the differences in project characteristics between construction and rail transit rolling stock purchases.  The characteristics are relative to a project management view as opposed to presenting the program Model showing the processes and life-cycle for development and production of rail transit vehicles.

Q2.      (November 2018)  How are prototypes used in the contract?

A2.      (November 2018)  Depending on the Buyer’s contract, there may be prototypes that are delivered for form, fit, function testing and assessment prior to final design and the start of vehicle production and assembly.   Elements of the rail passenger that are frequently prototypes are passenger seating, car vestibules,  restroom  compartment, and operating cab and engineer seating,   The Project Manager will ensure the contract includes the technical requirements as well as performance milestones and dates for delivery of the prototypes.

Q3.      Are there design submittals and review meetings specified in the contract?

A3.      Yes.   While the Buyer’s contract may not provide detailed requirements, most rail car manufacturers in their proposals will explain the their established and proven  plans for managing the execution of design and documentation to support material purchase, fabrication and assembly, delivery and acceptance testing, in-production upgrades, warranty, and spare parts. 

Q4.      What are the elements and durations in the typical acquisition process for rolling stock contracts.

A4.      Due to the limited amount of manufactures for locomotives and rail passenger cars, the process is different than the process for construction and systems purchase contracts.   For rolling stock, the process may include:

A)  Outreach to manufacturers for comments on the proposed technical requirements.   This allows the Buyer and Seller to adjust requirements so the specifications are not outside the current products available in the industry.   Estimate six months for this activity.

B) Expression of Interest from contractors.  This allows the Buyer to test the market for Sellers that can deliver the product within the Buyer’s proposed milestone dates and the budget range.    Estimate three months for this activity.

C)  Request For Proposals.   This allows the Buyer to solicit and evaluate detailed technical and cost proposal from Seller’s and to select the most responsive and responsible contractors to negotiate the contract amount.    Estimate six months for this activity.

D)  Request for Best And Final Offer (BAFO).   This allows the Buyer to obtain and evaluate cost to determine the final contract amount that offers the best value to the Buyer over the intended life cycle of the product.   Estimate three months for this activity.  

Q5.      Are contract specifications and drawings very different from construction contracts?

A5.      Yes.    Most construction contracts define the requirements for each square foot of space as well as detailed descriptions of equipment, systems and furnishings that are installed within the space.   Rolling stock contracts are more oriented to defining features and performance attributes of the vehicle’s performance expectations over a specified period in years for the life cycle, which includes period maintenance, running repair and  mid-life  maintenance overhauls.   

Q6.      What is the basis for selecting the Seller with the best value?

A6.      Buyers define the criteria for selecting the Seller in the Information For Bidders.   Buyer’s cost proposal requirements for rolling stock contracts will contain detailed cost data for evaluating the direct and indirect costs.   The Seller’s proposals will include per vehicle cost for delivery, and estimated labor and materials costs for operation, inspection, maintenance/running repair and mid-life overhauls.    The total costs will be used to determine the Seller offering the best value.  The Buyer’s contract may also consider negotiating long-term operating contracts for providing Original Equipment Manufacture (OEM) components and spare parts.