Keolis: Buses, Bussar, Les Autobus

A French company headquartered in a Swedish city where everyone speaks English. If that is not a picture of a global company I don’t know what is. The entire concept of what a transportation company should be parallels very well French business culture. Being early or on time is paramount and treating every customer with the same respect as the first day you met them.

The atmosphere in the Keolis headquarters is very Swedish. The hierarchy is held as flat as possible, position gender equality is well balanced and the meetings are endless. Management truly recognizes why they exist and what their primary function should be. A manager is there to provide guidance and translate the company’s strategy into actions that can be carried out by the various departments and employees. At Keolis, they believe that if an employee does not have enough work or is not motivated then it is management’s responsibility to find new projects and to motivate the employee. Employees are paid for their specific skill sets, not necessarily to create and translate the company’s vision. In the United States, management always seems lost when it comes to this concept. Whether it is the employee being blamed for not pursuing new ideas, not working hard enough or the management getting to closely involved in the day to day work of the employee after the project or direction has been given. We are taught these concepts all throughout our business undergrad and graduate studies, but they still seem like a foreign concept in the real business world.

The idea of a private bus company contracting for a public service seems like a very foreign idea coming from Orange County where the bus system has be operated for years by the government run Orange County Transit Authority. The OCTA has improved its services over the years, but still fails to provide the level of service that can be seen in the Stockholm bus transit system. Keolis has managed to provide good service, and enact new greener bus initiatives all while still turning a profit. Keolis has managed to grow at over 9% last year and produce an EBITDA % of 15.4%. OCTA on the other hand operates at an EBITDA % of (387%). It is kept afloat by a mix of federal grants, county taxes and capital infusions from other sources. Operating at a loss as big as this would be okay if it was a free service, but it’s not. Fares for OCTA buses range from $2-$6 per ride depending on region and other factors. One final thing to point out is that Keolis operates a fleet of buses that are 100% powered by a wide variety of biodiesel fuels. The OCTA did make a large conversion to buses that run on natural gas, but it was done by passing on the cost to the riders both in fares and county taxes.

Keolis has shown us that something many may consider a very old institution, bus transportation, can make use of innovative office design, forward thinking management techniques, sustainable and environmentally sound operation and still maintain growth and profitability.