• Cracking Oyster: Shashi Verma & Transport for London Confront a Tough Contract (B) Sequel

    This sequel accompanies case number 1985.0, "Cracking Oyster: Shashi Verma & Transport for London Confront a Tough Contract (B)." "Cracking Oyster (B)" is the second part of a two-part case set, intended for use in a two-class sequence. The (B) case may also be taught on its own, but students will need to read (or at least skim) the (A) case in order to understand (B). "Cracking Oyster (B)" is accompanied by a six-and-a-half minute video companion piece. The (B) case describes how Shashi Verma (MPP '97), Director of Fares and Ticketing for London's super agency, Transport for London, copes with a frustrating contract at the heart of the agency's ticketing operation-the Prestige Contract, which is, when he assumes his position in 2006, at the midpoint of a 17-year contract term. While the (A) case lays out the nature of Verma's frustrations with Prestige (a cumbersome process for negotiating variations, excessive costs, inadequate performance requirements, and poor incentives for the contractor to col-laborate with TfL on new innovations), the more provocative (B) case describes how Verma-using techniques of "game theory" and taking some political and legal risks-tries to negotiate much more favorable contract terms for TfL. The case ends with Verma, TfL, and the TfL board on the horns of a dilemma-whether to go forward or re-treat after a high court grants one of the contractors an injunction that will require TfL to defend its actions in a court trial (or, more likely, settle out of court) if it goes forward with its plans. This one-page sequel describes what happens: TfL does decide to go forward, does settle the legal matter out of court, and ultimately obtains a contract on much more favorable terms than the original Prestige. The video companion piece shows Verma in conversation with HKS Professor Richard Zeckhauser, as the two reflect on Verma's use of game theory, a subject taught by Zeckhauser. Case number 1985.1
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  • Cracking Oyster: Shashi Verma & Transport for London Confront a Tough Contract (B)

    ""Cracking Oyster (B)" is the second part of a two-part case set, "Cracking Oyster (A) and (B)," intended for use in a two-class sequence. The (B) case may also be taught on its own, but students will need to read (or at least skim) the (A) case in order to understand (B). "Cracking Oyster (B)" is accompanied by a six-and-a-half minute video companion piece. The (B) case describes how Shashi Verma (MPP '97), Director of Fares and Ticketing for London's super agency, Transport for London, copes with a frustrating contract at the heart of the agency's ticketing operation-the Prestige Contract, which is, when he assumes his position in 2006, at the midpoint of a 17-year contract term. While the (A) case lays out the nature of Verma's frustrations with Prestige (a cumbersome process for negotiating variations, excessive costs, inadequate performance requirements, and poor incentives for the contractor to col-laborate with TfL on new innovations), the more provocative (B) case describes how Verma-using techniques of "game theory" and taking some political and legal risks-tries to negotiate much more favorable contract terms for TfL. The case ends with Verma, TfL, and the TfL board on the horns of a dilemma-whether to go forward or re-treat after a high court grants one of the contractors an injunction that will require TfL to defend its actions in a court trial (or, more likely, settle out of court) if it goes forward with its plans. A one-page sequel describes what happens: TfL does decide to go forward, does settle the legal matter out of court, and ultimately obtains a contract on much more favorable terms than the original Prestige. The video companion piece shows Verma in conversation with HKS Professor Richard Zeckhauser, as the two reflect on Verma's use of game theory, a subject taught by Zeckhauser. Case number 1985.0 "
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  • Cracking Oyster: Shashi Verma & Transport for London Confront a Tough Contract (A)

    ""Cracking Oyster (A)" is the first part of a two part case set, "Cracking Oyster (A) and (B)," intended for a two-class sequence, but the (A) case may also be taught on its own. It is accompanied by a brief, two-part video companion piece with a total length of six-and-a-half minutes. The (A) case introduces Shashi Verma (MPP '97) in 2006, soon after he has received a plum appointment: Director of Fares and Ticketing for London's super agency, Transport for London. The centerpiece of the agency's ticketing operation was the "Oyster Card," developed and managed under the terms of a 1998-2015 PFI (Private Finance Initiative) contract called "Prestige." Thus, in pursuing his goals for TfL ticketing-a reduction of costs, expanded service, and adoption of convenient, lower cost technologies-he knows he will have to negotiate with the contractor, a consortium called TranSys, governed by its two leading partners, Cubic Transportation Systems, a San Diego based company specializing in automated fare collection equipment and service, and EDS, one of the world's largest information technology service providers. Though the Oyster system-reliable and popular-was widely regarded a smash success, Verma soon learns that within TfL, the Prestige Contract is the source of much frustration. The case details the perceived shortcomings of the contract: a cumbersome process for negotiating variations, excessive costs, inadequate performance requirements, and poor incentives for the contractor to collaborate with TfL on new innovations. While the contract does, technically, allow TfL the opportunity to opt out early, TfL appears to have little practical ability to do so, as intellectual property for the complex system resides with the contractors. "Cracking Oyster (A)" ends with Verma facing a broadly-framed dilemma: what to do about Prestige? Case Number 1984.0 "
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