MicroTransit and the future of procurement innovation

By Rani Narula-Woods and Debra R. Avila

LA Metro is investing in new transportation innovations that harness new and emerging technology services to improve the experience for customers. Metro is beginning to experiment with technology to develop the best possible ways to serve our customers.

Rather than buying off-the shelf mobile apps and software, Metro is pivoting to design new services and products in collaboration with the private sector. LA Metro has becomea laboratory for transportation technology, and MicroTransit is our first experiment.

MicroTransit Pilot Project

Earlier this year, the Metro Board of Directors awarded contracts to three technology firms to design a new on-demand service. The three teams (RideCo, Via and Transdev) bring global expertise as early adopters of on-demand technology in Canada, Europe and Asia. You can read the staff report. [NR2]

This shared ride service, commonly known as MicroTransit, is being designed to improve the delivery of services and products to better fit our customer’s needs. MicroTransit is a signature project of Metro and is part of Metro’s Twenty-Eight by ’28 Initiative to complete 28 major projects before the 2028 Summer Olympics and Paralympics. [NR3] By partnering directly with technologists as prime contractors, Metro created a new and exciting procurement strategy that supports active and early engagement with private sector, encourages innovation and allows for constant iteration to the design of services and products.

Active Engagement

Throughout the process, the private sector has been encouraged to participate in the development of the design parameters of the service. Unlike traditional procurements, Metro posted a draft version of the project specs, invited tech firms to meet one-on-one with the project team and gathered private sector companies in a speed networking event to encourage teaming-up to provide the most competitive product to Metro. Fostering early engagement among potential bidders yielded overwhelmingly positive results. Traditionally, transit agencies receive two to three compliant solicitations for this type of project. Metro received eight for the MicroTransit Pilot Project.

Dreaming Encouraged

Metro provided incentives for the private sector to remain ambitious in its design. By taking a white board approach, the companies had the flexibility to operate beyond traditional metrics that often inhibit projects. The companies were primarily motivated by a single success metric: defining and designing improved customer experience that would attract current riders to ride more and bring to riders to the system. As a result of this approach, Metro is setting a higher bar for the level of service customizations than is traditionally associated with public-facing transit operations.

Constant Iteration

Metro used an unusual contracting model for technology contracts, known as a ‘pre-development agreement. Typically for a Public-private partnership (P3), this tool was designed with outside counsel to allow the flexibility to plan, design, evaluate and implement the new service/product. This has enabled Metro and the tech teams to adjust the design of MicroTransit without requiring a new solicitation and/or numerous contract modifications.

Over the next several months, Metro will continue to work in close coordination with our private sector partners to finalize the design phase of the project. MicroTransit is anticipated to launch in late 2019.

Rani Narula-Woods is the Sr. Director, Special Projects in Metro’s Office of Extraordinary Innovation and Debra R. Avila is Metro’s Chief Vendor Contract/Management Officer. Narula-Woods and Avila will present on MicroTransit at the American Public Transportation Association Annual Conference in Nashville this week.