Lessons from IRCTC

India's most successful B2C site is run by the government. What lessons can other projects learn from it

Thursday, February 10, 2005

The Indian Railway Catering and Tourism Corporation (IRCTC) was started in end 2001and one of the earliest activities it took up was Internet based ticketing. The order for developing the software was given in December 2001, and sales of tickets started on August 2, 2002. In the first month, we sold 112 tickets per day to record a turnover of Rs 51 lakh. 

In December 2004 we were selling 1,26,899 tickets or 4100 per day, to record a monthly turnover of Rs 16.4 crore. We deliver these tickets to 132 cities including to foreign tourists visiting India. Our database of registered users is 1.3 million strong, with over a thousand users being added every day. Not bad for a government project run by career bureaucrats. Right?

Are there any learnings that this project can provide to other government initiatives? When PCQuest asked me the question, it set me thinking and I was able to identify twelve key learnings that we at IRCTC have learnt.

(Editor's note: It is sheer coincidence that there are 12 learnings here and 12 prerequisites in the earlier article on Prerequisites for E-governance. The two articles have been written independently and in parallel.)

Is there a market?
The railway ticket is a ubiquitous product and the competition the Internet faces is from the thousands of counters run by the railways themselves. The long queues at the booking counters are testimony to the demand and the need for an alternate, easier to use and convenient channel. 

Start with the customer, end with the customer and stay with the customer throughout
This service started with a simple objective. Avoid the customer going to the PRS (Passenger Reservation System). Bring the PRS to the Customer!  

And that is what IRCTC did. It first brought the PRS to their desktops and now to the customer's mobile phones. 

A host of features like 100 most popular trains, stations, preferred passenger lists etc. make the experience quite hassle free. 

There are over 20 payment  options.

Keep it simple
Both the site and the booking process are eminently user friendly, simple and self-contained. Detailed instructions at every step make the experience quite stress free. A normal registration takes 3 minutes and a booking 7-10 minutes depending on the Internet speeds and the time of the day and week. The website was designed to take care of all moments of doubt, like "which trains should I choose, are there enough seats on the day I want to travel", etc.

Many old institutions work. And very well too!
The Railways is a 150-year-old organization with numerous tried and tested processes and procedures for different eventualities. Many of them still work very well. For instance, the good old L1 method of selecting the lowest tenderer still works like a well oiled machine and the global players in the era of e-commerce can be made to toe the line and provide optimum quality at reasonable price by this method.

Never stop learning
IRCTC maintains an ever growing suggestions and complaints list at their Operations Center and they are regularly perused by every key team member for ideas to enhance the services. For a bunch of career bureaucrats venturing into something like e-commerce, learning began on day one and it continues.

There is always room for improvement
Just as learning is a continuous and never ending process, so is improvement. Sometimes requests and complaints from users for additional facilities yields results from the Ministry (for example, extending booking hours from 0400 to 2330, increasing limits on number of tickets booked etc). Sometimes a number of persistently occurring problems can be solved at one stroke (for example, increase of Internet bandwidth availability by more than eight times in two years).

E-governance/e-commerce is certainly neither pro-elite nor pro-urban
Over 52 percent of tickets booked are in II sleeper. We are seeing places like Patna, Guwahati, Thiruvananthapuram, Madurai, Bhopal, Allahabad, Nagpur and Mysore booking hundreds of tickets every month. Fifteen percent of users are women and 2 percent are above 60. The message is obvious.

Smaller teams work better
Led by just two officers, 10 regular employees, 20 retired persons and 20 outsourced customer support staff, this service has managed to satisfy over 2 million passengers.

Customer interface to be sensitive, positive and friendly
IRCTC uses a judicious mix of mature experience and youthful enthusiasm in their customer support staff. Simple but clear instructions exist, "Do not put the phone down till the customer says thank you"; "Do not make the customer wait and get charged on his phone. Call him back" "Answer every mail without fail within six hours". These have gone a long way in making the Customers pleasantly surprised and satisfied.

Select the best partners and keep them happy!
In every venture try to scout around for the best in the field. Go for competitive bidding among the top players so as to bring the prices down. Once engaged, keep the partner/vendor happy. For this, professionalism helps, transparency pays, friendliness lubricates. Most of the time you do not need to lower your values or compromise on principles.

Do not be afraid to improvise. There are no government rules forbidding it!
Where there were no precedents, no guidelines, no nothing, IRCTC made up rules, policies, thumb rules as they went along, always staying within the broad guidelines given by the Ministry. For example, when a customer with an Internet ticket fails to get a cancellation done at the counter (due to ignorance of the counter staff) IRCTC suo motu refunds the money and then processes the case for the customer. He is not left alone and helpless. The same happens if a train is cancelled or if a customer books multiple tickets for some journey by mistake or there is Internet connection failure.

Salary?
The reader will note that I have not mentioned a need for high pay packets, perks or facilities to the staff as motivators for running such a successful enterprise. The reality is that the IRCTC staff gets the same pay and allowances as thousands of government servants other all over India. But the satisfaction, of achievement, of running or being allowed to run a project like this, is a perk in itself. 

Indian Railways carries 1.4 million passengers a day, for whom about 4 lakh tickets are booked on the PRS and IRCTC handles just about 1 percent of this business. So we have a long, long way to go. But we are on our way. Very much on the rails, on track!

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e-governance projects that are either in the process or have been successfully implemented

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