CDO interview: Danny Gonzalez, chief digital and innovation officer, London North Eastern Railway

Building a platform for change

Gonzalez recognises that transforming an industry that relies on legacy processes and systems is no easy task. As well having to move away from a reliance on paper records and often decades-old systems, his team must help make passengers’ journeys as straightforward as possible across a complicated set of interactions.

“Rail is absolutely full of elements that can go wrong across an end-to-end journey,” he says. “From the retail part of the experience to getting to a train station and on to delays that can occur when you’re on trains and through to the onboard experience and even getting away from the station itself.

“We believe digital plays an absolutely crucial role in helping customers have complete control of all of those elements of the journey. We look at how we can fix any pain points and prioritise the different types of customers that we have.”

Another key factor pushing LNER’s business transformation is the need for operational efficiencies. If technologies can be implemented that help reduce costs and increase profits, then Gonzalez and his directorate are keen to explore potential applications.

“The other part of the equation is the well-documented challenges around the cost of running railways,” he says. “We really need to modernise ourselves to be viable businesses in the future. A huge part of that will be the digital transformation of how we run our business and moving away from legacy processes and legacy technology.”

The digital team has focused on a couple of major programmes to help support its technological explorations. First, they have moved the company’s IT infrastructure to Amazon Web Services (AWS) to deliver a scalable cloud-based booking platform. Second, they have implemented real-time data systems to help create personalisation for customers. 

“AWS has helped create an integrated ecosystem to move data around the different component parts of the business,” says Gonzalez. “That allows us to give our tech teams what they need and to create the products and services our customers require.”

Exploring leading-edge innovations

LNER’s digital directorate has already pushed through some creative solutions to the business’s challenges and the team continues to look for more openings. Gonzalez says their efforts are often focused on innovation opportunities.

“We’re out there looking at things that can really make a difference to the business and we’re looking much further down the roadmap to see the new technologies that could help us address our pain points,” he says. “We give the team a lot of freedom to try stuff, to run proofs of concept and to understand where the technology does or doesn’t work.”

A crucial element of this activity is an in-house accelerator programme called FutureLabs, where LNER works with the startup community to explore fresh and exciting directions. Since 2020, the digital directorate – in combination with an ecosystem of enterprise and startup partners – has launched more than 60 tools and trialled 15 proofs of concept. 

LNER has just run the third cohort of its accelerator, where selected startups receive mentoring and funding to scale up technology solutions alongside the digital team. The first launch of FutureLabs led to LNER’s QR-code-enabled “Let’s eat at your seat” function, which allows passengers to order food and drink from their seats, which was crucial during the social-distancing requirements of the coronavirus pandemic.

Other innovative product launches include Quantum, which taps into machine-learning technology to help process huge volumes of historical data on train journeys. Developed alongside a specialist startup called Jnction, Quantum helps LNER's employees to reroute train services that might be delayed and minimise the impact on passengers.

“Everyone’s really excited about this project and how the technology can be used to transform the way we provide our train services,” says Gonzalez. “When you look at the list of customer requirements, the one that comes out as the absolute number one is, ‘I want my train to be on time’. If anything's going to drive people away from rail, it’s big delays.”

Delivering great connectivity

The provision of Wi-Fi connectivity is another significant issue for people using public transport. As Gonzalez recognises, it’s difficult for companies to provide high-quality connectivity to passengers on trains that are hurtling through the countryside at 125mph.

That challenge is intensified by the increasing number of customers who are using their smart devices to consume TV shows, music and online games from major entertainment companies. LNER research suggest 69% of customers take good Wi-Fi into consideration when choosing how to travel. For business travellers, this figure rises to 79%.

Providing connectivity is tough at the best of times, but it becomes even harder when people stream content that demands significant amounts of bandwidth. LNER’s answer is an innovative approach called Edgecasting, which allows passengers to stream content from ITV Hub without impacting the Wi-Fi capacity of trains.

The rail company is working with technology specialist Netskrt to trial the technology. Popular content is stored on the trains’ servers. When passengers log on to the LNER Wi-Fi service, they are presented with the opportunity to stream content. As well as the proof-of-concept trial, Gonzalez is exploring how other media companies might become involved in the future.

“Edgecasting caches streaming platforms directly onto the Wi-Fi service on a train,” he says. “For users, it’s almost like your ITV Hub account is now on board the train. We are trialling the service on a few trains at the moment. We are also looking to introduce BBC iPlayer and we’re talking to Amazon to see if we can get those guys on board, too.

“We’re really excited about Edgecasting because I think it could solve what has been a very difficult problem around how people stream content. It also frees up bandwidth, so business customers can use our Wi-Fi capacity for the things they need to do. So far, it’s working seamlessly. It’s a very clever piece of technology.”

Reaching the destination

Over the next 24 months, Gonzalez says his team will be working on attempts to understand how the application of more machine-learning tools can help to transform the business.

“We really see that as a space that can change the game in terms of a lot of things that we do,” he says. “It will help our people make better, more informed decisions. Machine learning will also help us automate some of our processes.”

Gonzalez believes automation encompasses a huge area of potential technological advances. He says there are still too many barriers that make it difficult for people to buy transport tickets and services quickly – and there is a significant opportunity to automate processes and allow customers to self-serve.

“By empowering everyone through technology, we are really striving to give customers digital touchpoints at every point that is important to them when they’re interacting with us,” he says. “Ultimately, we want customers to step off our trains and say LNER are providing an amazing experience, whether that’s via digital channels, through our people or on our trains.”