Title: Division of activities and tasks - challenges and efficient structures for market-based procurement of public transport services

Authors: Markku Tinnilä; Jukka Kallio

Addresses: Department of Information and Service Economy, Aalto University School of Business, Runeberginkatu 22-24, Helsinki, Finland ' Department of Information and Service Economy, Aalto University School of Business, Runeberginkatu 22-24, Helsinki, Finland

Abstract: This paper illustrates the challenges of purchasing public services from private markets by analysing the bus tenders in a European city area with a population of approx. 1 million. City bus services have traditionally been organised by public organisations, while recently these are increasingly arranged in a combination of public and private services with a variety of organisational models. The paper analyses the typical challenges connected to public procurement of market-based services, as well as, based on a literature review analyses the case from viewpoints of division of labour, activities and tasks, efficient market structures in bus services, challenges connected to service purchasing, as well as, scale and scope economies in services.

Keywords: division of labour; division of activities; public procurement; public transport; service efficiency; transport services; city buses; public services; private markets; bus tenders; urban transport; cities; bus services; market-based services; service purchasing.

DOI: 10.1504/IJPM.2017.083467

International Journal of Procurement Management, 2017 Vol.10 No.3, pp.360 - 380

Received: 22 Oct 2015
Accepted: 08 Jun 2016
Published online: 31 Mar 2017 *

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