ORGANIZATIONAL RESPONSES TO THE DEREGULATION OF THE BUS INDUSTRY IN BRITAIN

The British bus industry, outside London, was deregulated in October 1 986. For the first time since the 1930s bus operators were able to com pete within local markets and experiment with service delivery. As a c onsequence, it was contended that deregulation would arrest the long t erm decline in bus patronage. This paper begins by documenting the key trends within the industry which have emerged since 1986. It then con siders the implications of deregulation and privatization from an orga nizational perspective, at the level of the individual bus company. Fi ndings from a study of nine British bus companies are presented and di scussed. Their three principal strategic responses to the deregulated operating environment are identified and discussed. The evidence sugge sts that the ability of an individual bus company to innovate in ways which will guarantee its survival is heavily circumscribed. As a conse quence, the capacity of an individual bus company to achieve the requi site level of internal stability to face competition, to become more s ensitive to changing market conditions. and to grow, has not been ease d significantly in the seven years since deregulation.