Abstract
London Underground Limited has a major programme of capital investment to improve service quality and financial performance and to provide wider social benefits. This programme has to be planned within strict but fluctuating funding limits. Traditional investment selection and planning techniques have to date been employed with great difficulty. An innovative approach, called Portfolio Optimisation, is being implemented, which shows great potential for improving the business planning process. This paper describes the concepts underlying the approach and the supporting computerised modelling processes. Maximising investment benefits London Underground Limited (LUL) operates one of the largest metropolitan public railways in the world. Capital investment varies between £500 million and £700 million per year, depending upon the level of government grant. Annual operating expenditure is of the same order. There are, however, insufficient funds to perform all of the required improvements needed for the network. There is therefore a critical need to identify those investments, within the funding limit, that will yield the greatest benefits to the system. This will help to achieve the desired standard, termed Decently Modern Metro (DMM), as soon as funds allow. Transactions on the Built Environment vol 6, © 1994 WIT Press, www.witpress.com, ISSN 1743-3509 94 Railway Design and Management
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