Identifying GIS For What Its Worth

by Larry Daniel

Vice President, Research & Information Systems

Castillo Company, Phoenix, Arizona

(published as "Expanding the Business Geographics Agenda," Business Geographics September/October 1995)

While in the midst of carrying the flag for the 'new' technologies, it can be ironic how we can fall back upon the 'old' benefits. There's a challenge in promoting and implementing business geographics as more than an automation of maps. As former Business Geographics contributor Gene Roe hinted, it's all too easy to pave over old cow paths. Roe observed "a unique opportunity exists for spatial re-engineering: the chance to rework an organization's business practices to produce a spatially informed work environment which incorporates GIS into business operations." I concur, and offer here a few comments on how we might look at business geographics differently to find its capacity to impact business.

In searching for the value of GIS, one can find analogies with copy machines and word processing. Today these two tools are cornerstones of office automation, but their early adoption was marred by "business blindness". Little market was forecast for the first copy machine. As Hammer & Champy wrote in their sentinel text "Reengineering the Corporation":

"In the late 1950s, when Xerox was performing the basic research on the 914, its first commercial copying machine, the company was hard pressed for money and wanted to cash out of the project. It offered its patents to IBM, which hired Arthur D. Little (ADL), the Cambridge, Massachusetts-based consulting firm, to do a market research study. ADL concluded that even if the revolutionary machine captured 100 percent of the market for carbon paper, dittograph and hectograph - the techniques used for copying documents at the time - it still would not repay the investment required to get into the copier business."

The bottom line was that researchers couldn't envision how this technology could upset the business world. Before this machine, business didn't make copies of hardly anything -- it was too labor intensive and time consuming. Hence, when asked to give estimates on sales, they were very conservative. They couldn't envision how copiers would redefine business. They couldn't see their product's subtler, but more profound potential. In a world where the standard was for companies to pass around originals, it was very difficult for Xerox planners to appreciate that their product would create a new standard, where copies would be distributed rapidly and widely, and one which would ultimately position companies to move much more swiftly with major decisions than they had ever done before.

In a similar manner, word processing was misforecast. When first introduced, it was perceived as purely secretarial equipment. In time, however, its impact was recognized not only to be in helping secretaries work faster, but in redefining the role of the administrative assistant, swiftening the speed by which managers could generate business text, and eliminating the redundancies and errors inherent to keypunching handwritten material.

I contend that business geographics stands in a similar situation. The challenge with GIS is not in selecting it as the appropriate technology for existing mapping applications, this is akin to seeing a copier as a replacement for the dittograph or word processing system as a secretarial tool. The challenge with GIS is in determining what new value the more rapid, consistent, intelligent and overall more powerful mapping systems bring to age- old problems in your business.

As demonstrated with photocopiers and word processing, the heart of solid technical initiatives generally isn't purely automation, but process improvement or process redesign. Hammer & Champy observed:

"A company that equates technology with automation can not reengineer...applying information technology to business...demands inductive thinking--the ability to first recognize a powerful solution and then seeks the problems it might solve."

Effective use of GIS demands inductive thinking. In a world where nearly 70-80% of business data has a geographic component, GIS still seems all too often relegated to automating maps or spotting customers. If 70- 80% of the data has a geographic component, then certainly at least half as much of business procedural analysis can be affected by GIS. The challenge is that since most business procedures were designed prior to GIS, we must think inductively about how this technology enables us to redesign business.

In battling the blindness, I fall back again on Hammer & Champy. From their text, they persuasively couch technologies not by their technical traits, but by their ability to enable users to break out of old paradigms. They see decision support, for example, not for its technical dimensions, but as a vehicle to shift the standard from managers making decisions to decision-making being part of everyone's job. They see high performance computing enabling plans to get revised instantaneously, expert systems shifting work away from experts to generalists. In other words, they don't get caught up in the cosmetics of technology, they look for impact.

And business geographics? It can function as all of the technologies discussed above and more. In working on cost-benefits, we've probed everything from its ability to support incentive programs to its capacity to support ride-share programs. Its ability to apply consistent measurement on assets that are geographically distributed are unrivaled and it produces previously unachieved levels of consistency in evaluating franchise, dealer and/or sales performance. Take this another step and it indirectly contributes to a reduced risk of litigation.

Business geographics can be used to enhance the service that one provides to external clients, "increasing customer share" as Don Peppers and Martha Rogers might say. Companies can enhance their relationships with customers by offering maps and geographical knowledge as a service. A taxi company could offer maps of current events around the hotel district. Movie chains could report which individual theaters are most likely to have seating capacity on a weekend opening night. Perhaps they could even provide maps to locations that complement their showing. Just seen a western or a foreign flick? Follow it up with a visit to the city's best barbecue or French restaurant. And consider the possibilities for joint marketing

The possibilities are like dominoes. Some are valuable and some might be throwaway. But with management examining the strengths of this technology versus other contending investments, they all need to be pursued. Simply put, the business geographics agenda won't expand until it is applied to areas where maps and map measurements didn't previously exist ... Hmmm, sounds like a GIS application.

References

Hammer, Michael and James Champy. Reengineering The Corporation: A Manifesto For Business Revolution. New York: Harper Collins Publisher, 1993.

Peppers, Don and Martha Rogers. The One to One Future: Building Relationships One at a Time. New York: Doubleday, 1993.

Roe, Gene A. "Don't pave over old cow paths: Spatially re-engineer." Business Geographics March/April 1993