Tuesday, 17 December 2013

GI: The Private Frontier

I have been promising/threatening an opinion piece (rant) for a while and here it is. This was actually thought up during the discussion and interaction session at AGI Cymru and relates to spreading GI into the private sector (selling services and products to the private sector that is). Traditionally the public sector has always been the main consumer of GI in the UK partly due to the huge range of geocentric tasks the various organisations undertake and partly due to how it is financed and run. Whilst this is likely to continue for the meantime the ongoing cuts to public funding mean that GI producers need new revenue sources if they are to grow.

Obviously this is easier said than done and although some inroads have been made this still remains a very unsaturated market. There seem to be two major reasons for this, firstly the perception around cost of GI systems and services and a lack of understanding of the benefits; in this case it is the second issue that I want to discuss. I am not a GI specialist but I have spent a reasonable amount of time managing and selling some reasonably complex services to a whole range of private sector organisations. Anyway my proposition is that GI is simply not being sold to the private sector in the right way. I have been to all the AGI events since June and a few other geo ones (FOSS, Mapping Showcase etc) and it seems like as an industry we are preaching to the converted.

The focus in our case studies is on how a solution was delivered, what the innovations were and how the technology was used. There is very little focus of what the benefits are and when there is these are described in a way that is technical and abstract from measurable business benefits. I am not saying that the work being done and the products and services available are unimpressive, quite the opposite in fact, simply that they are not being packaged in the correct way.

The fundamental concern of senior managers (who have the buying power) at private companies is profit and expenditure and this is how any service needs to be pitched. They are not concerned with the fine detail of the software solution or how the datasets will be handled (that’s for the due diligence people later in the process). If for example a company is pitching a route optimisation product to a logistics manager their concern is how much it will save them in vehicle costs and hours as this is how the investment will be justified. Again this is not to say that people outside the industry are incapable of understanding how GI products work just that in my experience this is not what is going to excite them.

The approach of the GI industry still seems geared towards large organisations with GIS teams that understand the language we are used to talking in. This needs to change to a strongly benefits and ROI focused approach if inroads are going to be made into the private sector. Obviously one problem is that is often hard to guarantee an efficiency saving based on implementation of GI but at the very least case studies of past work need to focus more on the tangible financial benefits the client received.

This is a major cultural change and a change the AGI needs to make as well. The prize awarded for best project based on business case and ROI is a start but in my opinion these are criteria that should be taken in to account for any award.

Anyway that’s my thoughts over, comments (and evidence proving me wrong) welcome.


  1. Chris

    I totally agree with your comments and I say that from experience in procuring a GIS system and more recently working for myself and "selling" GIS solutions to clients.

    I have been a GIS user for getting on for 20 years and still believe it has huge scope particularly in the area I work in, land and property management. Whilst Group Property Director at Aggregate Industries I wanted to invest in a GIS and Property Management System with a total investment of about £120k. To put that in context the annual company capex budget was north of £40m per annum and where a single tyre for a large loading shovel can cost £15k. It took me nearly a year of negotiating to get the project approved. You are 100% correct, the decision makers are simply not interested in how it works, they want to know how it can make you more efficient and save costs.

    During that drawn out process I made one big mistake and that was getting the software vendor to explain the system, put me back months. In the end I sold the concept on a practical demonstration and quite a bit of lobbying. I recall the payback was projected to be about 3 years. Ironically the payback was a few months as we "discovered" through GIS analysis that one particular quarry we were able to work some substantial additional reserves.

    Moving forward 5 years I now use GIS extensively for managing my clients portfolios or for undertaking specific GIS projects. Explaining the benefits of a GIS application in say a 10 minute pitch to me is quite hard. Show someone a GIS application in use and the response is usually pretty quick. The main issue I do find is the cost of GIS software and the licensing costs of map data. Both of these put off SME's and and many are reluctant to go down the freeware route.

    I have recently taken on the Chair of the AGI Land & Property Special Interest Group. At out first meeting last week it was interesting how much debate was focused on getting those outside the AGI interested in GI.


  2. Hi Jeremy,

    It's good to hear that someone with more time in the industry has come across similar issues. I can definitely see cost being an issue for SMEs, I'm surprised that there is such a reluctance to pick up Open solutions although I guess these may need more skill to maintain.

    I will definitely try and come along to the meeting of the group as that has been a common theme among AGI Council as well and were keen to hear any ideas on the topic.