Ashish Kothari

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In today’s competitive business environment, GIS is the latest game on the block. Offering the possibility of impressive paybacks, GIS is rapidly being integrated into the business intelligence and decision-making processes in the government and private sectors. Here’s what you need to know to determine whether this exciting technology is right for your business.

Geographical Information Systems or GIS is a catchall phrase that refers to a system comprising computer hardware, software, data and the people who deal with the storage, management, retrieval, conversion, analysis, modeling and display of spatially-related data. The system combines multiple layers of location- and place-related information in order to aid the user in performing complex analyses related to, for example, finding the best or most efficient delivery route, assessing environmental damage, detecting patterns, and finding the best location for a store, among other things.

Source: www.gis.com

Ranging from low-end mapping software appropriate for displaying sales regions or sub-market distributions to high-end software capable of managing and studying environmental and safety-related information for large regions, the key components of GIS software include:

• An easy-to-use graphical user interface (GUI)
• Tools for capturing and manipulating geographic information such as addresses
  A database management system (DBMS) for housing spatial and non-spatial data as well as the relations between them
• Spatial data analysis tools useful for creating digital maps that can be analyzed, or queried for more information, or projected for presentation or documentation.

Assessing the Benefits of GIS Systems

GIS systems allow improved organizational integration via its ability to link data sets by location (for example, addresses). They improve decision-making capabilities through enhanced ability to query, analyze and map data in support of the decision making process. In the following pages, I show the particular benefits and their application in government and business.

Improving organizational integration and reducing costs

One of the major benefits of GIS is improved management of the information assets of organizations, which results from its provision of linkages between otherwise disparate sets of data using spatial information as the common key. This enables people in various departments in the company to share their work. By creating a shared database, one department can benefit from the work of another—data can be collected once and used many times. This produces a substantial cost savings, especially among governmental units, which often work separately and do not coordinate their activities with other governmental units.

Making better decisions

By integrating GIS technologies into an organization’s existing decision-making structure, organizations can enhance their decision-making capabilities, especially, as a result of the tools if offers for querying, analyzing, and mapping data. Further, this visual representation of data increases the analyst’s ability to recognize patterns, which is extremely useful for interpreting and maximizing the value of data.

Just who is using GIS systems? Clearly, as the figure below suggests, GIS software finds its maximum application among educational institutions and governmental bodies at the local, state and federal levels. There, multiple centers have been set up to promote the use of GIS technology. One such center is the federally-developed CADD/GIS technology center, which is charged with facility coordination and infrastructure and environmental implementation of GIS within the Department of Defense and other federal, state and local participating governmental agencies. The CADD/GIS center, among other things, sets standards, promotes systems integration, and provides assistance for the installation, training, operation and maintenance of GIS systems. By offering free or discounted licensing of its software to educational institutions, GIS has created a large user base and promoted early adoption of its software. Other heavy users include consultants and the retail sector.

Major Types of GIS Users by Percentage of All Users Source: http://www.pobonline.com

Applications in the Private & Regulated Sectors

Now that we know who is using GIS systems, let’s examine some applications. To begin, we’ll offer examples of users in the private and regulated sectors.

Chase Manhattan uses the unique ability of GIS to help it visualize market situations, analyze data, and build realistic models that predict how changes in strategy might affect its business (see www.gis.com). Among other uses, it has employed GIS to study branch locations in urban market s and to identify opportunities by focusing on the market’s daytime population. Including address information with the branch customer data enabled Chase’s analysts to infer that roughly 66% of the branch's customers lived in its trade area. This meant that 33% of the branch's customers worked in the area but lived elsewhere. Knowledge of these two distinct segments enabled the bank to develop unique marketing programs for each of these. Researchers in another Chase department then used the same data to analyze the remote customers and determined that many of them worked at local medical centers. By plotting the hospital locations, the location of the Chase branch, and competitors’ branches, analysts determined that the competitor bank’s close proximity to the medical center gave it a competitive advantage over Chase. These findings were used to recommend relocating the Chase branch.

Chase Manhattan GIS Analysis Source: www.gis.com

In the real estate industry, GIS benefits both buyers and sellers. By integrating a wide variety of data into a single map format, GIS allows real estate business users to perform cross-searches in order to narrow down the number of potential properties using multiple criteria. Consideration of a wide variety of data affecting the attractiveness and market value of a property on a map is far more revealing and accurate in studying the suitability of a property for rental, first time ownership, or site selection for a shopping mall than any number of generalized market studies and aerial and land photographs. An excellent example of the latter use is provided by Arlington iSites, which helps businesses seeking to relocate to Arlington, Texas search for vacant commercial properties, perform demographic analyses, and generate site-specific business cluster reports based on user-defined selections. The site, which updates property data in real-time, allows users to search for property available for lease and purchase by multiple criteria—e.g., property size and type--and displays it on a map. Users can turn on or off multiple layers depicting schools, traffic, parks, streams and lakes around the property, etc. Detailed demographic information as well as the information on the types of businesses in the vicinity of a property can also be displayed for any property (see www.gisplanning.net/arlington).