What’s the payback from investing in GIS for local government?

Is a proposed IT investment going to pay for itself? If it will, how soon will it do so?

The return on investment question is ? or at least should be ? a common concern in the business world. But in the public sector, where making a profit is not a concern, what yardsticks are used to measure success?

By Bill Lloyd GovTech.net

For 15 years, I’ve observed how GIS has made an impact on service delivery in both the public and private sectors.

If a semiconductor company and invests in research and a production line for a new chip, it wants reasonable assurance there will be a profit as soon as possible. That doesn’t apply in the public sector; there’s neither a bottom line, nor shareholders who want answers.

But that doesn’t mean there’s no way to measure success in government, and it’s certainly no reason to use resources ineffectively. City council members and other policy-makers want a businesslike approach to an investment such as GIS.

Government agencies provide services that simply can’t be provided by the private sector, because of cost or risk factor. Therefore, the success of government agencies is usually measured in terms of provided services, and their effectiveness and efficiency.

Municipal and state governments can be compared to private-sector conglomerates: a collection of widely different businesses that have little in common except their shared source of funding. In the public sector, the varying tasks of different government agencies can sometimes compete for the same dollars.

Research has shown many examples in which investment in GIS technology paid for itself in terms of increased efficiency and quality of service. In some cases, GIS implementation even resulted in new sources of revenue.

Though the general awareness of GIS and its benefits has grown over recent years, it can still be difficult to persuade decision-makers to approve funding for the technology.

Classifying the five different categories of benefits provided by GIS and finding examples of each type can help convince policy-makers and executives that the technology is worth the initial investment.

GIS payback can be divided into the following types:

· productivity improvements,
· service-level improvements,
· effectiveness improvements,
· "home runs," and
· quantifiable but unanticipated benefits.

It’s fairly simple to place a value on productivity improvements and "home runs," but it’s more difficult to place values on the other three groups. Because the majority of benefit types are difficult to quantify, the benefits of using GIS can frequently be understated.

Studies of GIS payback at the federal level have consistently shown that the value of service-level and effectiveness improvements can significantly exceed the value of those easily measured productivity improvements ? often by a factor of 10 to one or higher.

A number of local governments have shown that well-planned, well-managed GIS will cumulatively pay back its initial investment by the end of the implementation’s third year. Because the public sector doesn’t always measure results in dollars and cents, that payback is a little more difficult to estimate, but the benefits are no less real.

Productivity Improvements

GIS allows productivity to rise without a corresponding increase in input. The easiest of the GIS benefits to quantify, productivity (or efficiency) improvements result in less money and/or staff time used to produce a given amount of services.

In the time-consuming area of updating maps, GIS really shines. Winnipeg, Manitoba, reduced the average time it took to update maps from three days to four hours. Many municipalities’ mapping departments have eliminated staff positions through use of GIS.

In the first year after implementing GIS, Philadelphia saved more than $1 million by using the technology to help support garbage truck routing.

It once took days for Clark County, Nev., to update address lists used for citizen notifications. Since GIS implementation, that process takes minutes.

It’s important to realize that in achieving productivity improvements, GIS technology creates the same product or service prior to GIS implementation. No additional or improved service is offered ? it’s the same service provided faster and sometimes with fewer people.

Service-Level Improvements

Agency management or policy-makers usually define their departments’ service levels in terms of objectives to be attained, such as addressing 95 percent of pothole complaints within two weeks or keeping emergency-medical-service response time below five minutes.

GIS technology can have a significant impact on service levels, including reducing response time, increasing the frequency of service, or reducing the amount of effort required by citizens to perform some function.

The Dallas Area Regional Transit (DART) in Texas used GIS to reduce the average time for addressing customer inquiries from 45 seconds to 10 seconds.

One great strength of GIS is its ability to merge layers of widely different types of data and produce a useful mapped tool. In recent years, many law enforcement and emergency medical-response agencies have used computer aided dispatch, powered by GIS, to help identify the closest qualified responder and fastest route to an incident, taking into account traffic and construction.

In the area of increasing service frequency, GIS helps a variety of law enforcement agencies perform crime analysis to help deploy increased patrols in areas identified as needing additional police presence.

Addressing service-level improvements, GIS can combine work history data with maps of physical assets to identify facilities that need inspection and/or preventive maintenance more frequently.

Additionally, GIS helps fire departments and emergency-medical-service personnel identify appropriate areas for new fire stations. The information allows for placement of fire stations in areas where the greatest number of citizens will be served in the shortest response time.

Effectiveness Improvements

For many organizations, the real value of GIS is not that it helps them do their work cheaper, but that it helps them do their work better.

In contrast to productivity improvements, effectiveness improvements gained through GIS involve producing something new and improved. GIS enables government to do something that could not, or would not, have been done without GIS technology.

Using GIS, a large number of separate concerns are overlaid to calculate the cumulative effect of a planned project.

GIS could easily produce maps to graphically demonstrate how the proposed route for a new road would affect a series of wetlands and other wildlife habitats. Such maps could be manually drafted for various alternatives, but the process would be so expensive that a thorough evaluation of each alternative probably would not be prepared.

Effectiveness improvements include better designs, enhanced consistency and reduced errors.

City planners can combine topographic and land-use data to perform preliminary design work for a municipal project. The process results in the identification of more factors and alternative methods than is possible without GIS.

Orange County, Fla., used GIS to map land parcels and flood plains more accurately, which reduced its residents’ flood insurance costs by 20 percent.

Mailing lists created with GIS technology help ensure that no property owners are missed when notifying citizens about zoning-change requests; many agencies also use the technology on a regular basis to evaluate the consistency of tax assessments.

Home Runs

Research finds numerous instances in which GIS technology was implemented for a certain objective, and in the process of meeting that objective, another benefit was found.

In many of these cases, the original intent was to improve consistency and quality, but increased revenue was an unexpected result. These agencies justified the original implementation of GIS technology, but once they had GIS, someone else asked, "Why don’t we use it to deal with this other problem?"

Some examples of home runs:

· Wyoming implemented GIS to audit its mass appraisal process and discovered 250,000 parcels that were not on the tax rolls.

· By using GIS to audit its billing files, Ontario, Calif., generated nearly $200,000 per year in additional business license fees.

· Martin County, Fla., used GIS to geocode an FCC database of telecommunications towers against the county’s parcel data and found many land parcels with under-assessed towers. The discovery generated an additional $3.5 million in tax revenue.

Quantifiable but not Anticipated

State and local governments are in the unique position of being expected to lead the response to emergencies and natural disasters.

Quantifiable but not predictable benefits come from using GIS to support disaster management and recovery efforts. You know if you’re a city in Kansas, a tornado sometime in the next 100 years is likely? but you don’t know exactly when or where it will happen.

Agencies have achieved enormous benefits using GIS to help respond to emergencies like Hurricane Andrew in 1992, the 1989 Valdez oil spill and numerous forest fires by supplying updated maps, transportation reports and other critical information.

In its response to the World Trade Center disaster, New York City’s seven years of investment in GIS helped provide rescue and recovery support; including pre- and post-attack maps; aerial photography; and subsurface structural, utility and transportation information.

Enterprise-wide GIS also provided the public with the status of transportation and utility lines, as well as restrictions on motorized and pedestrian traffic.

Selling GIS Payback to Management

GIS benefits are well documented, but what’s the best way to explain GIS payback to government policy-makers and executives? How should you attempt to convince them that your agency should fund GIS?

First, don’t try to impress decision-makers with techno-babble. Policy-makers don’t approve projects because of technology. They’re not going to give you a pot of money because something’s "object-oriented."

Instead, executives should be made aware of the benefits of GIS, and more specifically, the benefits that impact citizens. Benefits for staff, such as reducing the amount of time it takes to locate a file, are of less interest to policy-makers than reducing the amount of time a citizen waits to have a question answered.

Providing examples of GIS benefits, especially those experienced by similar agencies, go a long way in showing executives the value of the technology.

Quantifying the results in dollars, service levels or other service measures will add further credibility.

While staying away from technical jargon, avoid justifications that couch benefits in a hazy manner. Statements like "enhancing public trust in the fairness of the process" do nothing to show the quantifiable value of GIS and can even create more skepticism toward GIS technology.

Instead, stick to the solid, measurable benefits that GIS has demonstrated in similar environments over the last 15 years. The technology has been proven. The risk of investing in unsubstantiated claims is minimal because so many cities and counties have successfully implemented GIS and seen quantifiable, beneficial results.

This article was developed from a presentation made by Bill Lloyd at the Geospatial Information & Technology Association’s Annual Conference 25 in Tampa, Fla., in March 2002.

http://www.govtech.net/magazine/story.phtml?id=31411

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