Itís Time to Change: How SaaS Will Enable the GIS Industry to Move Forward and Engage With New Market Opportunities

By Philip O’Doherty

As a rule, we in the GIS industry are a conservative bunch. We have been slower to embrace new technologies and approaches. We have concentrated on serving a relatively narrow customer base of highly skilled domain experts in industries where GIS and its attendant benefits are well-understood. The status quo has served us and our customers very well.

But it’s time for a change.

It’s time to branch out and examine the opportunities that exist in broader markets. As organizations around the world awaken to the enormous opportunities that location intelligence can bring them, they seek the tools that will enable them to leverage this knowledge. It’s time for the GIS industry to open itself up to new markets.

New markets mean new opportunities – but also new expectations
With new opportunities come new expectations. We are accustomed to dealing with domain experts: GIS specialists who are intimately familiar with our toolsets. Unlike traditional users, customers in new markets are unfamiliar with the current GIS solutions. They have their own ideas about what tasks they want to accomplish, what financial commitments they’re prepared to make, and how the relevant toolset should be delivered. While traditional GIS customers may accept and be comfortable with the status quo, new customers simply won’t see the traditional GIS setup as an option.

New expectations: Full functionality and improved usability
Users in these new markets are not GIS experts, so the full functionality offered by our traditional GIS solutions may leave them cold. Terms like raster and vector data are unfamiliar; the difference between styling and editing in an interface may not be clear.

Users typically want answers to a discrete set of questions – and quick and easy processes to get the answers they seek. They won’t typically use a location intelligence tool for prolonged periods of time; it will be one of many tools they use to do their jobs.

As only one of many useful tools in a new user’s arsenal, usability and availability become vital. Operating in a world where software is becoming increasingly easy to use – and available at any time, from anywhere – the expectation will be that a location intelligence tool will be reasonably easy to use, and available when the user needs to use it. New users will be intolerant of overly complex interfaces, painfully slow loading times, firewall restrictions and outages. They want to get in, perform their tasks quickly and efficiently, then get on with the rest of their jobs.

In order to serve new markets effectively, we cannot simply serve up the same highly specialized technology used by domain experts. Instead, we must seriously consider the needs of the new users, investing in the usability of our solutions accordingly. No matter how rich the functionality offered, the customer will not buy a tool if it is too difficult to use.

Combining ease of use with full functionality is central to the success of SaaS. SaaS providers have focused substantial resources on making interfaces easy to use so that users can accomplish tasks themselves.  

A clear, usable interface does not require sacrificing functionality. A clear focus on the use and usability of the interface will still accommodate complexity and specialist functionality for those who require it – but not at the expense of those who do not.

This tight focus is enabled by a shift in priorities for the vendor. No longer tied to time-consuming activities of customizing and maintaining multiple instances of their software, their attention shifts to taking a system-wide approach to developing software that meets the needs of a broad range of users. When improvements are made, all users benefit.

New expectations: Lower cost
The traditional GIS model involves purchasing a software license and hosting it in-house, with additional paid support and professional services provided as required.

While this model has worked well for GIS vendors and customers alike, it simply isn’t an option for customers in new markets who do not have budgets dedicated to location intelligence software. Indeed, as return on investment (ROI) for location intelligence is yet to be proven in many of their industries, customers in new markets are unlikely to make any sort of substantial investment in as-yet-unproven technology in the near- to medium-term.

Substantially reducing the financial commitment and total cost of ownership (TCO) associated with GIS is a significant requirement for new-market entry. Minimizing investment and maximizing ROI are popular reasons to choose SaaS delivery. Knowing that new prospective customers simply won’t participate in the higher-cost traditional GIS model, it is vital to embrace the significant cost savings that SaaS brings its customers.

SaaS frees customers from the financial burdens of software and hardware purchases and licensing, and the costs of the staff required to maintain them. Instead, costs are limited to a comparatively low monthly license fee per user, typically based on a minimum term of 12 months.

The low cost – typically in the hundreds for the smallest companies, with volume discounts for larger customers – makes it affordable for new customers to try new technology. Furthermore, the pricing model introduces predictability, making it quick and easy to calculate the annual cost of ownership for a set number of users, as well as the cost of additional licenses.

New expectations: Convenient, IT-free delivery
Our current customers are familiar with the long implementation cycle and complex environment associated with hosting GIS software on in-house servers.  However, the long implementation cycle is a major barrier to adoption for new markets. Having decided that location intelligence is an interesting avenue for exploration, new customers will be unwilling to wait for a complex installation – they want to try it out now, not in six months’ time, when another opportunity will be top of mind.

Furthermore, new customers are not interested in buying and maintaining additional software and hardware to try out a new discipline. They lack the required budgets, and are frankly disinterested in expending any IT resources at their disposal on software that is both perceived to be niche, and that lacks proven ROI.

The delivery model is perhaps the best-known component of SaaS: instead of being installed on individual machines or company servers, the vendor hosts an instance of the software on its own servers, and deals with all associated upgrades and maintenance.

This delivery model has played a vital role in the swift adoption of SaaS – particularly specialized software – because it does not require any IT involvement beyond a standard browser and Internet connection. Quick and painless delivery is key for prospective customers in new markets. They want access to fit-for-purpose software that is immediately available, requires minimal fuss to get started, and that is maintenance-free.   

Moving toward the future
To date, the GIS industry has found success by concentrating on customers who are domain experts. While this has produced excellent results for all involved, it has reduced the enormous potential of GIS to that of a specialized discipline, open only to a select few.

Given the overwhelming potential of GIS, it seems foolish to continue in this manner. Yet in order to embrace new opportunities afforded by new markets, the GIS industry needs to change.

Embracing the SaaS model has enabled eSpatial to gain access to exciting new markets, increasing the use of GIS and raising awareness of the value of location intelligence. In addition to providing a new revenue stream for our own business, we’re also providing businesses with real value derived from insights gained using our GIS solution.

Published Tuesday, March 15th, 2011

Written by Philip O’Doherty

Published in

Location Intelligence

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