Just posted a conference report for last week’s Geospatial Infrastructure Solutions Conference. The report summarizes overall trends and opportunities in the infrastructure space. What I wasn’t able to squeeze into my coverage were a few takeaways from conversations that I had with a few GIS managers. These discussions revolved around the operational benefits versus costs of GIS systems and services.
I spoke to a manager at a large pipeline company and he related a recent scenario where his direct report was out of the office and he needed to make a presentation to a top-level executive without his boss present. A few minutes into his project status report he was stopped by the executive and asked to come back in three months with a full accounting of their bottom line return on investment. When the manager returned and learned of the executive’s request he was livid as they recently went through a cost justification exercise for the project.
Previously, operations managers were asked if they wanted to continue to support the GIS department as it is a cost item in their budgets. Being told to cut overhead by a significant margin, the reaction from managers was to jettison the whole system. Learning this, the whole GIS department’s morale took a nose dive and they all thought they were out of a job. Late in the afternoon of the second day after this news an Executive VP visited the department and told them that their work was of value to the company and that they were to continue as usual.
Another utility that I visited related a similar scenario where their GIS department is a cost center that is considered overhead and separate from the benefits that are derived in operations. This seems to be a common scenario that becomes troubling in tough economic times. When the system is separate from the services and intelligence that can be derived and it becomes a challenge to defend.
What gets lost is this cost justification are the many questions that can’t be answered without a GIS in place. How can an organization adequately plan for the future without a detailed understanding of their assets and operations? The executive VP at the pipeline company came to this realization despite the lack of support from various operations managers, but it obviously took him some time to analyze and reach that conclusion. I’m guessing that one month into operation without GIS and the company would be scrambling to rehire and put the system back online, but without that awakening the employees in this department won’t rest easy that their value is understood.
I don’t get the sense that a lot of GIS departments are going through this hassle, yet it certainly is more prevalent as the economy struggles to rebound. Has your GIS department been able to escape this scrutiny or have you had to justify the investment in GIS recently? I think we’d all be interested to understand any recent cost justification efforts, and responses to upper management that have worked.
