Monetising Geospatial Values and Practices

The Geospatial World Forum in Rotterdam (11-16 May 2013) carried the theme ‘Monetising Geospatial Values and Practices’. The theme conjures images of geospatial specialists hunched over their workstations trying to encode complex economic calculations and computations that can help them express the value of what they do in a universally understood language of value – money. Indeed there were elements of that. Speaker after speaker, presenter after presenter bombarded the delegates with figures and charts of quantified benefits, assumed benefits, Return on Investment (ROI) calculations, Net Present Value (NPV) calculations etc. There was a plethora of great examples and case studies. There were also questions about the meaning of ‘monetising’ and ‘geospatial’, in addition to who should monetise geospatial and how. On this blog post I will try to summarise what I took from the forum; in the hope that it will either evoke more questions or help perpetuate the conversation on benefits of geospatial within the UK community, especially in the context of INSPIRE where benefits realisation is becoming important, and will be even more important post-implementation. The techniques and methods that came out of the forum will be invaluable to the way we assess the value and impact of INSPIRE going forward.

 

Universal Challenge

From all the presentations, panel discussions and plenary sessions, it was clear that the global geospatial community faces more or less the same challenge i.e. how to articulate the value of geospatial in monetary or economic terms in order to garner the much needed support of policy makers and politicians. It was clear from industry, public sector and academia that this was a universal challenge. The universality of the challenge is important because it means there is a lot of work being done on the subject. This in turn provides us all with numerous opportunities for continuous learning and improvement. 

 

Calculating Benefits of Geospatial

Given the theme of the forum, the topic most talked about was how to calculate benefits of geospatial and express them in monetary terms. Any geospatial project, be it acquiring new software or collecting data, requires a business case. This usually involves pitting the costs, which are real and straight-forward, against the expected benefits, usually not as straight-forward and easily quantifiable in monetary terms as the costs. In most cases the business case ends up with a total figure for costs and a figure for benefits.  A common problem being that the benefits figures can hardly withstand scrutiny if challenged. There was general consensus that in most cases these figures are prepared by geospatial specialists without any involvement of finance people or economists. The recommendation is that geospatial people need to talk to, and seek input from, qualified finance or economics people. There were case studies where specialists were hired to calculate the return of geospatial investment. A very good case study from King County can be found here .  I am not advocating that we routinely hire consultants to calculate benefits, but I know for sure that almost all public sector bodies employ finance people or economists. Let’s involve them in our efforts to articulate benefits for geospatial.

Another emerging theme from the forum was that monetary valuation is not always possible – or even desirable. We need to find other ways of articulating the socio-economic, societal and environmental benefits. NASA shared a Primer that they prepared to help the Earth Observations community measure socioeconomic impacts. This is a fantastic resource that can be used when valuing projects, equipment or even geospatial data.  I highly recommend it! Please find and download it here.

 

Value of Geospatial

 As the conference progressed, the conversation seemed to shift a little, from a position where monetising geospatial was a necessity to a view that it was desirable but not necessarily imperative.  The consensus was that the discourse should focus on the value of geospatial as a means to an end, not an end itself.  Once geospatial is accepted as a means to an end the implications on cost benefit analysis will be significant.  This would imply that calculations of benefits would be carried out for the service or product being delivered with the help of geospatial, and not on just the geospatial alone.   There was even the suggestion that the public sector should move away from monetisation per say. We should try to shift the culture in order to make geospatial accepted as a necessity (like Finance or HR functions within organisations).  With that cultural shift the question will also shift from ‘where is the return on investment’ to ‘what is the best way to pay for this’. Discussions would then centre on the cost effective way to pay – shared services, shared data, shared infrastructure, shared knowledge and skills etc. But first there is the question of how do we achieve that cultural shift?

 

Making Geospatial Fun

First we need to make geospatial not only accessible but interesting and fun. This will help citizens embrace the technology at the same time attracting young people to whom we will one day pass the baton. My suggestion for a ‘double-edged sword’ approach was well received. The approach requires us to conceptualise geospatial as two archetypes - ‘Industrial geospatial’ and ‘citizen geospatial’. Industrial geospatial is concerned with the big complex analysis and business applications while the citizen geospatial is more about the ways consumers interact with geospatial - be it a map app on a smart phone or geo-enable video game! With such conceptual separation we will be able to market and package geospatial accordingly. We’d emphasise design and rigour for industrial geospatial. This will gain and raise its integrity in business, industry and service delivery. Once this value is recognised by industry it will become easier to attract young people into the field. Academia should also play a major role by promoting lateral cross-faculty collaboration to embed geospatial into the core curriculum of relevant subjects.

 

As far as citizen geospatial is concerned there is a lot that can be done to build on what currently exists. Participative and interactive applications headlined this section. There were great case studies. One that stood out was the GRID Warszawa in Poland where they are using interactive online GIS for consulting the general public in planning and delivering a major infrastructure project. The public can draw, tag or comment on lines on the map, allowing citizens to suggest and even draw, alternative routes. In so doing they actively engage with planners and other citizens in discussing the merits/demerits. This greatly enriches and enhances the consultation process, at the same time lowering costs significantly. There is scope for central and local government organisations to adopt this approach. With increased access to free, easy-to-use geospatial tools citizens will become more interested and engaged. More importantly they (citizens) can become ambassadors for geospatial, making it easier to garner buy-in from politicians and policy makers. The public sector can also encourage citizen geospatial by opening up data; data that can be used by individuals and private sector companies to create interactive fun apps and other digital products.

 

Open Data

It’s not surprising that open data was once again a topic of heated discussion. There was consensus that open data is good; in fact much better than the alternative. For the delegates, it was impeccable timing that the global geospatial community was strongly endorsing open data when the Shakespeare Review had just been published advocating the same.  One presentation highlighted a study that was carried out to compare investment on geospatial and returns for Europe and the USA. Europe and USA make annual investments of €9.8 million and €19 million with returns on that investment of €68 million and €750 million respectively. The study concluded that the disparity - Europe’s 6x return on investment compared to USA’s 40x - is mainly a reflection of data policies. The USA has led the way in open data. Of course this is too simplistic a view but it illustrates the point very well. 

 

INSPIRE as a great European story

INSPIRE was heralded as a great European story. But there are lingering questions about the benefits of INSPRE now. There was a session dedicated to SMEs (Small and Medium Enterprises) that are working with government bodies to deliver the INSPRE Directive. Indeed these SMEs have created jobs and contributed to GDP and economic growth/recovery. But there were questions whether these SME case studies were highlighting costs or benefits of INSPIRE. There was general agreement that if government bodies pay a contractor (SME) to help deliver INSPIRE then it is indeed a cost to that government body.  But when SMEs create jobs and contributes to GDP it is a benefit; a benefit that accrues to the state not directly to the data publishing bodies. This raises the question - Should economic benefits calculations be carried out at state level or at the level of the individual bodies?

  

Last words

From the deliberations at the forum there was a call for the use of more rigorous economic techniques to measure value of geospatial, especially the involvement of trained finance and economic specialists. The call echoes the just-published Shakespeare Review which makes a similar recommendation (Recommendation 7). The NASA Primer is a very good source of such techniques. As an example the Primer advocates the use Value of Information (VOI) methods. These methods simply measure how data and information changes decision-makers’ prior understanding of uncertainties and the value from this change – also known as ‘with/without ‘analysis.  The Primer also provides a worked example (Appendix B) of VOI or Expected Value of Information calculations.

It is clear that INSPIRE principles are on the right side of history. Whilst the benefits may not accrue (or seem to do so early enough) to the public sector bodies that are publishing data, there are a lot of reasons to be optimistic. INSPIRE gives Europe the chance to emulate the US by increasing annual returns from geospatial by making data open.  As a geospatial community we need to engage other professionals when assessing benefits. We can also increase benefits by making geospatial fun and exciting for citizens but rigorous and well-designed for ‘industrial’ applications.

The true benefits of geospatial are not constrained to money; they should be measured and articulated in other ways and by the citizens who consume geospatial products and services.