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					       Business Applications of
Geographic Information Systems
                          (GIS)
                                     Richard G. Born
        Operations Management & Information Systems
                                 College of Business
                          Northern Illinois University
                                 DeKalb, Illinois USA

                                        October, 2008
Outline
 Introduction to Business Geographics
 Business Geographies and Censuses
 Case Study: Walgreens Drug Stores
 GIS Software: Microsoft MapPoint
 Business GIS Projects at the Northern
  Illinois University College of Business
Why Study Business GIS Systems?




                     Geographic



    It is estimated that 80% of all corporate
    data has content that is geographic.
What is “geographic content”?

           Street Address
                                     City
 State/Region/District/Province
                                  Postal Code
             Country

       Telephone Number

   … any data that has location information
   and could be plotted on a map.
Why 80% geographic content?
   Manufacturers
   Suppliers
   Shippers
   Customers
   Stores
   Warehouses/distribution centers
   Financial institutions
   Stockholders
   Competitors

     … any entity that is of interest to a company
     has address information that can be mapped.
The time has come to …
 …treat geographic data as an
  organizational asset
 …realize the value of geo-information as a
  key business driver
 …easily spot trends, patterns, and
  opportunities that are difficult with
  traditional techniques
 …provide an exciting way to view and
  analyze business information
Which is more enlightening?
 … this table of data
Which is more enlightening?
  … or this map …
Why are businesses slow at
adopting GIS solutions?               SHARP RISE
                                      IN SALES!!!
   Many executives are unaware of
    the existence of business GIS
   Benefits of GIS are largely
    intangible
   GIS cost vs. perceived value is
    not obvious
   GIS vendors do not educate
    mainstream business on how to
    demonstrate the power of GIS
                  Business
                   Rules
…why slow at adopting GIS?
 GIS tends to be implemented at the bottom
  layers of a company – by the worker bees
 Relatively few universities have business
  schools with courses in business GIS




                     Notable exception…
                     NIU’s College of Business
Business GIS Courses at NIU
   OMIS 379. BUSINESS APPLICATIONS OF
   GEOGRAPHIC INFORMATION SYSTEMS (3)
   Examination of leveraging an organization’s spatial data to
   analyze and solve business problems. Extensive computer
   laboratory work designing business geographic services
   using commercially available software. PRQ: GEOG 256 or
   OMIS 351, or consent of department.


   OMIS 679. BUSINESS GEOGRAPHICS (3)
   Examination of geographic information systems
   development and use from the perspective of contemporary
   business. Extensive computer laboratory work designing
   specific geographic systems using commercially available
   software. CRQ: OMIS 652 or consent of department.
In what department within a
typical company does GIS belong?
      Marketing – customer penetration study
       Customer Database              Postal Codes for next
       Area demographics   Business   Direct Mail Campaign
                            Rules

      IT Department
        Server requirements
        Database development
        Planning and networking
      Finance Department
                                      Dissemination of MAPS
       Customer Database   Business           showing
                                       Sales, Revenue, and
                            Rules     Profitability Information
…which department?
        Planning Department
          Growing new markets
          Growing the customer base
          Adding locations for:
           ○ Stores
           ○ Warehouses
           ○ Distribution Centers

        Operations Department
                              Identify areas
           Supply Chain                                GIS
                           needing optimization


 GIS can greatly benefit virtually every department within a company!!!
Business Value By Layering
Business Value By Layering
Business Value By Layering
Business Value By Layering




   Patterns, Opportunities, New questions?
Business Geographies (United States)
        Business        Total        Typical # of
       Geography       Number        Households
   States                      51           1,862,745
   MSAs                       303            250,000
   Counties                  3141             30,245
   ZIP Codes               41,940              3,167
   Census Tracts           61,257              1,551
   Block Groups           226,399                   420
   Carrier Routes         556,821                   171
   Blocks                6,500,000                   22
   ZIP + 4s             28,000,000                   10


          Government Census Every 10 Years
Business Geographics (Austria)
                  State (Bundesland)




                                     Municipality (Gemeinde)




                 District (Bezirk)
Advantages of Census Taking
   Age                Industry
   Population         Marital Status
   Education          Occupation
   Employment         Transportation
   Ethnicity            Travel time
                         Commute time
   Expenditures
   Households         Vehicles Ownership
   Housing            Crime
   Income Levels      Weather
                       …..
Political Structuring in Bosnia
and Herzegovina



    2 Major Entities       10 Cantons   137 Municipalities
  and the Brcko District



   Significant Fact: Last official census in 1991


                                         *Maps from Wikipedia
Case Study: Walgreens
 A major U.S.
  pharmacy chain
 7,000 stores
  planned by
  2010
 5 million
  customers/day
 583 million                       Typical store:
  prescriptions in               14,500 sq. ft. (1300 sq. m.)
                                   Staff of 25 – 30 people
  fiscal 2007                     Annual sales $8.5 million
                     Pharmacy, photo lab, cosmetics, general merchandise
Walgreens New Location Targeting
   Determine 10 potential locations for a new
    Walgreens store in Tulsa, Oklahoma (USA)
Walgreens New Location Targeting
           Business Rules -- New Store Criteria

   New sites cannot be less than 1 mile from an
    existing Walgreen store
   Proposed locations must satisfy the following
    criteria:
     Prescription potential within a mile    Most important
       must exceed 250 prescriptions/day
     Total daily intersection traffic
       must exceed 20,000 cars
     The fewer the competitors the better,   Least important
       based upon supply and demand
Walgreens New Location Targeting
                                   Potential
      1 Mi Rx/Day                4=High, 1=Low          After Weighting

      337                         3       2              9 1
                288                                            2 6
                                                                3
                                              X3=
          450                         4                      12
279                          1                      3
                                                                                Overlay
                                                                               Using ADD
Total Intersection Traffic
      23K                         1                      2                     13        13
                32K                       2                        4
                                              X2=
                                      3                        6                    20
          41K
56K                          4                      8                     15


      Competitors

                                  2       3             2                   HIGHEST
      2          1                                                 3
                                                                            VALUES
            2                                 X1=            2                HAVE
                                      2
0                                                                           HIGHEST
                             4                      4
                                                                           POTENTIAL
Walgreens New Location Targeting
  Walgreens New Location Targeting




One mile buffers
are constructed
around existing
stores.
    Walgreens New Location Targeting




   Daily Block Group
Prescription Potential
What factors affect
the daily prescription
potential?


      Daily Intersection
                  Traffic
Walgreens New Location Targeting
A Look at GIS Software Pricing
Microsoft Has Changed the
Competition
   Has the know-how to price its desktop product
    MapPoint affordably.
   Has made MapPoint easy to learn and use.
   Targets decision makers, not those who
    create/maintain complex GIS data.
   Developed MapPoint Web Service (for
    corporate internet mapping applications)
   Affordably bundles demographic data with
    their software.
     USA Geographies include states, Metropolitan
      Statistical Areas (MSAs), counties, ZIP codes, and
      census tracts
MapPoint’s Two Versions
MapPoint North America       MapPoint Europe
   United States               Demographics for:
    Demographic Data              Austria
   Streets and Roads for:        France
     Canada                      Germany
     Mexico                      Great Britain
     United States               Italy
                                  Netherlands
                                  Switzerland
                                Streets and Roads for
                                 many countries in
                                 Europe (but not Bosnia
                                 and Herzegovina)
                                 Location-Enabled                       Location-Aware (Real-Time)
                        (understand location and how to process it) (application is also aware of its own location)




Disconnected
(location information              MapPoint 2009                          MapPoint 2009 Interfaced
    and processing         •Thematic mapping of corporate data
  framework are all          •Corporate territory management                with a GPS Device
      on the host         •Demographic mapping of census data                    •Real-time navigation
     computer’s             •Determining shortest/fastest routes     •Real-time location-based information logging
      hard disk)




                                                                          MapPoint Location Server
  Connected                   MapPoint Web Service                           •Hosted within your enterprise
(network connectivity              •Hosted by Microsoft                  •Enables real-time location scenarios
     is essential—          •Global location-based applications                 using locatable devices
 location information         that work for multiple countries           •No GPS hardware/software needed
    and processing                      •Store finder                     •Finding nearby ATMs, restaurants,
 framework are on a                 •Best route to store                          motels, gas stations
   remotely located                  •Find competitors                       •Calculating driving directions
      host service)         •Maintain custom points of interest                based on current location
                                                                             and real-time traffic conditions
Disconnected, Location-enabled
Projects
   ESRI ArcGIS Projects
       Rockford MidTown District
       Bridges of RiverMist
       Family Shelter Services
       Subaru Chicagoland District Sales
   MapPoint Projects
     Planned Parenthood Advocacy
     Affordability of Homes in Kane and McHenry
        Counties in Illinois
Rockford MidTown
District
 Agency to make this area of
  Rockford, IL a safe and
  enjoyable place to live and
  operate a business
 Develop a GIS that would aid
  in trending, forecasting, and
  justifying its marketing and
  development plans
 Crime maps help assess the
  effect of social programs to
  reduce crime rates.
 Major lesson learned – the
  most difficult part of
  developing a business GIS is
  obtaining the data from the
  constituent parties.
     City government
     Police department
     Other agencies
Rockford
MidTown
District
   Adding
    features to a
    map:
     Streets
     Block
      groups
     ZIP codes
   Labeling
    features
   Inserting
     Titles
     Legend
     Scale bar
   Creating pie
    chart to show
    demographics
Bridges of Rivermist
   New subdivision in
    DeKalb, IL (home of NIU)
   Goal was to produce maps
    that could be used to
    market lots on the Web
   Learning activities
     GPS collection of
       control point data
     Heads-up digitization of
       lots, streets, and ponds
     Joining corporate data
       to geographic parcels
   Students had the feeling of
    accomplishment in being
    the first to create a map of
    a new subdivision.
    DuPage County Family Shelter Services
   An organization in
    Illinois that provides
    shelters for
    immediate safety for
    domestic violence
    victims and their
    children
   Goal was to
    determine the best
    location for a new
    shelter
   Students learned:
        Joining corporate
         data to spatial data
        Clipping features
        Creating map layers
        Creation of
         graduated symbols
        Preprocessing of
         data in Excel pivot
         tables
Subaru of America Automobile Sales
                                      Subaru wanted
                                       a map that
                                       could be used
                                       to analyze
                                       sales in its
                                       Chicagoland
                                       districts
                                      Students
                                       learned:
                                          How to create
                                           Subaru
                                           defined
                                           territories by
                                           dissolving ZIP
                                           codes
                                          Joining
                                           Subaru sales
                                           data to ZIP
                                           codes
Planned Parenthood
Advocacy (PPA)
   An advocate of reproductive
    rights and health issues
    wherever public policy is
    discussed
   To better focus marketing
    efforts, requested maps to
    show clients by U.S.
    Congressional Districts
   Students learned:
     How to geocode addresses to
      the street level
     How to import ESRI shape
      files (e.g., U.S. 108th         108th
      Congressional districts) into   Congressional
      MapPoint via COM add-ins        Districts and PPA
                                      Clients
                              Affordability of Homes in Kane
                              and McHenry Counties in Illinois


   Affordable—any
    home selling for less
    than or equal to the
    median selling price
   Major finding—
    clusters of
    affordability
   Students learned:
       Importing an Access
        database into
        MapPoint
       Aggregating data by
        using shaded area
        maps
       Geocoding
        addresses
Connected, Location-enabled
Projects
 A result of rapid increase in the use of
  smart phones and pocket PCs
 Aided by advances in Visual Studio
  2005 and 2008, including mobile
  application development on a pocket PC
  emulator.
 MapPoint Web Service applications:
     Walgreens Store Locator
     Pocket PC Mapper
Walgreens Store Locator

                             Visual Basic
                              Windows or
                              ASP.NET
                              project
                             Makes use
                              of the
                              MapPoint
                              Web Service
Pocket PC Mapper
    Built using Visual Basic
     2005/2008
    A pocket PC Device
     Application
    Makes use of the
     MapPoint Web Service
    Can find places as well
     as addresses
 GIS methods are ideal for solving many
  business problems.
 GIS allows you to analyze and visualize
  business problems in unique, effective
  new ways.
 Biggest challenge in Bosnia and
  Herzegovina – obtaining current
  demographic data normally available
  through periodic censuses

				
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