Businesses crave certainty. The more you can know what will happen, the more you can reduce risk and effectively plan to increase profits. While a business degree helps, what most executives would love to have is a soothsayer to foretell the future. Finding a psychic of commerce is pretty unlikely. But companies can get the next best thing: an economic oracle called a geographic information system, or GIS. It’s technology that allows managers and executives to combine and analyze large amounts of information for insights.
While GIS can help companies identify customer trends and optimize their operations, it can go one step further to geospatial predictive modeling. Proper use of GIS technology can help a business identify future trends, developing consumer habits, and upcoming business needs, using extensive data and statistical analysis to predict what is likely to happen. That may not be a foolproof guide to the future, but it’s the next best thing.
For example, retail chains can combine data about consumer preferences and changing population patterns to determine the cost-effective remaining life of individual store locations. With that type of information, executives can determine where to both close and open stores to maintain profitability. Banks can analyze potential merger and acquisition opportunities.
Any company could plot periodic market research results onto maps to build trends by location to predict future market demands and customer segmentation. Because GIS uses location as a unifying factor in analysis, companies can use data that they would otherwise find difficult to directly correlate and compare. That’s why predictive analysis of customer trends and business conditions can be difficult to undertake without GIS. Location connects information that a company otherwise stores and examines separately. Here are just a few examples of what a business could undertake using geospatial predictive analysis:
- Meteorological data and long-range predictions can point to likely weather for customers. A business can then create a direct marketing campaign for goods appropriate to the temperatures and precipitation levels.
- Companies can use geospatial predictive analysis to identify such potential problems as labor strikes, transportation disruptions, political instability, and public health issues that could disrupt operations.
- Geospatial predictive modeling can help facilities managers identify the likelihood of failure in buildings and equipment, to better schedule and coordinate preventative maintenance.
In a way, you could say that predictive analysis using GIS is like oracles in classical literature. These were people who could announce what was to happen. However, understanding what an oracle actually meant was tricky. It took priests who could make sense out of the utterances. That’s why companies need people with a GIS degree who can sort through the masses of info and find the nuggets of truth.