The use of Geographic Information Systems for optimal site selection in expanding companies in the retail sector.
Summary
The Netherlands is ranked among the top five countries in the world in terms of its levels of user adoption of geographical information (GI). Eighty percent of all available data contains a geographical component and can be handled with a Geographical Information System (GIS), which is an information system that is designed to work with data, referenced by spatial or geographic coordinates. The use of GI leads to increased productivity in several business operations, and to greater accuracy of information for both professionals and the general public. Therefore, GI can be useful for making the right choice regarding the best location. Although GI is nowadays being used on an increasing basis, not every company makes its location choices based on GI. This research determines the site selection work process of companies in the retail sector, and investigates which reasons could account for the potential of GIS not being fully utilised. The goal of this research is to evaluate the use of GIS in expanding retail companies in the Netherlands in order to identify the gap between what GIS contributes to a company at present, and what the potential value of GIS could be for expanding companies. The main research question that will be answered is: ‘To what extent are expanding companies in the retail sector using geographical information systems for their site selection and what could enhance its potential use?’
According to the theory there are four factors which can held responsible for the non-use or suboptimal use of GIS. These factors could partly explain why there is a gap between the use and non-use of GIS. The sensitizing factors were developed on the basis of these constraining factors.
- Awareness is the knowledge of the existence of data and GIS, and its potential added value.
- Accessibility is about the critical importance of a potential user of GIS having access to all data needed in order to correctly represent a particular site in its surroundings.
- Accuracy is about the usability, the type of the data, and is an important factor for knowing whether the data are of value to a company.
- Knowledge relates to specific technological know-how with regard to the GIS software.
The design of this research is explorative and qualitative. At present, there is scant knowledge as to why GIS is not widely used in the retail sector. Inductive research is needed to ask the companies in the work field why they do or do not use GIS. In order to identify these explanatory variables and concepts, the Grounded Theory method was used in this research. The Grounded Theory is a qualitative inductive method intended to seek and conceptualise latent patterns and structures – a substantive theory – through a process of constant comparison. Therefore, in-depth qualitative semi-structured interviews were held with 10 companies in the retail sector to gain new insights and new theoretical concepts about the possible gap between the practical and potential use of GIS, and to establish what would need to be done to accomplish the potential use of GIS. The sensitizing concepts were also used as a guideline for the interviews. The interviews were held with the companies’ expansion manager or CEO.
The results have revealed that not all interviewed companies in the retail sector make use of GIS when searching for a new establishment. From the interviews it emerged that the work processes of the ten retail companies can be divided into three groups: Use GIS, Non-use GIS and External GIS. Not all three groups are using GIS, but two of them do. It appeared that, when the awareness about GIS in the company was high, the companies were using GIS already. The five most important factors for the use or non-use of GIS appeared to be: lack of knowledge, the processing of subjective data, strategy of the company, an alternative method or system, and the cost-benefit ratio. From the interviews it also emerged that there indeed is a gap between the contribution of GI to a company at present and the potential value. The most important conclusion emerging from this research is that insights into the possibilities of GIS is the key for enhancing the potential use of GIS. Therefore, awareness needs to increase, because awareness is a first step to getting greater insights. Furthermore, the subjective data remains of importance to every company and must always be taken into account when discussing the GIS analysis.