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What is Location Intelligence and why is it important to my business?

13/08/2019

What is Location Intelligence and why is it important to my business? Let's start by addressing another question first. What is "Business Intelligence" (BI)? BI is a broad term that applies to both the technologies, processes and strategies used by businesses to perform a wide array of activities ranging from data mining to data visualization (data viz) and distribution. When many people think of the end product of BI systems performance dashboards, balanced scorecards, and operational reporting often come to mind. However, I would summarize the end product of BI to be the knowledge and wisdom we learn from consuming the content generated by our BI system. I would liken it to answering the question of "what is the end product of school or college?". If you answered a degree or diploma I fear you may have missed the point. I believe the end product of school and college is knowledge, wisdom, and skills... the most important of which I would argue is the skill or ability to learn in itself. If nothing else we should learn in college how to keep learning and advancing while doing our jobs for the rest of our lives. In a similar fashion, I like to think the true end product of BI is knowledge, wisdom, and insights about our business and new capabilities when it comes to planning, management, and reacting to change. Understanding more about how our business operates, and what things impact performance for the better or worse. Enabling us to make better business decisions when planning for the future, as well as to respond to negative trends and minimize impact while identifying and capitalizing on positive trends to maximize benefits.

Now let's get back to our original question. What is Location Intelligence and why is it important to my business? Location Intelligence also sometimes referred to as spatial intelligence is the integration of geographic information systems (GIS), spatial analytics tools, and geospatial data with our BI technologies, processes, and strategies. Providing additional context which can lead to more knowledge, more wisdom, and more insights into our business.

When learning to write we are taught about the 5 W's: who, what, when, WHERE, and why. When applying this to BI we must know the who, what, when, and where first in order to understand the why and what next. Knowing where things are/will happen or planning where is highly important. Also if we cannot separate and make proper use of location or geography (where) as dimensional attributes we can easily miss things like the fact that some sales regions are doing poorly, while others are performing well, and while a simple bar chart displaying sales vs goals by sales region might highlight for us how each sales region is performing visualizing this data on a map or including distance measures relative to important locations or events may provide the additional context needed to understand the fact that sales are performing poorly primarily in areas near a new competitor location.

By integrating Location Intelligence into BI we can begin to understand important factors about our business such as how far are customers willing to drive to buy our products or receive our services. Additionally, we can reduce risk by answering questions like how many alternative suppliers are close enough to my manufacturing facilities to serve as backups when we experience interruptions in our supply chain or a spike in demand that our usual suppliers cannot meet. Finally, using geospatial data such as demographics, socioeconomic, and risk metrics by geographic area to profile areas and their populations. Enabling us to identify new target markets where the population is similar to that of the areas where our business is already performing well, or calculate market penetration and identify how much potential opportunity remains untapped in established markets.

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