Understanding the total cost of ownership for your GIS

Image by Scottslm from Pixabay

By Skye Perry

I’ve been in the GIS business for a long time. I have performed almost every job role within our company including many positions focused on technology evangelism, customer education, and sales engineering and support. Within those roles we have always focused on the value that a GIS can bring to a utility or telecom by way of the core tech or improved business processes, how our customer’s end users can engage with and embrace GIS technology to perform their jobs more effectively, and yes, ultimately the cost to implement the recommended technology solution. But far too often, the implementation cost, inclusive of licensing, is the only cost our customers focus on.

However, the total cost of ownership of any investment considers every aspect of costs that contribute to the initial purchase, implementation, ongoing maintenance, and every day use of the asset. In technology, it helps to think about every check you write related to the system inclusive of IT hardware, support staff, data, editors, managers, change management, and even the costs to get updates into the system from the field. The sum of all of those internal AND external costs results in your total cost of ownership (TCO). It may seem pretty straightforward, but many utilities have difficulty calculating and utilizing this somewhat elusive number.

With the advancement of Esri in introducing the Esri utility network to support a utility’s true modeling and management of a geospatial digital twin, we have also been introduced to a new and modernized GIS platform that includes fully exposing and consuming GIS data via web services. While functionally significant, this change also importantly ushers in a new era of architectural design, implementation and support. Conceptually, the basic system requirements will be understandable by any IT organization. Still, it’s worth noting that the way we designed, implemented and supported the GIS in the past doesn’t fully translate to the new world of the modern Esri platform. Dependent on your IT organization’s maturity level, this could impact the TCO of your GIS. And that goes well beyond the cost of the servers and software licensing. Don’t forget the costs to train the IT support team on the inner workings of the new software components and integrations, the diagnosis and triage of any system issues, use of both standard IT and GIS-specific monitoring toolsets, and, of course, the support of the end user applications. 

Next is the change management related to upgrading your operations to fully enter and validate a true digital twin of your utility network within the GIS. Now, to be clear, there are varying options with regard to the complexity of the model you want to maintain. Still, regardless of the chosen path, the tools you use to manipulate the data are new and enhanced from the decades old GIS that most customers use today. This begins with communication, education, and user engagement and will evolve into training, validation, and verification of the skills required in the new platform. Whether managed internally or contracted through an external vendor, an intentional change management plan is absolutely critical to ensuring the success of your new GIS investment.

Another issue garnering a lot of attention these days is data quality. Increased data quality can improve utility operations in a multitude of ways, but this goes to the source of capturing as-built changes in the field all the way back to the accuracy of the data that exists in GIS today (which often dates back decades). This data not only supports an accurate GIS but is also typically the system of record for the connected network that feeds every other mission critical system within a utility. Bad data at the source creates a downstream ripple effect which impacts decision making and usually increases the time crews spend in trucks. All resulting in costs that may or may not be considered part of your TCO. Other costs may be one-time investments in the correction of the GIS data via a potential field audit. Others may be an investment in ongoing improvements to the way that data flows from the field to the back office in both a timely and ideally automated fashion. A true utility digital twin can be operationally life-changing, but it’s only as good as the utility’s ability to capture and maintain the data that goes into the new model.

Many of the above costs are operational and ongoing in nature so you begin to explore TCO in the context of a number of years. We often find that it’s valuable to explore a 5–10-year (or longer) TCO vs. a shorter time period as it better represents the realization of the investment you are making into your new GIS. If history guides us at all on this topic (and from my perspective, it absolutely does), then I’d expect we very well might see the new GIS in place for 20+ years. We don’t know every exact challenge that will be presented to the modern utility over the next two decades. Still, we do know the new utility network has been designed to handle a granular digital twin via a modernized architecture.

And finally, in addition to the ongoing yearly operational costs, you will roll all of the typical implementation costs that we traditionally account for into the TCO. Discover, design, develop, and deploy. While those four D’s are a big part of what we offer at SSP Innovations, they are far from the TCO that should be considered when considering the entirety of the new solution. The larger world of IT has and continues to evolve, and we are constantly looking for ways to lower your long term TCO in addition to your initial investment to get up and running. But to talk apples to apples, we all need to understand just exactly what the TCO includes. Hopefully this post helps get the gears turning!

About the Author

Skye Perry

Skye Perry is the CEO for SSP Innovations and has provided technical architecture, development, and management solutions for GIS-centered implementations since 2000. Skye’s roots tie back to Convergent Group, Miner & Miner, and Enspiria Solutions where he has focused on implementing Esri GIS customizations and system integrations. Today Skye is still involved on a number of SSP’s project implementations and supports technical marketing in addition to leading the company.

Previous articleEPRI reflects on the year gone by
Next articleThe New Year will bring a suite of new challenges for power grid operators

No posts to display