Photogrammetry Supplement
Why Don't U.S. Firms Get More Global Mapping Jobs?
By Jerry Wilson

When it comes to mapping and surveying services, there seem to be two distinct markets: the United States and the rest of the world. The two markets tend to be mutually exclusive. U.S. firms, which have been successful in their domestic market have had difficulty breaking into international markets.
      It's not that they lack the technology or the expertise. U.S. firms rank among the best in technology. And yet they are virtually absent from the international market.
      "If you look, you can find a number of firms that are involved in international projects," said John Palatiello, executive director for the Management Association for Private Photogrammetric Surveyors (MAPPS), Reston, Va. "But on the whole, U.S. mapping firms are severely under-represented in the global marketplace."
      Palatiello believes this under-representation is a serious problem for U.S. industry and holds it back from the kind of growth it should be enjoying.

Easy Pickin's at Home
Perhaps one reason so few U.S. companies work internationally is that most have been able to find more than enough work close to home. The U.S. has been the largest market for mapping services in the world for the last several decades. Its large geographic size, vast natural resources and well-established infrastructure have provided a sufficient demand for mapping and surveying services to build a healthy domestic industry.
      By contrast, mapping firms in most other countries have had no choice but to look beyond their borders, simply because there just was not enough work at home. Many European countries, like England and France developed strong international mapping industries to support and maintain their colonial empires. These mapping industries continue to thrive even though the empires are gone.
      Consequently, unlike many other countries, the mapping industry in the United States is largely regionalized, according to Bill Fry, CEO and managing director of Spatial Data Institute (SDI), Bethesda, Md.
      "It's a very capital intensive business, he explained. "It requires a lot of expensive equipment and that equipment is difficult and costly to transport over long distances." So you see a lot of smaller, regional firms that focus their attention on a specific geographic region or particular market niche, like environmental, cadastral or infrastructure mapping.
      "That's true for the many small and midsize firms," added Palatiello. "But there is a cadre of firms emerging that are more national in nature and have the resources to expand into foreign markets."

The Rules Change
As these firms reach out beyond their borders, they quickly discover that the rules for business are quite different in foreign markets compared to the United States. They quickly find themselves at a disadvantage.
      Many companies have had bad experiences working on international projects. Some of the biggest have folded as a result of foreign projects gone bad.
      Capital requirements are higher, the sales cycle is longer. For firms accustomed to a straight-forward RFP-to-bid process in which the best-suited vendor gets the job, foreign markets can be frustrating. The bid process is more vague; information is not so readily or equally available to all bidders; personal relationships often count for more than skill or expertise (some may argue this is also true in domestic projects).
      But perhaps the biggest challenge for U.S. firms is the interplay between private enterprise and government, which is essential in international business dealings of all sorts. This is in sharp contrast to the U.S. practice which looks suspiciously on public-private collaboration.
      "European mapping companies have been supported and fostered by their governments to go international," said Bryan Logan, CEO of Photo Science Inc., Gaithersburg, Md. "Even Canadian firms get a lot of support by their government."
      He explained that in most parts of the world, government officials can open doors for commerce where private companies could not even get a toe-hold. "Foreign firms often are sponsored with grants for marketing and operations until they can become self-sustaining," Logan explained. They will also provide important introductions to key decision-making authorities.
      "Once you get in, then you tend to find other opportunities and you can get established on your own. But it takes a little help to get established," he added.
      By contrast, U.S. mapping firms often have found their government competing with them for specific projects rather than helping to open doors.

Government as Friend or Foe
"Unfortunately, the U.S. government often seems to be the opposing team," declared MAPPS' Palatiello. "In other countries the government is like an umpire or manager. Canada, for example provides tremendous amount of export promotion. Our government is actually one of our biggest competitors."
      As an example, he points to the Agency for International Development (AID) which provides funding to foreign nations. Of the more than $22 million in mapping services it purchased in 1989, most went to federal agencies like USGS. A small portion went to mapping firms in the country receiving the aid. None was contracted to U.S. companies.
      MAPPS and its constituents have successfully lobbied to change that particular problem. Late last year Congress passed a bill, sponsored by Senator Ted Stevens (R-AK) requiring AID to bid and award all of its mapping service work out to U.S. firms.
      Even without government support the challenges to breaking into a foreign market are daunting. Culture, language, customs, tax and business laws always put the newcomer from outside the country at a disadvantage. "When your own government is your biggest competitor, how are you going to succeed?" Palatiello added.
      Still, U.S. firms are not giving up on international business. In fact, they think the time is right. "U.S. firms are reaching critical mass," Logan said.
      Those in the fray identify three key ways to go after international business:
1. Seek out joint ventures on projects where mapping is part of a bigger project.
2. Network with international and government agencies.
3. Choose a specific market and dive in.

Option 1: Build a Team
Perhaps the easiest way to get into foreign markets is to join a team in which mapping is a component in a larger project.
     "A large percentage of foreign mapping work is done by U.S. firms riding on someone else's coat tails," said SDI's Fry. "The large multinational design and build firms serve more as project managers on big construction projects and they farm out the mapping and surveying."
      Fry explained that almost every infrastructure development project, like a hydroelectric power plan or road construction project, has a large mapping element.
      Working on these large projects can enable a firm to get into foreign markets while minimizing its exposure and investment requirements.
      Photo Science's Logan thinks mapping firms can take the lead on these project teams as well. "We can be the lead for larger projects and open doors for others like engineers and construction companies," he said.
      Of course, taking the lead implies also taking a greater share of the risk and footing the investment to open the market.
      Actually, this approach was the basis for founding SDI. It is a consortium of six mapping technology and surveying firms; Aerial Data Service Inc., Bohannan-Huston Inc., Horizons Inc., Photo Science Inc., Towill Inc. and Vernon F. Meyer and Associates Inc.
      The consortium members feel that by pooling their resources and going after projects in a collaborative way, they will have a greater chance not only of winning the projects, but also completing them successfully.

Option 2: Network
Government agencies and funding agencies, like the World Bank provide an important network for companies going international.
      U.S. firms are starting to see more government support. To its credit, the U.S. Commerce Dept. and World Bank recently hosted a joint workshop for U.S. mapping firms interested in bidding on mapping and GIS projects with the World Bank.
      In an innovative move, MAPPS entered an agreement with the Tennessee Valley Authority to help open international doors the federal government has left closed. "Government agencies can get to a higher level. They can make deals at the government-to-government level," Logan explained. "By teaming with the TVA we can take advantage of their status as a pseudo-government agency. It's an excellent way to get into the bigger foreign projects."
      The memorandum of understanding between MAPPS and TVA provides an agreement under which the TVA will pursue international opportunities and use the expertise of MAPPS constituent firms via a qualification-based selection process.
      Another important resource is funding agencies, in particular, the World Bank. According to a report by the World Bank published last December, it currently is sponsoring more than 70 infrastructure and environmental projects that contain a significant GIS component. These projects are intended for all regions of the world and include a wide range of applications including forest development support, land use rationalization, watershed management, transportation planning and rehabilitation, agricultural development and many others.
      The GIS needs identified by the Bank include environmental analysis, development of accurate cadastral records and engineering support. In fact, the need for mapping services and GIS by the World Bank are so universal that the Bank initiated a task force to study the business value of GIS data and processes and the possibility of sharing information between bank departments and among projects.
      In its report, Sharing Information, Building Collaboration and Enabling Innovation, the task force concluded "substantial cost savings, effectiveness and efficiency gains in projects, and value-added innovations are realizable at nominal cost by collaboration and coordination of GIS initiatives both inside and outside the bank."

Option 3: Dive In
Finally, if you want to do business in a particular country, get on a plane and go there. However, this approach is not for the faint-hearted or the undercapitalized.
      "There's no quick way to enter foreign markets," explained Tony Follett, senior vice president for AeroMap U.S., Anchorage, Alaska. You have to take a long term view-five or 10 years at least."
      AeroMap has identified an opportunity to provide mapping and GIS services in Russia and other former-Soviet-block countries.
      Follett has been aggressively marketing there since 1992 and, after four years, their efforts and investment are beginning to pay off. "We're starting to do a few projects," he said. Follett concedes it's still tentative, however. "Our role has been more that of a facilitator on projects where we interface with other, local companies," he explained. "It's more of a consultative rather than an executional relationship."
      Still, he is confident the return will eventually be worth the investment. "You have to develop relationships and that takes time," he said. "People have different ways of doing things and you have to take the time to learn. In the end, everyone prefers to do business with someone they know and understand, and who they feel understands them as well."
      The biggest difference between foreign and domestic work according to Follett: "Most countries have a much tighter control over information than the U.S. It can be very difficult to get maps for planning and often you can't get access to control points," he said. This is especially true in Eastern Europe and the former Soviet states. "They'll give you maps with selected information removed. You almost never see a map with a grid or georeferencing."

Slow Progress
Slowly, U.S. firms do seem to be making inroads into international markets, and such efforts should result in solid growth numbers in the years to come. But the road is not easy. It takes a clear strategy and a willingness to invest the time, money and effort into developing the markets.
      Palatiello offers this three step program for getting into world markets:
      1. Pick out a region and go after it. "You can't market to the whole world at the same time," Palatiello said. Start with a region and business niche that fits your strengths.
      2. Research, research, research. "Do as much research as you can," he said. "Make sure you understand the market, the culture, the language, the business practices and the local laws and business practices."
      3. Establish a local presence. "If you're going to be successful, you've got to have local eyes and ears," Palatiello said. Visit foreign and commercial offices in the local embassy and enlist their assistance. Hire a local representative. Find a good local attorney to help with contracts and legal considerations.
      "Most of all," he concluded, "be patient. It can take a long time. What you do on the front end is very important to your ultimate success."

About the Author:
J.D. Wilson is a freelance writer in Denver, Colo., specializing in the GeoTechnologies. He may be reached at 303-751-7636 (phone) or 303-322-3702 (fax).

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