Rand McNally Case Study

There is one major problem that Rand McNally faced back in the 1990s. This problem was to figure out how to overcome their mindset of just being a printed map company. They had a bunch of employees of the older generation that did not really understand the technological, or Internet age. GeoSystems, better known now as MapQuest had already sprung themselves into the web based maps. It seemed that Rand McNally was really lacking in innovation to be able to make their jump into a web based product. They set up a website in 1994 to support its customers’ use of the map CDs it produced. If they did not find a way to innovate and bring new ideas to the table, Rand McNally would become non-existent.

The first great action I believe Rand McNally’s new investors took was to appoint Richard J. Davis in 1999. He already had 25 years of experience in management with companies that specialized in high tech equipment. He also had seven years of experience with one of Rand McNally’s biggest competitors, GeoSystems. He definitely should have known GeoSystem’s strategy inside and out. I believe this helped Rand McNally update their own tech based maps to be able to compete in an ever changing market. Davis hired Chris Heivly to run the RandMcNally.com website. Heivly immediately put maps and address-to-address driving directions online. This was considered a very risky move by the previous management that Rand McNally was under. Heivly saw it as an essential move to stay in the mapping business. Rand McNally then decided that travelers needed to bring online road maps with them. Detailed driving instructions and road conditions were essential to create the best and safest way to travel a route. At this time there was not a lot of wireless devices that could receive this kind of information. But as we all know, this type of service is almost a must for any traveler. Maps, directions, and traffic updates are in almost every car for most people driving in today’s world.

One major way that Davis tried to increase Rand McNally’s revenues were by becoming very personable with his employees. He tried to make them feel like it was their company and anything they did was helping themselves out too. I believe a manager in any business must be personable and be able to talk to his employees openly. Davis did this by selling what he believed the company’s future would be to the employees. When he began speaking to each employee, the old-time employees became angered with his approach to the company. They believed that Davis was spending to much money on the Internet approach, and would eventually quit because of it. Davis had to replace much of his management team that did not agree with where he envisioned Rand McNally’s future to be going. Getting a new group of management employees in there might have saved the company. They had a fresh set of ideas and embraced the fact that the map business was changing from paper to Internet.

Technology played a huge role in this case overall. The first way technology played a huge role was when Rand McNally started to lose market share because they were only focused on the paper side and not on Internet sales. The other way that technology played a role was when Rand McNally wanted to use technology that was not created yet. This was wireless travel services. This was not developed until a later time, which meant no company had achieved a lead in this industry. Almost all of Rand McNally’s services run through their website now. Customers can purchase paper maps or other products right off the website. This is the present and future of almost every business in our world today.

The first major theory that we discussed in class that is also related to this case is giving free samples of the product. This worked in the wrong way for Rand McNally because they chose not to give free maps to consumers. GeoSystems was smart and chose to actually give away their services, which in turn created a buzz among the community. This sky rocketed their sales making it much harder for Rand McNally to get into the online map business. GeoSystems had millions of viewers every month on their website, making them a well known company. They really were the first ones to get their maps online and straight to the consumers in the easiest way possible. Being able to adapt and innovate to new ways of getting your product to the consumer is what business is all about these days. Usually the first company to figure out the next best way to utilize a product will come out on top.

The next major theory that most companies utilize is called the customer lock-in theory. This is where a company offers something like a loyalty program to try and get the customer to stay with them for a long period of time. Rand McNally offered this on their website to customers trying to look at maps. The program was developed so that customers would get charged a fee for unlimited access to the website. This included getting directions, looking up certain locations, and even discounts on some other products. This increased revenue tremendously for Rand McNally and really kick started their website business, which is still very good today. As of today, Rand McNally has a very user friendly website that allows you to purchase products, map out trips, look at the company profile, contact a representative, and many more ways to use their products. It seems like they have really grasped how to run an online business, while still being able to sell paper maps to older people that want them. As the times evolve they will need to innovate just like they did with the Internet age. I really do believe that Rand McNally took the right approach in trying to get ahead of the competition. They were already a well known brand in the paper map business. They just had to establish themselves in the online map business, which was much easier because of their earlier success.