International Land Systems has been a leader in providing land administration services to clients worldwide. Last year, the company was acquired by Manatron, which in turn was acquired by Thomson Reuters, the IT and information giant that, through its GRM software suite, helps governments improve operations and optimize revenues and transparency.
The sales didn’t mean the end of ILS, though. In fact, its staff has been flourishing under the Thomson Reuters brand, and the company continues to hire in Washington and elsewhere.
Devex spoke with ILS founder Peter Rabley, now vice president for global business development in the tax & accounting government business of Thomson Reuters, about the services the company is now able to provide its clients around the world.
Why is the rebranding of ILS as Thomson Reuters significant for stakeholders in the areas of international development and land and tax administration?
We worked very hard at ILS to develop a strong brand tied strongly to land administration. In fact, we made it a point of pride to say that all ILS did is land administration. After years of sticking to that theme, we became well-known in the industry for our focus and commitment to land administration products and services.
In Washington DC, where a lot of excellent companies do more broad-based consulting, being focused on our products and services we offer clients helped us develop a comparative advantage that was important to our success. After some time, our brand name became synonymous with excellence in land administration.
In the transition to Thomson Reuters, it’s important for our clients and all our partners and network contacts to know that we haven’t gone out of the business or changed our focus on land administration, including tax issues. It’s still our driving goal to service government clients worldwide and to provide them with the same level of service and product that we had at ILS.
The name has changed, but the team, the focus and the dedication to our clients has not.
How will the rebranding affect the work you’re able to do for partners such as the U.S. Agency for International Development and the World Bank?
From a legal standpoint, we’ve been able to transition many of our existing contracts – so that hasn’t been an issue. Obviously, as part of Thomson Reuters, which is a very large publicly traded company, we have the scope and scale to provide a broader reach in land administration, particularly in the area of property tax and property valuation systems and services. So, we don’t think it will affect our ability to work with USAID, although it may change our relationship with our traditional implementation partners.
As to the World Bank and other multilaterals such as the Inter-American Development Bank: Becoming part of Thomson Reuters has very much strengthened our financial position. We are now able to bid for projects we may not have been able to pursue before because they were considered too large for us to handle on our own.
Is Thomson Reuters going to more aggressively pursue indefinite quantity contracts and other large contracts offered by some of these major donors?
I don’t think we will change our approach to USAID and IQCs and working with our business partners. Unlike a lot of others in the development industry in Washington, we are not a primary or sole USAID contractor. We typically earn less than 30 percent of our turnover from USAID. And because of our niche focus, we haven’t become a generalized USAID consulting firm: Typically, in most requests for proposals that we respond to, land administration is a smaller component of a larger project.
This has allowed us to develop close and trusted working partnerships with Chemonics International and others who provide the prime contracting role. We think this model will not change for us as Thomson Reuters and we look forward to continuing to work with our partners.
I think we will pursue more aggressively, however, World Bank and IDB projects that we might not have pursued in the past due to financial requirements as well as multiple country registration needs. As a small business, it was difficult for ILS to operate in multiple countries as a local entity. Now, as part of Thomson Reuters, with offices in more than 100 countries worldwide, it provides us with a tremendous ability to facilitate these as well as other issues, such as local hires and currency issues.
What new regions and sectors does your recent expansion allow you to branch out into?
Latin America and sub-Saharan Africa are key and obvious markets for us. ILS had been successful in both regions, for instance by establishing a software development facility in Bolivia in 2007. Thomson Reuters has a significant corporate presence in both of those regions, which allows us to leverage that existing infrastructure to pursue opportunities there. In particular, Thomson Reuters has been aggressive in building out more presence in Latin and South America, and we expect that by the end of 2012, we will have a corporate presence in each of the countries in the region.
This corporate and legal presence allows us to be competitive by being efficient about our cost of delivery and not trying to source everything out of the United States.
We are committed to continuing to develop and expand our team of world-class talent through the Thomson Reuters global structure by building on ILS’s proven ability to develop local offices and staff. I realized early on that having local capacity to deliver regionally or locally many of the consulting services around our world-class technology platform was going to be a cornerstone of our success – and it was. At ILS, we had developed not only the center in Bolivia but, in 1999, a software development center in Ukraine as well. We have been able to deliver quality product and services from both of these sites and look forward now to developing more sites around the globe.
I feel strongly that development as we have known it will and has to change. What we had done in our own small way as ILS can be a blueprint for future development for other small businesses. That is, investing for the long term in global talent pools that are able to deliver quality products and services is a truly effective and sustainable form of development.
Describe some of the more innovative projects that illustrate where you want to go?
We’re proud of all of our work and our teams that have delivered this work. However, post-project sustainability is most important for us, and two programs I would single out in particular would be in Jamaica and Ghana.
In Jamaica, we successfully completed a World Bank contract about ten years ago to implement a modern national land registry system. Since that time, we have been providing maintenance and service support to the National Land Agency, which operates our GRM Registry platform eight to ten hours a day with more than 100 concurrent users, all efficiently processing complex land transactions.
Jamaica, while not considered high-income, is also not at the base of the pyramid, and is able to pay for our services out of the NLA annual budget. And I think it’s because they value the product they have and the service that we provide, and see it as fundamental to running their office.
I would give most of the credit for the success of our system to the Jamaican government and the staff that run the NLA. The success of our technology innovation is really much more attributable to them.
Prior to the technology modernization, they first modernized the public administration related to land by defining a national land policy and then creating a single executive agency based on the U.K. form of executive agencies. The staff is not civil servants in the usual sense, the NLA is run by a CEO, and everyone is monitored against performance targets and service provision. They are able to keep a large percentage of the fees they raise through their services and as a result, are able to pay competitive salaries with the private sector and to reinvest continually in their operations. There is a constant drive at the NLA for ongoing productivity gains and efficiencies and transparency.
So, in many ways, the creation of that environment made technology modernization a very, very good option for them and allowed us to be successful.
The other things I would note is that one of our technical staff is a Jamaican national who works at the NLA providing on-site support, so there’s a real feeling within the NLA that they’re getting value because there’s someone on-site who can respond to the system needs immediately. That’s certainly a model, going forward, that’s quite replicable and appropriate, and it’s part of our investment in our overseas staff to be able to provide regional and local support.
In Ghana, we worked initially as part of a private investment we made with various other groups, including a nonprofit microfinance organization, Opportunity International, to provide land titling services to microfinance clients in slum areas of Accra.
Microfinance organizations are for the most part effective and trusted stewards in poor communities, they have a physical presence, and they have staff that are well-trained, that use technology and are constantly in the field collecting information about their clients to manage the loans and so forth.
Our concept was to train those loan officers with basic, easy-to-use technology that is critical to maintaining the records of the person taking the loan but also, with a few extra data fields and by gathering additional evidence data, meant there was enough information to create a property portfolio. This property portfolio is a detailed dossier of information which occupants of land could use for various purposes – including possibly applying for a full statutory land title.
We have also done MCC-funded studies in assessing the demand for such services to lower-income groups, and we found that more than 70 percent of respondents indicated they were willing to spend at least $50 to be provided with property folios so they can have some form of documentation.
What’s interesting about these property folios is that the intention is not for them to act as collateral but rather to act as additional evidence from which the microfinance organization can make more informed decisions about providing larger-value loans. For example, it gives them an idea of whether a client is a flight risk, how stable they are in the community and what the risk might be for that person to be unable to repay the loan.
At the same time, the information we gather can be taken forward to possibly secure statutory recognition of their right to occupy and have more extended property rights.
As a result of this successful work, we submitted a grant proposal to USAID together with Opportunity International to extend the same work, but to expand to a housing finance program for clients that have expressed the desire to borrow larger sums of money to improve their dwelling or take their loan for construction of a school or the creation of a small business. So, instead of a $40 loan, this would be more like an $800 or $1,000 loan. As part of this grant program, we were able to process over 2,000 property folios, and showed that they were crucial to these housing and finance loans. The next stage will be for those occupants to take those folio documents forward to the government so that they can apply for formal title. That phase has yet to come.
Our ability to coinvest with trusted partners like Opportunity International and USAID to prove out a concept is a viable and useful model for us. Ultimately, we see this as a good investment in improving our technology and processes to provide a very affordable solution for microfinance or any type of institution trying to collect information about their clients in the field.
As your company focuses increasingly on sustainable revenue streams for governments, what can we expect to see change in the way your team implements projects?
We’re seeing governments becoming more sophisticated in their understanding of their needs. Traditional funding agencies and programs are shifting from supporting pure consultancy services with sometimes hard-to-quantify results to more specific approaches, tools and techniques that have real impact. There’s a growing understanding that certain kinds of technology that allow for good record keeping, transparent governance and the collection of sustainable revenue are smart choices for development agencies to fund.
The question is about setting sustainable tax rates and effective tools that enhance the ability to collect that tax revenue. The problem is that revenue collection is not effective in many countries but a commitment to an equitable and efficient tax process as well as an effective tax collection regime can realize significant sustainable revenue for governments.
Brazil is a very good example of this, as are other rapidly developing economies. There is a realization that they have to play by global rules and there’s an expectation that they’re able to provide information for sound investment decisions as well as getting everyone to pay a fair share. Our systems for revenue collection and land management help to do that.
What can we expect next from Thomson Reuters – both as part of the ongoing restructuring as well as longer-term changes?
We’re going to do two things. We’re going to continue to grow our core team for global products and services working out of Washington, DC, and as a result, we will continue to hire management and senior positions here.
But at the same time, we’re going to be developing and building up worldwide nodes in Asia, Latin America and sub-Saharan Africa, and I would expect that within the next nine to 12 months, you’ll see several announcements from us concretely laying out plans for offices and staffing that we will be opening in these regions.
One of the benefits of Thomson Reuters is that we’re now part of a global company and we can deliver global products and services. We truly are thinking globally and deploying globally, but we’re going to deliver locally.
This article is sponsored by Thomson Reuters.