Hu Yoshida

Smart Cities and Smart Economies

Blog Post created by Hu Yoshida Employee on Mar 2, 2016

Last week I was in Jakarta to meet key customers and learn more about their business and IT issues. Jakarta is a mega city with a population of 10 million in a country that has over 255 million and is expected to be the third largest population by 2043 with more than 50% of the population migrating to the cities. For this reason Indonesia is very motivated to drive the growth of smart cities.

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Indonesia is an archipelago of 18,000 islands so the smart phone and ecommerce has been ubiquitous for some time. However, smart city efforts have only been a focus since 2015 when the government launched a smart city index. The main criteria used for the index are economic conditions (smart economy), social interaction between the public and the administration supported by IT (smart society) and the environment (smart environment). Creating this index enables cities to rate their progress to becoming smart cities. A city could be categorized as a smart city when IT had been developed to the point that the administration could sense, understand and control every resource to serve its people and sustain development in the city. Jakarta followed suit with its Jakarta Smart City project in December last year, launching two smartphone apps: Clue for residents to lodge complaints and CROP for city leaders to respond to complaints. The mayor has pledged that “If a resident notices a pothole, he or she can take a picture and send it to us. We will fix it as soon as possible,”

 

Traffic in Jakarta is notoriously congested due to the lack of a metro rapid transit system. The MRT project is delayed due to delays in acquiring land and clearing construction sites. Our HDS sales people regularly start out at 4:30 am in the morning to make a 9:00am meeting. Digital business transformation is helping to ease this problem.  New startups like Go-Jek, an uber for motor scooters, and Tokopedia, an Amazon like marketplace, are helping to deliver goods and services without the need to sit in traffic.

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In congested Asian cities, motor scooters are a faster way to weave through traffic than in automobiles, and many motor scooter drivers offer informal taxi services. These are known as “ojeks”.  While at Harvard, Nadiem Makarim started a summer project where commuters would phone into a call center and request ojek drivers to pick them up on-demand and take them wherever they wanted to go.  This was the start of Go-Jek. Like Uber, a Go-Jek app tells you how many drivers are in your area and sends you a picture of the driver as well as his expected time of arrival. Unlike Uber, the Go Jek driver will offer you a shower cap and helmet to protect your hair and head as well as a facemask to protect you from pollution. Don’t speak Bahasa? No problem, the app is also available in English from iTunes and the app tells you what to pay in Rupiah

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Go-Jek has expanded its OtoO services (Online to Offline) by providing Go-Food, for ordering takeout food, Go-Shop for home shopping, Go-Send for courier services, Go-Clean for cleaning services, Go-Glam for home beauty treatment, Go-Massage and even Go-TIX which will have some one wait in line to buy tickets to events. This diversification will ensure continued success even when and if the traffic problems are solved.

 

While Go-Jek may be considered to be a low tech operation, it may serve a more important smart city service than an MRT. An extra advantage of OtoO services like Go-Jek is the opportunity for working class people to participate in the opportunities provided by digital transformation. While we often see the advantages of smart cities in terms of healthier, smarter, and safer cities, we must also ensure that these benefits extend to everyone and not just the technology elite. Economic conditions or a smart economy must be a prime focus for Smart cities as recognized by Indonesia.

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