We often hear about the immediate drivers of the adoption of IoT for specific business areas but I can’t find articles out there that take a step back to explain how the advent of smart cities fits in the broader picture. It seems that there are only tons of articles about how disruptive it is. So here’s my attempt to actually show that more than a complete disruption, smart cities are a result of larger transformations of our world.
It all starts with globalization. The latter is defined as “a process of interaction and integration among the people, companies, and governments of different nations, a process driven by international trade and investment and aided by information technology. This process has effects on the environment, on culture, on political systems, on economic development and prosperity, and on human physical well-being societies around the world.” ( globalization101.org). In other words, there would be no use for smart cities if there hadn’t been a globalization effect first. For each and every word of this definition you can find a correlation with smart cities. As people want to interact more and are better integrated through the increase of inhabitants in the cities they need better structures to push this process further, they need to act more responsibly to preserve the world for the next generations, and they need healthier environments. In other words smart cities have been thought as a consequence of globalization and will in turn support it.
The second lever was the digital revolution with the advent of computers. Arguably it’s also a consequence from the globalization but this has really been a disrupting factor in terms of the pace of change it resulted in. With digital it was suddenly possible to have machines execute far more complex operations. However the data was mainly generated by humans and was therefore in the IT (information technology) field. Then machines have been enabled to generate their own data through, for example, sensors, in an exponential manner. It’s the advent of OT (operational technology) that can now detect and/or cause changes in physical devices without human intervention. Now, it’s a lot of data, accumulated with you probably knowing little about it (click here – did you know that existed??). But it’s here, ready to use, crazy huge data platforms are sustaining it and you can possibly drive amazing social innovation applications from it; something I must say Hitachi is very good at and investing a lot in. With this data at hand you can manage today’s cities more easily, adapting the patterns of traffic or water/energy according to real-time needs and by doing so reduce costs and waste drastically.
Last but not least, authority decentralization is moving the competition from a nation level to a city level, making it paramount for cities to attract people. Let’s take Europe as an example. The authority of the different countries is progressively deferred to a central supreme European authority, weakening in a way the authorities of these individual countries. But on the other hand the regions are more and more empowered and can make their own decisions. This brings cities closer to the decision-level, hence an increased competition among them. In India 100 cities are parts of a $15bn Smart City Mission project. In the United States “The USDOT has pledged up to $40 million (funding subject to future appropriations) to one city to help it define what it means to be a “Smart City “and become the country’s first city to fully integrate innovative technologies – self-driving cars, connected vehicles, and smart sensors – into their transportation network” (www.transportation.gov/smartcity). The city-as-a-business is a rising model everywhere in the world! Ultimately this change fits in the management shift currently happening, empowering individuals and giving more autonomy to the smaller entities.
More than a disruptive change the advent of smart cities is part of the globalization process and is substantially driven by the digital revolution as well as a shift of the decision-making levels. How much do you agree? Hope you liked this article; share your thoughts in the comments!