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How to build a smart city: Expert tips on where to start (and pitfalls to avoid)

Leaders from Nesta, Navigant, Connecthings and more offered advice on how to begin on the path to smart innovations.

While there are hundreds of cities with smart initiatives in place, there are even more that have not started on their smart journeys. Because there is no specific blueprint on how to build a smart city, many have developed new tactics for creative development. Google's Sidewalk Labs is even dropping a smart city project on a 12-acre section of downtown Toronto where they want to experiment with "reimagining cities from the internet up."

Luckily for Google and the rest of the world, there is a host of guidance, ideas and lessons learned (sometimes the hard way) for cities to follow when starting off. Below are some ideas from experts and business leaders on where and how to start, as well as pitfalls to avoid.

Start with a goal and open up data

From helping an aging population, to ensuring environmental sustainability, to fixing social inequality, having priorities sorted will guide the work that's being done. Just starting with the desire to see autonomous vehicles on a city’s streets because it's a growing trend is not the way to go.

"You don’t start from the technology, you start with the priorities that your city is trying to achieve," said Eric Woods, Navigant’s research director for its smart industry research program.

Cities starting out have occasionally been hung up with putting out a vision statement and then not actually backing it up with anything — or they've focused on winning awards.

"That’s just hype," Woods said.

Instead, Woods advises using priorities to focus on efforts like getting money for a pilot project or putting out a request for proposals (RFP). Even when working on a pilot project, cities should focus on making it practicable and looking at ways to scale it.


"You don’t start from the technology, you start with the priorities that your city is trying to achieve."

Eric Woods

Research director, Navigant


Figuring out how to implement these goals will often start with data. Determining what data a city already has, how to gather new data and how to better use it is all part of the process. Even more specifically, cities should consider opening up data and creating an open data policy.

"That has got to be a starting point," said Tom Saunders, a researcher at England-based research and innovation foundation Nesta.

Many times, finding data that has been siloed and desiloing it is an early step. Many companies and departments purposefully guarded data before software companies started promoting open data.

"We’re all now speaking this open data language," said Julia Thayne, director of urban development at Siemens.

Utilize data and lessons from other cities

Once data is opened up, cities should start looking at how it's used — and how it can be improved.

"You start to enrich what you’re doing with that data," Woods said.

Going after existing data is the place to start. Cities developing data-driven projects often make the mistake of tracking down new data when, most of the time, they are already collecting data and have been for years.

"A recommendation for anyone going down this path would be to engage with the data the city already has," said Ashay Prabhu, the founder of Assetic, a cloud-based software company. "Most cities already have petabytes of data."

Cities should invest in analyzing and finding patterns from the available data, then engaging with customers via simple apps so city planners can find out how citizens want the city to operate. Educating the public on where those data sets and simple apps are is also needed, as cities can’t expect residents to find them on their own.

"Yes, open data should be a big part of smart cities policies but there's also need to create the demand for it," Saunders said. "The smarter cities are the ones that are able to transparently dish this data out well in advance before discussing future infrastructure projects."

Besides the data sets being collected by different agencies, residents can also be tapped as walking repositories of useful data.

"Cities are covered in a network of people who all have smartphones," Saunders said. “It’s a fruitful way to make the cities smarter."

In one example, Seoul used phone data to map out where its night bus services were needed most. The data has saved the city’s lower-income residents approximately $1.2 million by reducing the need to drive or take more expensive taxis, and also reduced air pollution by sending buses only where they needed to go.

Looking at what other cities have done is also key. With conferences, scholarly papers written on smart cities and different organizations tackling a variety of cities, there are plenty of resources and ideas to emulate. Figuring out what's working in other cities and how it could translate is easier than trying to reinvent the wheel.

Get creative on financing

There's no doubt smart city projects can be expensive. Installing sensors, putting in broadband, upgrading buildings and ripping up old roads to lay permeable concrete all costs serious money that can strain city budgets. According to a new Deloitte study, "addressing the challenge of investing in smart cities programs requires creative thinking that departs from traditional models of infrastructure finance."

Some cities have already done those creative financing projects. In 2014, D.C.’s water utility issued green bond to finance a portion of its new infrastructure projects. This $350 million issuance was the first "certified" green bond in the U.S. debt markets that had a sustainability opinion from an independent, second party.

New York City's digital kiosk project is another example. Costing $200 million for 7,500 units, each will offer free high-speed Wi-Fi, maps, information for tourists and sensors to monitor environmental data. The city partnered with a consortium of companies including Qualcomm, Civiq and Intersection, and the program is expected to bring $500 million in advertising revenue during its 12-year implementation period.

There are other funds available from places like Bloomberg Philanthropies, the EU’s Regional Development Fund and opportunities like the U.S. Department of Transportation’s Smart City Challenge.

"All these programs can help seed initial programs," Woods said. "Cities need to be very pragmatic about the funding."

Utilizing what’s already in place is a way to save money, too. Fiber optic cables could be used to detect and distinguish between vibrations caused by cars, bikers and walkers. Additionally, Connecthings CEO and Founder Laetitia Gazel Anthoine suggested that IoT can be established with public-private partnerships early on without much trouble.

"To have the best things, companies in the IoT space need to be creative on the way they finance it," Anthoine said. "And after we have that, we provide them a lot of service on it and they discover what they get."

Find leaders and prioritize working with residents

To run the smartest cities, residents need to not only be informed but to also be ready to lead the charge.

"It has to start from the people up," said David Gershon, founder of the Empowerment Institute.

The Empowerment Institute runs an initiative called Cool Blocks that is in both Palo Alto and Los Angeles. Neighbors go from house to house to get people on board with the program’s goal of taking action on climate change and encouraging people-to-people connection.


"It has to start from the people up."

David Gershon

Founder, Empowerment Institute


Residents are given 112 actions that range from changing the thermostat on hot water heaters to eating less meat. In the pilot program, 51% of people who had their doors knocked on joined a cool block team and reduced their carbon footprint by 25%. Gershon said this is the way to go about building more sustainable cities compared to top down methods.

"Climate action plans don’t have a great rate of implementation," Gershon said.

Still, city leaders have to be on board to help run these programs.

"They have to look for strong leadership," said Woods. "The buy-in has to be at the very top."

Paris’s "Madame Mayor, I have an idea" is a good example of both city leaders and citizens working on projects together. The participatory budgeting project allocates €500 million (approximately $562 million) for projects proposed by citizens between 2014 and 2020. Between the online forum and meetings, it blends online and offline in order to make sure a broad spectrum of citizens can take part.

"This is all about people in the end," Saunders said.

Involvement with the community is an ongoing process. First step is the coalition of the willing, like stakeholder groups, and getting commitments from the private sector for projects or money. From there, cities need to get more proactive and get more people involved.

"It’s about the people, it’s about the place, it's about the data it’s about services and connecting those dots," Prabhu said.

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