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Charting a Course for the Future of Cities

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It’s been a busy couple of weeks for people who follow the demographics and economics of cities. Last week, the US Census Bureau released the local area population counts from the 2020 decennial census, and a number of interesting facts jumped out from the data.

  • We grew slowly, as the US population grew at its slowest rate over the past decade since the Depression era of the 1930s.
  • We got older, as adults grew at a faster rate than children, highlighting longer life spans and declining fertility.
  • We got more diverse, as the share of white alone non-Hispanic population declined from 64% in 2010 to 58% in 2020. All other racial and ethnic groups grew in population over the past decade.
  • We clustered more in cities and metropolitan regions, as the population of US metro areas grew by 9% over the past decade, while the population of US micro areas grew by 1%. All ten of the largest cities in the US grew in population, with only Los Angeles and Chicago growing by less than 5%.

Meanwhile, we’ve seen the impacts of the COVID-19 pandemic continue to buffet cities and communities all around the country. Spring optimism for recovery has turned into caution as the Delta variant and vaccination resistance has led to a resurgence in Covid cases and rapidly filling hospitals, particularly in cities and states with low vaccination rates. Plans for a return to something like normal after Labor Day are being reconsidered, as office reopening plans are being delayed or modified, conferences are being canceled or postponed, and vaccine and mask mandates are being put in place to reduce risk to employees and customers and allow for continuation of reopening plans.  While the pace of economic recovery has been stronger than expected, due in part to federal and state stimulus efforts and increased vaccination levels in many parts of the country, the impacts of the past 18 months are still being felt, as employers struggle to keep or find employees, supply chains have been disrupted, and tourism struggles to get back to its pre-pandemic boom times.

And in Washington, we are seeing Congress continuing to push forward on a two track path of “infrastructure” with the bi-partisan “hard” infrastructure bill providing over $550 billion in new spending for roads, bridges, transit, broadband and water/stormwater improvements, among others. The larger, $3.5 trillion Budget reconciliation bill, focuses on “human” infrastructure, such as child care, education, paid leave, health care and climate. Both of these bills have significant implications for cities and metropolitan regions, providing the potential for significant new investments

Given all of this change, and all of this activity, Econsult Solutions was excited to recently announce the launch of the ESI Center for the Future of Cities. This new research and thought leadership effort is designed to bring together ESI’s expertise in urban economics, policy and strategy to tackle the most important issues facing cities both locally and globally. Our thinking in creating this new focal point was that our experience and expertise in understanding and analyzing urban economies and working closely with city and business leaders on strategies and plans for sustainable futures gives us the ability to work on the most important issues facing cities.

The ESI Center for the Future of Cities will build on our work at the intersections of the public and private sectors, our extensive experience working closely with anchor institutions and local governments, and our core understanding of urban economics to provide our partners and clients with cutting edge research and analysis that can drive decisions and improve outcomes. What might that look like?

Let us know what you are interested in – we’d welcome the chance to have a conversation about your vision for the future of cities and how we can help support those efforts.

 

Steve Wray, Senior Vice President & Principal
wray@econsultsolutions.com

Steve Wray is a Senior Vice President and Principal at ESI. In this role, Steve focuses on the development and implementation of programs and projects that support ESI’s vision and short- and long-term plans. He leads the work of the firm’s principals and senior staff in developing new partnerships, expanding and building on existing practice areas, and integrating the firm’s strengths in economic analysis and thought leadership. Mr. Wray joined ESI in 2017 as a Director and was promoted to Vice President, Strategic Initiatives in 2019.

Expert Views: Smart Cities Should Be Sustainable Too

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The UN’s Sustainable Development Goals (SDGs) have become an essential tool to overcome the devastating impacts that the COVID-19 pandemic has had on cities. ESI ThoughtLab’s survey of 167 cities worldwide determined that 77% of cities have included each of the SDGs as a framework for their plans. With a public health crisis to solve despite exhausted budgets, cities will need to find sustainable solutions to recover.

ESI ThoughtLab’s thought leadership team asked experts participating in our Smart City Solutions for a Riskier World global study to offer their perspectives on how the SDGs can help rebuild cities after the pandemic shock and serve as a roadmap in their future development.

Our research shows a clear correlation between smart city maturity and progress on the SDGs. How do cities use smart innovation to achieve their sustainable development goals?

William Baver, Vice President, Smart Platform, NTT: NTT certainly believes there is a correlation between smart city maturity and progress on the SDGs. Smart solutions and data are powerful tools for cities to achieve their sustainability goals: these can in fact provide useful information not only to track progress on how they are doing against their goals and set new measurable KPIs, but also to really understand their starting points and therefore outline a precise and relevant strategy. Cities without data have a harder time starting and working towards clear objectives and consequently they often end up failing because they lack a strategy aligned with their situations and capabilities. By focusing on specific citizens’ needs, cities can easily get momentum and then enlarge the scope of their projects.

Jose Antonio Ondiviela, Microsoft Western Europe Industry Executive Smart Cities:  Smart innovation is the main driver to achieve the SDGs, not only for goal #11 (Sustainable Cities) but also for the rest. Technology plays a crucial role in achieving sustainable cities and communities, as it is the key enabler for energy, water, air, traffic, buildings and processes to work efficiency and in alignment with expected goals.

Andrew Caruso, Director, Urban Solutions, Hatch: Technology enables SDG progress because it can integrate both technical and social solutions. It optimizes use of scarce resources, connects governments with their citizens, and scales quickly to respond to dynamically changing conditions. Further, it enables both front-end insights, and feedback loops that power a cycle of continuous improvement which drives progress.

Gordon Feller, Board Member, Alliance for Innovation: Some cities are using SDGs as a vision statement and as a goal-post. Other cities are using SDGs as a benchmarking tool. This allows city executives to evaluate themselves (and/or their contractors), by comparison, against other cities that are either geographically close or similar to them. When benchmarking their urban performance against the SDGs, these cities are using the SDGs as a stand-in for external criteria.

Gerald Uche Maduabuchi, Director of Sales, Panorama Data Solutions Ltd: Africa faces the most challenges in meeting the SDG commitments with its highest environmental degradation, poverty and unemployment rates. But, counterpoints like social media and high mobile broadband penetration provide some unique opportunities for Smart City solutions. Smart City technologies can help Africa meet its SDG commitment. It entails enabling policy reforms and the use of new and existing technologies to improve all sectors of the economy.

Miguel Eiras Antunes, Global Smart City, Smart Nation & Local Government Leader, Deloitte: The link between smart city maturity and progress on SDGs is almost logical, and now we have the data from the ESI ThoughtLab survey to prove that link. While traditionally characterized by high population density and construction, cities are now rethinking their structure and functions to secure ecosystem resilience and human well-being and ensuring sustainable urban living. COVID-19 has only further accelerated the trend to create these cleaner air, walkable, green, bicycle cities.

Eugenie L. Birch, Nussdorf Professor and co-Director, Penn IUR: Cities use smart innovation to advance any number of SDGs depending on what they have selected to concentrate. For example, if they are focusing on Goal 3 health, they might use smart phone apps to help mothers keep track of their children’s vaccinations. If they are pursuing Goal 11 cities and human settlements, they might invest in various systems (water, sanitation, transit) to make them more efficient.

Ton de Vries, Senior Director, Business Development, Bentley Systems: The City of Porto, Portugal is focused on improving its entire urban water cycle. They commissioned a smart water management platform called H2Porto. This digital twin has helped to improve the accuracy of data produced from sensor readings to nearly 99%. Their water service interruptions fell by 22.9%, sewer collapses decreased by 54%; repairs for pipe burst and sewer and service connections improved as well by 8.3% and 45.5%.  The integration of real-time data and ability to access information in the field helped improve operations by 23%.‍

Cities like New York, Copenhagen, London, and Singapore stand out as leaders in both sustainability and smart innovation—what we call Cities 4.0. What can city leaders learn from these 4.0 approaches? Do they represent the urban model of the future? What do you see as the hallmarks of success for cities in the future?  

Jose Antonio Ondiviela, Microsoft Western Europe Industry Executive Smart Cities: Most cities are still in the 2.0 stage, gathering data to monitor and control the city. Few are starting the 3.0 ladder where they offer a citizen-centered service and none has fully achieved the 4.0 as a Cognitive/Inteligent city with technology managing all automated processes and citizens fully and permanently connected and cocreating the future of the city.

Aseem Joshi, General Manager of Smart Cities, Honeywell: Three important factors differentiate these cities in a shared vision, which is developed with deep stakeholder engagement and brought to reality by strong, execution-focused leadership. Instead of siloed approaches, these cities take a more integrated view to create improvements across a range of functional areas. As Honeywell has worked with multiple cities around the world, we have found this to be a consistent theme for success.

Jarendra Reddy, Director, Urban Solutions, Hatch: Many cities struggle to drive growth without compromising the quality of life for citizens or the long term social and environmental sustainability of their communities. Cities 4.0 — those making measurable progress in both SDGs and Smart Solutions — create balanced growth and share the benefits of this growth across broader segments of society. Investment in enabling infrastructure, grassroots innovation programs, tailored service provision, reduced dependence on scarce resources, and innovative delivery models are hallmarks of smart city solutions that advance SDG achievement.

Eugenie L. Birch, Nussdorf Professor and co-Director, Penn IUR: Many cities can learn from New York, Copenhagen, London, and Singapore but they have to realize that all adaptations have to be context specific – it is important for the “model” cities to reveal the conditions that allowed them to undertake their innovations and equally important for the adapting city to understand its own conditions – not to adopt something without adapting it.

Ton de Vries, Senior Director, Business Development, Bentley Systems: In our experience, we see successful innovation happening when collaboration happens. It’s where city leaders are collaborating across departments, partnering with technology providers, and partnering third party companies to identify a problem to solve or a service to provide, to connect the right data sources to build a digital twin fit for purpose, and delight their stakeholders by deliver new or improved services.

Our research shows that cities making the most progress on the SDGs typically monitor that progress, conduct voluntary reviews, and designate specific departments to lead SDG initiatives. What best practices would you recommend that cities follow to achieve the SDGs?    

Andrew Caruso, Director, Urban Solutions, Hatch: Strategy alone is not enough. Monitoring and evaluation help track progress on implementation at a tactical and operational level. Interventions should be informed by business case frameworks with SDGs as a central objective, using evidence to understand the triple-bottom-line outcomes and describing impacts in ways relevant to stakeholder groups. A system thinking approach is essential to aligning stakeholders and disciplines around objectives, performance, and needed refinement to achieve SDGs.

Gerald Uche Maduabuchi, Director of Sales, Panorama Data Solutions Ltd: The bottom-up approach is a holistic and most productive approach whereby the government institutes some study groups to conduct grassroots research and stakeholders’ consultation forums with the citizens, communities, NGOs, trade unions, private and foreign companies to enact a bill and formulate a Smart City Act. The Act, through its frameworks and directives, will be used to form an independent governing body who will be in charge of developing rules and regulations that will create an enabling environment for the SDGs and Smart City innovations; and it is achievable at any or all levels of government: federal, state or local.

Eugenie L. Birch, Nussdorf Professor and co-Director, Penn IUR: Cities need to align their own goals and objectives with those of the SDGs.  Many cities already have sustainability plans, so the key is to see where the SDG efforts and their own agree on directions. In other words, the global community cannot expect to impose the SDGs on cities – they have to let the cities (and nations) use the aspirational framework (that is what the SDGs are) as guidance.

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Smart City Solutions for a Riskier World is an in-depth global study designed to create an evidence-based roadmap to make cities safer, more sustainable, and resilient. The research reveals lessons learned from the pandemic, centered on the social, environmental, and economic imperatives that matter most, and based on objective quantitative analysis that shows which investments and technologies will be most effective for achieving their goals.

Expert Views: Post-Pandemic Trends in Cities

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As city leaders around the world continue to cope with the impacts of COVID-19, they are also assessing which will remain with us in a post-pandemic world. Repercussions of the health crisis, including recession, high unemployment, and the new urban exodus, have highlighted weaknesses and underscore why leaders need to improve public health and other infrastructures, create new jobs, and adopt new technologies and innovative solutions to address their social, environmental, and economic challenges.

ESI ThoughtLab’s thought leadership team asked experts participating in our Smart City Solutions for a Riskier World study to offer their perspectives on how the pandemic will reshape cities, what future trends they foresee for urban centers, and how smart technology and solutions, along with new partnerships, will help city leaders address the challenges they face.

Smart City Solutions for a Riskier World is a multi-organization initiative designed to create an evidence-based roadmap to making cities safe, sustainable, and resilient. The research will reveal lessons learned from the pandemic, centered on the social, environmental, and economic imperatives that matter most, and based on objective quantitative analysis that shows which investments and technologies will be most effective for achieving their goals. It builds off of last year’s research program, Building a Hyperconnected City.

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What will cities look like over the next 3-5 years? How will city living, shopping, working, and mobility change? Will Main Street look different? How so?‍

Kok-Chin TAY, Chairman, Smart Cities Network: COVID-19 has had tremendous impact on cities worldwide. Hence, future cities need to see an exponential growth in their use of technologies for city governance, to make progress with the digital economy, and get used to the future of work.

‍Gordon Feller, Advisor to cities; Board Member: 4 VC-funded smart-city solution providers; 4 non-profit smart-city solution providers: Executives who help lead cities—whether elected, appointed, or otherwise—must be armed with tools, and usable real-time data is among the most vital of those critical tools. Solid research and analysis can help leaders because they’re finding that data-at-rest is often found less useful than data-in-motion.

Miguel Eiras Antunes, Global Smart City, Smart Nation & Local Government Leader, Deloitte: The pandemic will have a long tail, and cities will take some time to bounce back. We will continue to see slower economic growth, a broader focus on public health infrastructure, and cities struggling with backlogs and pent-up demand. But we will see an emergence of an adaptive governance style that focuses on data-driven decision-making, adopting emerging technology, and implementing innovative policies.

‍Kevin Taylor, Segment Development Manager, Smart Cities, Axis Communications: In past years, there was a global mega-trend of populations moving into metropolitan centers. More recently, and in light of COVID-19, it is likely that more suburban areas will grow into mid-size cities. The things that have drawn people to cities over the last 30 years—economic opportunity, cultural/social/entertainment choices, and an environment conducive to mass transit and micro-mobility options—are likely to be scaled down into smaller “home-town” style communities.

Mark Saunders, Academic Director, Zigurat Global Institute of Technology: Cities may implement different changes, but it is important to appreciate which may be temporary and which more sustained. Key changes such as contactless payments are likely to become ubiquitous and permanent; issues like “the future of work” and the utilization of city center office space may be more dynamic.

‍Andrew Caruso, Director, Urban Solutions, Hatch: COVID-19 has reinforced fundamental principles of healthy, resilient communities. The ability to access the necessities of everyday life within one’s local context—food, education, economic opportunity, transit, safe space for exercise, and digital connection—has proven essential to surviving catastrophic risk events of all types. Buildings will need to increasingly flex to accommodate new uses. In the wake of rising eCommerce, we hope Main Streets find reawakening in their history of social and civic functions, potentially reinvigorated by rising levels of non-motorized transport adoption.

Raúl García-Rodríguez, Advisor, Real Estate Market Advisory Group, UNECE: Cities will be less automobile focused; people will try to reduce their mobility range to closer areas thus fostering neighborhood life rather than city life. All services will eventually return to the “closer” environment, suburban development will no longer focus just on retail services, offices, and industrial uses as all uses (other than non-polluting production) will reallocate within the “closer” areas.

‍William Baver, Vice President, Smart Platform, NTT: With remote working becoming a norm rather than an exception, new localisms emerge, and cities will have to deal with this by decentralizing their services and increasing flexibility to meet a demand that can scale up or down. Data-driven information can certainly help city leaders here in understanding for instance which facilities are used and how.

Yi Wang, Head of Global Development Program, ANBOUND: Science and technology are driving the sustainable development of cities. The development of diversity and equality with access to conceivable gadgets could prepare for uncertainties. City leaders have ideals and can handle their urban planning properly, but would they be able to plan people’s life? We will be rethinking the needs of people in a city that is truly people-oriented and that aims to bring about urban prosperity.

‍What techniques and tools will cities of the future use to achieve their sustainable goals? What role will smart technology, partnerships, and financing play in improving social, environmental, and economic conditions?

Yi Wang, Head of Global Development Program, ANBOUND: In today’s information society, material wealth can be digitized, including currency. History, cultural, and artistic expression are also in the process of rapid digitization. The smart city will not just rely on the tedious technical systems, but rather on smart technology like VR, AI, cloud, IoT, 5G/6G, robotics, biometrics, and anti-digital crime. Smart solutions will facilitate data platforms open to the public and engage business executives in regulations and policymaking.

Kevin Taylor, Segment Development Manager, Smart Cities, Axis Communications: The first tool that cities should leverage is an internal culture of collaboration. If the pandemic has taught us anything, it has revealed that no one person, stakeholder or department within government has all the answers to solve all the needs of the community. Best of all, this tool costs cities nothing; they already have everything they need to put it to work for the good of the community they serve. Cities will adopt technologies that are open architecture and compliant to established standards.

MC, UE, Launch of Metro 21, Smart Cities Institute, March 2 2018

Karen Lightman, Executive Director, Metro21: Smart Cities Institute, Carnegie Mellon University:Techniques such as user-centered design and design-thinking principles should guide any city of the future—because cities are about the people, not the gadgets. Yes, we should aim to improve efficiency, but not at the expense of human nature or humans in general. We should be mindful of diversity, equity, and inclusion to ensure that any techniques or technology are based on improving quality of life for all.

‍Miguel Eiras Antunes, Global Smart City, Smart Nation & Local Government Leader, Deloitte: New and emerging technologies will play a vital role. We will see a truly hyperconnected era in cities with the convergence of IoT, 5G, cloud, and edge computing. For instance, today’s smart cities might have sensor networks of a few thousand connected devices. Imagine a scenario where millions of such devices can be connected in a city center, measuring temperature, humidity, air quality, flood levels, pedestrian traffic, and more.

‍Jarendra Reddy, Director, Urban Solutions, Hatch: Smart solutions will enable transformations in both demand and supply. Real-time feedback could help consumers understand the impacts of consumption patterns and make individual decisions that optimize their use of scarce resources. Likewise, providers can leverage more robust data to assess future requirements and pinpoint opportunities to improve products and services, leading to more efficient and less impactful consumption and production patterns.

‍Karen Lightman, Executive Director, Metro21, Smart Cities Institute, Carnegie Mellon University: Techniques such as user-centered design and design-thinking principles should guide any city of the future—because cities are about the people, not the gadgets. Yes, we should aim to improve efficiency, but not at the expense of human nature or humans in general. We should be mindful of diversity, equity, and inclusion to ensure that any techniques or technology are based in improving quality of life for all.

William Baver, Vice President, Smart Platform, NTT: Smart technology, data, and analytics will need to be translated into new sustainable economic and environmental policies. Cities will need to learn how to harness the power of data to make more informed decisions and ultimately achieve their goals. AI and analytics-based solutions providing real-time and predictive information will be key alongside having better data and multiple data sources.

Mark Saunders, Academic Director, Zigurat Global Institute of Technology: Cities need to fully embrace a range of technologies to automate activities to make them more efficient and safer. Key “backbone” systems, like Internet of Things networks, allow a range of downstream benefits across the whole gamut of city life. We all need to help cities understand the hugely positive business cases around smart city developments and act on them.

‍Raul Garcia-Rodriguez, Advisor, Real Estate Market Advisory Group, UNECE: Corporate social responsibility and sustainability criteria will be the necessary catalyst for companies to survive. Innovation and technology will allow the adoption of sustainable criteria and policies for every process and activity. The financial sector could and should be the main catalyst when adopting CSR and sustainability criteria by providing capital for the transition conditioned to ESG impacts.‍

How will cities use a range of partnerships to achieve their future goals? How will they leverage partnerships with companies, government agencies, other cities, start-ups, universities, and other entities to make things happen?

‍Per Bjorkdahl, Sustainability Sales Engagement Director, Axis Communications: Construction of current partnerships needs to be revised to sustain dramatic changes that now caused disruptions. New partnerships need to broaden their scope to be able to withstand disruptions. Research institutes can contribute by narrow focus on local conditions backed by the research of best practices in a much wider context.

‍William Baver, Vice President, Smart Platform, NTT: Cities cannot be alone in this journey. They will need to partner with local, regional, global organizations across both the public and private sector to make this happen. We will see the creation of new business models that can allow these groups to exist and cooperate while sharing costs and profits. To make things happen, a two-way dialogue will be important to receive and share information on all fronts.

‍Kok-Chin TAY, Chairman, Smart Cities Network: Ecosystems of stakeholders will start to develop, as people begin to see the benefit of partnerships with the increased online interactions. Such partnerships will help fill the gaps that individual companies cannot fulfill.

‍Andrew Caruso, Director, Urban Solutions, Hatch: Our hope is that cities emerge from this crisis with the same vision—the courage to reimagine existing relationships and structures between stakeholders, and the focused ambition to generate opportunities for shared value and prosperity. Much like a vaccine trial, reinventing our cities will be iterative. It will require quantitative analysis and qualitative reflection. We must talk about failures as much as successes, shift away from celebrating the individual successes to collective prosperity, and leverage and invent new technology at every step.

John Tuohy, Director, Smart Cities Strategy, Oracle: Cities will need to partner with other academic, non-profit, and government agencies to use platforms for online services and engagement that may have a high startup cost. An example might be using a non-profit platform to attend a conference shared by multiple conference providers. Also, start-ups that offer niche pointed solutions in lieu of expensive enterprise solutions, provided they can provide integration and security.

Mark Saunders, Academic Director, Zigurat Global Institute of Technology: Resilience is a “team sport” and no single party can succeed on their own. While cities compete with one another, there is also much to do to share and work together. Sharing “what works” and “what didn’t work” are key aspects of this and when cities define longer term outcome-based aspirations, different companies, agencies, and institutions can identify how they are able to contribute and collaborate.

Miguel Eiras Antunes, Global Smart City, Smart Nation & Local Government Leader, Deloitte: A successful development strategy for cities depends on six critical factors: technological innovation, citizen involvement and co-creation, strategic partnerships, local leadership strategy, innovations in public procurement, and new innovative financing systems. It is necessary to create the right conditions for people to develop their business, invest in education, create a vibrant talent economy, and evolve a robust technology ecosystem. Governments can’t do it alone: they will need to build a broad, multi-stakeholder ecosystem on the ground.

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