What makes a city “smart”?
The following is an excerpt from the McKinsey Global Institute report, Smart cities: Digital solutions for a more livable future.
What does it really mean to be a “smart city”? For years, the definition — and even the end goal — remained fuzzy. The term has been used to describe cities that are environmentally sustainable, those with a concentration of knowledge workers, and places with smoothly functioning infrastructure and entrepreneurial economies. Over time, the idea of creating digitally connected cities moved to the forefront.
Today those concepts are converging. Smart cities are being redefined as places where different actors employ technology and data to make better decisions and achieve a better quality of life. City agencies can use data to respond to fluid situations and to plan more accurately for the future. Better-informed companies and individuals can make decisions that translate into more efficient use of resources for the city overall.
Cities around the world face daunting infrastructure challenges, but smart city technologies change the nature and economics of infrastructure. Technology reduces the physical and transaction costs of gathering information on usage patterns. With an unprecedented volume of data points in hand, cities can get more out of their existing infrastructure systems.
Adequate investment in building and maintaining sound physical infrastructure still matters, but adding an overlay of intelligence enables cities to expand the capacity and lifespan of existing assets. Even if new construction is needed, embedding smart technologies from the outset can make the investment go further.
Smart systems also speed up the metabolism of city government, giving agencies the ability to watch events as they unfold, understand how demand patterns are changing, and respond with faster and often lower-cost solutions. Cities can make data-driven investments with shorter planning cycles.
All of this leads to higher quality of life in cities. Quality of life has many dimensions, from whether people breathe clean air to whether they feel safe as they walk down the street. The McKinsey Global Institute’s report, Smart cities: Digital solutions for a more livable future, examines how much better off residents could be if cities added an intelligence layer to take advantage of the full range of smart solutions available today.
Specifically, we aim to quantify the progress cities could achieve in a wide range of people-oriented priorities: safety, time and convenience, health, environmental quality, social connectedness and civic participation, jobs, and cost of living.
Three layers work together to make a smart city hum.
First is the technology base, the building blocks that have to be in place before a city can deploy applications at any kind of scale. The technology base includes high-speed communication networks, a critical mass of smartphones, open data portals, and sensors. Second are the specific applications and tools themselves. The third and most crucial layer is user adoption and experience.
To learn more about each of these layers and how they have developed to date in 50 cities around the world, download our new report, Smart cities: Digital solutions for a more livable future.
