Smart Cities

Definition of “Smart Cities”

A smart city uses innovative technology and large volumes of data to create an interconnected and efficient city. The purpose of a smart city is to improve its citizens quality of life through better decision-making, enabled by collating more comprehensive and real-time data. For a smart city to properly function, three layers have to work together: the technology base, specific applications, and the usage of data.
The technology base includes a critical mass of smartphones and sensors connected by high-speed communication networks. Specific applications translate raw data into actions. Wide adoption and usage are key to the efficiency of smart city initiatives.

Their importance in the current global context

Simply put: smart cities matter because cities are critical. Cities are home to tremendous economic growth and opportunity, as reported by the World Bank, stating that 72% of cities outpaced their respective national economies in terms of growth. Furthermore, by 2050, the top 600 cities are expected to account for 60% of the global GDP. With rapid worldwide urban population growth, expected to increase by 2.5 billion by 2050, it is critical that cities be properly equipped to handle this increase to reduce the chance of an economic slowdown.
Rapid urbanization raises new challenges for city centers in terms of environmental sustainability and physical safety of residents. Economic growth is meaningless if at the same time natural resources are rapidly depleted and cities are fragilized by civic unrest. Thriving cities thus search for sustainable and resilient growth, which can be partially enabled by technology. Cities are now pivoting towards their most valuable assets, their people, to prompt smarter decision-making; in other words, promoting collective intelligence.

Smart Cities and their impact on urban quality of life

Smart-city applications can enhance the quality of urban life in across many dimensions: safety, time and convenience health, environmental quality, social connectedness and civic participation, jobs and the cost of living.
Data can be used to better deploy scarce resources and personnel, to predict and anticipate crime and accelerate judicial responses. Smart-mobility can greatly reduce road congestion, provide citizens with better transit options, cutting down on commuting time. Intelligent syncing of traffics signals in congested areas can make transit more efficient and smart-parking applications can reduce the time used to find parking spots. Remote patient monitoring systems can alert doctors when an early intervention is needed, and health data analytics can help identify which populations are at risk of certain diseases. Dynamic electricity pricing, building automation systems and mobility applications can reduce CO2 emissions while IoT can be used to predict water leakages and pipe failures, reducing water consumption. Better connectedness of residents with local agencies improves government responsiveness and guides better decision-making. The inclusion of smart technology and the digitalization of government functions will create a more entrepreneurial and innovative business climate.

A shift in collaboration patterns

Shifting to a smart city requires a combined and collaborative effort from governments, businesses, non- profits and social enterprises and citizens. To start off, governments have to come up with compelling business cases which their residents can understand. Governments should also run their efforts as portfolios rather than single, huge projects, and employ a phased approach with a series of “small wins”. Governments should communicate throughout their journey, as changing cultures and mindsets require time. Lastly, governments should focus on demonstrable results to sustain public support in their project.
Businesses, non-profits and social enterprises should look for opportunities to partner with cities and create an ecosystem of partners to help develop smart city initiatives. The private sector should also look beyond just financing smart city initiatives, but also look for opportunities that could add value to both the city as a well as business. In this case, balancing the risk and reward between public and private parties will be critical.
Lastly, citizens should take a proactive role as co-creators in shaping smart city policies and initiatives through active participation to the projects. Furthermore, citizens should be conscious and vocal about the changes that a smart city transformation entails, to ensure the smooth implementation of these initiatives.

Issues related to smart cities

Proper collaboration between the cities, businesses and citizens is not the only issue associated with smart cities, with barriers including economics, inclusivity and security raising new issues.
The implementation of smart city initiatives mainly relies on the large-scale deployment of sensors, which requires costly and complex infrastructure to be installed, maintained and powered. With main cities already challenged with replacing old infrastructure, limited budget and long approval processes, can infrastructure be deployed on a relevant scale?
Furthermore, smart city initiatives rely heavily on citizens, and the proper utilisation of new technologies, meaning that any city-wide technology deployment must involve educating the community. It is critical for smart cities to push citizens to adopt technology and encourage its use. This raises the question of inclusivity, as it is crucial that all the population is fairly represented and has access to smart cities functions, including older and low-income residents, to avoid exacerbating the existing inequalities.
Security and privacy are the main concerns for smart city initiatives, as they rely on the accumulation and storage of large amounts of personal data. Malware and denial of service are also issues which should be taken into account. With the increase in digitalization of services, the energy, communications and financial services sectors are all systems at risk. Today, only 15% of the major cities worldwide consider to be properly equipped against cyber-attacks, and therefore cities should focus their efforts on ensuring the integrity of their cyber-security. Lastly, there is a major ethical issue about smart cities; essentially, smart city initiatives advocate for the monitoring of large data streams, which in other words, is called surveillance. With smart cities having unclearly defined aims, people are not ready to trade their privacy for the illusion of security. Smart cities are also considered by many as leveraging technology to promote social control, such as the Chinese social credit system.

Current State of Deployment

Although the development of smart cities still has a long way to go, the evaluation and ranking process of smart cities has already begun. McKinsey has assessed and ranked the major cities worldwide depending on the strength of the technology base, the number of smart city applications being deployed, and the awareness and usage of these applications by residents. The top 5 ranked cities as of today are New York, London, Paris, Tokyo and Reykjavik.


While the concept of smart city has gained a lot of traction in the recent years and seems like a very promising way of dealing with the rapid increase in urban population, barriers to the development of such initiatives are still very present. Although technology is the key enabler of these initiatives, its implementation should be carefully planned and highly secure. But only when city governance, technology and communities of people come together and commit to a plan will a city become truly “smart”.