This is the second in a three part series on Smart Cities. Best to start with Part I.
Urbanization in China Sets the Stage by Defining the Need
According to the World Bank, China's urban population was 191 million in 1980. By 2007, it was 594 million, excluding migrants. About half of China's population now lives in cities, and that trend looks likely to continue particularly as the government relaxes restrictions on internal movement institutionalized in the strict hukou system of residential registration.
And, bigger cities face bigger challenges to meet the needs of their burgeoning populations:
Infrastructure and jobs. Between now and 2025, it's likely that another 200 to 250 million people will migrate to China's cities, adding to an existing mobile or migrant population of about 155 million. Providing infrastructure - housing, roads, hospitals etc. - and jobs for this anticipated inflow of people poses major challenges. With new changes to the hukou system, this migration into cities could be even greater.
Energy. Urban residents use 3.6 times as much energy as rural residents; suggesting that energy use is far from its peak. In China, energy intensity (consumption of energy per unit of GDP) is 7 times that of Japan and 3.5 times that of the United States, and over 70% of electricity use is coal-produced.
This is actually not a tale of two specific cities but of two types of cities, or “smart cities” as the new moniker goes. It will appear in three parts.
Defining Smart Cities
“Smart” has become the adjective of choice among tech vendors to describe solutions that capture, synthesize and analyze the vast amounts of data being produced by computing and networking systems. Forrester defines Smart Computing as:
a new generation of integrated hardware, software, and network technologies that provide IT systems with real-time awareness of the real world and advanced analytics to help people make more intelligent decisions about alternatives and actions that will optimize business processes and business balance sheet results.
What does that mean in layman’s terms? Every system can be smarter if it can learn from and act on the data it produces.
A city is a “system of systems” making the potential for efficiency exponential as all of its systems interact. Therefore, a smart city is:
A city that uses technology to transform its core systems – city administration, education, healthcare, transportation, public safety, real estate, utilities and business — enabling them to capture, analyze and act on the data they produce.
As a result, a smart city’s systems can optimize the use of and return from largely finite resources. It can, in other words, “do more with less.” Using resources in this smarter way also boosts innovation, a key factor underpinning competitiveness and economic growth.
I recently completed an interview with the VP of patient management for a large healthcare organization. When introducing herself, she said that her responsiblity is “connecting the dots”. I asked her what kind of dots, and she said “We have a software application for everything we do -- I must get them talking to each other and this is a challenge.” I asked her what the role of IT. Her answer was “they do a good job of maintaining the applications, but not so much on cross-functional processes”.
Is this an unusual situation? Obviously not. A recent Forrester survey of 141 organizations shows that in 78% of organizations business executives -- not IT -- drive process improvement initiatives. I assume that most of these initiatives are about “connecting the dots”.
I think that IT decision-makers can do a lot more to improve business processes, in particular cross-functional processes. Acting as agents of process improvement, they need to re-focus their teams from supporting tech platforms to optimizing cross-functional processes. As one of these change-agents pointed out in a recent interview “ No single functional department owns end-to-end order-to-cash. IT can help a company see something that is hard to see”. (see this report)
Working with several IT decision-makers, I developed a few recommendations for change-agents who aim to increase the business orientation and efficiency of their organizations:
Focus on business enablement through service orientation
Ever since I first started working with online social communities I've been thinking about just what it is that makes some communities successful while others fizzle and die. In particular I'm curious why collaboration communities seem to be so hard to make work.
While doing recent research on social computing initiatives I got to thinking on this problem again. Recently I made the connection to Abraham Maslow's work on the hierarchy of needs:
Maslow suggested all people are motivated by a desire to fulfill basic human needs in an ascending hierarchy. He also suggested that unless the lower-order needs are fulfilled, the higher-order needs are not motivators of behavior.
The primary needs Maslow identified fall into five groups:
Cliff Condon, the Forrester VP in charge of research processes, just pulled the trigger on Forrester's new blogging network. I'm very excited about the new platform, for it provides a rock solid foundation for enhancing Forrester's research and service engagement. Let us know what you think!
And while you're thinking, here's what Cliff has to say.
Hey everyone. Here it is – Forrester’s new blog network. We made some changes to improve the experience for readers and to encourage more analysts to blog. Feel free to poke around and let me know what you think.
There are a few things I’d like to point out to you:
BPM has always provided fertile ground for new ideas but often results in confusing business process and application professionals. Recently Dynamic Case Management and Social BPM are being spoken of as important directions for BPM. But how do they relate to one another? And since social media is an important part of both, what value does social really add to process improvement and Line of Business professionals if any? No doubt social improves collaboration in process design, and more important is the ability -with analytics to add a new form of input to process improvement -input that may go directly to the CEO. This is part of the BPM advantage but the area of Case Management may have more dramatic value as you collaborate during a critical incident like an adverse drug reaction, or create a stronger community to deliver a more personalized service event -or to gather "voice of the customer" data to improve case handling. But in both BPM and Case -social is an enabler and takes a seat along side important advancements such as analytics, convergence of BPM and ECM, and a stronger domain focus.
You can use Internet protocols to make phone calls inside your own network. And you don't have to pay for the minutes. But you can't do the same thing with a business partner. Instead, you have to pay a carrier like BT or AT&T to carry the phone call over the public switched telephone network (PSTN).
(PSTN is an analog network born in 1878 when Bell opened a switching office in New Haven, CT. It's done us proud, but it's time to move to a digital network.)
It's even worse for video conferencing. If you want to have a video conference internally, you can use your IP network to do it. But if you want to do a video conference with a business partner, you have to use a complex business gateway link and pay a lot of money for it.
Cisco thinks it's time to change that. We spoke with Cisco executives Tony Bates, Barry O'Sullivan, and Joe Burton about Cisco's intercompany media engine (IME), a new technology to replace PSTN with its Internet equivalent. Cisco's goals are audacious:
On Friday March 5th, the National People’s Congress (NPC) – China’s equivalent of Congress or Parliament – held the opening meeting of its annual full session.At a high level, the agenda of the session will focus on succession planning for government and Communist Party leaders, the stimulus exit strategy and economic initiatives for the coming year.In this, there is much to interest tech vendors.
In one of the opening speeches, Chinese Premier Wen Jiabao presented his work report which summarized some major economic indicators for 2009 and provided a broad outline for the 2010 plans. Technology appeared center stage throughout much of the speech, and the word "innovation” was peppered throughout.
Economic relief is in the air. When Cisco executive John Chambers is in a "sunny" mood and describes revenue growth as “dramatic,” you know that positive signs will shortly be all around. Forecasts of positive IT spending abound, including Forrester’s Q4 signal and 2010 perspective.
Brazil has launched a full court press and is using technology to do so in the form of its new e-government portal ‘Portal Brasil’ – the new official website of Brazil. And, here‘s the best news: they didn’t forget us here at Forrester. According to the press release, the site's content is designed to meet the needs of both Brazilian citizens and foreign audiences, including: analysts (yes, analysts!), investors, private sector companies, media, academics, NGOs, students, tourists, and other groups.
And, for us tech industry analysts – according to the Brazil’s Secretariat of Social Communication (SECOM) – Portal Brasil will maintain current information on Brazilian technology initiatives, including:
Information on Brazil’s Digital Inclusion Programs, including the Computer for All program and the Broadband Internet in Schools program