Open Innovation

Oh no !!!! One more Smart City ranking !!!!!

Who didn’t think lately this when confronted with another Smart City ranking? Indeed, in the last years, in spite of the lack of indicators, it has been an explosion of smart city rankings attempting to bring something new to the table.

However, two main problems plague Smart City rankings.

First, the lack of data. There is little data at city level and therefore you have to resort to interviews, self-declared assessments or use national or at most regional data, which makes non-sense for individual cities. Also, there isn’t any data that could allow a fair comparison of city initiatives. Again surveys take the main role and with them a very subjective view, if not bias, of the impact and worth of these initiatives.

Secondly, the polyhedric nature of the concept. Smart City is usually defined by its impact in many areas ranging from resilience to citizen participation or economic growth. Having cities different priorities it seems logical that they push in different directions. How can you compare them? The classical example refers to new cities recently build versus the old ones where many infrastructures cannot be changed. They obviously confront very different priorities.

When in spite of these difficulties you attempt to produce an index, any index, comes the question of usefulness. What is its contribution? Rank the efforts that cities do around Smart Cities, why is this useful?

Most of them rank existing assets in the different categories of the index, which honestly adds little not only to our understanding but in terms of guiding political action.

Once you gave up comparing potatoes with oranges, resilience with citizen participation or the rise of the sharing economy, the idea of a ranking that can provide a framework that could orientate Smart City initiatives can certainly be of some interest.

Very recently (June 2015), Nesta, Accentrue and Catapult have produced one of these: Citie that aims to rank city initiatives for technology, innovation and entrepreneurship. Citie doesn’t cover the whole spectrum of Smart Cities but maybe its most interesting part because it talks about growth and these days we all need growth, don’t we?

I am sure that you want to know the winners first 🙂

These days apps4Europe (http://www.appsforeurope.eu) is ending. In the last 3 years apps4Europe tried to redefine the dynamic of hackathons making them more effective resulting in more and better apps putting into practice concepts such as the Business Lounge. This is the last of a series of European projects (Open Cities, Commons 4 Europe, CitySDK, apps4Europe, …) aimed at transforming cities into ecosystems where app services were provided not by the cities themselves but by developers and startups. It is therefore time for a reflection.

Over the past years European cities promoted lots of hackathons with the hope of fostering the development of city & civic apps. Hackathons have become a staple in cities’ policies with the ambition of promoting the development of a tech ecosystem.

However, very few startups graduated from this process and for the ones who did you can argue to what extend hackathons have been a decisive factor. Moreover, if we look at the apps that we have installed in our smartphones and we normally use, only very rarely we can find one resulting from this process. None is in the list of top 100 either.

Therefore, confronting results with the ambition it is hard to argue that we got far away with this strategy and it becomes pretty obvious that we have to rethink the whole process, because … it has not been working and it is not working. And in this case, it has not been that we didn’t try, we did and we did a lot.

In spite of this evidence however, cities continue investing in hackathons. It seems quite reasonable to ask us why is this happening and to what extent this is the best possible move.

Remember the days when Nokia and Motorola owned the phone market? They are not so distant, only a few years ago. Yet how many of you have a Moto or a Nokia now? Let me guess: none!

If you are sceptical about the power of innovation for shaping markets and destroying fortunes, these two examples are a reminder of how fast things can go. But they tell us more; they describe a change in the way we compete.

Not so long ago, firms competed on price. In a way all societies started here, taking advantage of low wages, natural resources or any other factor that might provide a sustainable advantage, difficult to replicate. As we know now, these advantages were far from sustainable. Low wage countries, if successful, became richer, raising wages. Shifts in extraction technology, such as fracking, made extraction advantages less relevant, and so on. So, let’s forget about sustainable, ok?

Productivity replaced low costs as the main form of competition. Knowledge became the new buzzword. Nowadays however, knowledge is everywhere and while some sectors strive to maintain their knowledge advantage, engineers in India or China have become just as competent as their rivals in Europe or America, and with them the productivity level of these different societies is levelling out.

We are no longer competing on productivity. Some of the biggest, most thriving companies such as Apple, Google, Airbnb, Tesla, Facebook, GE, Amazon and Apdo still compete on productivity of course, but they earn their huge surplus and tremendous market share from innovation. They compete not on making similar things more efficiently but on transforming the world with completely new products and services.

This Copernican change in the way we compete has huge implications.

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