How to Solve City Problems

I am not the first one to write that urbanization is one of the defining demographic trends of the 21st century. This is true in Western Europe and the United States, and things are also really changing quickly in developing regions like Africa and Asia.

According to this UN Report from 2014, about 54 percent of the world’s population lived in cities during 2014. By 2050, that number will climb to 66 percent. Three countries – Nigeria, China, and India - are predicted to account for 37 percent of the world’s projected growth between 2014 and 2050.

Urbanization is happening, and it will continue to happen.

The move to cities is really changing how people live. It’s not just that people are living close to one another, it’s that we have different kinds of jobs (factory work rather than farming), different kinds of community networks (living in a city of 8 million is a lot different than in a village of 800), and different kinds of responsibilities for public authorities (sewage!).

I mentioned in my last post that I was going to attend an event that was engaging with these issues, and trying to figure out how to ensure that urban life in the 21st century is safe, healthy, and productive for as many people as possible. The organizers approached these problems in an interesting way. They acknowledged at the very beginning that there is no Single Set of Solutions that will solve the world’s urban dilemmas.

Instead, the crucial necessity is to have the right approach to answering these questions. Why is that so? Because every city is different, every group of people is different, so the important thing is to bring as many people as possible into the decision-making process. If you do that, you’re bound to get better solutions than through top-down decision-making.

To get a better idea of what this approach entails, I spoke with Sean O’Brien, the Global Lead of Urban Management and Public Safety for SAP, one of the event’s organizers. For those not familiar, SAP provides a technology platform that allows firms (and governments – I was told that SAP has contracts with more than 4000 regional governments around the world) to analyze huge amounts of data, and to improve their processes, products, and services based on insights from that data.

[Quick aside: At first I thought that SAP’s involvement in the workshop was simply an attempt to drum up business. That is surely true but the longer I spoke with him, the more I came to believe that Mr. O’Brien really believes in what he is doing, and thinks that SAP technology can help governments provide better services.]

Like many others, Mr. O’Brien believes that urban issues are “the main engines for the global economy. There are so many factors that have converged in this century that make cities the most important venture for humans going into the future.” The way he sees it, cities are the economic, social, and innovative engines of the world.

But as cities grow, they are presenting new challenges for public authorities, particularly in less-developed regions of the world. These problems range from crime to to environmental issues to citizen engagement with local governments. In SAP’s experience, in order to solve these kinds of problems, “you’ve got to have a diversity of ideas.” What that comes down to, oftentimes, is simply bringing people into a room together. If you do that, Mr. O’Brien told me, then “this germ of an idea is incubated because we have those different perspectives.”

An Entrepreneurial Approach

If you think about it, that is very similar to how entrepreneurs go about their business: they see a problem, and they try to develop an innovative solution to it. SAP thinks along those same lines. Mr. O’Brien said that he hoped that cities, especially in Europe, could act “more entrepreneurially.” He said that it’s important to “capture the power of innovation and ingenuity.”

One of the best ways to encourage entrepreneurism by city governments is to attract  a lot of entrepreneurs in the city.  The best way to do this is invest in education, infrastructure, and economic freedom. The proximity and accompanying exchange of ideas should then develop into innovative approaches to public problems.

Why this Helps Governments

As an example, Mr. O’Brien described a project that he had implemented in Buenos Aires, Argentina. The city had been having problems with flooding. They weren’t able to predict where floods would happen, so entire neighborhoods were being heavily damaged. The SAP solution was to install sensors in drains all across the city. The sensors collected data and were able to predict where the flooding would be – well before it happened. This allowed the city to take preventative measures.

Another example was streetlights. Buenos Aires wasn’t able to keep its streetlights working. They would constantly break, and contractors would refuse to repair them because they weren’t getting paid on time. SAP installed a system of LED lights with chips that not only indicated when a light was malfunctioning, but was able to predict when a light would break before it went dark, and would automatically send repair requests to contractors. The SAP system also organized the payment system so that contractors would agree to work and know they were going to get paid.  

 But Does it?

I really want to believe in the idea that making governments act more like entrepreneurs will lead to better service provision. I really want to think that all you need to do to solve cities’ 21st century challenges is bringing diverse groups of people together.

But I wonder if the examples that Mr. O’Brien used were the best illustrations of the approach that he and SAP said they wanted to emphasize - of collaboration with diverse stakeholders leading to innovative solutions. The two stories from Buenos Aires seem to me like pretty straightforward examples of governments using technology in the same way, and in order to fix the same type of problems, that thousands of companies already do. This wasn’t about letting a germ of an idea grow, it was about applying established technology in a different context.

But even if this story doesn’t demonstrate the power of bringing diverse groups of people together in a room, it certainly does demonstrate the efficacy of data analysis and process management. And at the end of the day, isn’t that also a compelling story? One where governments manage to use technology to do a better job?

I hope that the politicians who attended the conference had the same impression as me. The collaborative workshops were really interesting, but if the goal is to improve services, I’d be much more interested in discovering new tools for governing, regardless of who else was in the room.