By Roger Chung, Director, Deloitte Research – TMT
‘Rise of China’s Super Smart Cities’ was published in the winter 2022 edition of the German Chamber Ticker. Editor: Noga Feige, Senior Editor of the Ticker Magazine. Visuals: Matter Design.
The “Super Smart City”
In recent years, many Chinese cities have upgraded their infrastructure, using sensing technology and data analytics to better manage urban assets such as public transit, wastewater systems, and roads. This connected infrastructure vision comprises what is known as ‘Smart Cities’ — physical assets networked via sensor technology that generate streams of valuable data from smart parking meters, streetlights, and even trash receptacles.
For cities that have yet to progress along the smart city journey, this is still a powerful vision. Connected sensors that collect data can help cities optimize their physical infrastructure performance, and are a key part of what it takes to build a smart city.
Today, however, we are beginning to see the dawn of the next generation of urban evolution—the ‘Super Smart City’ — as some of the more advanced Chinese cities have started to move beyond mere infrastructure, tapping the wisdom of their residents and businesses. The Super Smart City focuses on enhancing the citizen experience by operating at the intersection of the 3Ds: digital, data, and human-centered design. The goal is to enable better decision-making through the use of data for all stakeholders. Ultimately, the cities of tomorrow will involve not just government, but citizens and businesses in an intelligent, connected ecosystem built on a sensor-based physical infrastructure.
Top Trends in Super Smart Cities
China has already become a global leader in innovative smart city initiatives. The government has launched a national strategy and channels public resources to promote growth in smart cities across the country. China has made significant investments in building smart cities over the past decade, and key trends are beginning to emerge going forward:
From ‘smart’ to ‘super smart’: China’s smart cities are being transformed into ‘super smart’ cities, which no longer focus on just achieving urban intelligence through advanced technology and data fusion, but with more emphasis on sustainability, urban resilience, and human-centric views to create an efficient, harmonious and sustainable city. ‘Super Smart’ cities can be measured via four dimensions: first, whether they have a long-term strategic plan; second, whether they are supported by adequate technological infrastructure; third, whether they can maintain sustainable green development; and fourth, whether they have a boundless capacity for innovation. In the super smart city echelon, the four first-tier cities in China (Beijing, Shanghai, Shenzhen, and Guangzhou) are all at the forefront in core areas; while second-tier cities are quickly catching up, third-tier cities meanwhile are focusing on their own characteristics, and there is still plenty of room for improvements.
From ‘data-driven’ to ‘human-centric’: The ‘human-centric’ urban construction is a systemic project that requires the coordinated development of urban space, systems, life, and culture. At the same time, it takes citizens’ needs as the starting point, developing a valuable urban development system from the perspective of inclusion, connection, innovation, and participation. The city should create value and warmth for its citizens, so that they can experience tangible improvements in urban services.
For instance, in order to provide better government services and urban management, Zhengzhou government insisted on human-centric services and created the ‘Zhenghaoban’ app. As the service port for citizens, the app covers more than 10 areas and 118 application scenarios, which can bring not only convenient smart life experience to residents, but also provide strong data support for the analysis and decision-making of the government and enterprises. This app currently caters to the community, medical care, scenic spots, transportation, and other scenes, and will be extended to more areas in the future.
From ‘growth-oriented’ to ‘green-focused’: During China’s 14th Five-Year Plan period, low-carbon green city is a new core issue for China’s smart cities. Urban construction and planning are making good use of intelligent technologies to accelerate low-carbon and green transformation goals. Leading Super Smart Cities in China are now transforming in four core sectors:
- In the energy sector, a clean energy system with multiple energy sources, networks, loads, and storage is being built;
- In the building sector, building energy efficiency is being improved, and low-carbon management covering the entire life cycle of design, construction, operation and demolition is being implemented;
- In the industrial sector, technological innovation will be promoted to optimize and upgrade the industrial structure and improve the utilization of energy resources;
- In the transportation sector, considering structural, technical, and emission reductions, cities are promoting new energy vehicles, improving the construction of related infrastructure, and pushing for intelligent transport systems development.
For example, Shanghai Lingang Special Zone has already devoted resources to promoting the construction of low-carbon cities. By 2025, numerous low-carbon demonstration zones will be built, with the allocation rate of new residential buildings and charging stations in public parking lots reaching 15%; the proportion of clean energy consumption reaching 50%, and the coverage rate of new rooftop solar reaching 100%. In addition, 80% of the zone’s transportation system will become environmentally friendly, and all buses will be powered by clean energy by 2025.
From ‘closed-loop’ to ‘open participation’: Transformation from closed-loop planning to open participation is the joint contribution of the government, businesses, and residents to the city, so as to achieve a ‘city built by the people, for the people.’ Although the focus of cities remains the same—creating livable environments where people and businesses can thrive—the ways to achieve that goal are evolving. Increasingly, cities are putting data in the hands of end users to drive better decision-making. They tap into the collective intelligence of their constituents to create solutions around some of the toughest urban problems. They adopt a platform approach that enables constituents to use technology to reimagine core city operations. These shifts democratize the development of cities and upend the traditional roles of governments, businesses, and residents. With governments evolving into solution enablers, businesses increasing engagement, and a growing cadre of citizen co-creators – tomorrow’s smart cities will be more connected, networked, and collaborative.
To fully mobilize the public’s enthusiasm to discover urban problems and supervise urban management, Wuhan set up an incentive mechanism: residents who actively participated in creating the smart city would be encouraged with publicity and prizes. The Wuhan government also established a ‘public planning platform,’ allowing the public to participate in the formulation of the project proposal, and the final project plan fully reflected public opinion. Furthermore, it launched ‘Cloud Wuhan’ – a platform for direct dialogue between the public and the government.
Double-down on data security and privacy protection: Smart cities hold a tremendous amount of data, with complex network connections everywhere. With many potential attack points, if adequate security is not in place, it will be vulnerable to network attacks, resulting in data leaks. The smart city security systems should revolve around data, while ensuring comprehensive security from smart terminals, edge computers, networks, and data centers. The security of smart cities requires not only agile security governance capabilities, but also the application of automated security technologies led by AI, big data, and trusted computing. Meanwhile, human-centered privacy protection is a top priority that cannot be ignored.
Zhejiang province, for example, launched a data security system to address the problem of data leakage and abuse. The government built a data security management and daily supervision system to prevent data leaks, tampering, and abuse, with the emergency response time shortened by more than 90%. Ultimately, the province enhanced the ability of data security guarantee while sharing information, and thousands of types of sensitive data could be continuously managed.
Creating the foundation for a ‘resilient’ city: The existing layout of smart facilities and platforms provides data for disaster prevention and emergency management in cities. Embedding resilient city functions in the construction of super smart cities, an integrated ‘smart-resilient’ management platform and a prediction and early warning system are created. More and more Chinese cities have prioritized resilience in the 14th Five-Year Plan period: Beijing, Shanghai, Nanjing, Hefei, and Changsha have all formulated corresponding top-level design, assessment systems, and emergency response regulations. For example, the outline of Shanghai’s 14th Five-Year Plan clearly puts forward the idea of ‘building a resilient city.’ In standard times, the government carefully monitors areas of high risk, such as the structural stress of bridges and tunnels and the pressure of pipelines, with accurate parameters. It utilizes digital and intelligent methods to prevent and control risks according to the algorithm of accident’s evolution mechanism.
Getting Involved With Smart Cities
Here are a few ways cities, businesses, and citizens can kick-start their smart city journeys.
Government
- Create a portfolio. Rather than a single, huge project, create a portfolio of projects, each with its own business case.
- Employ a phased approach with a series of ‘small wins.’ Demonstrating success early on is important, so organize resources to make this happen.
- Communicate throughout the journey. Don’t underestimate change management and communications—changing the culture and mindset takes time.
- Focus on results. Pick three things to announce as successes one year from now to demonstrate progress.
Businesses, nonprofits, and social enterprises
- Look for opportunities to partner with cities. Look for initiatives that match organizational goals.
- Look beyond just financing smart city initiatives. Identify opportunities that could add value to both the city and the business. Balancing the risk and reward between public and private entities is critical.
Citizens
- Take a proactive role as co-creators in shaping smart city policies and initiatives.
- Be conscious and vocal about the change that smart city transformation will entail. Garner a better understanding of emerging technologies and identify their implications for security and privacy.
Outlook
In an era of explosive growth, emerging technologies will shape the way cities change. Residents and businesses will increasingly take a central role in driving the future of our cities, with governments enabling their participation. The next generation of urban evolution moves beyond just connected infrastructure and smarter terminals: the smart cities of tomorrow engage governments, citizens, and businesses in an intelligent, connected ecosystem. The goal is sustainable, safe, and resilient city services for a higher quality of life. The evolving ‘Super Smart Cities enhance citizens’ experience and decision-making using the 3Ds—digital, data, and design, and we expect to see more cities adopting this approach going forward.
Roger Chung is the Director of Deloitte Research – TMT. Roger has over 10 years of experience in advisory, venture investment, and capital market in the TMT sector. He is well-versed in advising companies on strategy, market, product, and financing. His areas of expertise include telecom, e-commerce, cloud computing, big data, and digital technologies. He also authors Deloitte China’s TMT-related reports.
Prior to Deloitte, Roger was with a venture capital firm that invests in start-ups with world-class technologies. There he managed the investment, incubation, and building of high-growth tech companies. Prior to venture capital, he was with a leading financial institution managing large-scale digital technology projects. Roger holds a Bachelor of Applied Science degree in Computer Engineering from the University of Toronto and an MBA from the University of British Columbia.
