As cities get bigger, can we make them better?

Nine ways for government, business and entrepreneurs to develop better cities

This September’s G20 summit in China will look at a host of issues to promote global economic development.

I’ll be speaking at the summit about how government, businesses and entrepreneurs can work together to meet some of the challenges the world faces.

Smarter, more resilient

One such challenge is developing cities that are smarter and more resilient.

Cities around the world are growing fast. Between 2014 and 2050, the global urban population is set to increase by about 2.5 billion people.

Such growth brings clear economic potential. But it also brings greater risk.

Dense populations and rising economic activity can mean higher costs for housing and services. Pollution, congestion and longer commute times can all reduce the quality of life for citizens.

Technology will be crucial to meeting these challenges.

But technology alone can’t solve the issues that growing cities face.

How well entrepreneurs, corporations and governments work together will determine how effectively cities can build a better working urban world.

At EY, we call this the “Power of Three.”

Cities are for their citizens and cannot grow and thrive without them. Citizens should feel connected to their city — through infrastructure and digital delivery, physical and social interaction, and emotional engagement.

So, what can government, business and entrepreneurs do to develop smart and resilient cities that put people first?

Steps for government

Unlock the power of big data and predictive analytics. New data and analytical tools allow municipalities to take a detailed look at their populations’ demands and behavioural patterns, then test and implement solutions that can serve them better at a lower cost.

Improve organizational structures. New data and decision-making tools can be placed at the heart of the city governance organization. Structures should make it easier for different city functions to work together and to involve citizens in open data sets and digital platforms.

Use data-driven decision-making by default. Data-led benchmarks and outcomes can drive productivity and improve commissioning, contestability and managed services models. With data and analytics, city governments can also counter fraud in areas such as taxation, waste and water, and urban development.

Steps for business

Use smart assets to drive return on investment. Real-time information on asset conditions can result in cheaper maintenance, reduced operational costs and greater energy efficiency. Using this data to inform funding and financing decisions could have a significant impact.

Work with municipalities to develop smart and resilient solutions. As with other large-scale infrastructure initiatives, businesses will need to partner with municipalities to design risk-sharing structures and incentive schemes. The right mix of collaboration and tax incentives will help businesses to scale-up smart solutions.

Resolve major investment and financing concerns. Clear public-private partnership models, loan guarantees, clarity on value capture and tax increment financing could all be important avenues to explore.

Steps for entrepreneurs

Reimagine the urban environment. Using data to understand emerging trends in citizens’ demands of their city infrastructure and social systems, and identify the gaps in existing commercial offerings, will drive new commercial opportunities.

Attract venture capital and other alternative finance to scale up. Building metrics on user profiles and revenue streams, and establishing a solid vendor pipeline, are parts of a strategy to work with corporate partners.

Understand the technologies that have potential in smart cities. Using new technologies to transform how citizens engage with their city — how they move around, where and how they work, and how they spend leisure time — is the sweet spot for entrepreneurs in the smart landscape.

Smart and resilient approaches to urban development demand the Power of Three. The shared mission is to create a city of well connected, prospering citizens to support the city’s long-term growth and sustainability.

With residents’ experience and well-being as a starting point, government, business and entrepreneurs can work together to redefine citizens’ connection with their cities.

Please join the discussion on Twitter @EY_GovtPublic and visit ey.com/citizentoday.

The views reflected in this article are the views of the author and do not necessarily reflect the views of the global EY organization or its member firms.