Connected cities ibm

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  • 1. 2012 IBM Corporation Get Smarter for a New Economy How cities are competing in the innovation economy Martin Fleming IBM Chief Economist and VP, Business Performance Systems June 27, 2013

2. 2013 IBM Corporation Cornelius Vanderbilt built the Grand Central Terminal with the help of engineer William Wilgus and created mid-town Manhattan Begun in 1903 and completed in 1913 Covered Park Avenue and created billions of dollars of GDP and real estate value Also created: Commuter Fares Red Carpet Welcome Ramps 2 Displayed bare electric light bulbs as a massive advertisement for electricity. 3. 2013 IBM Corporation Get Smarter for a New Economy: How cities are competing in the innovation economy In the years ahead, economic growth will increasingly rely on the merger of creativity, technology and innovation. Cities will face increasing competition for human capital, entrepreneurship, and investment. Addressing this challenge will require cities to provide services that meet the needs and expectations of the highly skilled and diverse population. Analytics and systems thinking will require new deployment of information and communication technology for cities to gain competitive advantage in this new economic age. Investing in citys to improve social and economic returns will help address pressing capital constraints. 3 4. 2013 IBM Corporation Skills and knowledge are having an increasingly significant impact on economic growth and activity among cities and regions Leading regional and urban economies combine a strong base of skills and talent, and a high share of knowledge-intensive industries in the overall economy Economies are becoming more skills and knowledge-intensive over time Skills and knowledge are driving growth in income (Regional and urban data, 1999-2007, size of the bubble reflects income per capita, US$ PPP) 0 10 20 30 40 50 60 0 10 20 30 40 50 60 Third level education, % of labor force Knowledgeintensiveservices,%oftotal 1999 2007 Source: OECD Regional Statistics database, 2010 and IBM Global Center for Economics Development analysis 4 5. 2013 IBM Corporation As focal points of economic activity cities are strongly positioned to benefit from the new talent-intensive economic growth Bangalore New Delhi Beijing Guangzhou Shanghai Johannesburg Cape Town Sydney Mexico Paris Lisbon Brussels Seoul -10 0 10 20 30 -5 5 15 25 35 45 55 Top cities act as economic activity hubs (Size of the bubble ratio of city share of national GDP to its share of national population, 2009) The top 100 cities worldwide accounted for roughly 25% of the worlds GDP in 2005. By 2008 this had increased to over 30% The world is at an unprecedented level of urbanization. Cities contain an increasingly large share of the world's highly skilled, educated, creative and entrepreneurial population Cities support large-scale business networks that absorb and extend innovation Source: UN Habitat 2010, and IBM Global Center for Economics Development analysis Cityshareofcountrypopulation,% City share of country GDP, % 5 6. 2013 IBM Corporation Cities are competing globally for more diversified and internationally mobile talent Diversity of skills, creativity and knowledge has a positive effect on cities income per capita By 2030, the stock of highly educated migrants will more than double on 2010 Internationally, flows of skills and talent are also becoming more cities-centered Diversity of skills, creativity and knowledge is positively linked with income 50 leading US cities, 2006 17,000 19,000 21,000 23,000 25,000 27,000 29,000 31,000 20 30 40 50 60 70 Source: UN Human Development Report, 2009, Diversification score is based on data from Impresa Consulting, 2006, and IBM Global Center for Economics Development analysis Incomepercapita,PPPUSD Diversification score, percent 0 20,000 40,000 60,000 80,000 100,000 120,000 Europe North America Asia World 1990 2010 2030(f) Inflow of highly educated migrants Thousands, 1990-2030 Source: UN Human Development Report, 2009, and IBM Global Center for Economics Development analysis 6 7. 2013 IBM Corporation Congestion is one of the main urban transportation problems faced by almost all cities and incurs significant costs 0 1 2 3 4 5 Kuala Lumpar Bangkok Sao Paulo Mexico City Dakar Manila Dublin Congestion costs %of GDP Source: Ley and Boccardo, 2010; CSO, County Incomes and Regional GDP 2010 Congestion negatively impacts the quality of life in a city by decreasing personal and business productivity lowering air quality creating noise pollution. Congestion pressures faced by cities will intensify going forward Car ownership in Sao Paulo is increasing at the rate of 1,000 cars a day Traffic is growing four times faster than the population in Mumbai, Delhi, Ahmedabad, Bangalore, Chennai and Hyderabad 7 8. 2013 IBM Corporation Poor public safety has a negative impact on skilled and innovative workers and businesses Source: Lloyds, Under attack? Global business and the threat of political violence Corporate location responses to political violence and terrorism % respondents (past five years) 37 8 7 0 5 10 15 20 25 30 35 40 Avoid investments in certain territories Cease or sell of operations in a territory Relocate operations wihtin a territory or region Levels and quality of human capital are linked to overall levels of public safety Higher individual and average levels of education increase demand for public safety How cities respond to threats to public safety, such as violence and terrorism, are of utmost importance for business location decisions Crime and poor public safety have a deterrent effect on foreign direct investment and domestic entrepreneurship, especially in highly skills-intensive sectors 8 9. 2013 IBM Corporation Health is fundamental to the quality and productivity of a workforce and is crucial for a citys overall survival and attractiveness 0.0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1.0 0.6 0.8 1.0 1.2 1.4 1.6 1.8 2.0 Education index Human development index, 2007 Leaders Followers Better health is positively correlated with higher quality of skills and knowledge Educationand HumanDevelopmentIndices Health Index Source: UN Human Development Report, 2010 database, and IBM Global Center for Economics Development analysis 9 10. 2013 IBM Corporation Smarter Cities solution portfolio can help no matter where a leader starts EnergyGovernment HealthcarePublic Safety Transportation Water Operations insight Law enforcement and public safety Building management Planning and Management Infrastructure Human Transportation management Water management Utility Network management Asset Management Social program management Citizen health and safety Educational outcomes 11. 2013 IBM Corporation Smarter Transportation enhances the traveler experience InfrastructureHuman Planning and Management What used to be a time-consuming process is now accomplished automatically and in real time, allowing us to make smarter and more timely decisions that keep our citys traffic flowing smoothly. Used intelligent video analytics to provide real-time traffic information to drivers, conduct traffic surveillance and improve city roads . Bucheon City Official, Korea Smarter Transportation Leverage information to create visibility across transportation networks and improve operations Anticipate commuter demand to optimize capacity and minimize congestion Coordinate resources to assure safety and improve the travelers experience 12. 2013 IBM Corporation T Public safety analytics make cities safer and more desirable for citizens and businesses InfrastructureHuman Planning and Management Coplink proved to be an important resource tool to help identify a suspect and solve an otherwise unworkable case. North American police agencies worked together to attain guilty convictions for theft cases Smarter Law Enforcement Leverage crime data to get a holistic view and identify leads more quickly Anticipate and uncover criminal trends to proactively deploy police resources Coordinate police resources and processes to quickly and efficiently resolve crimes David Maher, Tustin Police Department 13. 2013 IBM Corporation One platform, many use cases Organization-wide dashboards Domain analytics Event and KPI management Geospatial mapping Data modeling and integration Simulation and visualization Cross-department collaboration Situational awareness Incident management Alerts and directives within a particular service area or managing across many services Leverage real-time visibility of cross-city data to optimize cost efficiencies Anticipate and proactively manage problems to mitigate impact to services and citizens Coordinate cross-agency operations with business and citizen participation to drive economic prosperity and enhance citizen involvement Intelligent Operations Center for Smarter Cities provides integrated insight 14. 2013 IBM Corporation Analytics is transformational and will improve decision making, but will require increased skills and ways of thinking about the entire work force Analytics are moving away from answering well-defined business problems towards solving for questions users dont even know to ask. Hadoop and visualization are complementary to data warehousing and will be integrated into most analytic processes in the future. Analytics is shifting to more probabilistic platform that analyzes only some of the data, while sifting out the noise. 14 Source: Morgan Stanley Research; Tech Hardware Insights Meetings Highlight Pent-Up Demand for Analytics / EDW; December 14, 2012 The shortage of data scientists and complex integration issues are critical problems that often hold companies back from adopting analytic solutions. 15. 2013 IBM Corporation In spite of current financial constraints, there are some basic steps city leaders can and must take now 1. Decide what their city brand s