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Follow the money by Jack Hanley, vice president for sales, Telensa North America

It’s time to step away from technology pilots and start making the business case for smart city applications

Follow the money by Jack Hanley, vice president for sales, Telensa North America

Can you have too much of a good thing? In the case of smart city pilot projects, the answer is definitely yes. There are too many technology trials and too few implementations at scale. The reason is simple: municipalities are asking the wrong question. We don’t need technology tests because there is plenty of evidence that these technologies do work. The real test is to create the business case. City leaders should be asking: what real-life financial benefits could this technology deliver if we deployed it across the whole metropolitan area?


The smart city technology industry is often guilty of describing a Utopian future of largely unquantifiable benefits. But before they commit to smart city infrastructure, municipalities (many of whom are working under severe financial constraints) need to see a tangible and near-term return on investment based on operational savings. You can’t build a case based on vague promises that the technology will pay for itself because one day you’ll be able to ‘monetise the data’. In other words, a smart city pilot should be about economics, not technology. The right starting point is to identify a pressing business need or operational headache and work out how to solve it using smart city techniques.


Smart street lighting is the first smart city application to have been deployed at scale. Why? Because the business case is straightforward. Savings in energy and maintenance pay for the devices, the network and the application and the RoI kicks in after just a few years into its 20-year lifespan. The important point is that the financial reward comes not from the actual lighting infrastructure but from related energy savings, maintenance costs and the ongoing contribution of street lights as sensor hubs for other applications. We need to apply that same thinking to other smart city applications which are stuck in a perennial pilot phase.


A smarter alternative to technology pilots


Take drainage. Every city has drains (generally more drains than street lights). Blocked drains flood, which is expensive, inconvenient, dangerous even, but there’s no way of knowing if a drain is silting up without a physical inspection (or a call from an irate local resident). Engineering departments tend to have a rolling programme to empty drains whether they need it or not, which is wasteful. Clearly, there is a case to be made for using smart city techniques to monitor performance and identify potential savings.


The ‘technology first’ approach would have us put a sensor in every drain. The pilot project would reveal that silt sensors are pretty expensive, and the potential savings could never cover their purchase. End of story.


But there is a much smarter way. Let’s temporarily install a sensor in the drain, moving a small number of sensors around the city until all drains have been monitored. The data collected tells the city engineer the fill rate of every drain, and which ones fill unpredictably. The city can install permanent sensors only in the few drains that are unreliable or where flooding would create a danger. Using the data model, the engineering team can ensure they arrive to empty the right drains at the right time. Regular inspections of unmonitored, predictable drains can keep the data model up to date. And the high-risk drains can be actively monitored in real time to pre-empt flooding. Such a solution will save money and provide a better service – surely the benchmark for a smart city application to go from pilot to mass scale roll out.


The business case for smart trash cans – it’s not what you think


Let’s apply the same thinking to trash cans. Everyone thinks that the business case for smart trash cans is to make collection more timely (the container calls out ‘empty me’) and efficient but they’re wrong. The business case for smart trash cans is all about understanding (and improving) the economics of specialist waste disposal operations.


Every waste services contract has specified service levels (SLAs), whether delivered by public service teams or commercially contracted out. Municipalities need to measure contract performance against SLA targets so that contractors can be penalised/rewarded appropriately. But no one right now has the data to do this reconciliation. You can’t enforce penalty clauses if no one knows if the trash cans are emptied or not. And it would be wildly expensive to measure manually. However, simple sensors will provide that data - which trash cans are full, overflowing, emptied on time, emptied late - and enable the city to identify under-performance and claim any financial restitution.


Make it real


In our experience, municipal officers are best placed to know what their city needs and while they will certainly have bold visions for the future, they are also very much aware of their here and now responsibilities to tax-paying local residents and businesses. They’re rightly sceptical of optimistic talk about ‘data-driven cross-departmental efficiencies through big data analytics’ and similar unsubstantiated claims. While such long-term benefits may indeed be part of the business case, city officers need more tangible economic arguments to commit to large-scale investment in smart city technology.


If you work for a city or municipality and you plan to visit Smart Cities Connect later this month, then why not come along prepared with a couple of real-life operational issues to discuss? Because it’s only by prioritising the business case that we’ll be able to halt the endless technology pilots and deliver to our communities the financial and quality of life benefits of full-scale smart city applications. `



Jack Hanley and the team from Telensa will be at Smart Cities Connect in Kansas, booth #409, ready to listen to your smart city ambitions and talk through a business-case approach to delivery at scale.


Jack Hanley is Telensa’s vice president for sales in North America. He has more than 30 years’ experience in sales and marketing management. Jack joined Telensa from PowerSecure (part of Southern Company), where he was Director of Roadway Lighting/ Smart City Solutions. He previously held a senior role with NORESCO (the energy services arm of United Technologies) and has worked in energy service companies, utilities, and government services across North America.


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