A Smart City Is a Collaborative Community: Lessons from Smart Aarhus
Numerous smart-city initiatives have been launched worldwide over the past decade. A “smart” city uses digital technologies to enhance performance and well-being, reduce costs and resource consumption, and engage more effectively and actively with its citizens.1 As yet, there are no flagship examples of a smart city—the most frequently cited examples are cities that are simply trying to become smarter. Nevertheless, one observer estimates that by 2025, there may be as many as 26 smart cities around the world, the majority of which will be located in Europe and North America.2
The pressure for cities to become smarter is coming from all sides.3 Urbanization is increasing around the world at a rapid pace. Currently, about four billion of the world’s population of seven billion live in urban areas, and this number is expected to increase to six billion people by 2050. Cities have become major contributors to climate change due to greenhouse gas emissions. Cities are also the hubs of the global economy. By 2025, the 600 largest cities in the world will account for more than 60% of global gross domestic product (GDP). These hub cities will have to operate intelligently to ensure the smooth flow of goods and services around the world. Moreover, because of the growing economic importance of cities, people are migrating to urban areas in search of opportunities only to find that, in many cases, the quality of life in those areas is declining.
In this study, we analyze Smart Aarhus, the smart-city initiative of Aarhus, Denmark. Among such initiatives worldwide, Smart Aarhus is noteworthy for two reasons. First, Smart Aarhus addresses both technical and social problems. The city of Aarhus is integrating and synchronizing its systems for water, transportation, energy, healthcare, waste removal/recycling, and so on while simultaneously working on ways to improve the quality of life of its inhabitants. Second, Smart Aarhus has been designed according to a collaborative organizational model. Cities can only become smarter by fostering greater collaboration among policymakers, companies, entrepreneurs, and citizens. Smart Aarhus was established as a “collaborative community” within the Danish frame for smart cities as set by the Danish Ministry for Housing, Urban and Rural Affairs.
Europe is home to many of the world’s smart-city projects. This is not just because of the strict requirements that the European Union (EU) has made in regard to carbon reductions (80% by 2050) and sustainable production and consumption, but also because the EU started an innovation partnership in 2012 called the Smart Cities and Communities Initiative to stimulate smart-city projects throughout Europe.
For a number of reasons, Denmark offers a favorable environment for the development and testing of smart-city projects. For example, the country has a long tradition of involving many different stakeholders in its decision and planning processes regarding urban development and environmentalism. That tradition led the country to become the first in the world to pass an environmental protection law (in 1973), and the practice of holistic and inclusive planning continues today. In addition, the Danish political climate supporting green solutions is both ambitious and stable. Denmark’s role as a leader in promoting the green growth economy is recognized internationally, and the country was ranked in the top two of the Global Green Economy Index in 2010, 2011, and 2012. Furthermore, Denmark has a well-developed digital infrastructure. All public organizations in Denmark went paperless in November 2014, including all communications with inhabitants, and the country is second only to the Netherlands in broadband penetration, making it ideal for implementing and testing smart solutions. Such testing has occurred in smart energy grids, communications, telemedicine, e-governance services, and other areas. Last, Denmark has greater access, relatively speaking, to open data and uses them to experiment with new ways of organizing. The general positive attitude toward sharing data is reflected in decision-making processes at the political level, where open data are seen as a useful way of organizing the public sector. Some municipalities have arranged data camps, where public authorities collaborate with private information technology (IT) apps developers to create new IT solutions based on public datasets. Collectively, these economic and cultural factors make Denmark a supportive and nurturing environment for smart-city initiatives.
Aarhus is the second largest city in Denmark, with a population of approximately 320,000. Its smart-city initiative, called Smart Aarhus, can be traced to a meeting in 2010, in which digitally interested managers and directors in Aarhus met with representatives of Aarhus University and the Alexandra Institute, a privately owned, nonprofit company that helps public and private organizations develop innovative IT-based products and services with the aim of creating growth and well-being in Danish society. Facing the same challenges as many other cities in the world—a growing population, limited tax revenues, and high expectations as to what the city should offer its residents—what was clearly needed was an alternative approach in which residents, firms, knowledge institutions, and municipal authorities work together to create a more livable city. The Danish Ministry of Housing, Urban and Rural Affairs defined the smart city as follows:
The smart-city approach demands community planning and co-creation with digitally facilitated micro-dialogue; combinations of citizen-driven, public, and commercial platforms; and governance based on shared ownership of public spaces and assets. Early citizen engagement on a macro-level requires digital tools that support involvement and exchange of information and ideas among all stakeholders.
Accessible data streams require open, licensed data and standards for sharing technical practices across governmental agencies, companies, organizations, and citizens. Real-time decision-making requires harnessing the potential of “big data” through the development of ICT [information and communications technology] systems and algorithms that enable evidence-based management. Shared situational awareness is achieved by combining real-time data with control and coordination mechanisms that link all relevant actors into a unified system.
In a smart city, there must be a focus on welfare technologies and social innovation both of which require alignment of physical space; technical solutions and services; smart procurement; and cross-sector coordination. Furthermore, a smart city needs business innovation based on open data licensed for commercial use; standards-based development roadmaps; partnership facilitation; and a large, diverse, and experienced talent pool.
Smart Aarhus was officially launched on January 24, 2012. The initiative is overseen by a steering committee, including representatives from the local business community, research institutions, and the municipality. On a day-to-day basis, Smart Aarhus is led by a secretariat that has a mandate to find new ways of developing the city, especially ways in which digital solutions are prominent. The Smart Aarhus secretariat works in close partnership with the municipality, Alexandra Institute, Aarhus University, and the Central Denmark Region (one of five administrative units in Denmark with primary responsibility in healthcare) toward the goal of making Aarhus a smarter city.
An important element of Smart Aarhus is its working groups. These groups consist of volunteers who work on challenges related to traffic, health, energy, culture, sustainability, and other areas. All working groups are guided in their efforts by the informal principles of Smart Aarhus: solve or address a societal challenge; strengthen the digital economy and create jobs; challenge the traditional roles of citizens, the public sector, and private enterprise; be open and involve stakeholders; and take risks and experiment by developing pilot projects. A number of valuable outcomes have resulted from the efforts of the working groups, many in the form of new software applications.
Smart Aarhus is open to contributions by all interested parties. If a group or organization initiates a product or service that complies with Smart Aarhus’s principles, the organization can use the Smart Aarhus brand, Made with Aarhus. The Made with Aarhus brand enables groups or organizations to communicate that they use a partnership model, which engages stakeholders, demonstrates a cross-sector approach, and aims to make the city more livable and sustainable.
Over the past few years, Smart Aarhus has accomplished three things in particular that have had a significant impact on the development of Aarhus as a smart city. These are now referred to as the “pillars” of Smart Aarhus’s success, and each continues to grow. One pillar is the open data platform called Open Data Aarhus (www.odaa.dk). Aarhus was the first city in Denmark to create such a platform, and Open Data Aarhus currently has more than 75 datasets. The second pillar is Internet Week Denmark. Launched in April 2014, this festival was intended to make IT solutions more visible to the community. In total, 123 events took place that week, three-quarters of which were crowd-sourced. A typical event was a talk or presentation by an entrepreneur or IT solutions developer demonstrating his or her interests and expertise. A “hackathon” and various workshops were also held. Internet Week Denmark is secured for the next several years. The third pillar, called Aarhus Challenges, involves work on societal challenges faced by the city. For example, this problem-solving approach uses digital means to lower barriers for the elderly to use the Internet. Community challenges are continually being brainstormed and developed.
Go Green with Aarhus
Parallel to the establishment of Smart Aarhus, the Go Green with Aarhus (www.gogreenwithaarhus.dk) portal was launched. The purpose of this portal is to coordinate efforts between the business sector and the environmental and energy sectors. The portal centers on the “green and blue city,” which refers to the themes of energy efficiency and innovative partnerships. The city council’s Technical Services and Environment Department maintains the portal, the content of which was developed by Aarhus Water, Department of Waste and Heating, and several internal and external partners. Many of the components of the energy-efficiency system were developed by Danish businesses, universities, and research/educational centers that are leaders within their fields. For example, the city’s more than 2,000 kilometers of district heating pipes have minimal heat loss, and 53,500 intelligent heat meters are to be installed over the next few years. This efficient heating grid makes it possible to convert to green energy over time. Looking ahead, the phase-in of wind energy into the heating system by 2030 will reduce dependence on biofuels, including the development of new heat reservoirs, heat pumps, and other technologies designed to provide better integration with the electricity grid. The various initiatives will reduce CO2 emissions in Aarhus by 1.2 million tons by 2030.
The Go Green with Aarhus project has more than 60 partners, including many large and small local and international firms. Many of the projects in Go Green with Aarhus are so-called demonstration projects where the municipality and research institutions, together with commercial companies, collaborate to create and implement innovative solutions. For example, because Aarhus is growing rapidly and traffic is steadily increasing, the traffic problem cannot be dealt with only by building and maintaining infrastructure. Aarhus, therefore, is running the Smart Mobility project, which aims to reduce congestion by helping residents change their transport behavior. Operating for the past three years, the project fosters smart mobility measures created in partnership with the people they will impact, ensuring the creation of optimal solutions.
Analysis of Smart Aarhus
Building a smart city presents its designers, managers, and citizens with many technical and social problems to be solved. When the knowledge needed to solve problems is complex, growing, and widely diffused, the ability to collaborate is a must.5 Collaboration is a process of shared decision-making in which all the parties with a stake in the problem constructively explore their differences and develop a joint strategy for action.6 When compared with hierarchical forms of planning and decision-making, collaboration has been shown to reduce risk, speed products to market, decrease the cost of solution development and process improvement, and provide access to new knowledge, technologies, and markets.7 Collaboration can be a springboard for economic development in a city or region, and it can be used to promote greater civic engagement.8
Architecture of Collaboration
New organization designs are emerging that are particularly well suited to the process of collaboration. We call these designs “actor-oriented organizations” and contrast them with traditional command-and-control organizations. Our actor-oriented organizational architecture has three elements: actors, who have the capabilities, incentives, and values to self-organize; commons, where the actors accumulate and share resources; and protocols, processes, and infrastructures that enable multiactor collaboration.9 Taken together, these elements both create and function within organizational contexts consisting of various combinations of transparency, shared values, norms of reciprocity, trust, and altruism10 (see Table 1).
Control and coordination in an actor-oriented organization are accomplished via direct interaction among the actors themselves rather than by hierarchical authority. Infrastructures—systems that connect actors—allow actors to connect with one another as well as access the same information, knowledge, and other resources. Capable actors who have the knowledge, information, tools, and incentives needed to set goals, and who assess the consequences of potential actions for the achievement of those goals, can self-organize. Self-organizing actors use protocols to guide their collaboration. Protocols are codes of conduct used by organizational actors in their exchanges and collaborative activities. An important category of protocols deals with the division of labor—the mobilization and linking of actors for a particular project or task. Examples are protocols by which actors advertise problems or opportunities as well as their own capabilities and availability, as well as protocols by which actors search for potential collaborators. Other protocol categories deal with interactor coordination within the resulting network. Commons refers to resources that are collectively owned and available to the actors. One example of a commons is shared situational awareness—an up-to-date portrait of problems and opportunities in the organization’s environment, as well as the current availability of resources to address those problems and opportunities. Another type of commons is datasets that are available to all actors for their use in developing new solutions. Collectively, the elements of the actor-oriented organizational scheme enable large groups of collaborating actors to self-organize with only minimal use of hierarchical mechanisms.
Many of the actor-oriented organizations we have studied benefit from the presence of a shared services provider.11 For example, in Blade.org, a collaborative community of firms in the computer server industry, shared services are provided by the principal office, a group of people whose time and efforts are donated to Blade.org by its sponsoring firms.12 A shared services provider plays a facilitative role in the community, providing infrastructure and administrative services that serve the community as a whole and developing strategic initiatives that help the community grow and improve. “Facilitating” collaborative activities among community members is different from “coordinating” or “orchestrating” those activities, the leadership role performed by managers in hierarchical organizations. A shared services provider can provide facilitative leadership to a collaborative community in numerous ways: screening and/or selecting members, providing infrastructures and protocols for members to connect and work with one another, developing datasets and other resource commons, providing administrative services, and formulating strategic initiatives to help the community expand and improve (see Figure 1).
Viewing Aarhus as a Collaborative Community
The Smart Aarhus initiative views the city of Aarhus as a collaborative community, as opposed to a series of silos managed by top-down planning. Applying the actor-oriented framework to Smart Aarhus, one can see that the three organizational elements essential to the functioning of a collaborative community are present. The focal actors in Smart Aarhus are citizens, firms, knowledge institutions, and the leaders of key municipal organizations (water, energy, transportation, waste removal/recycling, and healthcare). They are willing to collaborate because they see value in, and have an incentive for, enabling Aarhus to share and leverage its resources and to become more thoughtful and competitive through experimentation and development. The Smart Aarhus model seeks to create a virtuous cycle by incentivizing actors to make contributions and then assessing the consequences of those actions. As a result, the role of citizens is evolving to one in which they co-create the municipal services they receive. By contributing, it becomes easier and more enjoyable to be a resident of the city. Local companies also have an incentive to improve the city, which makes it easier to attract employees, and many initiatives have as a by-product the development of new products and services.
One commons of Aarhus city is the Go Green with Aarhus portal where all the technical projects and partners are listed. Another commons is the Smart Aarhus website and blog, where information about ongoing projects is available to all interested parties. A particularly valuable commons is Open Data Aarhus, the growing collection of datasets whose purpose is to make relevant data and information accessible to citizens and organizations. Open Data Aarhus contains data about everything from traffic flows to health to sports opportunities. This information is potentially valuable because it can be used as raw material for the development of apps. A test version of the data portal was launched in 2012, and refinements are continually taking place. Smart Aarhus is currently working to create standards that make it easy and safe to use the portal’s data. In addition to these commons, other types of commons are being considered for development.
Regarding protocols, processes, and infrastructures, Smart Aarhus describes itself as a “new mind-set developed in order to create sustainable urban innovation and growth.” An articulated mind-set can serve as a protocol to guide actors’ thinking and behavior. The Made with Aarhus brand is another example of a protocol. Made with Aarhus specifies a set of guidelines for appropriate conduct that firms must adhere to in order to be allowed to use the brand. Infrastructures that connect actors at both the individual and systemic levels have been developed within Smart Aarhus. They are primarily enabled by the Internet and have facilitated newly developed apps for traffic control, road repairs, warning services, personal travel maps, and more. In March 2014, the wireless network in Aarhus changed its name from AAKHOTSPOT to Smart Aarhus. The network is now the largest wireless network in Denmark, and every day it is heavily used by the employees, guests, and citizens of Aarhus. The city continues to enlarge the capacity and extend the range of the network. In June 2015, the network began carrying the worldwide educational and research network EDUROAM, and Aarhus was the first Danish city to do so. This will provide new opportunities to any interested party, especially opportunities to create intelligent solutions for the city and to collect and use a variety of data.
Unlike some other smart-city initiatives, Smart Aarhus does not have a hierarchical management system. It has a steering committee that provides overall guidance and a secretariat that handles day-to-day operations, but neither body has formal management authority. Instead, the Smart Aarhus secretariat operates as a principal office and shared services provider. It plays a facilitative role by bringing interested parties together and helping them to collaborate voluntarily. “Interested parties” include the leaders of the municipal organizations that constitute Go Green Aarhus (e.g., water, energy, and transportation). Here is where the collaborative community organizational model of Smart Aarhus blends with the hierarchical model of Go Green Aarhus to achieve technical system integration and efficiency as well as citizen engagement.
Collectively, these actor-oriented organizational elements allow Smart Aarhus actors to collaborate with all relevant stakeholders toward the goal of making Aarhus a smarter, more competitive, and more livable city.