Smart Cities and Regulatory Implications

I once had a cus­tomer tell me that a year­ly release cycle (for com­plex mid­dle­ware) was too quick. It amount­ed to them being in con­stant evaluation/upgrade mode because it would take them a year to test, plan, and then imple­ment each new release (and any req­ui­site changes in appli­ca­tions that an upgrade would demand).

That’s not so unusu­al, though is chang­ing as more and more soft­ware is con­sumed as ser­vice. Inter­est­ing­ly, remem­ber when Apple was at a dis­ad­van­tage to Microsoft in the enter­prise because Apple would­n’t share a five-year roadmap with buy­ers?

Reg­u­la­to­ry deci­sion mak­ing is even slow­er than enter­prise deci­sion mak­ing, and requires even more due dili­gence. In fact, it’s like­ly that the pace of change has “lapped” the pace of due-dili­gence, mean­ing, by the time the “strat­e­gy is in place” it’s already irrepara­bly out of date.

As a result of last week’s announce­ment with CA part­ner Chor­dant I got asked about how the reg­u­la­to­ry envi­ron­ment will impact Smart City progress.

Will reg­u­la­tions make Smart Cities rigid and inflex­i­ble, or will the desire for suc­cess force reg­u­la­to­ry deci­sion-mak­ing to become more agile?

It should be obvi­ous to any­one pay­ing atten­tion that tech is bump­ing up against reg­u­la­to­ry chal­lenges. Sim­ply watch­ing the big play­ers shows the risk – Uber and AirBnB are the most promi­nent exam­ples.

I don’t think any­thing about smart cities them­selves are “excep­tion­able,” mean­ing, we don’t need one off excep­tions to the reg­u­la­tion process. We sim­ply need an agile process. It’s more like that it’s no longer pos­si­ble to ignore the fact that while cur­rent reg­u­la­to­ry lim­i­ta­tions are noble and impor­tant in their own con­text, that the speed at which tech­nol­o­gy moves and the chan­nels through which it dif­fus­es make the cur­rent approach to reg­u­la­tions a real chal­lenge.

It reminds me of past work, where a devel­op­ment team might be agile, but oper­a­tions not… devel­op­ment could release every sprint or two, but to get that release into pro­duc­tion was still a cum­ber­some and time con­sum­ing (and very much non-agile) process. Even­tu­al­ly there had to be a meet­ing of minds to re-eval­u­ate the assump­tions that slowed down oper­a­tions. Those assump­tions were still rel­e­vant but a new approach was need­ed.

Same with smart cities. The ben­e­fits are too com­pelling to not cause us to exam­ine how we approach the need to cap­ture the ben­e­fits of reg­u­la­tions, while bypass­ing cur­rent reg­u­la­to­ry lim­i­ta­tions.

Making regulatory environments agile

I’ve seen a cou­ple of ways to make reg­u­la­to­ry con­sid­er­a­tions more agile.

One is to try to adopt an agile pos­ture, includ­ing min­i­mum viable reg­u­la­tions with rapid updates as new things are learned.

Anoth­er is to cre­ate an unreg­u­lat­ed, exper­i­men­tal, envi­ron­ment so that solu­tion providers togeth­er with gov­ern­ment can under­stand how to reg­u­late new tech­nolo­gies.

Final­ly, just today, I heard of a place where they are inno­vat­ing the pur­chase process for new solu­tions so that small­er inno­v­a­tive providers can com­pete against estab­lished com­pa­nies when sell­ing to gov­ern­ment.

In this lat­ter case, they use soft­ware com­pe­ti­tions (hackathons) that give win­ners the oppor­tu­ni­ty to spend three months inside the gov­ern­ment area that they are pro­vid­ing a solu­tion to – learn­ing even more about the “cus­tomer”. At the end there is a new pur­chas­ing process in place… effec­tive­ly mak­ing the “com­pet­i­tive aspect of the bid” the work done dur­ing the hackathon where the com­pe­ti­tion is about inno­va­tion, rather than much lat­er in the cycle where it becomes about being the low-cost / low-risk provider. Cost and risk are instead man­aged through­out the life­cy­cle of the project rather than as a “gate­way step” just before a deal is signed. I find it com­pelling.

Three ways to approach reg­u­lat­ing #SmartC­i­ty tech­nolo­gies to the ben­e­fit of cit­i­zen expe­ri­ence Click To Tweet

Privacy

One area that I think will con­tin­ue to be much more close­ly reg­u­lat­ed through­out the process though is data pri­va­cy. I believe that the reg­u­la­tions will get tighter, more aggres­sive through­out the process. I like to say that an appli­ca­tion is “bet­ter” when secu­ri­ty is built into the design instead of lay­ered on top (it’s of course hard­er to do it this way). Sim­i­lar­ly, data pri­va­cy is going to have to be some­thing con­sid­ered from the very begin­ning, rather than devel­op­ing a solu­tion and see­ing how pri­va­cy reg­u­la­tions apply. I think we’re see­ing that with GDPR in Europe.

I like the idea of data inform­ing pol­i­cy and then apply­ing pol­i­cy on the fly. I don’t think this con­cept will be uni­form­ly applied though. Some gov­ern­ments will get this, oth­ers prob­a­bly not so much. And, even those that “get it” will have a non-uni­form way of imple­ment­ing an updat­ed reg­u­la­to­ry pos­ture – and some will be suc­cess­ful, oth­ers less so.

Smart cities are inevitable; Consider citizen experience

One final thought. The oppor­tu­ni­ty with Smart Cities is huge. If I had to sum it up, and this is impor­tant because it has to be the guid­ing prin­ci­ple, cities need to piv­ot from think­ing about how to pro­vide access to gov­ern­ment ser­vices (and think­ing about dig­i­tal as a chan­nel) and instead think about how to improve the citizen’s expe­ri­ence. When think­ing about expe­ri­ence, cities will find they need to be able to gath­er data from across silos and bring it togeth­er to cre­ate new out­comes that improve people’s lives. This is why I think it’s such an inter­est­ing space to watch.

Two exam­ples of reg­u­la­to­ry bod­ies will­ing to exper­i­ment in acknowl­edg­ment of the need to be more agile are the FDA and FCC:

1. FDA speeds up tech approvals in a pilot pro­gram designed to get health improve­ments to cus­tomers more quick­ly
2. SEC allows Google (Alpha­bet) to bring emer­gency mobile phone ser­vice to Puer­to Rico

In both cas­es, one can clear­ly see that putting the focus on the cus­tomer makes it obvi­ous that action needs to be tak­en. Cus­tomer expe­ri­ence is a real­ly good lens through which to view the changes that are hap­pen­ing all around us.