My predictions for 2011

This thing of predicting is difficult, especially when your predictions are situated in the future. However, let’s give it a try :-)

Here are my predictions for 2011 !!!

1.- Facebook will surpass Yahoo and enter China. Yahoo and in general Social Networking sites offer more than search, offer connection with real people, something that we all want and the reason behind its growth. Facebook is not yet established in China. This will be the year when Facebook enters China.

2.- Innovation will become a priority in China. Well, this is not a real prediction, Innovation is one of the two important priorities in the current draft of the next 5 year plan in China. However, for a country that competes on price and productivity, this change towards competing on innovation is a big change.

3.- We’ll see a number of technological advancements and market pitfalls. Among them, batteries will double its capacity and  3D TVs are not going to make it. But probably one of the most interesting ones will be the addition of NFC (Near Field Communications) to the iPhone and other mobile phones, it will allow us to pay (replacing credit cards), open doors (replacing keys), etc... and will make possible different kinds of business models. Apple will probably launch iPhone 5 with NFC on summer and they can move the market (updated on 1/1/11).

4.- Open Innovation will enter the Public Sector. Open Innovation has been confined to the private sector until now, 2011 will be the year for Open Innovation in the Public Sector.

5.- Android phones will break the $50 barrier and will become mainstream. Recently they broke the $100 barrier, 2011 will see how they break the $50 and become mainstream. The iPhone will be close to $100.

6.- Netflix will come finally to Europe and provide a real alternative for consumers to websites that offer movies and series without respecting copyright. It will be a big success.

7.- Open Data as a policy will become mainstream. Governments will begin to think that making websites that nobody sees and maps that nobody uses is not a decent way to use taxpayers money and will endorse massively Open Data and platforms.

To all of you --- HAPPY NEW YEAR 2011 !!!!

Policy Analytics

First of all let me apologize, there is not such a thing as Policy Analytics, at least not yet. However, as I will argue, it will be worth to invent it.

Policies are derived from frameworks that represent our understanding of a field. They cannot exist isolated without this reference.

For example if we understand Innovation in terms of economic growth, our policies will probably focus in the creation of capacities and on providing incentives to the different actors to use these capacities.

If, on the contrary, we understand innovation as the result of complex interactions among many agents, we will be busy trying to ease bottlenecks, optimize flows and maximize capacities.

This small example illustrates an important phenomenon, as our understanding gets more complex, the associated policies get also more complex.

However, in this path that otherwise looks natural, there is an important gap. The indicators that we use are still static and most of the times cannot match the objectives of the new policies derived from theoretical insights.

For the sake of the example, let’s continue with the case of Innovation Policy. In order to ease bottlenecks you have first to detect them and in order to optimize flows you have to be able to measure them … capacities is probably the easy part of the equation.

Why is that happening? There is really no data available? Well, yes and no. Certainly the instruments traditionally used in policy modeling are cannot provide this type of data. Nevertheless, there is a growing trend in the private and public sector to tap into the wealth of data lying in web 2.0 portals.

One good example is computer-savvy traders, also known as quants, according to Aite group, a financial services company, about 35% of quantitative trading companies are exploring whether to use trend and sentiment mining compared to about 2% two years ago (http://www.nytimes.com/2010/12/22/technology/22trading.html?_r=2) .

We can find similar examples in public policy, such as the use of Crowd-Sourcing  by the Obama administration (challenges.gov) or the FCC (broadband.gov) among others.

Closely looking at the different strands we can witness to kind of objectives that nevertheless intermingle one with another. On one side we have the ones that go for Policy co-creation with potentially large constituencies. Here good example are all sorts of Crowdsourcing or Innovation exercises.

On the other we find the development of novel indicators aimed at tapping into the wealth of data available on-line. Here we can find the very active field of trend and sentiment mining.

Therefore, it is clear that there are new opportunities lying ahead, however, what are the problems that could justify this new field or this new understanding?

Basically, as policies get more complex, policy makers have to dealt with two new situations.

We can characterize the first one as the asymmetry of knowledge. In fact, it is very difficult to foresee the impact, the level of adoption or the problems of a certain policy if you are not an insider. Exactly the same in the case of detecting bottlenecks, missuses, insufficient flows or institutional governance problems. Policy makers are at a clear disadvantage when they have to deal with the micro-level, with the detail and implement in concrete terms general frameworks.

Policy co-creation involving large groups of constituencies in exercises like crowd-sourcing could certainly alleviate this problem.

There is however, another kind of information asymmetry that we have to solve. The one of the citizens. They lack the macro data that informs the framework. Here Open Data could have, rendering available to everybody this specialized data.

However, policy design is only half of the problem. Complex policies demand detail monitoring and for that real-time indicators that could tap into the micro-level are needed. Technologies such as trend and sentiment mining also in groups or constituencies can probably help in determining what is not working and needs to be cancelled, what has to be modify and what is working well.

We are in the early beginnings of this understanding. Today there is certainly a gap between the ambitions of our policies and our frameworks and the capacities of our instruments to measure and control them. The good news is that  there are insights on how to close this gap.

Why don’t we name it? Policy Analytics is my proposal for a name. 

Smart Cities – Beyond IT

Last week I was in Ghent attending the Future Internet Conference and the assembly of the ENoLL (European Network of Living Labs). I had a presentation of our project Open Cities and I also was invited to participate in a panel on Smart Cities.

Curiously enough even when the concept of Smart Cities speaks of Innovation, there was little talk about this aspect. Mostly most of the speakers focus on technology.

There is certainly nothing wrong with technology. The application of new technologies is a key ingredient that makes possible to think of Smart Cities. However, nobody that needed to transform a company from competing with productivity alone to compete with innovation will think that the addition of technology will solve by itself the problem.

This, probably naïve vision of the transformative power of technology, seems however to lie behind many of the proposals around Smart Cities, from the “Smart City in a box” solutions of large vendors to Future Internet proposals of advance research groups.

Cities have been through history the locus of invention and innovation. From this melting pot, from this dense network of connections between people and ideas is from where many ideas first and trials later have been transform into innovations that changed the world.

This heavily contrasts with City Management, mostly focus on finding effective, proven ways of providing services to citizens. My guess is that in the last decades, the proven part has been enforced, giving little room to experimentation and hence to innovation.

Can we build the Smart Cities of the XXI century that way?

To the despair of the Smart-City-in-a-box vendors, I think we shouldn’t and let me give you three reasons why.

My first argument is about competition. Cities and their hinterlands have become instruments for competition in the territory. Cities compete by attracting talent, companies, industries or developing specialized clusters. And probably this competition is increasing and becoming more global. There are in fact views out there that portray a future where nations will have an increasingly diminishing role (except the small nations in Europe that can be easily identified with Cities or a federation of cities, such as Denmark, Holland, etc…). Therefore if cities need to compete, buying the standard box, is probably not always a good idea and on the contrary developing unique capabilities and being in the forefront of innovation seems to be the path to follow.

Nevertheless the second argument addresses the nature of the proposed solutions. Everybody that knows a bit the field is pretty aware that Smart Cities is a term in-construction. There is not a precise definition of what it means and there are not proven solutions that can be safely applied. Smart Cities will be in years to come the result of a process of co-creation and evolution between technology, citizens, meanings and business models among other factors.

These days of global knowledge and intense connectivity are also the days of Open Innovation because nobody can think that an internal group of experts has the best ideas or the clue for the most appropriate solutions. This is even truer, more evident when we deal with something that is in-construction.  

Therefore, Smart Cities need to be address taking into consideration not only ideas coming from the expertise in the City Hall but also taking advantage of the large base of knowledge outside the City Hall.

My third argument has to do with the special nature of Public Services. In fact in public services maximizing is not about profits, but about a social function and it is certainly odd that you can do that without taking into account the suggestions, the ideas, the desires and the lives of your citizens. This fact provides a different meaning to Open Innovation mechanisms such as Crowdsourcing, there it is not only a  purpose of getting more and different ideas, but also connecting with the feelings, needs and points of view of your citizens.

Therefore, given this framework, it is clear that technology is not enough. Cities have to deal with Innovation Management, but not only that, they have to deal with a new way of relating and engaging their citizens and their communities.

Certainly the private sector is a place where to look for inspiration on how to manage innovation and how to engage users. However, this cannot be a direct translation, cities have to reinvent new ways of engaging users and managing an innovation process that probably won’t be able to do alone anymore, cities will have to begin to collaborate with … other cities.

-- Open Cities is the name of the EU project that we are coordinating that explores all these issues.