2nd International Conference on ICT for Sustainability (ICT4S 2014)

The Smart City from a Public Value Perspective

Ellie Cosgrave Theo Tryfonas Tom Crick

Department of Science, Technology, Faculty of Engineering Department of Computing
Engineering & Public Policy University of Bristol Cardiff Metropolitan University
UCL, UK Bristol, UK Cardiff, UK
Email: e.cosgrave@ucl.ac.uk Email: theo.tryfonas@bristol.ac.uk Email: tcrick@cardiffmet.ac.uk

Abstract—This paper explores whether it is useful to view interviews with several leading smart city experts. The purpose
the fundamental ideas behind the smart city concept through of this data collection was to focus on the core themes in the
the lens of the ‘Public Value Management’ (PVM) paradigm. smart city theory, the espoused value, and the implications and
It investigates how appropriate ICT investment in cities might challenges for city leadership in the interpretation and delivery
be articulated and valued through the concept of PVM. In of this value.
order to achieve this, it explores the core concepts found in
the PVM literature, and draws key connections to the smart This paper is part of a wider action research project that
city literature. This data is supported through semi-structured investigates the steps that city leaders can take in order to
interviews with smart city experts. The aim is to understand the maximise the social, environmental and economic benefits
potential value of smart city concepts beyond simple optimisation
of ICT in their municipalities. This is achieved through
of city processes and cost cutting. This paper concludes that
there are conceptual connections between the PVM paradigm working closely with city leadership, as well as economists,
and the smart city. It argues that the types of projects adopted, technologists and service providers. Increasingly, there is a
and their success, are inseparable from the political paradigm strong theme of sustainability: the role and impact of the
within which they are undertaken. As such, it takes the view transformational power of ICT for making our world more
that adopting the PVM paradigm could support the successful sustainable.
delivery of smart cities, predominantly through the ability to
understand value beyond the optimisation of systems.
C. Context
Index Terms—Smart Cities, Public Value Management, We live in a world transformed by technology, a trend star-
Leadership, Information Marketplaces, Sustainability
ted in the industrial revolution that will extend long beyond our
lifetimes. However, over the last 10 years or so there has been
I. I NTRODUCTION a significant shift in the nature of this development. Recent
A. Aims advancements in information & communications technology
(ICT) have seen the scale and role of data and information
This paper explores whether it is useful to view the in every aspect of modern life expand almost exponentially.
fundamental ideas behind the smart city concept through the This information is transforming how we live our lives through
lens of the ‘Public Value Management’ (PVM) paradigm. It better informed decision making that is both conscious to
investigates how appropriate ICT investment in cities might us and invisible to us (via automation/sensors e.g. in smart
be articulated and valued through the concept of PVM. In grids). This transformation has driven increased speculation
order to achieve this, it explores the core concepts found in the and research into the implications of ICT on the way a city
PVM literature, and draws key connections to the smart city functions and operates [1] – a dialogue that has largely been
literature. The aim is to understand the potential value of smart captured in the smart city debate.
city concepts beyond simple optimisation of city processes and
cost cutting. The transformation to ‘smart’ is manifest not only in the
operational efficiency and optimisation heralded by ubiquitous
This paper aims to draw tangible links between contem- sensors and actuators, but it has also already altered global
porary public management concepts and ICT innovation. It is supply chains, business models, and the way communities and
intended that this will support city leaders in identifying areas individuals choose to live their lives [2]. Cities compete with
of value from ICT investment that cannot be uncovered by each other to attract private finance and investment within
more traditional business case analysis. a national and global ‘system of cities’. For example, the
UK Government’s Foresight project The Future of Cities 1
B. Methodology (launched in 2013), will take a long-term look at how UK
cities can best contribute to economic growth over the coming
This paper uses the PVM paradigm as an interpretation decade, taking into consideration wellbeing, equity and social
instrument to delineate useful links between the often quite inclusion, all vitally important for cities and their citizens.
abstract concepts discussed in the smart city literature, and New ICT (such as smart phones, broadband, 3G), has driven a
the realities of local government delivery. This interpretiv- fundamental change in the way we work (networking through
ist research paradigm is supported by an action research
and grounded theory approach. A literature review has been 1 http://www.bis.gov.uk/foresight/our-work/projects/current-projects/future-
undertaken, which is supported by in-depth semi-structured of-cities

© 2014. The authors - Published by Atlantis Press 369

social media, distance working), how we shop (online, price Effective, appropriate and insightful dialogue is re-
comparison), interact with family and friends (Skype, social quired between city leaders, smart city experts, and
media), and our expectations of government (311, open data). the wider community if the complex problems faced
ICT has also been at the forefront of a new era of activism and by cities today are to be resolved. No single party
community unity. “In the Arab Spring, social media facilitated holds the full set of tools to make informed, ap-
action in the Middle East and North Africa (MENA) region, propriate and innovative decisions that can address
providing a free and accessible method of organising and our contemporary local and global issues...I see a
coordinating demonstrations” [3]. This was echoed in the 2011 great opportunity for cities to use smart city ideas
London riots, and the subsequent clean-up operation. to transform themselves into thriving, healthy and
happy places that are globally competitive. But it
Private sector technology companies like Facebook, will require sensitive and informed dialogue that can
Amazon and Google have capitalised on this opportunity by be translated into action. [10]
using information to provide value to their customers. These
companies utilise information as a core asset, and leverage it
to create products and services that respond to user desires II. P UBLIC VALUE M ANAGEMENT PARADIGM
and expectations. As highlighted in the report “Information
Marketplaces: The New Economics of Cities” the current The concept of Public Value Management (PVM) has
‘information marketplace’ in cities already creates value for grown out of and developed upon the New Public Management
citizens and contributes to its sustainability [4]. Innovative (NPM) paradigm. “Much of the NPM literature is clear about
information-based products and services create jobs and sup- the deficiencies yet NPM has remained the dominant policy
port citizens in navigating and using the city in effective, model in the public sector for over 20 years” [11]. NPM
resource efficient and enjoyable ways, as well as enabling sus- broadly asserts that market forces can be leveraged to deliver
tainable development [5], [6]. In fact, the ‘Smart 2020’ report, more cost effective and efficient services to citizens, and
written as part of The Climate Group’s ‘Clean Revolution’ focuses on the utilisation of metrics and monitoring to evaluate
campaign, found that ICT-enabled interventions could deliver success.
“7.8 GtCO2 e of emissions savings in 2020. This represents
15% of emissions in 2020 based on BAU estimation” [7]. Hefetz and Warner argue however, “the social values in-
herent in public services may not be adequately addressed
However, city leaders are struggling to identify the true by the economic efficiency calculus of markets” [12]. In
sources of value that novel ICT can generate for their mu- response to this, PVM takes a more pragmatic approach to
nicipalities. They are finding it difficult to transform the the delivery of public services and “presents the achievement
higher-level concepts evident in the smart city literature into of public value as its core objective” [13]. It seeks to take into
actionable and effective policies, projects and programs that account a wider variety of factors when deciding when and
deliver measureable value to the citizenry [8]. This is in part how to deliver services, incorporating concepts beyond simple
due to the nature of the city itself, which is “an enormously cost cutting. “Public Value has been described as a multi-
complex and open-ended system, with many intertwining force dimensional construct – a reflection of collectively expressed,
fields influencing its form simultaneously” [9]. politically mediated preferences consumed by the citizenry-
created not just through ‘outcomes’ but also through processes
There is also a fundamental misunderstanding of the nature
which may generate trust or fairness” [14].
of the change that is occurring. ICT can be used to increase
the operational efficiency of a city through applications such Horner and Hazel define Public Value as the correlate
as traffic management systems or the implementation of smart of private value or shareholder return: “The value may be
grid. However, more than that, ICT is essential in creating a calculated through economic prosperity, social cohesion or
novel and dynamic marketplace that can provide real long term cultural development. Ultimately, the value – such as better
value to the citizenry, both through the services it provides services, enhanced trust or social capital, or social problems
and the continued economic development that it facilitates. diminished or avoided – is determined by the citizen” [15].
City leaders can use this concept to better understand how to This is a distinct step away from the Net Present Value (NPV)
engage with ICT, and the smart city to enable them to deliver approach, which attempts to gauge success through the analysis
real value to the modern public. This is a priority theme for of measures and metrics.
the Future Cities Catapult 2 , a global centre of excellence on
urban innovation, launched by the UK’s Technology Strategy “Public Value Management does offer a new paradigm and
Board in 2013. a different narrative of reform. Its strength lies in its redefin-
itions of how to meet challenges of efficiency, accountability,
Identifying the specific role of new ICT in such a complex and equity and in its ability to point to a motivational force
system requires a really fundamental understanding of the that does not rely on rules or incentives to drive public service
specific city context, as well as a firm grasp of the vast array reform” [13].
of roles for ICT in delivering value to the city. Unfortunately,
these two core requirements are rarely found in the same place, “The ‘Public Value’ approach has fast become an estab-
and necessitate effective cross-sector engagement, dialogue lished (if as yet minority) approach to assessing the success
and action. Volker Buscher, Director of Smart Cities at Arup (or otherwise) of public services and organisations in the UK,
explains: Australia and some other countries” [16]. It represents an
approach that appears to be feasible and realisable, and is
2 https://futurecities.catapult.org.uk therefore appropriate for a more detailed investigation.

370
A. Core Themes considerations)” [19]. However, “city leaders must take care to
ensure that the ability of ICT to outsource city services does
The PVM paradigm relies on the public sector gaining not dictate the political direction, but that instead, investment
a legitimate mandate for action, which is considered to be in ICT is derived from a sound articulation of political, social
the only justification for government action. Gaining this and cultural values” [20].
legitimacy requires a combination of:
The PVM paradigm calls for leadership to consider the
• Performing efficiently; role that they should play in delivering public value in order
• Being accountable; to achieve policy goals. While the PVM approach may lead
to the adoption of a similar project or program (i.e. a service-
• Being responsive to public needs; oriented approach to delivery), the conceptual leap is important
• And gaining trust. as it releases opportunities for the creation of value beyond
the traditional service approach. In this way, “the public value
Of course, these parameters are interrelated, but a focus paradigm demands a commitment to goals that are more
on each of these is required by the PVM paradigm if public stretching for public managers than those envisaged under
sector actors are to gain and maintain a mandate for action. previous management regimes” [13]. Furthermore, Kearns
argues that “[Public Value] can be used both as an aid to
This legitimacy provides an opportunity for public man- judgment by governments when deciding what activities to
agers to stretch their traditional politically-driven mandate for undertake as a yardstick against which to access government
action, and align actions more closely with genuine public performance” [21]. In this way, the PVM paradigm is reflexive,
needs. “The Public Value approach suggests that actually pub- and can be used to both define and gauge the success of
lic managers need not be so passive – that they can supplement government investment.
and enhance the link between citizen and delivery within the
context of continued accountability to the political principle
C. Being Accountable
and awareness of the wider authorising environment” [17].
In order to achieve legitimacy, the public sector must
B. Performing Efficiently show itself to be transparent and accountable. “Public value
argues that public services are distinctive because they are
Although cost cutting is not the primary focus of PVM, characterised by claims of rights by citizens to services that
the efficient and appropriate use of resources is an imperative have been authorised and funded through some democratic
for ensuring legitimacy in public sector actions. This means process” [22]. This democratically appointed authority means
that city leaders must seek to increase the efficiency of that public sector decision makers are accountable to the
their operations and services, as well as ensuring that new public.
projects invested in represent the best value in the longer
term. This includes the requirement to consider the through-life The political move towards accountability and openness
implications of projects and programs including the end-of-life has accelerated in recent years. “In his first day in office,
transferability and adaptability of the scheme as highlighted in President Barack Obama issued the open government directive
cradle-to-cradle thinking [18]. committing his government to the three principles of trans-
parency, participation and collaboration as the cornerstone of
Furthermore, the PVM paradigm challenges leaders to an open data government” [11]. January 2010 saw the official
think more deeply about the services they choose to provide to launch of data.gov.uk 3 (“Opening up Government”), releasing
their citizens. As Stoker argues, simply “providing services is public data to help people understand how government works
no longer a sufficient justification for state intervention funded and how policies are made. Similarly, the 2010 UK Conservat-
by citizens, whether those services are provided directly or ive Party manifesto claimed that the party intended to “make
commissioned” [13]. Instead, city leaders must evaluate their government more transparent” [23].
role in delivering the value that those services traditionally
represented. For example, the city might have a responsibility This move to transparency and accountability as the found-
to ensure that their citizens are educated. In the past, this ation for public sector action has been partly in response
has been interpreted as a mandate to run schools, and other to a general push for a more open approach to governance,
education services. The PVM paradigm calls for cities to particularly around the topic of open data. This has been com-
consider how best to deliver education in a city, rather than pounded by increasing media scrutiny of government in recent
how best to run education services. It focuses on value creation years, particularly through social media. In this way, “The
rather than service delivery. This frees up city leaders to be same technological advances which have opened informatory
more creative and responsive to local needs. access and accountability of public services also can cause
intense pressure on public managers for managing demand
Importantly this does not dictate a particular political path and expectations” [17]. Moreover, “because of rising expect-
or tendency. Baptista argues that the opportunities created by ations, technological advances and 24-hour media scrutiny
the smart city “may lead us to a more fundamental choice the exchanges between politicians, managers and the public
between a privatised government (in which most issues are are of greater intensity and any confusion in roles become
dealt with according to commercial relationships and prin- politically salient and can feed into a loss of public confidence
ciples, with services paid for by clients) and traditional, public about the stewardship of both manager and politician” [17]. To
government (in which many services considered to be of public combat this, the public sector has had to respond creatively to
interest are provided to citizens and businesses according to
a variety of criteria not necessarily linked to commercial 3 http://data.gov.uk/

371
how it engages with and incorporates public values into their generators of ideas, services and solutions, rather than passive
decision-making processes. recipients of them” [25].
A clear example of the evolution of this information
D. Being Responsive to Public Needs marketplace is the website Openly Local 4 , which scrapes
data from various local government sources, and brings it
The PVM paradigm acknowledges that public leaders are together in one accessible place, in order to create an “open
operating in a complex and evolving environment. In this and unified way of accessing Local Government information”.
light it argues that leaders must adopt a dynamic approach This information can then be used for a variety of purposes,
to stakeholder engagement and longer-term decision making, including the development of innovative products and services
being responsive in the light of complexity. This is not to say for citizens.
that governments should not plan ahead and lay down concrete
strategies, but that the strategies that they do employ must While city leaders and local authorities are key stakeholders
take into account that the context that the strategy is enacted in this system, they can by no means directly conduct and
in will change over time. An understanding of this must be control this marketplace. However, they have a responsibility
incorporated into the strategy in order to make it more robust to determine what their role might be in fostering a healthy
in the longer term. “The adoption of a public value approach marketplace that can support the delivery of their objectives.
to public services needs to take account of both empirical This involves investigating how they should invest, at what
complexities in the delivery landscape and in how the rules of time and for what purpose.
engagement between politicians and managers are interpreted
In that light, it is helpful for governments to adopt an
and enacted” [17].
understanding of smart cities that lies beyond the optimisation
Here, the relationship internally within local authorities is of city services. Working with the Smart Cities team at Arup
key, but there is also a clear need for genuine dialogue with over the past two years, this research has explored the concept
citizens. This dialogue must be carried out in a way that reflects of the smart city through a variety of meetings, workshops
the diversity of citizen needs, values and aspirations in an and practical applications. Through this engagement, three core
appropriate way. It must also ensure that dialogue is set up interrelated categories of smart city value have emerged [4],
in a way that enables it to be incorporated into government [26]. These are broadly:
planning and policy. This means that it must be timely, specific
and seek genuine insight. • Optimisation;
• Service Innovation;
E. Gaining Trust • Information Marketplace.
All claims to legitimate action are founded on an un- Each category represents a different tier of conceptual in-
derlying trust between core actors. This is achieved through tegration of themes and ideas. While ‘optimisation’ looks quite
processes such as being responsive, accountable, and efficient, specifically at the operational efficiency of a given system, the
but also requires effective communication. A report from the development of an ‘information marketplace’ integrates many
Work Foundation on measuring Public Value, puts trust and system externalities, and deals with a wider variety of themes.
legitimacy at the center of their model. It claims “trust and
legitimacy is placed at the top of this list deliberately, in A. Optimisation
line with the Public Value approach, because without it none
of the other (aspects of public value) are possible” [16]. Many people and organisations have pushed the idea that
Likewise, in this paper, we argue that the development of trust the smart city, revolved around ubiquitous sensing and actu-
in government and governance decisions is an imperative for ation, can deliver optimisation of city services. For example,
successful public sector leadership. a Forrester report describes the smart city as “A city that uses
information and communications technologies to make the
critical infrastructure components and services of a citymore
III. T HE C ORE P RINCIPLES OF S MART C ITIES aware, interactive, and efficient” [27]. There is a significant
The concept of the smart city has gained traction in focus on the use of ICT improve the operational efficiency,
recent years and although it has been coined for a variety of or in reducing provisioning costs of core city services. This
purposes, it broadly refers to a city that is using new ICTs is exemplified by smart grid projects. Here, information is
innovatively and strategically to achieve their aims. This should collected in real time about the energy usage at different areas
not necessarily be interpreted as top-down vision delivered of the grid. This information is then used to optimise the flows
solely through government investment. Quite the opposite, the in the system. Some smart grids have actuation functionality
smart city is largely an organic ‘system of systems’ [24] which that enables them to balance the load on the grid – thereby
comprises an ecosystem of products, services, companies, reducing peak requirements.
people and society that are working together creatively to foster The word ‘optimisation’ has been tangled up in significant
innovation within the city. “Smart cities cannot be defined debate when referring to engineered systems; the move towards
by one application, or central organising body, that sets pre- a ‘fully optimised’ approach to systems has led to the increased
programmed limits. They will be defined by individual citizens, vulnerability of systems by the tendency to engineer-out re-
who are anxious to collaborate with each other...to create dundancy. This can lead to single point of failure systems that
devices and applications that solve specific problems. Smart
cities will be places that foster creativity, where citizens are 4 http://openlylocal.com/

372
are not resilient to change, and cannot cope with unexpected open up new value chains that spawn innovative applications
events. and information products that make possible sustainable modes
of city living and working” [4]. This concept is at the centre of
In this paper, we to refer to optimisation in the sense
fostering the information marketplace. Chris Namih explains:
of making improvements to a system in such a way that is
most suited to the delivery of its purpose. This does require For me an information marketplace... creates an
a focus on resource efficiency, but also incorporates process ecosystem where third parties can deliver services
improvement, and building up resilience to unexpected events or certain aspects of them, or entirely new services
through access to more granular information about the real- by being enabled by information. [28]
time state of the system. In this way, optimisation should be
understood in terms of improving the quality of the services Thus, fostering this ecosystem of benefits supports a city
provided, at lower resource cost, and with increased resilience in becoming more competitive, as well as achieving their core
to failure. high level objectives.
City service optimisation is an internally focused area for These buckets arent just technology-focused. You
cities, where they investigate ways in which their internal can optimise through process change or business
processes and functioning can be achieved more effectively. organisation change, and you can do the same in
Chris Namih, Consultant (Smart Cities) at Arup, explains that: service innovation. Technology is often involved, and
technology can lead to these changes, but it is not
Optimisation is internal within the provision of ser- the only factor. [28]
vices as they stand. [28]
This means that the smart city concept is concerned with
B. Service Innovation more than just the implementation of technology. It is also
concerned with the ecosystem that can be built up around
The concept of service innovation in smart cities includes that technology in order to create positive social, economic,
the development of novel ways of delivering service outcomes environmental and political outcomes. This requires both top-
in the city. This goes beyond optimisation, offering a paradigm down engagement through hard infrastructure investment and
shift in the way that services are delivered, rather than im- visioning, as well as a bottom-up energy to capitalise upon
proving (or ‘optimising’) within a given way of doing things. and drive innovation in ICT and service provision.
It offers new and more innovative ways of delivering services
within the city. The multiple layers of the smart city story means that,
while governments do have a significant role to play in the
A service innovation will have an implication for the creation of smart cities (particularly through the optimisation
way in which a user behaves, or experiences the city. An of city services) there are a vast number of stakeholders that
example of this might be the move to a smart ticketing system lie outside the bounds of local government. This is particularly
for public transport within the city. Transport for London’s relevant to the creation of information marketplaces within the
Oyster card system 5 resulted in a transformation in the way city. As such, city leaders need to understand how to engage
people interacted with public transport in several ways. Chiefly, with this evolving information community, and understand
flexible charging allowed people to roam more freely around their needs in relation to economic and social drivers, as well
the city, particularly in going beyond the zone for which as investing in the existing marketplace within their city.
they had bought a travel card. It also increased efficiency of
bus systems by significantly speeding up the boarding time
IV. T HE PUBLIC VALUE LENS : THE RELATIONSHIP TO
required.
SMART CITIES
The Oyster card data has also provided significant insight
Achieving city objectives through smart city projects re-
into user behaviour [29], which has been useful for research,
quires political and civil engagement. Léan Doody, Smart
and system optimisation. The opportunities for this detailed
Cities Associate at Arup, explains that effective action requires:
dataset have not yet been fully realised, but it is recognised
that, if used innovatively, it can be used to both optimise A certain leadership in the council to look at the role
the system and contribute to the information marketplace as of IT information in achieving top level goals. [30]
described below.
This does not exclude the importance of the bottom-up
C. Information Marketplace creation of smart cities, but demonstrates that the types of
projects that a city engages/invests in, and their effectiveness,
The concept of the information marketplace argues that are inextricably linked to the prevailing political and cultural
there is a wider economy developing around the smart city paradigm.
that is outside the boundaries of the local council. This mar-
ketplace relies on information as a core asset to drive economic Two-thirds of UK government ICT projects fail [31], partly
development and other social and environmental aims. So, due to the fact that “city administrators often fail to acknow-
in the case of transport, innovative companies or individuals ledge projects as being complex or strategic and neglect many
could use anonymised oyster card data to create novel products ‘softer’ issues that are essential for a project to succeed” [4].
and services. The Information marketplaces report argues, “By This high failure rate has also been due to ICT providers under
unlocking technology, infrastructure and public data, cities can bidding in a competitive tendering process in order to win
work, leading to under-resourced and under-supported projects.
5 http://www.tfl.gov.uk/tickets/14836.aspx Measures have been put in place, for example the creation of

373
the Major Projects Authority 6 , to improve project performance how to foster public value in the wider city ecosystem.
for the taxpayer, as well as the creation of the Government This might be through investment in the technology sector,
Digital Service 7 in 2010 to implement the UK Government fostering innovation through funded competitions (e.g. the
Digital Strategy [32]. However, projects have failed as a result Apps for Democracy 8 competition in Washington, which
of being largely driven by the creation of ‘political capital’ “yielded 47 web, iPhone and Facebook apps in 30 days –
for the presiding politician, which may not have a rigorous a $2,300,000 value to the city at a cost of $50,000”, which
founding in the realities of successful project delivery. was given to the developer of the winning app as a prize) or
running appropriate events and symposiums. This represents
ICT projects in cities cannot be seen as distinct from their
a clear progression from the direct approach of delivering
political, social, or economic context, and therefore must be
value exclusively through public sector service provision, to an
analyzed as part of that system. This section seeks to identify
understanding that value can also be derived through fostering
how the political paradigm adopted in a city relates to the
positive externalities.
success of a smart cities program, with a particular focus on
PVM. As Chris Namih explains:
Figure 1 maps the core themes discussed in the PVM In understanding the information marketplace, quite
literature to the three ‘buckets’ derived in the smart cities often it is the mind-set that needs to be re-jigged. [28]
section. Conceptualising the problem in this way highlights
a two-way relationship between PVM and smart cities. In one The PVM approach supports this shift in focus by arguing
sense, new ICTs are pushing the need for governments to for a more holistic approach to value creation in the city that
adopt a PVM approach because of increased media scrutiny does not focus solely on the delivery of services. In this way,
and increased skepticism from the public. In another sense, an adoption of the PVM approach may support leaders in
adopting a PVM approach could help city leaders to understand capitalising on the information marketplace.
the potential value of smart cities more comprehensively and
holistically. B. Being Accountable
The PVM paradigm argues that in order to gain legitimacy,
public leaders must be accountable to the public. In reality
however, while governments and political leaders are often
held accountable for certain services, they have in some cases,
given over the responsibility for delivery over to third parties.
This has restricted their ability to impact upon, or change the
way in which those services are delivered. If governments
are to have more control over the public services that they
are accountable for, they must think creatively about how
to engage with responsible parties. ICT may have a role to
play here in fostering better communications, or joining-up
infrastructure projects so that there is greater interrelationship.
The concept of accountability also assumes that there is an
object or body to whom a party is accountable. In the case of
Figure 1. Relationship between the smart city and the public value cities, this body is the citizenry. If genuine accountability is
management paradigm to be demonstrated then city leaders need to foster effective
communication with citizens, in a way that enables citizens
A. Performing Efficiently to challenge and appreciate the ways in which city leaders
are accountable for their actions. As such, accountability
As previously discussed, the PVM paradigm espouses that for public spending may require a more open approach to
efficient and appropriate use of resources is a central tenet governance. This may be in the form of opening up city
in public sector legitimacy. There are multiple examples that dataset to the public, which would in turn contribute to the
highlight smart cities contributing to resource efficiency in information marketplace. This demonstration of accountability
city service delivery (e.g. the Águas de Cascais roll-out of is also heavily linked to the fostering of trust as discussed in
‘TaKaDu’ which is a “web-based service that allows the Section IV-D.
water utility to detect leakage and network problems as they
occur” [33]). C. Being Responsive to Public Needs
The obvious link here is in the ‘optimisation’ category A key part of the PVM paradigm is a responsive and
of smart city projects. These optimise city systems in order reflexive approach to the needs of the citizenry. Effective public
to reduce resource consumption and deliver better services. dialogue that can be fed into investment decisions is essential
However, because the PVM paradigm calls governments to in achieving this. Léan Doody, explains that one of the key
reassess how they provide value in the city, a distinct crossover principles of smart cities is:
with the information marketplace emerges. In the creation of
the information marketplace, city leaders need to understand About making sure the flow of information is not just
one way, so its about getting informed commentary
6 https://www.gov.uk/government/groups/major-projects-authority
7 https://gds.blog.gov.uk/about/ 8 http://www.appsfordemocracy.org/

374
 and ideas back from the public...Technology plat- There are important lessons for any organisation that is
forms potentially have a huge role in enabling people in control of significant amounts of public data, especially
to communicate directly. This opens up government in public organisations that are directly accountable to the
at different levels, so it’s a kind of flattening of the public. Holders and users of public data open up channels
organisation and they way that people are able to for the development of mistrust between themselves and the
communicate directly with maybe more junior people public, which can severely damage long term relationships,
who actually have a voice now through Twitter or and consequently the effectiveness of public service provision.
seem to be a bit more happy to engage. [30]
In order to combat this, city leaders must demonstrate trust-
Importantly, this interaction and understanding of citizen worthiness by becoming custodians of public data, utilising it
needs must be translated into appropriate action and in- only when they can demonstrate a tangible link to the delivery
vestment. In Los Angeles, transport planners are using web of public value. This is a complex task that requires further
platforms strategically in order to engage with the public to investigation.
inform their planning process. Part of this includes a ‘virtual
town hall’ where subjects are opened up for discussion over V. C ONCLUSION
several days; this is accompanied by face-to-face workshops.
The diversity of consultation approaches means that the city This paper has highlighted that there are conceptual con-
is able to capture a wider variety of citizens needs than would nections between the PVM paradigm and the concept of the
have been previously possible. Importantly, the planners have smart city. It argues that the types of projects adopted, and their
a structured plan to feed back findings to inform planning success, are inseparable from the political paradigm within
decisions at the appropriate time in the process [34]. which they are undertaken. As such, it takes the view that
adopting the PVM paradigm could support the successful
delivery of smart cities, predominantly through the ability to
D. Gaining Trust understand value beyond optimization of systems.
New ICT is also driving city leaders to a more open and The PVM paradigm encourages governments to concep-
transparent approach. Increased media coverage has become so tualise their actions from a new perspective, requiring them
ubiquitous through the rise of Web 2.0 and social media that to place the creation of public value at the center of their
governments are under unprecedented levels of scrutiny. This focus, rather than the provision of efficient services. This subtle
has driven the political transparency agenda, firstly in the US, shift in focus actually requires a profound leap in the way
and now increasingly in Europe and elsewhere. Furthermore, in which decisions are made, and that value from projects
now that the technology is at a level where it really can be can be analysed. The PVM approach offers a key for city
used to aggregate huge levels of personal data about citizens leaders to understand the value of smart city projects, and
and their behaviour, cities that do not take an open approach importantly provides a political legitimacy for investment in
may be accused of operating ‘big brother’ type states. Léan it. This is especially important when city leaders are trying to
Doody explains that ubiquitous ICT and smart technologies: justify investment in the information marketplace. Here, certain
values need to be incorporated that are not measureable in the
Would also allow a horrible dystopian view of the traditional sense – that do not sit neatly alongside traditional
future- look at how technology is being used in more metrics, but that require investment nonetheless.
repressive regimes. [30]
If government is able to understand itself as a body that is
Citizens and organisations will start to question leaders that dealing with complexity, trying to be responsive to needs and
chose to cut themselves and their operations off from public think in the long term, and not necessarily metric oriented, it
dialogue, especially now that there are widespread technology can get more out of smart cities. This is because it is able to
platforms that make engagement so much easier. The PVM articulate value that lies beyond optimization and bottom line
paradigm’s emphasis on being accountable to citizens and efficiencies. So, if city leaders are able to look at ICT through
gaining trust, is clearly going to play an important part in a public value lens, it helps them to understand the value of
managing the relationship between citizens and public and ICT projects and smart cities. From this viewpoint city leaders
political leaders, whether or not they have a desire to engage can come to make better decisions, based on a more coherent
with the transparency and open data movement. understanding of the role of technology in achieving their core
Citizens can become quite sensitised to perceived privacy aims.
violations with respect to their personal data. This has been This paper identifies a two-way relationship between PVM
exemplified by Google’s change in privacy policy which en- and smart city delivery. Firstly, new ICT (or smart city con-
abled them to “cross-pollinate personal user data recorded on cepts) pushes the need for governments to adopt the PVM
any of its 60 products” [35]. This incited a severe reaction paradigm through:
from the international community: “Lawmakers, privacy au-
thorities, technical experts, and privacy organizations around • Requirement for transparency;
the world (released) public statements and direct letters to
• Increased scrutiny from social media.
Google representatives that (were) critical of the new policy.
Advocacy groups criticise(d) and condemn(ed) the changes, Equally, smart city concepts also support the delivery of
and the European Union, Japanese, and Canadian privacy public value through:
authorities have released statements indicating that the new
policy may violate their domestic privacy laws” [36]. • Data provision (and open data);

375
 • Effective communication; in terms of management processes and organisational structure.
Given the new understanding of the role of technology, how
• Supporting dynamic governance and ability to respond might they now evaluate technology investment projects in the
to citizen needs; future? Does it have an implication for the metrics they are
• Dealing with complexity; able to employ? What limitations and drawbacks might they
still face?
• Fostering creativity.
The new perspective offered by PVM enables local govern- ACKNOWLEDGMENT
ment to understand the value of smart city beyond efficiency
gains that can be achieved through optimisation. This paper Part of this work has been supported by Arup and the
argues that applying the traditional NPM approach to smart University of Bristol’s Industrial Doctorate Centre in Systems
cities restricts a citys ability to invest in ways that deliver the (EPSRC Grant EP/G037353/1). The first two authors would
greatest value to the citizenry. This is especially relevant for also like to thank Volker Buscher and Professor John Davis
value that cannot always be measured through standardized for their support in preparing earlier versions of this paper.
metrics and measures, or through bottom-line cost cutting. For
adequate smart city investment, city leaders must be able to
grapple with the real-life complexity of their challenge. They R EFERENCES
must understand that the problems they face are multifaceted, [1] N. Odendaal, “Information and communication technology and local
interrelated and dynamic. This necessitates the genuine public governance: understanding the difference between cities in developed
engagement, effective internal communication and collabora- and emerging economies,” Computers, Environment and Urban Systems,
tion, and responsiveness as represented in the PVM approach. vol. 27, no. 6, pp. 585–607, 2003.
[2] N. Komninos, Intelligent Cities: Innovation, Knowledge Systems and
This paper argues that taking a public value management Digital Spaces. Routledge, 2002.
approach can support cities in understanding the value of ICT [3] P. Bright, “How the london riots showed us two sides of
investment, as well as increasing the likelihood of success of social networking,” August 2011, http://arstechnica.com/tech-
smart city interventions. However, it does not claim that adopt- policy/news/2011/08/the-two-sides-of-social-networking-on-display-
ing the PVM paradigm is a requirement for smart city delivery, in-the-london-riots.ars (accessed 2014-02-12).
or that is holds exclusivity over smart city implementation. [4] Arup, The Climate Group, Accenture and Horizon, University of Not-
tingham, “Information Marketplaces: The New Economics of Cities,”,
There may well be other management paradigms that support November 2011.
the delivery of smart city concepts. As Léan Doody explains: [5] W. Wagener, “Connected and Sustainable ICT Infrastructure,” Connec-
ted Urban Development, 2008.
I think the point about technology is that it is
[6] N. Villa and S. Mitchell, “Connecting Cities: Achieving Sustainability
about your intentions more than the technology, the Through Innovation,” Cisco, October 2010.
technology will allow lots of different outcomes. [30]
[7] The Climate Group, “SMART 2020: Enabling the low carbon economy
in the information age,” 2008, Global eSustainability Initiative (GeSI).
Equally, we do not intended to claim that the adoption of
[8] R. G. Hollands, “Will the real smart city please stand up? intelligent,
PVM will necessarily deliver valuable smart city interventions. progressive or entrepreneurial?” City, vol. 12, no. 3, pp. 303–320, 2008.
This paper merely means to highlight the potential value in
[9] A. Sevtsuk and J. Beinart, “The effects of ICT on City Form,” MIT
viewing the delivery of smart cities through a public value School of Architecture and Planning, 2005.
lens. [10] V. Buscher, April 2012, Interview.
[11] E. Coleman, “From New Public Management to Open Governance: A
VI. F UTURE WORK New Future or The More Things Change the More They Stay The
Same?” Master’s thesis, University of Warwick, UK, 2011.
This paper is part of a wider action research project that [12] A. Hefetz and M. Warner, “Privatization and Its Reverse: Explaining the
investigates the steps that city leaders can take in order to Dynamics of the Government Contracting Process,” Journal of Public
maximise the social, environmental and economic benefits of Administration Research and Theory, vol. 14, no. 2, pp. 171–190, 2004.
ICT in their municipalities. From a sustainable development [13] G. Stoker, “Public Value Management: A New Narrative for Networked
perspective, we note the imperative to connect within cities Governance?” The American Review of Public Administration, vol. 36,
(which, by inference, includes technology) and the increasing no. 1, pp. 41–57, 2006.
importance of connecting among cities: a global community [14] J. O’Flynn, “From New Public Management to Public Value: Paradig-
matic Change and Managerial Implications,” Australian Journal of
of connected cities committed to sustainability. We intend to Public Administration, vol. 66, no. 3, pp. 353–366, 2007.
use the concepts developed in this paper, and other work to
[15] L. Horner and L. Hazel, “Adding Public Value,” The Work Foundation,
continue to deepen our understanding of the challenges faced January 2005.
by city leaders in approaching smart city delivery. [16] C. Talbot, “Measuring Public Value – A competing values approach,”
Firstly, we intend to use this conceptual foundation to The Work Foundation, October 2008.
work with a city to understand the implications of smart [17] F. Gains and G. Stoker, “Delivering ‘Public Value’: Implications for
Accountability and Legitimacy,” Parliamentary Affairs, vol. 62, no. 3,
cities for their investment and organisational decisions. We will pp. 438–455, 2009.
take an action research approach to develop a systems-based
[18] W. McDonough and M. Braungart, Cradle to Cradle: Remaking the
process/framework that allows cities to find the cross sector Way We Make Things. North Point Press, 2002.
implications of the smart city, and guide decision-making. [19] M. Baptista, “eGovernment and State Reform: Policy Dilemmas for
Through interviews, case studies and workshops, we will seek Europe,” Electronic Journal of e-Government, vol. 3, no. 4, pp. 167–
to identify the implications of the findings for city leadership 174, 2005.

376
[20] E. Cosgrave and T. Tryfonas, “Exploring the Relationship Between [28] C. Namih, April 2012, Interview.
Smart City Policy and Implementation,” in Proceedings of the 1st [29] J. Reades, “Early Views of Public Transit Usage in London,”
International Conference on Smart Systems, Devices and Technologies April 2011, http://simulacra.blogs.casa.ucl.ac.uk/2011/04/early-views-
(SMART 2012), 2012, pp. 79–82. of-public-transit-usage-in-london/ (accessed 2014-02-12).
[21] I. Kearns, “Public Value and E-Government,” Institute for Public Policy [30] L. Doody, April 2012, Interview.
Research, 2004.
[31] Parliamentary Office of Science and Technology, “Government IT
[22] D. Coats and E. Passmore, “Public Value: The Next Steps in Public projects,”, Report 200, July 2003.
Service Reform,” The Work Foundation, October 2008.
[32] UK Government, “Government Digital Strategy”, December 2013,
[23] The Conservative Party Manifesto, “Why we think you should vote for https://www.gov.uk/government/publications/government-digital-
us,”, 2010. strategy (accessed 2014-02-12).
[24] C. Harrison and I. Abbott Donnelly, “A Theory of Smart Cities,” in [33] PRWeb, “Águas de Cascais Rolls Out TaKaDu for Water Network
Proceedings of the 55th Annual Meeting of the International Society Monitoring and Water Loss Reduction,” March 2012, http://www.prweb.
for the Systems Sciences (ISSS), 2011, pp. 7–22. com/releases/2012/3/prweb9288938.htm (accessed 2014-02-12).
[25] U. Haque, “Surely there’s a smarter approach to smart cities?” [34] Los Angeles Departments of City Planning and Transportation, “LA2B,”
April 2012, http://www.wired.co.uk/news/archive/2012-04/17/potential- 2011, http://la2b.org/about/ (accessed 2014-02-12).
of-smarter-cities-beyond-ibm-and-cisco (accessed 2014-02-12).
[35] M. Pinter-Krainer, “Google Enforces New Privacy Policy, Despite
[26] E. Cosgrave, K. Arbuthnot, and T. Tryfonas, “Living Labs, Innovation International Outcry About Its Implications,” March 2012,
Districts and Information Marketplaces: A Systems Approach for Smart http://www.consumerwatchdog.org/story/google-enforces-new-privacy-
Cities,” in Proceedings of the 2013 Conference on Systems Engineering policy-despite-international-outcry-about-its-implications (accessed
Research, 2013, pp. 668–677. 2014-02-12).
[27] J. Bélissent, “Getting Clever About Smart Cities: New Opportunities [36] M. Sutton, “International Reactions to Googles New Privacy Policy,”
Require New Business Models,” Forrester, 2010. March 2012, https://www.eff.org/deeplinks/2012/03/international-
reactions-googles-new-privacy-policy (accessed 2014-02-12).

377