Planning for the Age of Digital Disruption
This article was exclusive written for the Ontario Planning Journal (Ontario Professional Planners Institute), May/June 2017 (page 3)
We are living during the fourth industrial revolution. Thanks to advances in digital technology, our physical and virtual worlds are converging, creating new experiences, services, and business models that will forever change how our cities, living spaces and infrastructure are developed.
Mobile, video, Internet of Things (IoT), cloud, and big data are the table-stakes technology foundation for business transformation today. For example, a business without a mobile strategy may become irrelevant very quickly. More than 90 per cent of the Internet is consumed via mobile devices and more than 75 per cent of all Internet traffic is generated from video. Already 1 million minutes of video traverses the Internet every second.
Every day, the Internet is connecting more people, processes, data and things that have the ability to alter how we work, live, learn, and play. Over the next three years the Internet will connect more than 50 billion smart objects, four times more devices than are connected today. Together these billions of smart devices is known as the Internet of Things, and each produces an increasing amount of data.
This data – your data – needs to be processed, stored, and protected. Cloud computing (leveraging remote and secure data centres) and fog computing (big data analytics and processing at the edge, near connected devices) are transforming the role of compute and networking.
In addition to these foundational technologies, transformational capabilities such as robots, drones, artificial intelligence, mixed reality, and autonomous vehicles are allowing us to re-imagine processes, products, services, business models, and experiences.
Driven by digital innovation, this pace of change is unprecedented. But it also introduces great challenges and opportunities. This has become our new reality, and Canadians are ready for it. Canada ranks #1 globally in Internet utilization. We have among the highest participation per capita worldwide on social media networks such as Facebook and Twitter. Conversely, we rank only 16th in Internet penetration. Not everyone is able to benefit from the opportunities presented to us by the fourth industrial revolution because Canada is lagging behind in building the networks and infrastructure for today’s digital innovation economy.
Digital literacy and readiness
Business also are slow to adopt and embrace digital transformation. An IDC study (2016) observed that 97 per cent of Canadian business executives appreciate the disruptive nature of digital, and expect their organization to be impacted in the next three years by the emerging trend and related technologies. The same study, however, showed that only 17 per cent of these business executives are prepared with an agile strategy, infused with digital practices, to protect themselves from digital disrupters or take advantage of the opportunities in front of them.
Businesses and industries are impacted by digital transformation. Legacy practices cease to exist at a faster pace than ever before, and new businesses that dramatically alter supply-chains, reconnect supply and demand in innovative ways, and deliver unprecedented customer service and experience are being created. The emergence, and success, of digital companies such as Uber, AirBnB, Spotify, and Alibaba validate the impact of this transformation. In a very short time, young entrepreneurs re-imagined experiences – and entire industries – we deemed satisfactory before. The mission of these companies, however, isn’t to simply provide an alternative to a taxi services, hospitality service, music consumption, or commerce. They all aspired to build new communities and experiences to make the world a better place.
In less than five years, each of these businesses has overtaken the market capitalization of their legacy competitors. What do you think the business executives of those established businesses are thinking today? How high of a priority has “digital transformation” become in their boardroom discussions?
In the book “Digital Vortex” (2016, Global Center for Digital Business Transformation), which describes how to beat disruptive competitors, it quickly becomes clear that it is not only the technology, media, or retail industries that face fierce digital competition. Digital transformation (and the Internet of Things) equally impacts healthcare, manufacturing, education, financial services, utilities, energy, construction, and government services. All companies in all industries are going to need a 21st Century infrastructure (beyond what was designed to support the 1st and 2nd industrial revolutions, such as electrical grids, water infrastructure, railways and highways) to innovate and transform themselves. A secure, resilient, and open digital infrastructure needs to envelop our communities and built environment if we want to take advantage of this new industrial revolution and successfully compete in tomorrow’s digital world.
The role of planners
Everyone has a role to play in reshaping our digital future. If you are a small business owner, a big enterprise, an educator or librarian, a government agency, or academic; we all have to start shaping a business strategy infused with digital capabilities if we want to remain relevant. Possibly the biggest task lies ahead for the planners, designers, and builders that give physical shape to our future neighbourhoods, communities, and infrastructure. Their responsibility is to accommodate the digital elements of our future into the physical world that surrounds us. And they have to do this while their own business, or existence, may be jeopardized by the emergence of digital disrupters or new, creative technologies.
Today, planners may need to (re)consider WHAT they are planning for, and HOW to plan effectively and efficiently in order to accommodate these rapid changes and meet the changing expectations around them.
Changes to reckon with and plan for
Some of the concepts introduced by the digital economy have the ability to reshape our communities and built environment. These include the sharing economy, autonomous vehicles, urban mobility, and smart buildings. Some of the emerging digital capabilities that will influence how we best plan and design for our future include big data analytics, artificial intelligence, and mixed reality. However, these factors will continue to increase, develop, and disrupt how we plan in the coming years.
The sharing economy is giving new meaning to the concept of ownership. In congested urban settings, where the cost of ownership is rising significantly, we will see future generations participate increasingly in the sharing economy. There may be a decreased need to own a home (AirBnB) or car (Uber), and we already see sharing services focused on health care (changing the dynamics of seniors’ homes and medical centres), home care (maintenance, handy-man services, and even borrowing tools from one another), and bike share programs, to name a few.
How will these affect the size and function of our future homes, the need for parking in populated areas, and the logistical design of our neighbourhoods?
Autonomous vehicles are undoubtedly already top of mind for most city planners. Automobile manufacturers are expecting the first commercial, large-scale availability of autonomous cars within the next ten years. That means the most costly and extensive planning decisions we make today must consider the needs of digital vehicles. First, our physical infrastructure (roadways, sidewalks, intersections) will need to be prepared with digital capabilities and markers to make them safe for autonomous vehicles. Second, research shows that autonomous cars will have a positive impact on traffic congestion, meaning the same rules for road utilization and capacity may not apply if we eliminate the human factor from driving. One will get quicker from point A to B, with less chance of accidents and reduced congestion. New projections may apply for planning our roads, intersections, and parking.
With car and bike sharing services, improved transit, and the introduction of autonomous vehicles on our roads, we have the ability to re-imagine mobility in our rural and urban communities. The need for disruptive transit expansions may seem less relevant if we augment our choices with rich and integrated mobility options. Smaller towns may look at Uber-like services to offset costly transit scenarios — reducing cost while enhancing citizen services. Digital kiosks and mobile applications will make it easy for citizens to move around the city, leveraging the best and fastest mobility services. Maybe it’s not only roads for cars that we need. And maybe, just maybe, we can spend less on transit infrastructure and focus more on the implications of the sharing economy and autonomous vehicles that will reshape how we move.
The Internet of Things is starting to have a profound impact on our built environment. Every smart object in our buildings (light fixtures, security systems, HVAC controllers and automation, automated blinds and windows, elevators, parking systems, etc.) is becoming a smart and connected device on a secure, converged digital infrastructure.
In a networked building, all systems are integrated and correlated through advanced data analytics. Smart, networked buildings are more energy efficient due to advanced control and management of environmental systems, safer and more secure, and cost less to operate. They also have a positive impact on the productivity of those that work, live, learn, and play in them. Digital buildings are also becoming increasingly common. Digital buildings have a reduced physical and environmental footprint and, with added technical capabilities, can now become distributed data centres and micro-grids, in turn having a positive impact on utility modernization.
Digital advances such as artificial intelligence (AI) will equally impact the way we plan and design our future infrastructure, buildings, and communities. The promise of AI is that it allows us to inform ourselves better of possible future uses of our public spaces, neighbourhoods, and communities by considering all potential scenarios.
Mixed reality will give us modernized ways to visualize the art of the possible. Both augmented reality and virtual reality are already leveraged in design and planning processes, but we will see how further advances in AI, analytics, and mixed reality will allow us to re-imagine what our future looks like.
These are just a few examples of how digital transformation will affect our communities and built environment, and why we must plan for them. Being all-inclusive in this article is merely impossible. Also, new technologies and trends will constantly be introduced that have an additional impact. It will be hard for planners to be aware, all the time, of everything that is available to them, or to understand the impact of every newly introduced capability. So how can we embrace digital disruption while ensuring we build future-ready infrastructure, buildings, and communities?
It starts with the design of an open, secure, and scalable digital infrastructure (regardless if it is for a neighbourhood, community, building, or roadway). This network will be the platform for future business transformation and the engine for continuous disruption and improvement. Note that the digital network cannot be “value-engineered” (in other words, cut out of budgets due to financial limitations); it is the most critical infrastructure for our future.
Second, planners need to partner with organizations that are active in the reshaping of our digital economy today. There is a lot to gain from collaboration with companies like Uber and AirBnB, or with more established technology and innovation companies such as Google, IBM, and Cisco. Their global experience in building 21st Century infrastructure, as well as delivering unprecedented new services and experiences, is invaluable when planning and designing our future infrastructure, neighbourhoods, communities, and buildings. Partnerships are essential for success in a digital world.
Third, an agile strategy will ensure we continue to improve upon decisions made today. We need continuous planning and design, and collaboration and partnerships will secure a sustainable future that is ready to absorb future changes and innovations.
Lastly, together, we need to dream more. Ideation and vision sessions will become more crucial than ever before because they allow participants in a collaborative ecosystem to contribute to the re-imagination of our future infrastructure and communities. The Internet has only been a public domain since 1994, and the transformation we have witnessed since is unprecedented. The speed of this change will not slow down.
Creativity and imagination will be cornerstone of how we define our future…a future that is digital. And there is nobody better equipped to take charge of this journey than our planners, designers, and buildings.