Six Lessons From Amsterdam’s Smart City Initiative

The city of Amsterdam has long been known for its canals, cafés, and bicycling culture. In recent years, though, it’s also become known as a model for what it takes to become a “smart city,” utilizing information technology to improve city services.

In April 2016, Amsterdam won Europe’s Capital of Innovation award by the European Commission. This €950,000 prize will help the city scale up innovation efforts to improve the way people live and businesses work.

A new case study by MIT Sloan Management Review looks at the steps Amsterdam has taken since 2009 to become a smart city innovator and the insights the city’s experience presents into the complexities facing city managers. The case study is titled “Data-Driven City Management.”

Many major cities recognize the opportunity to improve urban life with data analytics, and some are exploring how to use data to develop more integrated services and a more sustainable footprint. Pioneering cities in the smart city movement include Rio de Janeiro, Barcelona, Copenhagen, and Dublin, as well as Amsterdam. Data integration presents great opportunities, of course, but the challenge is that city managers must collaborate with a diverse group of stakeholders — in both the public sector and private sector — to achieve those goals.

Among the findings of the MIT SMR case study:

Private-sector data is a critical part of changing policy. The Amsterdam Smart City initiative encompasses projects across eight categories: smart mobility, smart living, smart society, smart areas, smart economy, big and open data, infrastructure, and living labs. Many of these projects involve stakeholders outside of government. For example, the city has begun using GPS data from an Amsterdam-based navigation software and technology provider to help manage traffic flow in real time. This private sector input improves upon traffic management models that were built on data from 2011. Those models needed revamping because in 2016, the city has 25% fewer cars and 100% more scooters than it did in 2011.

Smart cities need chief technology officers. Data and analytics are crucial features of Amsterdam’s initiative, and Amsterdam appointed its first CTO to coordinate its data work in 2004. Ger Baron took the post after spending six years running the Amsterdam Smart City initiative and its predecessor organization.

Cities need to manage expectations. Publicity around the Internet of Things and big data has created expectations that smart city initiatives will produce fast breakthroughs — commutes cut in half, easy access to parking spots, significant energy savings. The reality is that cities like Amsterdam haven’t seen such rapid change. CTO Baron said that companies that come to Amsterdam, for instance, expect to find data that’s structured, but he says there are many steps that have take place before that’s the case (“we don’t even know how many bridges we have,” he notes). Baron says that despite how far Amsterdam has already come, it is “very much at a starting point of the transformation.”

A smart city initiative starts by taking a simple inventory. The “fundamental first step” for Amsterdam was to inventory what turned out to be 12,000 datasets across 32 city departments. Each dataset had its own idiosyncrasies and incentives. Doing such an inventory has little short-term payoff, and is, as Amsterdam CTO Baron puts it, “a boring, boring job.” But successful analytics projects depend on solid infrastructures and thorough data, and on building a process to keep up with the (relentlessly) growing data supply.

Cities can find success in experimenting with pilot projects, learning from them, and building iteratively. Amsterdam’s smart city initiative has created more than 80 pilot projects citywide that touch on many areas of urban life. One pilot focuses on helping trash trucks make fewer trips to pick up recyclables (down roads that are often barely wider than a truck and shared by bicycles, cars, pedestrians, trains, and buses) by giving residents different colored bags for the four waste streams of plastic packaging, glass, paper, and biowaste. Other projects have replaced much of Amsterdam’s parking meter stock with pay-by-phone apps. Others around shared transit now look primed to scale in size and scope.

Citizen input can help initiatives flourish. In April 2013, the City of Amsterdam held a design contest to create an international technology institute. The winning entry, from a collaboration of Delft University of Technology, Wageningen University, and MIT, proposed a research institute to help develop urban solutions through collaborations among academic and research institutions, enterprise, municipalities, and, crucially, local residents. With a $50 million initial investment, the Amsterdam Institute for Advanced Metropolitan Solutions (AMS Institute) is now a key player in Amsterdam’s smart city efforts. One example is its idea for something it calls Beautiful Noise. This project analyzes social media posts from sites including Flickr, Twitter, and Instagram. The goal: look at the huge amount of “ambient geo-social data” produced by tourists and locals to identify patterns and then send out alerts about things such as lines at museums and delays in public transit.

Amsterdam’s use of data to advance its public sector agenda is not a novelty. The Netherlands is accustomed to using technology to survive an ever-present threat of flooding, and relies on a system of dikes, levees, and barriers to protect the 55% of its population living in flood risk zones. Information technologies are being used to manage this complex system.

As Amsterdam continues to be a world leader in encouraging alternatives to car travel and in its electric vehicle infrastructure, improved traffic, parking, and other city services will support stronger commerce, safety, and tourism.

To find out more, read “Data-Driven City Management: A Close Look at Amsterdam’s Smart City Initiative.” The study is posted online and can be downloaded as a PDF.