Cities should plan to learn while entering the data utility market

In recent years data has become a product that is generated and used almost universally. This trend meets local government in the realm of smart cities, which frequently cite open government data as a major component. Government has supplied data to corporations and individuals for years – think of the Census Bureau – but now the demand is for broad, accurate, and recent data from smaller government bodies. Due to these forces, local governments should approach open data as an emerging market, and accordingly develop strategies to plan for learning.

From the perspective of the private sector, data was an emerging market years ago. However, in the public sector it is still an emerging market. While local governments currently have many possible responses to the market, including fighting against open data, the smartest approach is to view data as a product. Data isn’t free, the government incurs costs in collection, maintenance, distribution, and risk, but a government data utility can create immense value to businesses and residents₁. Considering these facts, the sustainable path for local governments is to treat data as a public utility to be provided in an emerging market.

Planning for learning is one of the key principles for success when entering an emerging market (Christensen, Discovering New and Emerging Markets)₂. A plan for learning is based on identifying unknown information and articulating the assumptions of the plan. This approach can help local governments providing data to approach the uncertainties of the market and avoid unnecessary capital investments.

A plan for learning would certainly look different for each city, but there are some elements that we can expect to be common. First, there are many common sources of uncertainty. Unknowns include the number and types (corporate, personal, research, etc.) of users, data infrastructure requirements, and risks. Second, a few assumptions will likely support all the programs. We assume that government is the appropriate actor to provide the data utilities, that customers will demand real-time data interactions, and that the data will be used in innovative ways to improve the city.

After identifying uncertainties and assumptions, in the plan to learn framework, city leaders should attempt to gather information and decrease uncertainty prior to making large capital investments of developing data infrastructure necessary for a functional data utility. Leaders could meet with likely users, research similar efforts in other cities, and meet with experts on legal and other risks. These actions will decrease uncertainty, but a key of the plan to learn strategy is remembering how little is truly known and how faulty the underlying assumptions can be.

While a plan to learn strategy may be counter to the culture of government, as cities enter the emerging data utility market their leaders should embrace this type of planning as they navigate entrance into the market.

 1. https://medium.com/a-r-g-o/introducing-argo-the-worlds-first-public-data-utility-9033b52b55c4

2. Christensen, Clayton M. “Discovering New and Emerging Markets”. The Innovator’s Dilemma: Why New Technologies Cause Great Firms to Fail