Government Designed For New Times Number 2

Innovation in
local government
Open Data
and Information
Technology
government designed for new times

ACKNOWLEDGMENTS
Innovation in local government:

Open Data and Information Technology
Innovation in Local Government: Open Data and Information Technology is written
by experts and practitioners in McKinsey & Company’s Public Sector practice and
the McKinsey Center for Government, along with other McKinsey colleagues.
To send comments or request copies, e-mail us: MCGpublications@mckinsey.com
Editorial Board
Aamer Baig, Andres Cadena, Michael Chui, Andre Dua, Diana Farrell, Jonathan Law, Lenny
Mendonca, Jaana Remes, Katrin Suder, Jonathan Woetzel
Senior Manager for Content and Production

Kate Jackson
Editors
Allan Gold, Eileen Hannigan
Contributing Editors
Roberta Fusaro, Jen Berlin, Caitlin Gallagher
Art Direction and Design

Cary Shoda
Editorial Production
Elizabeth Brown, Heather Byer, Torea Frey, Shahnaz Islam, John C. Sanchez, Sneha Vats
Managing Editors
Michael T. Borruso, Venetia Simcock
MCKINSEY PRACTICE PUBLICATIONS

Editor-in-Chief
Lucia Rahilly
Executive Editors
Allan Gold, Bill Javetski, Mark Staples
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written consent of McKinsey & Company.
Copyright © 2014 McKinsey & Company. All rights reserved.

CONTENTS
3 Introduction
andre dua and diana Farrell
4 How government can promote open data and help

unleash over $3 trillion in economic value
Michael Chui, Diana Farrell, and Kate Jackson
24 A closer look at open data: Opportunities for impact

Michael Chui and Diana Farrell
32 Coordinates for change: How GIS technology and geospatial

analytics can improve city services
Andrew Grant, Rohit Razdan, and Thongchie Shang
44 Partnering to build smart cities

Jürgen Laartz and Stefan Lülf
52 Capturing efficiencies through smart technologies

Shannon N. Bouton, Kate Toews, and Jonathan Woetzel
54 Capturing value from IT: A ten-point plan for the public sector
Pedja Arandjelovic, Aamer Baig, and Bassam Chaptini
Government Designed for New Times 1

2 Government Designed for New Times
introduction
National policy making and public officials often grab headlines, but local
governments have increasingly become engines of growth and innovation and
are equally worthy of focus. By 2025, over 60 percent of global GDP is
expected to come from cities, according to McKinsey research. While local and
city government leaders can be agents of change, success is not inevitable.
In fact, many regions are struggling with crime, poverty, inequality, and poor
planning. How, then, can local governments deliver value for the citizens
they serve in a sustainable, inclusive, and fiscally sound manner?
To answer that question, the McKinsey Center for Government explored
innovative approaches by local government leaders around the world.
In the coming months, we will look at the tools and models that these policy
makers and public-sector leaders are using across a range of topics. There
is much to be gained by cross-pollinating ideas and sharing best practices. No
one region or city has all the answers, and the challenges vary by geography—
for instance, US states may grapple with ways to modernize their education
systems, which are governed by a different set of rules than those in Europe and
Asia. But one thing is certain: the dynamics of a globalized economy mean
that all leaders must continuously recalibrate and adapt.
In this ongoing series, we will focus on themes that are central to how state
and local governments operate and deliver value for their citizens, including
improving customer service, creating jobs, and making government work better.
Our first collection looks at how local governments can harness open data
to promote value creation and implement effective information-technology
programs to transform the way they operate.
We hope these resources help public officials and civil servants learn from
counterparts around the world and discover approaches they can apply in
their own agencies or teams. Business leaders and nongovernmental organiza-
tions may also benefit from a better understanding of opportunities to
partner with city and regional initiatives. Citizens can see how open data and
technology empower them to be part of a more innovative, nimble, and
service-oriented public sector. In the spirit of collaboration, we invite you to
contact us directly on any area of interest.
Andre Dua Diana Farrell

Twitter: @andredua Twitter: @Farrell_Diana
E-mail Andre and Diana at local_gov_innovation@mckinsey.com.

open data/it Michael Chui, Diana Farrell, and Kate Jackson
HOW GOVERNMENT
CAN PROMOTE
OPEN DATA AND HELP
UNLEASH OVER
$3 TRILLION IN
ECONOMIC VALUE
Open data has the potential to unleash innovation and transform every sector of the economy. Government can
play a critical role in ensuring that stakeholders capture the full value of this information.
Michael chui is a partner at the McKinsey A recent McKinsey report, Open data:
Global Institute, and Diana Farrell is a director in Unlocking innovation and performance with
McKinsey’s Washington, DC, office, where liquid information, identified more than
Kate Jackson is a consultant.
$3 trillion in economic value globally that
1
Additional information about the methodology and
could be generated each year through
approach to size the economic impact of open enhanced use of open data—increasingly
data can be found in the McKinsey report released “liquid” information that is machine
in October 2013, Open data: Unlocking innova- readable, accessible to a broad audience at
tion and performance with liquid information. This
little or no cost, and capable of being
report is a joint effort of the McKinsey Global
Institute, the McKinsey Center for Government,
shared and distributed. The sources of value
and McKinsey’s Business Technology Office. from open data identified in the report
It provides analysis of the seven domains, includ- include new or increased revenue, savings,
ing important levers for unlocking open data’s and economic surplus in seven domains:
value, examples of how the value is being realized
consumer finance, consumer products, educa-
today, discussion of how the major stakeholders
might become involved in open-data initiatives,
tion, electricity, health care, oil and gas,
and considerations of both the barriers and enablers and transportation.1 The domains were chosen
to unlock economic value. to provide a diverse understanding of how

open data, such as census demographics, We evaluate the primary levers that generate
crop reports, and information on product value from open data and government’s
recalls, can create value in public- and role in enabling them. The report then turns
private-sector organizations, in consumer and to the risks of open-data programs; these
business-to-business markets, and in are top of mind for many citizens, businesses,
products and services. and policy makers but can be mitigated
This report expands on an important topic through approaches we outline. We also
in the earlier report: the critical role of describe the needs of stakeholders and
government in unlocking the economic value opportunities for them to actively create,
of open data, managing risks, and engaging promote, and participate in open-data
stakeholders (Exhibit 1). As a provider, cata- strategies and applications. To conclude, we
lyst, user, and policy maker, government present a discussion of how public-sector
is in a unique position to define an agenda for leaders can launch, assess, and scale up their
open data that improves decision making; open-data programs.
fosters the growth of innovative businesses, We hope this report helps stakeholders—
products, and services; and enhances both inside and outside government—
accountability. Government is also well posi- to design, build, and participate in effective
tioned to encourage private companies and open-data programs. For elected officials
other stakeholders to share their data—one of and civil servants, it can serve as a guide for
McKinsey Center for Government 2014
the best strategies for creating value. understanding, evaluating, and promoting
Open data
In this government
report, value
we first explore what open open-data initiatives. We include examples of
Exhibit
data is and1why
of 7the trend is taking hold. how various governments shape their agen-
Exhibit 1
Government plays a critical role to help enable value creation,
manage risks, and engage stakeholders in open data.
Enable value creation Manage risks Engage stakeholders

• Promoting better decision making • Protecting the privacy, security, and • Engaging consumers/citizens,
• Stimulating development of new personal safety of individuals businesses, the media, and
products and services • Helping organizations manage risks nongovernmental organizations
• Increasing transparency and related to confidentiality, liability, and in open-data efforts
improving accountability intellectual property
Government’s critical role

open data/it
Open data government value
Exhibit 2 of 7
Exhibit 2
‘Openness’ or ‘liquidity’ of data can be defined by four characteristics.
More liquid
Completely open Completely closed
Accessibility Everyone has access Access to data is to a subset of

individuals or organizations
Machine readability Data are available in formats Data are in formats not easily retrieved
that can be easily retrieved and and processed by computers
processed by computers
Cost No cost to obtain Offered only at a significant fee
Rights Unlimited rights to reuse Reuse, republishing, or distribution

and redistribute data of data is forbidden
das and invest in resources that can be used international organizations, such as the Open
as models for other agencies or regions. Knowledge Foundation (OKF).2
For business, technology, and start-up leaders, Open data can be local, regional, and
our report aims to provide a relevant and global in scope—from procedure costs at a
perhaps missing perspective on when and how single hospital to city-level water use
they might engage with government. Last, to revenues from national tax collection.
our report will highlight for citizens, the media, Governments capture and share large
and nongovernmental organizations (NGOs) amounts of data on a range of topics, but busi-
the potential of open data to improve services nesses and other private organizations
2
that directly benefit consumers. also have information they could make more
The definition, from
opendefinition.org,
liquid, such as data on sales transactions,
is as follows: “A Open data: What it is, why it has taken shipping patterns, and medical records.
piece of data hold, and how it varies The value of data can vary depending on
or content is open if What it is. Companies, governments, and its level of detail, accuracy, and compatibility.
anyone is free
NGOs have begun to release and share For example, a government could annually
to use, reuse, and
redistribute
vast amounts of information. However, the release 600 data sets that contain aggregated
it—subject only, at extent to which information is truly open information, such as the number of rob-
most, to the varies in four ways: accessibility, machine beries committed in a month in a particular
requirement to readability, cost, and rights for reuse neighborhood. Although this information
attribute and/
and redistribution. Exhibit 2 shows how data is important, it has less potential to generate
or share-alike.”
For more on
are classified across the spectrum, from value than more specific data that are
the subject, see completely open to completely closed, using a released more frequently, such as a weekly
okfn.org. definition closely related to those of many report showing the time of day and

location of each robbery, or even a real-time nature, as well as diverse in its sources and
feed of crime reports as they are generated. types. It represents a source for ongoing
Similarly, data released in commonly discovery and analysis.
accepted formats that can be easily shared
and reviewed by external parties are • Big data analytics involve examining large
more valuable than information presented amounts of data to uncover insights, such as
in nonstandard formats. And the release process efficiencies, as well as connections
of raw data can create more value than the between events that can generate competitive
release of a research analysis, since this advantages and improve operations.
allows for more original uses.
Discussions of open data frequently • MyData refers to data about an individual
reference “big data,” “big data analytics,” and consumer to which that person is granted
“MyData,” all of which fall into different access. Upon receiving access, people
dimensions than open data (Exhibit 3): can correct inaccuracies, gain real-time and
historical information about themselves
• McKinsey
Big data refersCenter for Government
to information that is 2014(such as their physical health and financial
Open datavoluminous
increasingly government value in
and real-time standing), and compare themselves with
Exhibit 3 of 7
Exhibit 3
Open data can come from individuals, companies, or governments,
and it differs from other data types in its degree of availability.
MyData
Personal Individual genome Health-care records

Income tax returns
Property records
Employee performance reviews

Data Open
Corporate Proprietary Financial
source data
data reports (public
companies)
Big data
Military plans Census data
Government
More closed More open
Accessibility

open data/it
others. In some cases, individuals can also back to let open data take its own course, or
specify how their personal data can be used. only letting fragmented efforts take hold, is no
longer a viable approach. The question is
Why open data is taking hold. Interest in not whether to have an open-data program
open data has been increasing for many years. but how to build one that works.
We are addressing this topic now because
the trend is gaining momentum and is top of How open-data programs vary. Approaches
mind for businesses, governments, NGOs, to open data vary across and within countries
citizens/consumers, and the media. Informa- and change over time. For example,
tion sources, particularly those from privacy concerns in Germany have limited the
government, are now readily available at government’s ability to share individual-
lower cost and in machine-readable level data—but in the United Kingdom,
forms. From electronic health records and domestic pressures for increased transpar-
student-achievement histories to site- ency have pushed more government
specific energy-consumption readings and data into public hands each day. The maturity
mobile-phone location data, a vast and of open-data programs also varies; some
rising quantity of information is collected, countries have much more advanced and
cataloged, and shared by companies, comprehensive initiatives than others.
governments, and consumers. The expansion One of the most important differences in
of open data, combined with advances in programs relates to the degree to which
big data analytics, is freeing information that governments encourage citizen involvement.
was once trapped inside the dusty pages of For example, Kenya has launched an
overlooked reports, enabling improved open-data portal and encourages public
decision making, new product and service participation, aiming to generate
offerings, and greater accountability. economic value estimated at $1 billion,
This change comes at a time of heightened mainly through benchmarking appropriate
focus on data-driven knowledge and project costs and identifying opportu-
evidence-based decision making. More nities for public-sector savings. Several
public- and private-sector leaders are private companies have created
seeking access to information and pressing innovative apps or tools based on the portal
for standards, guidelines, and regulations data, including Nairobi-based Upande,
that will ensure the sustainability and which integrates information about water-
usability of open-data initiatives. Sitting supply services in different regions that
The expansion of open data, combined with advances in

big data analytics, is freeing information that was once trapped
inside the dusty pages of overlooked reports, enabling
improved decision making, new product and service offerings,
and greater accountability.

Exhibit 4 of 7
Exhibit 4
Three overarching value levers of open data can help generate
more than $3 trillion annually for the global economy.
Decision making New offerings Accountability

Open data provides a fact base Open data enables organizations Open data reveals issues in
to make more informed and to better understand their customers behavior, choices, and
objective choices using information and context and to design new spending that citizens and leaders
that is often available in real time products and services can act on to effect change
would otherwise be difficult for citizens or areas. The government of Singapore, for
businesses to obtain on their own. instance, was concerned about the impact of
Such variations, combined with differences rising residential energy consumption, and
in awareness, cultural values, legal sys- so it sponsored a “hackathon”—a community
tems, and technical capabilities, mean that meeting where technologists and start-
governments will need to customize their ups were invited to explore potential uses of
open-data programs. Nevertheless, there are open data and develop new apps. Invitees
common value levers and roles for govern- included energy and sustainability experts,
ment that apply across open-data initiatives, researchers, and developers. The new
as described in the next two sections. apps that participants created could help
with both decision making and increas-
Value levers of open data ing accountability.
Government plays a critical role in
enabling value creation from open data. This Decision making: Reaching better
value primarily accrues in three ways: conclusions more rapidly
decision making, new offerings, and account- Stakeholders across the spectrum, including
ability (Exhibit 4). These levers produce governments themselves, can use open
benefits for the government itself and for data to improve decision making. For
other stakeholders, including private- example, Trafikverket, Sweden’s transporta-
sector organizations and consumers. In fact, tion agency, provides third parties with
consumers are the main beneficiaries of real-time data on train departure and expected
the potential $3 trillion in value we identified. arrival times, allowing passengers to make
There is some overlap among the three better travel plans. More generally, companies
levers—as one example, some new have developed online programs that use
offerings may enable better decision making. open data on transportation to help travelers
We also recognize that a single open-data and shippers to make better-informed
initiative can simultaneously enable multiple choices about travel modes and routes. The
levers, thereby creating value in different wide release of data also gives businesses

open data/it
greater insight into the competitive land- improve existing offerings. Consider a
scape, including current pricing conventions, few examples of companies that rely on open
which helps them make better decisions data for their success:
about contract terms when working with
vendors and other parties. • The Climate Corporation employs open data
By regularly analyzing open data related to to create various tools, including weather-
performance, stakeholders can identify monitoring and yield-forecasting products,
gaps and select appropriate improvement which farmers use to make decisions
strategies. For example, educators can such as where and when to plant crops.
enhance teaching methods through adaptive-
learning systems—online tutorials that • Propeller Health, a private company,
immediately adjust the presentation of educa- has benefited from access to data from the US
tional material according to students’ Centers for Disease Control and Prevention
learning needs. At Arizona State University, (CDC). It created a GPS-enabled tracker that
educators used adaptive online-learning monitors inhaler usage by asthmatics.
programs for students struggling with The information is ported to a central data-
remedial math. The software tracked metrics, base and used to identify trends for
such as keystrokes, to see how students individuals, groups, and the overall popula-
interacted with the material and where they tion. By merging usage data with CDC
needed extra instruction. These adaptive- information about environmental triggers of
learning systems helped improve pass rates asthma (for instance, pollen counts in
from 66 percent to 75 percent. the Northeast and volcanic fog in Hawaii),
During the decision-making process, stake- Propeller Health helps physicians
holders can use computer programs to develop personalized treatment plans and
analyze the vast quantities of open data. Such spot prevention opportunities.
technologies will enable them to make
more logical, fact-based decisions faster than • The UK-based website findthebest.com used
manual analysis would allow. For example, open data from the government to create
city officials in Edmonton, Canada, use the UK Car Fuel Economy and Emission App,
application-programming interfaces and real- which helps car buyers compare features
time updates to analyze the city’s perfor- such as fuel economy based on their type
mance on a variety of metrics ranging from of commute.
public transit on-time performance to
utilization of public spaces to 311 call-response • Emergency-room physicians created iTriage,
time. Researchers can simply and easily a mobile app that helps patients under-
visualize more than 400 data sets, empower- stand their symptoms, locate nearby health
ing them to make better-informed decisions facilities or physicians, and book appoint-
on how to improve performance. ments. The iTriage app has been downloaded
more than ten million times.
New offerings: Developing products and
services that create value for customers Some of the most innovative open-data
When the government and other stake- products are created through cross-sector
holders release data, they help companies, collaborations involving public and
agencies, and individuals to develop private organizations. For example, after the
innovative apps, products, and services or 2010 earthquake in Haiti, volunteers

across the world combined data from sources This, in turn, can help prevent corruption and
such as aerial photography, World Health waste. Consider a few examples:
Organization maps of health facilities, and
locations of police facilities from the • The Brazilian government opened its books
Pacific Disaster Center. This OpenStreetMap via the Brazilian Transparency Portal,
project became a critical source of reliable which publishes a wide range of information
information to guide workers from govern- that includes federal-agency expenditures,
ment and private-aid agencies in deliver- elected officials’ charges on government-
ing supplies to hospitals, triage centers, and issued credit cards, and a list of companies
refugee camps. This map also helped banned from contracting work with
responders better match the supply of and the government. Data from the portal are
demand for various resources in the after- helping journalists and activist groups
math of the disaster, significantly improving expose corruption and may reduce unneces-
the services delivered. sary or suspect spending.
Accountability: Increasing transparency • Beginning in 2011, New York City released

and enabling action detailed information on energy and water
By releasing data, businesses and gov- consumption for each nonresidential build-
ernments can ensure their actions, including ing. Building operators are now using
their spending practices, are transparent. these data to benchmark their own energy
© Scott Olson/Getty Images
Workers unload an
aid shipment
from the United
Nations in Port-au-
Prince, Haiti.

open data/it
efficiency, prioritize investments to capture in northern California that benchmarked its

savings, and potentially create incen- broadband expenses was able to reduce
tives to promote energy-reducing programs costs by 30 percent.
or devices. When attempting to increase accountability,
stakeholders, especially those in government,
• The United States–based Sunlight Founda- might consider involving the public. For
tion, a nonpartisan private organization, instance, New York City’s 311 initiative allows
works to improve government transparency residents to report nonemergency com-
by publicizing data related to many plaints—about common problems such as
activities, including food-stamp use, political potholes or garbage collection—via a
donations, and Congressional spending. website, a mobile app, text messaging, Skype,
or phone. The city now processes 60 percent
About one-third of the estimated potential of service requests online. In addition
value from open data comes from to lowering transaction and issue-resolution
benchmarking, which exposes variability and costs, the initiative allows users to track
opportunities to improve performance. the status of their requests. New York City
For instance, many schools pay flat, uncom- released the underlying 311 app to other
petitive rates for broadband services, cities around the world, enabling citizen par-
without soliciting competitive bids. Estimates ticipation in additional locations, including
in the United Kingdom suggest that schools Boston and Buffalo, New York.
pay three to four times what private compa-
nies with similar capacity requirements Government’s critical and unique roles
pay for broadband service. But benchmarking Sitting at the nexus of citizens/consumers,
the price of broadband service offered by businesses, and NGOs, government is
McKinsey Center for
local Government
suppliers 2014 reduce costs,
can significantly optimally positioned to extract value from
and we have
Open data government value seen the benefits in multiple open data—and to help others do the
locations worldwide. One school district same. Much of this value is consumer surplus,
Exhibit 5 of 7
Exhibit 5
Government can serve as an open-data provider, catalyst, user,
and policy maker to create value and mitigate risks.
Provider Catalyst User Policy maker

• Capture information • Build an open- • Apply sophisticated • Make rules for internal
electronically data culture analytics to improve and external use
• Release data publicly • Convene stakeholders decision making, offerings, • Establish standards for
and regularly • Champion the and accountability data quality and format
• Identify ways to improve movement • Invest in people, tools,
data quality and systems

© Kiyoshi Ota/Bloomberg via Getty Images
or economic benefits that are captured by over 85,000 data sets are now available on Attendees work on
individuals. Government can spur value data.gov, the federal government’s pub- computers as
they participate in
creation at all levels of society by concurrently lication arm for open data, along with user
a hackathon
fulfilling four important roles: as a provider, guides, event postings, and examples of in Japan.
catalyst, user, and policy maker. Because applications across industries, from agricul-
technology, capabilities, and cultural norms ture to manufacturing. By making these
are always changing, these roles contin- data available to enterprising companies and
ually evolve (Exhibit 5). individuals, government is spurring
private-sector innovation and increasing
Government as an open-data provider transparency—two of the most important
Across all levels of government, millions of goals of any open-data initiative.
individual data records are collected, stored, When prioritizing data for release, gov-
and analyzed. From tax returns and unem- ernment might consider focusing on both the
ployment claims to hospital reimbursements value that can be created as well as the ease
and energy use, much of this information with which data can be made available. Often,
is now available electronically and readily the data that are easiest to release may
shared. In the United States, for instance, contain little that interests stakeholders. To

open data/it
Many staff members and leaders at government agencies need to

significantly shift their mind-set about data from one that has open
data as an exception to one where open data is the rule.
avoid wasted effort, government leaders can Government as an open-data catalyst

work with their teams and external stakehold- Government can serve as a catalyst for
ers to evaluate and decide which information the use of open data by creating a thriving
to capture, how to standardize and digitize it, ecosystem of data users, coders, and
and when and where to share it. They can application developers. To attract such talent,
also look for opportunities to migrate data to it can advertise its open-data efforts
electronic formats that are suitable for all through press releases or other marketing
internal agencies and external audiences. The materials, or even engage in individual
2010 US Census effort, which focused on outreach efforts. One innovative approach
both data quality and accessibility, included taken by governments worldwide involves
dozens of experiments and evaluations organizing “hackathons” and “datapaloozas,”
of data collection, coding, and analytics to often with prize money and publicity.
improve the accuracy of the information These events help promote the use of data in
and to make it available in an easily down- the development of innovative products
loadable format. and services. They also allow governments to
Timely data are also essential to accurate share newly released or digitized data,
research and better decision making. As draw on the expertise of participants, and
such, government might consider explicitly provide guidance about privacy and
setting expectations about how often safety. Other marketing platforms to cham-
data will be updated. In addition, government pion open data include interagency meetings,
might consider releasing metadata—in roundtables with NGOs and businesses,
other words, data about data. Metadata may and public-awareness campaigns.
describe the accuracy of a data set, the There are a range of relevant topics for
methodology of collection, or other param- users to cover at open-data events, including
eters. Government can also assist reasearch- what data could be most valuable if released,
ers by publishing data “dictionaries,” the best format for sharing data, user
which are easily searchable repositories access and permission levels, and potential
of metadata. applications that could be developed from
3
The June 2013
Many staff members and leaders at govern- the data. For instance, the US Department of
G8 summit
promulgated an
ment agencies need to significantly shift Health and Human Services recently
Open Data their mind-set about data from one that has convened 40 leaders from the technology and
Charter, which open data as an exception to one where health-care spheres, presenting them
establishes open data is the rule.3 Specifically, they can no with existing data sets and asking how the
“an expectation”
longer see their primary role as the provi- data could be used. This resulted in a
that the all
government data
sion of services; instead, they might consider productive brainstorming session and the
be published focusing on helping third parties create development of a number of health-
openly by default. innovative products and services. care apps and services.

Governments can also serve as a catalyst by lower in the organization.) Government
selecting leaders to champion open-data leaders can also create appropriate incentives
initiatives. In the United States, for example, to retain employees with strong technology
President Obama has appointed a “White skills, since they may otherwise lose them to
House data evangelist” who oversees and the private sector.
promotes use of information on data.gov. The Beyond recruiting talent, government
data evangelist’s team aims to increase could optimize data use by training current
public access to open data generated by the staff—even those not in technical roles—
executive branch and encourage innovation about the overall value of open data, as well
outside government. The White House as the benefits of providing data to third
also supports innovation fellows—individuals parties. Training could emphasize how staff
recognized as rising technology leaders— can derive insights from open data to improve
who serve 6- to 12-month rotations in partner- their own programs or services, as well as
ship with federal-agency leaders. These strategies for engaging external stakeholders
fellows help develop pilot programs, prioritize (for instance, by holding the previously
open-data opportunities, and codify mentioned datapalooza events). Agencies that
best practices. build strong support from the top during
these efforts will increase the likelihood that
Government as an open-data user open-data initiatives are viewed as an
There are two primary ways that government essential part of their mission rather than
engages as a user of open data. side projects.
In an environment where technology is con-
Applying analytics. As a data user, govern- stantly changing, it is important for open-data
ment can benefit by applying advanced programs to continue to evolve or value can
analytics that improve internal decision mak- be lost. Some organizations, such as the Open
ing, promote the creation of new offerings, Data Institute, have established strategies
and increase accountability. For example, for refining open-data programs that involve
utilities can identify areas for improvement by investing in computer-storage capabilities,
sharing data about pilot results, task-time establishing strong technical safeguards to
benchmarks, construction plans, performance- protect privacy, educating staff about
management systems, and asset-replacement confidentiality risks, and building or buying
schedules. In parallel, they can provide sophisticated software programs. Govern-
MyData to customers, such as information on ments and other stakeholders may improve
their electricity-usage patterns to promote data usage by studying their strategies.
more efficient consumption.
Government as policy maker
Investing in programs. To optimize use of At a fundamental level, government is well
public data within their own agencies, positioned to perform several interrelated yet
government leaders need to invest in first- distinct tasks to improve the lives of the
class talent, tools, and systems. On the public, generate value, and protect individual
people front, this involves hiring knowledge- privacy. These include making rules and
able staff at all levels. (Although many helping to establish standards.
cities, counties, states, and agencies today
have chief information or chief tech- Making rules. As a consumer advocate—
nology officers, they often lack data expertise the watchdog and protector of the public

open data/it
trust—government can draw on its legislative mation on its Electronic Data-Gathering,

authority and enforcement powers to Analysis, and Retrieval website. The EU
ensure safety, security, equity, and justice has also declared that data about individuals
for all members of society. In the context held by private companies must be made
of open data, its purview includes available to those individuals upon request
several elements: (a task that would be made easier through
• defining rights to access or use certain MyData systems, which are central
sensitive information, including databases that allow individuals to access
that obtained from medical files, tax information about themselves).
returns, and driving records Elected officials may be concerned about
• deciding what data should be mandatory public perceptions of privacy issues
for individuals and companies to share related to open-data initiatives. In addition
• providing guidelines on the collection, to ensuring robust protections are
management, and dissemination in place around private/identifiable data,
of information government can engage citizens early
• creating incentives for participation and to address their concerns, seek new ideas,
compliance with data-sharing efforts and answer questions about how data
In some cases, government may need to limit can inform policy.
the use of open data to protect privacy
and confidentiality. The United Kingdom, for Setting standards. The policy-maker role
instance, enacted the Data Protection Act involves participating in the creation of
to control how public and private organiza- technical standards about data quality and
tions use personal data. Among other format, since these can significantly
provisions, the act stipulates that data should increase and scale the benefits of open data.
only be used for limited, specifically stated Public-sector leaders might consider
purposes and that they must be stored in a consulting experts to help design standards,
secure location. The act also provides stronger which will facilitate use across different
legal protections for particularly sensitive computer systems. For instance, they could
information, such as data related to follow the example of some private
an individual’s health, religious beliefs, or organizations by promoting the use of Data
political opinions. Similarly, the US Catalog Interoperability Protocol (DCIP),
federal government has enacted multiple which specifies design criteria for data
laws to ensure data privacy, including catalogs published on the web. Among other
the E-Government Act, which prohibits the recommendations, the DCIP promotes
secondary disclosure of information the use of JavaScript Object Notation, an
obtained for statistical purposes, among easy-to-use data-interchange format.
other protections. As tools and technologies become more
There are also situations where the sophisticated, leaders might consider
government can serve the public by mandat- revisiting existing standards, since better
ing the release of data. In the United methods for organizing and sharing
States, the Securities and Exchange Commis- data may emerge. Government could also
sion (SEC) seeks to protect the public by reevaluate the level of detail contained
requiring companies to collect and submit within open data, the frequency of its release,
certain financial documents. The SEC and the ease with which data can be inte-
then posts documents deemed public infor- grated across systems.

Exhibit 6 of 7
Exhibit 6
Public-sector leaders can address data risks that could threaten
individuals and organizations or undermine open-data initiatives.
Individual risks Organizational risks
Privacy Confidentiality
Improper sharing of personal Revealing excess information
information
Liability
Security Fines or damages from ineffective
Inadequate protection of data data protection
Safety Intellectual property

Data made public that could be Lack of ownership standards
used to do harm
Potential mitigation strategies
Remove identifying information or

aggregate data
Invest in technological safeguards

and staff training
Engage stakeholders to share

concerns and suggestions
Risks in open data—and potential zations, such as confidentiality, liability, and

strategies to address them intellectual property (Exhibit 6).
Public-sector leaders are often called
on to protect individuals and organizations Individual risks: Privacy, security,
from the risks of open data while also and safety
advancing open data’s potential value. Risks As noted earlier, open data can improve
include those that fall largely on individuals, accountability in government, make
such as privacy, security, and personal businesses more competitive, and help public-
safety, and those related primarily to organi- sector leaders debate issues and identify

open data/it
sound policies. But total information people are at home (higher energy use) or
sharing without safeguards or limits can put away (low energy use). Since it is not possible
individual privacy and security in harm’s to predict all possible uses of data, govern-
way. Agencies that release information might ment may want to institute policies that
therefore need to exercise caution. For regulate their use rather than their collection.
instance, regulators in many countries publish This approach may be more pragmatic
data about hospital performance on certain than expecting to prevent all potential negative
procedures to compare costs and outcomes, outcomes through fine-grained regulation
but they do not publicly reveal patient- for data collection and access; it also reflects
level information. Similarly, 45 US states the fact that specific uses of data are often
evaluate student performance according what people find objectionable.
to standards set by the Common Core State
Standards Initiative. These standards Organizational risks: Confidentiality,
allow educators to analyze longitudinal liability, and intellectual property
student and teacher data from multiple From small start-ups to Fortune 500 com-
districts, but some citizens have expressed panies, organizations stand to generate
concern that records related to individual significant value from open-data initiatives.
performance could damage college prospects Government agencies are also poised to
if released. In response, officials have reap great benefits. However, public officials
developed clear guidelines stipulating that the can try to actively manage certain risks
federal government can only have access to that occur whenever any organization releases
aggregate student and teacher data. potentially sensitive data. For example,
As open data become increasingly impor- there are concerns that opening performance
tant, ensuring cybersecurity will be an ever- data to third-party analyses could inadver-
more-challenging task. For example, tently discourage positive change, appropri-
criminals could commit fraud or identity theft ate risk taking, and innovation. But
if they obtain ATM personal-identifica- government could try to balance the public’s
tion numbers or financial data about a bank’s desire for information with the stake-
clients. As noted earlier, government could holders’ need to avoid undue criticism—for
try to address the security challenge in its role instance, by instituting regulations that
as policy maker by establishing limits on limit liability.
data access or usage (such as stipulating that Another organizational concern relates to
some personal information can only go to questions about intellectual property: who
law-enforcement officers) or forbidding the owns rights to the underlying data, who owns
release of certain information. rights to the tools used to extract insights
To reduce risk, public-sector leaders could from the data, and who owns rights to any
try to anticipate potential uses for newly products or services created from the
released information, focusing on the insight data. Currently, permission rights to use open
it offers and parties that might be interested. data vary greatly depending on the source.
For example, government could protect Similarly, some advanced technology,
consumers by ensuring that data on individ- software, and analytics used to derive insights
ual energy usage is provided to residents from data are free, as are some apps and
as MyData but aggregate the data points when other products created from the data; in other
making them publicly available. This would cases, organizations levy copyright and
limit the ability of criminals to track when licensing fees. Whenever protections or restric-

tions on usage exist, such as contractual and information about drilling methodologies
agreements that establish whether data can can increase the success of exploration
be redistributed, published, or combined activities and improve reserve-replacement
with other data, it is important to respect ratios, reduce costs per barrel, and reduce
them. If government establishes intellectual- risk. In its role as an open-data champion,
property rules that are transparent, fair, government could encourage private
and promote innovation, it could help create companies to share such proprietary data,
a growing ecosystem of “data-preneurs” including industry benchmarks, in all
who turn a profit by using open data to create sectors of the economy. Several protections
goods and services. can help reassure companies that their
Some organizations may be reluctant to proprietary data will not be misused. For
release proprietary data for fear that common example, the Yale University Open Data
access to their hard-earned knowledge will Access (YODA) project provides pharmaceuti-
erode a competitive advantage. Although this cal and health-care companies a safe route
is indeed a concern, releasing data may for releasing clinical-trial information that
also spur development of solutions that a would otherwise go unpublished. People
single company could never devise on its own. interested in accessing the data must submit
For example, the “hive mind” approach, a proposal, complete a short course on
which draws on the talent and knowledge of responsible conduct, and agree to share their
multiple organizations, is relevant in the research findings. Applicants who seek
information-dependent field of oil and gas data purely for commercial or legal purposes
exploration. Greater sharing of seismic data are denied access. With such protections in
© Scott Eells/Bloomberg via Getty Images
Public real-estate
data is shown on a
mobile app.

open data/it
place, YODA can help ensure that researchers Citizens and consumers
will only use the data to contribute to Based on our prior analysis of seven domains
overall scientific knowledge, thus balancing of the global economy, citizens and consumers
an individual company’s intellectual- stand to gain the most from open data.
property rights with societal benefits of For instance, they will be able to make more
open data. informed purchase decisions since they
will have greater price transparency, thereby
External stakeholders in saving money. They will also have better
open-data programs insights about schools, transportation, and
Any government open-data initiative will health treatments, which can help them
involve multiple external stakeholders make informed choices. As one example, con-
who have different roles, needs, and concerns, sumers will have more information about diet
as well as varying strategies for learning and exercise patterns that could reduce their
about data, mitigating risks, and advancing susceptibility to lifestyle-linked conditions and
their agendas (Exhibit 7). illnesses such as hypertension and diabetes.
Exhibit 7 of 7
Exhibit 7
Among core stakeholders, government is positioned to represent
and advance shared interests.
1 2
Citizens and consumers Businesses
• Citizens and consumers can participate • Businesses are working to understand
in development of open-data initiatives and shape government rules, standards,
• Government can hold public forums to and regulations about data use
encourage their engagement • They are also creating innovative products
and services based on open data
Government
Media NGOs
• Media outlets use and interpret open • Nongovernmental organizations (NGOs)
data in print, online, and TV pieces can help government develop common
• Government can involve them in standards that improve data availability
publicity efforts and discussions of • Foundations can promote and fund
new initiatives education of data specialists
3 4

Government could consider engaging Business leaders might consider sharing
consumers by holding public forums that data with other stakeholders or collaborating
illustrate how open data can improve with them to develop innovative offerings
services—for instance, by helping the public- that leverage open data. For example, they
works department to understand what could potentially access sources such
streets are most in need of repair. In all cases, as Google Transit Feed Specifications, which
government could emphasize that private would allow them to develop services
data will be protected, since citizens are often like NextBus, an app that tells riders their
concerned about confidentiality issues. projected wait time.
Consumers themselves can make an impor-
tant contribution to open-data initiatives Media
by sharing personal information. For instance, In all formats—including print, radio, TV,
consumers who release health information, online video, tweets, and blogs—media
such as data on daily exercise levels, can help outlets use and interpret open data. Some also
clinicians identify individuals who may be closely follow and report on developments
at risk for a particular disease. If individual in this sphere. OKF’s recently released 2013
data are combined with information from rankings of the most and least “open”
other sources, such as demographic records, countries received extensive global media
clinicians can then target specific popu- coverage. In addition, media outlets
lations for health-education or prevention have intensely monitored national-security
efforts, such as disease-screening programs. breaches in which data are compromised,
as the WikiLeaks and Edward Snowden
Businesses incidents made evident. This coverage spurs
Across industries, single “data-preneurs,” public dialogue about the standards
small start-ups, government contractors, and needed to protect individual or national-
large multinational corporations are security interests.
attempting to understand—and in some cases Many journalists use open-data sets to
shape—appropriate government rules, identify trends, patterns, and behaviors that
standards, and regulations about data use. deserve attention, a trend known as data
But even more important, many businesses journalism. For example, they could use open
are now creating innovative products data to highlight the time of day when
and services based on open data. There are most traffic accidents occur or to illustrate
numerous examples we could cite in addition crime patterns within a city. Articles on
to those mentioned earlier in this report. such topics may serve as catalysts that spur
For instance, Zillow, a US real-estate com- officials or private citizens to take action.
pany, combines data from county land Acknowledging the importance of open data,
records, satellite imagery, and multiple newspapers and other media sources are
listing services that advertise homes dedicating increased resources to the creation
for sale. Visitors to the Zillow website can of infographics based on open-data sets.
thus view images of entire neighborhoods Some of those most interesting ones are
when assessing potential properties. It may interactive and allow readers to find specific
be helpful to publicize examples of some data. In London, the Guardian recently
of the more successful creations, since other published an infographic that shows
companies may be more inclined to use open temperature changes over the past 100 years
data if they see the economic potential. in most countries. Readers can type in

open data/it
a city and country to view location- since most countries lack skilled workers who
specific data. have training in the science, technology,
Media can also serve a vital function by engineering, and mathematics fields. Other
publicizing success stories about open NGOs, such as “Code for America,” sponsor
data and reporting on trends related to data programs that place people with data
use. Government leaders could thus skills in positions where they can help create
engage journalists, commentators, and tech- applications enabled by open data.
nology and government reporters in
early discussions of new programs or policy Developing a customized
changes, as this may help raise public open-data approach
awareness about and engagement with the Although interest in open data is gaining
initiatives. Publicity about open data momentum worldwide, countries and
could also stimulate crowdsourcing, since agencies are not at the same starting point.
more people will become aware of Some, such as Denmark, the Netherlands
available information and suggest new (which topped the 2013 OKF rankings),
ways to use it. Norway, the United Kingdom, and the United
The media can even help with job- States, already have well-established
recruitment efforts. For instance, news articles initiatives that touch almost every sector of
may raise awareness of government open- government, and they are well positioned
data initiatives and related job opportunities to remain on the forefront of value creation.
for coders or app developers. Other countries have various open-
data programs across agencies and are still
NGOs attempting to integrate them. Still others
With access to information from multiple are just beginning to investigate the use of
governments and constituencies across the open data or have a few nascent programs.
globe, NGOs (including universities, Regardless of their current capabilities,
advocacy groups, and think tanks) represent however, all governments will need to develop
some of the most active collectors, a clear understanding of their strategy
disseminators, and users of open data today. and goals.
The International Monetary Fund, the To begin, we suggest examining the three
World Bank Group, and the World Health critical components of any successful
Organization all have vast stores of informa- initiative—people, tools, and systems. The
tion that they share with the public, diagnostic can include five elements:
allowing others to analyze data and create • inventorying available data to assess
tools and products similar to those based on their value
data from businesses and governments. • analyzing initiatives that are in progress
Given their presence across the globe and in • identifying gaps in knowledge,
multiple jurisdictions, NGOs can play capabilities, technical infrastructure,
a crucial role by encouraging policy makers to management, engagement, and
adopt common standards that improve the other areas
availability and use of open data. • prioritizing actions and investments
Foundations that invest in education can • evaluating how third parties are
also support open-data initiatives by using an organization’s data and whether
promoting training efforts for data scientists. they are fully exploiting the informa-
Such education is more crucial than ever, tion’s potential

For each topic, a list of questions can help of experts. In Rwanda, the government is
government devise an improvement plan and working with the World Bank Group and the
meet the needs of all stakeholders. In local start-up community to define the
the people category, for instance, government open-data agenda. In Uruguay, the govern-
leaders can assess the external talent pipeline, ment invited representatives from NGOs
describe the skills needed for internal and regional technology leaders to help outline
employees, evaluate the degree of leadership a road map for its open-data program
support, and rate the strength and select high-value data sets to release.
of their open-data culture.
As noted earlier, government can also
advance its open-data agenda by convening The use of open data is a relatively recent
experts at working sessions at the start of— phenomenon, but as with many technological
and throughout—open-data initiatives. Given advances, it is growing in relevance and
the ever-changing nature of technology prevalence—in other words, it is becoming the
and the increasing availability of data in elec- “new normal.” The benefits of open data are
tronic format, they might consider treating significant and include the potential for more
open-data efforts as an iterative process. than $3 trillion in economic value annually,
Ongoing engagement will also help govern- much of which will likely go to consumers. Yet
ment understand what consumers, NGOs, the success of open-data programs is not
and the private sector truly value, allowing guaranteed. It takes real effort to engage an
strategies to be refined. In the United external community to use open data.
States, for example, government officials Risks, such as threats to privacy and
within the Health Data Initiative con- intellectual property, can be actively and
vene an annual conference for companies that continually addressed.
are investigating innovative strategies Encouragingly, governments around the
for using health data in tools and applications. world have taken steps toward developing
More than 2,000 data experts, technology responsible and robust open-data programs.
developers, entrepreneurs, policy makers, We hope this report will inspire and
health-care-system leaders, and community enable more government leaders and stake-
advocates attended one recent forum. In holders across the spectrum of business,
addition to speeches, breakout sessions, and citizens and consumers, the media, and
presentations, the forum allowed compa- NGOs to engage in the conversation, invest
nies to demonstrate their products and work in the work, and promote open data
on them in “code-a-thons” that brought in a way that helps unlock economic and
innovators together for live collaboration. societal benefits. n
While some countries may not be able to
convene such large conferences, they
can still benefit from gathering smaller groups

open data/it Michael Chui and Diana Farrell
A closer look
at open data:
Opportunities
for impact
Local and regional governments can use open data to make substantial improvements to education,
transportation, and health care—but first they will have to overcome some big challenges.
Public institutions and private companies are

aware of the opportunities and challenges
associated with big data analytics. But as these
organizations take steps to harness the power
of big data, it’s important that they are also
aware of a complementary global trend; open
Michael Chui is a partner at the McKinsey data—the release of information by govern-
Global Institute, and Diana Farrell is a director in ments and private institutions and the sharing
McKinsey’s Washington, DC, office.
of other data within and across industries—
1
Data sets range from completely open
extends the power of big data and makes
to completely closed across four dimensions: possible entirely new products and services,
accessibility (the range of users permitted to while also enabling better decision making
access the data); machine readability (the ease and improved operations in both the private
with which the data can be processed auto-
and public sectors.1 In fact, our research
matically); cost (the price of obtaining data); and
rights (limitations on the use, transformation,
suggests that open data can help unlock more
and distribution of the data). We use the terms than $3 trillion annually in seven domains
“open data” and “liquid data” interchangeably. of the global economy: consumer finance,

consumer products, education, electricity, These applications, while promising, are
health care, oil and gas, and transportation. just the beginning. Open data can help local
Many regional and local governments and regional governments transform the
have already opened up their data to increase way they deliver services while also offering
transparency and accountability, promote significant cost savings. Moreover, by sharing,
civic engagement, and improve basic public where appropriate, the vast amount of data
services. In the United States, for example, at their disposal, governments can catalyze the
residents of Texas can help their government use of open data in other sectors, which can
identify potential cost savings by scrutiniz- in turn help create value in the broader
ing publicly available budgetary information. economy. (For more, see “How government
Some third parties have used “liquid” can promote open data and help unleash
information (data that are open, widely avail- over $3 trillion in economic value.”) Realizing
able, and in shareable formats) to create this potential will not be easy and will require
smartphone apps that tell commuters when creating safeguards for personal privacy,
Open
the nextdata
bus will arrive or that guide drivers making investments in technology, changing
Exhibit 1 ofavailable
to the nearest 1 parking spot. mind-sets and work processes, and embrac-
Exhibit
Education accounts for nearly 40 percent of state spending
in the United States.
State spending, % of budget
K–12 education
25
Other1
35
Education and health
care make up 54% of
state spending
15
Medicaid
5 1 Public assistance
14 5 Corrections
Higher education Transportation
1 “Other” includes care for residents with disabilities, economic development, health benefits for public employees,
parks and recreation, pensions, state police, and general aid to local communities.
Source: State Expenditure Report: Examining Fiscal 2010–2012 State Spending, National Association of State
Budget Officers, Dec 2012, nasbo.org

open data/it
ing new concepts such as MyData—a term ments. In the United States alone, state
that describes the sharing of information with and local governments spend about $1 trillion
the individual about whom it has been a year on education; as the exhibit shows,
collected. (See sidebar, “About MyData.”) in fiscal year 2011, 25 percent of state dollars
Here, we discuss the open-data opportunity— were spent on schooling for K–12 students.
and the accompanying challenges—in With so many resources dedicated to public
three of the seven domains we researched that education, there are substantial opportuni-
have the closest ties to regional- and local- ties to improve current systems.
government budgets: education, transporta-
2
In defining the
tion, and health care (exhibit). Improve instruction. Many of the most
scope of the valuable applications of open data will evolve
effort, we include Education: Opportunities inside and in the classroom itself. Schools can improve
kindergarten outside the classroom instruction by using open data to develop per-
through grade 12
More than one billion students are enrolled sonalized learning plans for students,
and higher
education delivered
in schools around the world, and those provide frequent feedback to teachers on their
through public students are served by more than 58 million performance, and create targeted professional-
and private systems teachers. Annual spending on kindergarten development programs. MyData programs
in the United through grade 12 and postsecondary education will be especially important here, as they
States, the
exceeds $4 trillion worldwide.2 In some allow families to track student progress and
European Union,
Asia–Pacific,
countries, public education is funded primar- correct inaccurate information.
and across emerg- ily at a national level; in others, it is largely For families and educators to identify areas
ing nations. the responsibility of state and local govern- for improvement, data on student perfor-
mance and information about specific teaching
practices can be combined with information
about individual learning preferences and local
educational mandates or guidelines. Adaptive-
learning programs gather data about how
About MyData an individual student interacts with specific
lesson plans and then they contextualize
MyData is not a specific program. It is a concept those measurements—with information about
that entails sharing information collected about that student’s past performance and the
an individual (or organization) with that person (or performance of his or her cohort—to identify
company). MyData will be an important part of areas that the student has mastered, or
capturing the open-data opportunity, especially in the conversely, where he or she might need extra
fields of education and health care. For example, help. When used for remedial-math programs
some hospitals now provide individual patients with at Arizona State University, personalized
access to their own medical-records data. Providing learning plans improved pass rates by nearly
aggregate statistics (a form of open data) along- 10 percent.
side MyData allows useful comparisons; some utilities This data-driven approach to teaching and
show consumers how their energy use compares learning allows for targeted, rapid responses;
with that of neighbors to encourage conservation. In by using insights gained from frequent
many cases, individuals can modify or correct the data data collection and analysis, problems can
provided to them, which improves its quality. be corrected and lesson plans adapted
before student performance suffers. Sharing
data across institutions and school districts—

making the data more liquid—allows for goods to schools across the nation. Suppliers
more robust analysis. Educators can monitor see information about current bids, the
student attainment frequently and at quantity of goods requested, and data on
a granular level (measuring mastery of a previous auctions, such as closing bids,
particular concept, for example) and prices, and quantities. Just two years after
track how individual student performance implementation, the average price of the
correlates to classroom activities (lec- items offered on the platform had dropped
tures versus exercises or group work). These by 24 percent. These efforts not only
approaches can also be used to increase reduce procurement costs but also allow
motivation, influence mind-sets, and vendors to better forecast demand.
adjust learning strategies to improve stu- While schools can reap many of the benefits
dent achievement. of enhanced procurement using their own
data, sharing their information across schools
Match students to schools and programs. and districts can lead to even better results
Open data can be used to help parents and through benchmarked price negotiations.
students identify the best fit with a school or Improved purchasing of broadband services is
program. Peng Shi, a graduate student, one example. By comparing the prices of
created Boston’s new methodology for public- broadband service offered by local suppliers—
school assignments by using information and by benchmarking their costs against
released by the city on the quality and location their peers’—one school district in northern
of schools.3 His algorithm presents parents California was able to reduce broadband
with choices based on school quality and dis- costs by 30 percent.
tance. While school choice in K–12 grades
may help students find institutions that can Challenges
better serve their needs, many districts The benefits of open data in the field of
cannot offer every student a slot in a high- education are tremendous; in addition to the
performing school; open data can help opportunities discussed here, open data
families identify alternatives and put can help match graduating students to
pressure on systems to provide more high- appropriate employment and can make the
quality options. true costs of higher education (and private
K–12 education) more transparent. But
Ensure efficient system administration. to capitalize on any of these opportunities,
Schools can reduce procurement costs by stakeholders must share information
using open data to consolidate, standardize, across the education system so they can
and compare the types of products they identify areas ripe for improvement,
purchase. By allowing administrators to and they must do so in a way that protects
analyze past purchases and examine how peer the identity of individual students and
institutions are allocating their budgets, teachers. They will also need standardized
open data can also enable better forecasts for measures for analyzing student, teacher,
when products or services will be required. and school performance and for identifying 3
James Vaznis,
One country in Europe, for example, has best practices so that educators can “MIT has plan
for Boston school
used open data to reduce the price its schools learn about learning—using data to see
assignments,”
pay for a wide range of supplies. Its open- which approaches work best for students Boston Globe,
bid platform hosts an online auction where and refining these techniques through October 28, 2012,
vendors bid on contracts to supply basic ongoing monitoring. bostonglobe.com.

open data/it
© Ableimages/thinkstock
A teacher helps
students in class.
Transportation: Doing more with less public projections of city and regional
Open data has already played an important development. By combining its own data
role in improving transportation; we believe it with open data, the city was able to
will continue to play a role in addressing determine whether extending its subway
the inefficiencies that persist. Open data can system into the suburbs was necessary
help local and state governments reduce or if other services could do a better job of
transportation spending and improve services meeting demand. The transit authority
in three ways. ultimately decided against making a costly
investment in the subway extension and
Improve infrastructure planning and instead planned a less costly investment in
management. Open data can help govern- a suburban-rail extension. This limited
ments improve transportation-demand Moscow’s up-front costs and ensured that
forecasting, prioritize transport infrastruc- services could be flexible enough to meet
ture improvements, and synchronize the the needs of a shifting population. The new
ways different modes of transportation inter- suburban-rail extension is part of a larger
operate. It is an especially powerful tool transportation strategy that, in addition to
when combined with other transportation avoiding more than $1 billion in infra-
statistics. For example, in 2012, the city structure costs, has the potential to reduce
of Moscow used open data to complement its average commute times by 16 minutes
own estimates of how long it would take per trip, saving one week of travel time for
citizens to commute via different modes of each rider every year.
transport; specifically, city officials used
Internet resources that measure traffic, as Optimize fleet investment. Open data can
well as mobile-phone-location data, help optimize the size and mix of public
transportation-operation statistics, and fleets—all the vehicles owned and managed by

the government—and make operations more Challenges
efficient. In one US city, for example, open Using open data to improve transportation
data helped the local government understand delivery can be tricky. Such projects raise
how its vehicles were being used, which privacy concerns, and there are gaps in data
uncovered an opportunity to cut the fleet by standards and capabilities in some transpor-
as much as 30 percent. And in California, tation organizations. There are political
after the state released budget data on vehicle and financial barriers as well; infrastructure
spending, citizen advocates spotted examples projects are expensive, long-run invest-
of unnecessarily high costs, and state agencies ments that often involve policy makers from
were able to reduce the fleet by 15 percent. multiple jurisdictions. There are also con-
cerns about providing transportation services
Inform customer decision making. Open data in rural areas where the financial return on
can help customers make better decisions investment in infrastructure, which open data
about when and which type of public trans- can help estimate, is of secondary importance.
portation to use; when aggregated, these
choices can be the source of significant eco- Health care: Better care at lower costs
nomic value. Public-transit systems have Using open data to improve health care will
expanded the use of sensors that generate be driven largely by stakeholders outside
location data, for example, which can local governments—for example, providers,
then be used to transmit train and bus loca- payors, national governments, and patients
tions in real time. This information is who choose to share their information—
used by transit agencies to manage their but these advances will in fact generate savings
operations, but these data streams also at the local level, especially in the context
have been made available to entrepreneurial of Medicaid spending in the United States. We
developers such as CUBIC, whose NextBus have identified several levers for capturing
app lets riders in cities such as Los Angeles, value in health care through the use of open
Toronto, and Washington, DC, see current and proprietary data. We focus on levers
wait times and delays. that can be applied in the United States, but
Open data on bus and train location and many of the levers we identify would work in
road congestion can shrink the “reliability other nations and have been applied in
health-care systems around the world.5
4
buffer”—the extra time a traveler builds into ravel Time
T
Reliability: Making It
a trip to account for possible delays, which
There On Time,
can be as much as 70 percent of total trip time.4 Right living. An enormous and largely All The Time, US
Open data on vehicle location and on-time untapped source of value in health care lies in Department
performance can also help attract new users the use of data by patients to manage their of Transportation
because of the increased predictability of own health to avoid illness and to get better Federal High-
way Administration,
services. In Duluth, Minnesota, for example, results from treatment if and when they
2006, dot.gov.
Google Transit installed transponders that do become ill. The major focus is providing 5
This section relies
record city-bus locations and make the data patients with the information they need to heavily on research
public so riders can decide if it offers make healthy lifestyle choices and to manage documented in
a suitable alternative to driving. After the their treatments effectively. The ‘big data’ revo-
lution in healthcare:
transponders were installed, ridership Health-care data that are made more liquid
Accelerating
increased by 12 percent, reducing traffic and can reduce the occurrence of lifestyle-linked value and innova-
also decreasing the cost of transportation conditions and illnesses (such as hypertension tion, January 2013,
for many passengers. and diabetes) by better identifying at-risk mckinsey.com.

open data/it
individuals. This is done by combining patient actions for a specific patient before a phy-
information (such as exercise habits) with sician selects a drug treatment or performs
demographic information and then analyzing a radiologic test.
outcomes across different patient populations. Open data can also be used to mount a
At-risk patients can then be targeted for vigorous response to disease outbreak—
health education or for assistance in prevent- another aspect of right care. Public-health
ing illness—for example, by recommending agencies collect data from emergency
screenings or issuing personal reminders. rooms and other sources to detect outbreaks
Open data can also help with drug adher- of certain diseases so that members of the
ence—failure to use medication as prescribed public can take steps to protect themselves.
for chronic conditions costs the US health- Google has shown that it can map a flu
care system $100 billion to $289 billion a outbreak in real time by monitoring the
year.6 Ginger.io has developed a smartphone number and locations of users search-
app that can detect when a patient is not ing for “flu” and related topics. A start-up
using drugs correctly or has changed behavior called Propeller Health has created
in a way that indicates a potential medical a GPS-enabled tracker that monitors inhalers;
emergency. The app collects motion data to it can be used to detect when environ-
establish a base pattern and then looks mental conditions such as high pollen counts
for deviations that might signal trouble; a might trigger severe asthma problems.
sharp drop in activity, for example,
might indicate that a patient has stopped Right provider. “Right provider” means
taking antidepressants or has fallen identifying the doctors and care settings that
down. Irregular sleep patterns could signal provide high-quality care for a specific task
that an anxiety attack is imminent. and determining which resources are needed
to deliver it (for example, determining
Right care. Research shows that suboptimal which procedures are best done by a physi-
care is often the result of poor communication cian assistant or nurse rather than a
between patients and doctors and among doctor). Optimizing provider decisions
doctors themselves. This leads to inappropri- depends on many organizations having access
ate or redundant care that can result in to performance data. Performance data
complications and raise costs. can be used to align incentives with outcomes
Electronic medical records can help avoid (for example, paying doctors for successful
these problems by creating a single con- treatment rather than for procedures).
6
“Meera Viswanathan solidated record for each patient and giving This approach can give patients better
et al., “Interventions access to all the patient’s caregivers. In options and raise the quality of care. For
to improve the United States, participating providers example, in Arkansas, all Medicaid providers
adherence to self-
can offer patients access to their own who treat upper-respiratory infections,
administered
medications for
medical records—their medical MyData— pregnancy, attention-deficit-hyperactivity
chronic diseases through an initiative called Blue Button, disorder, and select diseases receive
in the United which was pioneered by the Department of a report on the cost and quality of treatment.
States: A system- Veterans Affairs. In France, patients can The aggregated data on all a provider’s
atic review,”
carry their entire medical histories on a smart claims help doctors understand how their
Annals of Internal
Medicine, 2012,
card—a card with a memory chip that any practices compare with other providers
Volume 157, Issue doctor or care facility can use. The system can in the state, giving them a way to identify
11, pp. 785–95. also flag potentially harmful drug inter- opportunities to improve. New York

State in the United States and the National can be extremely serious. Government,
Health Service in the United Kingdom providers, and payors must ensure that effec-
have opened up data about hospital perfor- tive systems are in place to keep shared
mance. These data can be used by patients, medical records confidential.
doctors, payors, and the public to identify the
best care available in their communities.
Making information more transparent is an
Right value. Open data can help increase important first step toward improving
value in health-care delivery by controlling public services, increasing transparency, and
costs and improving quality. This includes saving taxpayer money, but it is not sufficient
using data to eliminate fraud, waste, or abuse to capture the value of open data. Govern-
in the Medicare and Medicaid programs, ments, like private institutions, will need to
which can exceed $70 billion annually.7 Regu- prioritize opening the data sets that will
lators can combine claims data with public create the greatest benefits; they will also
information about patients (such as date of need to invest in technology and culti-
birth, address, employment, or registry vate a vibrant network of third-party develop-
of motor-vehicle information) to confirm ers that can transform raw data into valuable
patient identity; this can help reduce tools. Additionally, they will need to
instances of billing for services that were not acquire and develop the talent, processes, and
provided. Using open and proprietary cultures to complement their technological
data to reduce costs, maintain quality, and investments. Key skills include the ability
7
edicare and Medi-
M
fight fraud could enable value of $50 billion to perform analyses, create useful reports and
caid Fraud, Waste,
to $100 billion a year. tools based on open data, and incorporate and Abuse: Effective
data into managerial decision-making Implementation
Challenges processes. In addition to meeting the techno- of Recent Laws and
Capturing the full value of open data in the US logical requirements of capturing the value Agency Actions
Could Help Reduce
health-care system would require several of open data, governments must also create
Improper Payments,
changes. The most fundamental one would be thoughtful policies that protect intellectual US Government
a shift in medicine and caregiving to data- property and ensure privacy of both consum- Accountability Office,
driven approaches, in which physician ers and institutions. n 2011, gao.gov.
decisions about treatment are informed by
results from thousands of patients.
Payment systems would also need to be
adapted because conventional means
of controlling costs, such as negotiating prices
of per-procedure fees, are not geared
toward taking advantage of the insights that
open data provide.
There are also technical and organizational
barriers to realizing the full value of open
data in health care, including the inability of
many health-care data systems to provide
standardized information. Finally, there are
concerns about privacy and confidentiality—
the consequences of mishandled medical data

open data/it Andrew Grant, Rohit Razdan, and Thongchie Shang
Coordinates for
Change: How
GIS Technology
and Geospatial
Analytics
Can Improve
City Services
An innovative technology harnesses data to reduce costs, improve services, and create a
better community for citizens.
We’re familiar with using maps to figure out

where to go, or how to get from point A
to point B. But now we can also use maps to
figure out where and when burglaries are
most likely to occur in a particular city, the
Andrew Grant is a director in McKinsey’s
parts of a country most in need of pre-
Singapore office, where Rohit Razdan is a principal natal health-care clinics, and where a parking
and Thongchie Shang is a consultant. spot just became available in a congested
neighborhood. The rapid retrieval and
1
Geographic-information systems (GIS) include the
presentation of such highly specific, extremely
hardware, software, data, management, and
analysis of geographically referenced data. The
valuable information is possible because
analyses based on GIS data are referred to of one innovative technology: geographic-
as geospatial analytics. information systems (GIS).1

GIS technology allows users to integrate technology. Many, however, have yet to
and analyze large, disparate data sets make full use of GIS capabilities, thereby
that involve geospatial information—in other potentially missing opportunities to
words, location data—and nongeospatial reduce costs, improve services, and create
information like population density or cus- a better community for their citizens.
tomer preferences. Through GIS, users We undertook extensive research of the use
can quickly detect patterns and trends that of GIS and geospatial analytics at the city level
might otherwise be overlooked—a per- to determine how urban areas could benefit
spective that helps them develop innovative from greater use of innovative geospatial
solutions to long-standing problems. technologies.2 The first section of this paper
While GIS has been in existence since describes our findings on the most relevant
geographic data met computers in the applications of GIS in city settings, focusing
1960s, the technology is constantly evolving. on those related to information dissemina-
The last few years alone have seen tion, planning and analysis, and service deliv-
particularly dramatic advances related to ery. The second section discusses three
several trends: key enablers that help GIS initiatives succeed,
• a sharp rise in the amount of geospatial including strategies to increase information
information available through smart- sharing among departments, partnerships
phones, credit cards, social media, GPS with private companies or academia, and an
devices, Google, and other sources emphasis on citizen cocreation. Through-
• an increase in the accuracy of data used out the document, we present case studies
to pinpoint locations based on our research to illustrate best
• an increased sophistication in the practices and potential results.
methods used to analyze geospatial infor- 2
This report is based
mation, which is partly enabled ‘Location, location, location’: How GIS on research
by the greater standardization of data technology and geospatial analytics im- conducted in over
30 cities, as well
and databases prove decision making
as interviews with
• advances in hardware, such as Dry definitions of GIS technology and GIS experts
improvements in GPS receivers and geospatial analytics do not convey their full from the private
range-finder devices power. For that, we need to look at real sector and
• maturation of open-source software, to examples. Some of the best come from the academia. When
examining cities,
make data more accessible to a broader private sector, where many companies
we conducted our
group of people have readily adopted geospatial analytics. most in-depth
These changes have produced a quiet revolu- UPS, for instance, famously used geo- research on those
tion in which geospatial data are increasingly spatial analytics to direct its drivers to more that were using
applied in new and innovative ways. (They efficient routes that favored right turns geospatial analytics
in the most
have also heightened concerns about data pri- over left. Since many states in the United
innovative and
vacy.) Private companies, recognizing States allow right turns on red, this change sophisticated
that GIS can help improve profitability and reduced idling time and cut fuel costs ways. Our research
optimize many aspects of their business, by $3 million annually. Other companies, allowed us to
have welcomed the advances and invested such as Starbucks, now offer mobile create more than
150 case studies
heavily in GIS initiatives. Some govern- applications that help consumers locate the
about the
ments, both local and national, have also nearest store based on their phone’s GPS use of geospatial
launched new geospatial projects that data. And ComfortDelGro, Singapore’s largest analytics in
fully exploit the recent advances in data and taxi company, has an app that identifies urban areas.

open data/it
the location of people who want rides using In San Francisco, the SFpark initiative
data from their smartphones. collects real-time information about available
Like their private-sector counterparts, parking spaces using sensors embedded
some governments have started to incorpo- in lots and ports the information to a public
rate sophisticated geospatial analyses into website. The system also adjusts prices
decision-making processes. Experience shows dynamically—charging less in areas with many
that three areas can reap significant benefits open parking spaces—in response to shifts
from GIS and geospatial analyses: informa- in demand. Among other advantages, SFpark
tion dissemination, urban planning, and reduces traffic congestion by decreasing
service delivery. Across each of these areas, the number of drivers circling and double
GIS technology and geospatial analytics parking. The public, in turn, benefits by
can increase speed, accuracy, and cost having more certainty about available spaces.
effectiveness related to a wide range of govern-
ment priorities, including those related to Planning and analysis
crime prevention, emergency management, Just as geospatial information helps compa-
disaster recovery, social services, health nies find the best locations for their stores,
care, transportation, urban planning, envi- bank branches, or other businesses, it
ronmental initiatives, and facility planning also helps governments determine where
and management. to place publicly funded facilities, such
as hospitals, clinics, sporting arenas, subway
Information dissemination lines, police stations, and community
People often complain that it is difficult to centers. In Uji City, Japan, for instance,
learn about available government pro- planners used GIS technology and
grams, regulations, and services, in both geospatial analytics to reduce the time and
developing and developed countries. effort required to determine where new
The problem is usually not that governments child-care centers should be located. Through
lack data on these topics; it’s that the their analyses, they could rapidly identify the
information is either inaccessible to areas with the highest density of young
the general public or too complex to allow for children and then visualize the information
rapid interpretation. on a map.
GIS technology, with its mapping capabil- Beyond facility placement, GIS technology
ity, can help the public visualize information and geospatial analytics can also help
about their communities in a more rapid, with a number of other planning decisions.
interactive way. Hong Kong, for instance, has For instance, Boston has created a GIS
used GIS and geospatial analytics to map of renewable-energy sources, such as
create an online street map that shows where solar and wind systems, to guide invest-
historical sites, cycling tracks, and other ment decisions, track clean-energy progress,
public facilities are located. Users can easily and meet the mayor’s goal to reduce
navigate through the map with a cursor greenhouse-gas emissions by 25 percent by
and click on a location to see more detailed 2020. City planners designed the map
information. Cities have also released to show the location of the energy source and
GIS technology and geospatial analytics to details about each site, such as the name
disseminate more complex information, of the installer and the kilowatt rating. As
including data that citizens would have diffi- another example, the National Library
culty finding through any other source. Board in Singapore uses geospatial informa-

tion to analyze public-library visitorship areas, discovering that a lack of quality stores
and book-loan transaction trends. By geo- was correlated with poor health. Planners
coding millions of transaction records, integrated this information into their
the board can identify hotspots of library decision-making process to identify areas
usage, such as the most popular branches, of high need and change zoning for
and develop strategies for targeted grocery stores—a move that could decrease
outreach and optimizing book collections. residents’ dependence on fast food or
An ambulance in
New York City is also active in using other unhealthy alternatives. (Note: some
the suburbs of
GIS technology to improve the lives of its studies have not shown a correlation Chicago is tracked
residents. For example: between improved access to grocery stores in real time with
and health outcomes.) CompassCom
• Analysts in the city’s Food Retail Expansion technology, which
integrates GIS
to Support Health (FRESH) program mapped • Planners in New York City use the Hazards
and GPS to track
health issues such as the prevalence of US tool, developed by the Army Corps of vehicles for
diabetes and obesity. The program correlated Engineers and the Federal Emergency businesses and
outcomes to grocery-store catchment Management Agency, to identify geographic municipalities.
© Brian Brainerd/denver post via Getty Images

open data/it
GIS
Exhibit 1 of 2
Exhibit 1
New York City uses the Hazards US (HAZUS) tool to
identify at-risk geographic locations and buildings and
estimate potential flood damage.
FEMA and Army Corps of Engineers developed HAZUS, a model to estimate
losses from natural disasters
1 Identify which geographic areas and

buildings are at risk
The city is divided into grids, which are categorized 3 HAZUS can estimate the cost of the storm,
by 35–40 different building types given a potential flood:
Flood analyses determine which areas are at risk of • Repair costs for buildings
flooding and how high the water could be to • Estimates of quantity and type of debris in
identify buildings at risk each grid
The analysis can be done for different mitigation

2 Develop damage estimates for buildings scenarios (eg, flood proofing, levies) to quantify
avoided costs and identify the most appropriate
For each building type, HAZUS has “damage countermeasure
curves,”1 ie, the expected damage to a building
based on depth of flooding and time the
building is inundated
1 These curves were specially customized to New York City’s building stock.
Source: Interviews with New York’s Office of Long-term Planning and Sustainability; interviews with New York’s
Office of Emergency Management; Federal Emergency Management Agency (FEMA)
areas and buildings at risk of flooding, as struggle to provide high-quality services to all
well as the potential economic loss from such segments of society, especially when large
damage. They incorporate this information or demographically diverse areas are involved.
into investment decisions on climate-change When governments fail, the consequences
initiatives (Exhibit 1). can be severe, ranging from lagging test scores
among schoolchildren to crime surges in
Service delivery neighborhoods that suffer from inadequate
Governments control a broad array of police coverage.
decisions related to education, health-care Government leaders and public-sector
provision, and public safety. Yet they can employees can improve service delivery by

using GIS and geospatial analytics to optimize smoking-cessation programs there. The NHS
resource deployment. For example, health has also used GIS to map the prevalence of
departments and emergency services could other health conditions, such as the number
use geospatial analytics to pinpoint the of diabetes-related amputations, and
best locations for dispatch facilities or hospi- used the information in geospatial analyses to
tals based on projected ambulance transport determine where it should launch various
time. Governments can also use GIS infor- health initiatives (Exhibit 2).
mation to determine which locations are most Governments and citizens can use GIS
in need of specific services. In the United technology and geospatial analyses to
Kingdom, for instance, the National Health improve service delivery. In Boston, citizens
Service’s (NHS’s) “New Leaf” program can report municipal problems, such
uses GIS to locate areas with a high number as vandalized or damaged public property,
of smokers. It looks at the number of through its Citizens Connect program.
patients with chronic obstructive pulmonary Users can identify issues through the pro-
disease or other illnesses commonly gram’s website or call center, or by
related to smoking, as well as areas that have using a mobile application. All reports are
a high number of people who fit the demo- geotagged, directed to the appropriate
graphic profile associated with smokers. After agency, and resolved as promptly as possible.
GIS
identifying high-risk areas, the NHS locates For instance, when numerous Bostonians
Exhibit 2 of 2
Exhibit 2
Geographic-information systems and geospatial analyses
help the UK National Health Service determine where specific
health initiatives should be offered.
Health-care topics investigated Initiatives supported or informed

• Amputations due to diabetes • Immunization drives • Drug-addiction outreach
• Access to dentists • Dental-hygiene drives • Healthy-eating campaigns
• Infant-mortality rates • Anti-obesity campaigns • Liquor-license-renewal lobbying
• Rate of healthy-eating habits • Diabetes-awareness campaigns • Specifying which drugs
pharmacies should carry by region
• Free health screenings
• Family-planning campaigns
• Breast-cancer screenings
Source: National Health Service

open data/it
For concerns about the ability of GIS

technology to track individuals, as well as
the ways that city governments are
Are there privacy protecting citizens, see sidebar “Are
there privacy concerns?”
concerns?
GIS in government: What needs
Few people doubt the benefits of GIS technology, but to happen
there are increasing concerns about how information on Governments with extensive GIS experience
people’s behavior, personal characteristics, or history may have sufficient skills and resources
is tracked and revealed. Governments can mitigate risks needed to implement new initiatives rapidly.
and alleviate concerns by aggregating data to a level Those with less experience may find it
that prevents individual identification. For example, some helpful to proceed in phases, running pilots
city governments now collect cell-phone data to and developing detailed business cases
monitor traffic patterns, but protections are in place to before building capabilities at scale. This
ensure anonymity. Telecom players typically assign approach can allow governments to build
random identification numbers to each phone number robust databases and supporting systems, as
and change them every 24 hours. Since the govern- well as a fully functional GIS team, before
ment is only provided with the anonymized information, beginning large-scale projects.
it cannot identify the location and travel patterns of Governments may have different capa-
specific citizens. The database of location information bility levels and objectives for GIS programs,
is also purged after a specified period, and only but they can all benefit from three
aggregate or analyzed data are retained. key enablers:
• sharing information across government
• pursuing partnerships with the private
sector and academia
• promoting citizen cocreation
complained that bulk-item trash pickup was
difficult to arrange, the city responded Sharing information across
by sending pickup dates in real time and the organization
automating the scheduling process. Government workers around the world share
Many other US cities have since developed or a common frustration that it is difficult to
are in the process of developing similar exchange data with other departments. This
phone centers, often known as 311 services, obstacle limits the value of GIS analyses,
that allow citizens to report problems. which require multiple agencies to contribute
As another example, Boston’s Street current geospatial and nongeospatial data,
Bump app allows citizens to help improve including information on demographics,
neighborhood streets. As users drive, health-care utilization, travel and transport,
the app’s accelerometer senses bumps that terrain, building attributes (such as age
indicate a pothole and records their and height), and 3-D images of land, topogra-
location. The data are collected and analyzed phy, or building layouts.
using algorithms that filter out bumps In many cases, information sharing is
related to manhole covers and other normal difficult because government departments
infrastructure. After identifying true rely on different data sources and com-
potholes, a crew is dispatched to repair them. puter platforms. Getting all groups to agree

on a uniform approach to data collection between departments and helps all involved
and management would facilitate progress, personnel find information more easily.
but this may not be possible in decentral- In Boston, a central GIS team worked with
ized systems where agencies operate autono- multiple agencies to develop the “SnowCop”
mously. More centralized governments, program to improve street clearing after
especially those where one person is in storms. It allows city managers to make deci-
charge of GIS initiatives, are more likely to sions about where to deploy plows in
be successful in adopting a common response to geotagged citizen requests, GPS
platform and sources. In San Francisco, information on the location of plows, and
which takes a centralized approach to data about the time a street was last cleared.
geospatial analytics, the Enterprise GIS The collaboration was so successful
Program maintains ownership of com- that Boston is now using a similar strategy
monly used geospatial data and uses this to address other municipal issues.
when providing services to city depart- In addition to management of multi-
ments and the public. (Importantly, more agency projects and data retrieval, effective
specialized data are maintained in central GIS teams may take the follow-
individual departments.) ing measures:
If governments do create uniform platforms • work collaboratively with other staff
for information exchange, they can benefit at government agencies to develop GIS
from considering instituting safeguards to applications and services
ensure that data are adequately protected. For • provide geocoding assistance, such as
instance, data sets could be classified into translation of a database with addresses
levels based on sensitivity. The lower layers to x–y coordinates for mapping
would be accessible to all or most personnel, • create training programs and
with progressive access restrictions for support in-house staff in developing
higher layers. With such protections in place, GIS capabilities
departments might be more willing to share • incorporate GIS technology into
information. For more information on security existing business processes and suggest
concerns, see sidebar “Are there security additional improvements
concerns associated with GIS data?” • manage issues with GIS systems, such as
Governments may also facilitate informa- the transition from legacy programs
tion exchange—and possibly reduce costs and • assess an agency’s current GIS tech-
timelines—by establishing a centralized nology and provide advice on appropriate
GIS expert team that oversees joint projects software programs and GIS trends
If governments create uniform platforms for

information exchange, they should consider safeguards
to protect data.

open data/it
Pursuing partnerships with the private worked with the government to create
sector and academia a geospatial tool that identified areas in the
Governments, businesses, and academics city where the public was at high risk for
are all pursuing geospatial initiatives, dengue fever. Based on data from the govern-
and there may be some overlap among their ment’s Food and Environmental Hygiene
efforts. Building partnerships across rele- Department, the CUHK researchers deter-
vant organizations and sectors can allow mined the number of mosquitoes—the primary
different groups to pool their capabilities and means for transmitting dengue fever—
resources, thereby reducing redundancy found in traps throughout the city. It also
and helping to catalyze better insights. tracked temperatures—a key indicator
Some of the most compelling partnership of where dengue-carrying mosquitoes are
examples come from the health-care sphere. more active—using data provided by the
For instance, a research team from the public Hong Kong Observatory. By combining
Chinese University of Hong Kong (CUHK) mosquito count and temperature informa-
Are there security concerns

associated with GIS data?
An investigation by RAND, a United States–based think tank, examined the dangers inherent in
releasing geospatial information by looking at 629 US federal data sets to determine what
information in them met the following criteria:
Usefulness. Could the data be used to identify a target and get location information
(such as facility construction details)?
Uniqueness. Was the information available through other sources, such as paper maps,
in-person visits, agency websites, or data tables?
Societal benefits and costs. Did the data provide important public-safety or
transportation-access information, such as locations of gas infrastructure or bus stops?
Does the value of providing the information to the public outweigh potential
negative outcomes?
The RAND analysis found the security risk was low. For instance, fewer than 6 percent of data
sets contained information that could be used to identify a target or plan an attack, and
fewer than 1 percent were both unique and useful. The researchers also determined that no
single data set provided attackers with information that was essential to their plans.

tion, the researchers were able to create an questions to arrive at solutions. It also helps if
online heat map that showed high-risk both parties have compatible computer
areas. Users can see alert levels for the city as systems, or at least use the same data sets,
a whole or for individual districts. They since they will otherwise have difficulty
can also enter their address to receive dengue sharing information (similar to the challenge
alerts for selected areas. that government departments face when
In another partnership, the Shanghai trying to integrate incompatible systems).
municipal government worked with As part of the partnership, both parties
Veolia Water Corporation, a company that should reach an agreement about who “owns”
manages water and wastewater services, the data and any resulting tools or insights.
to install and monitor sensors throughout the This understanding can help avoid potential
3,300-kilometer piping network. Through legal battles over intellectual-property
this collaboration, Shanghai obtained real- rights. While both parties might have an equal
time, detailed, geotagged data about water claim to the data, other partnerships
pressure and quality. The city used this infor- might involve more one-sided agreements
mation to identify precise locations of in which a single group has the right to
network issues, such as leaks. The real-time use the findings.
data dramatically improved response
time for repair crews, which translated into Promoting citizen cocreation
less damage to the water infrastructure, It is often time-consuming, expensive, and
lower maintenance costs, and reduced tedious to compile the extensive data sets
disruption of services. The information also needed for geospatial analysis. But govern-
helped crews see which pipes were at ments may be able to reduce some of the
risk for rupture and group them accordingly, complications by promoting citizen involve-
which helped set priorities for preven- ment in various ways. For instance, as in
tive maintenance. Boston Connect, the government could call on
In some cases, cities have partnered with citizens to report problems in their neigh-
multiple external groups on GIS initiatives. borhoods, such as damaged public property.
For instance, the Wellbeing Toronto website Although governments cannot mandate
provides a color-coded online map that participation, they may find that public
residents can use to visualize how neighbor- interest is high and that people want to be
hoods rank on various indexes, including part of the solution, especially for problems
health care, housing, culture, transportation, that concern their own neighborhoods.
and education. They can also combine Governments could also encourage citizen
several domains to create a composite well- participation by offering themed compe-
being index. When developing Wellbeing titions or “hackathons” in which computer
Toronto, the city obtained data from numerous programmers, professional or amateur, 3
Eric Braverman
external groups, including a local hospital, develop geospatial applications based on and Michael Chui,
York University, and the Wellesley Institute, public data. For instance, the US Department “Unleashing
a Toronto-based nonprofit organization. of Health and Human Services holds meet- government’s
The most successful partnerships typically ings in which it shows stores of data to leading ‘innovation mojo’:
An interview
involve two or more parties that are health-care and technology experts. The
with the US chief
equally invested in the project. Rather than agency then challenges them to develop apps technology officer,”
simply exchanging data, they are willing based on the information and present them June 2012,
to meet, share ideas, and talk openly about at “Health Datapaloozas.”3 mckinsey.com.

open data/it
A central database of public reports can promote

efficiency by reducing response times and making it easier
to analyze data.
If governments decide to collect informa- If governments do encourage citizen

tion from the public, it might be helpful cocreation, they should ensure that safe-
to create a central database of all reports and guards are in place to filter “noise”
requests, which will provide officials with from the system, such as prank calls or
an integrated view of the issues that matter frivolous complaints. For instance,
to constituents. A central database can callers who make nuisance calls could be
also promote efficiency by reducing response fined or even charged with criminal
times and making it easier to analyze data acts. Some cities have also had success by
(such as the number and type of requests by requiring users to create a login or pass-
location). New York City, for example, has word to monitor their activity.
a GIS-enabled service, NYC 311, which serves If many citizens begin contributing infor-
as a one-stop service for municipal issues. mation, governments may be overwhelmed
To create this department, the city consoli- with data or requests for service. To ensure
dated call centers from 14 agencies and the most important problems receive the
also began online and mobile-reporting most rapid attention, officials can create pro-
services. NYC 311 now receives over 60,000 cedures for prioritizing reports, similar to
calls daily. Benefits of the centralized group how emergency phone calls are ranked.
include the following. One major hurdle to citizen cocreation
programs is a lack of public awareness.
Increased convenience. Citizens only If only a few people are making complaints or
need to know one phone number or website to sharing information, the data may not
receive help from all city agencies. accurately reflect the concerns of the popula-
tion as a whole. Some cities, including
Greater efficiency. NYC 311 has set rules for Boston, New York, and Seoul, advertise their
routing calls, which helps ensure that they go geospatial services to increase awareness.
to the right agency. One-stop reporting also Others publicize helpful civic tools that were
eliminates the time-consuming step of having created based on city data, which also
one agency to contact another if it receives increases public awareness. For instance, the
a request outside of its purview. government of Singapore arranged to have
exhibits displayed at the Singapore Art
Better performance management. All service Museum related to real-time geospatial data.
requests are tracked centrally and top The exhibits visualized how the time
managers receive frequent progress reports. needed to get a taxi increased during rain,
If there are problems—for instance, changes in air temperature related to air-
specific requests that take a long time to conditioner use, shifts in traffic-flow patterns
resolve—managers can review work processes throughout the day, and other interesting
to identify areas for improvement. aspects of life in the city.

As with partnerships, cities must carefully To achieve the potential, we see a major The authors
consider intellectual-property issues role for geospatial analytics in three areas: would like to thank
their McKinsey
during citizen cocreation projects. If the city information dissemination, urban planning,
colleagues Nadir
owns the data but the work was done and service delivery. Governments can Ait-Laoussine,
by a private citizen—for instance, a computer strengthen their performance by ensuring Brian Cooperman,
program based on city data—there that key enablers are in place before Clayton Hunter,
could be disagreements over which party launching extensive GIS programs. As GIS Nicole Leo, David
Newsome,
should profit. adoption grows, it could potentially have
Jonathan Ng, and
an even greater impact in the public sphere Oliver Tonby for
than the private sector, given the scope their contributions
City governments are increasingly open to and scale of government services. n to this paper.
GIS initiatives, partly because of the impact
they are observing in the private sector,
but few have embraced their full potential.

Open Data/IT Jürgen Laartz and Stefan Lülf
Partnering
to build
smart cities
Better communications between local government leaders and technology vendors
can encourage the development of connected, resource-efficient urban areas.
A study by the McKinsey Global Institute traffic load across its transportation systems.
suggests that the world’s 600 fastest- The same city may use so-called intelligent
growing cities will account for 60 percent of meters to better match electricity supply with
global economic growth between 2010 demand or to detect water shortages. In
and 2025.1 To achieve and sustain this level either case, officials can use the information
of growth—and to acknowledge recent collected to adjust schedules, equipment,
Jürgen Laartz
is a director in
urbanization and climate-change trends— and other variables accordingly, thereby opti-
McKinsey’s Berlin municipalities in both emerging markets mizing potentially scarce resources.
office, and and developed nations must pay closer Municipalities in Europe and elsewhere
Stefan Lülf is attention to the way they manage resources already have smart-city initiatives under
a consultant in
and infrastructure. way, piloting new technologies in certain city
the Munich office.
Many are pinning their hopes on smart-city districts. The leaders of 22@Barcelona,
1
For more, projects. Broadly, the term “smart city” for instance, are seeking to convert an older
see Urban world: refers to the use of innovative technologies in industrial area in Spain into a modern,
Mapping the complex urban environments to manage attractive city district offering energy-efficient
economic power
resources and infrastructure in a sustainable residential and office buildings and public
of cities, McKinsey
Global Institute,
way and create opportunities for growth. green spaces as well as a knowledge-sharing
March 2011, on A city may use intermodal route-planning environment that will lure innovative
mckinsey.com. software, for instance, to help balance the companies and workers.

Several technology firms have already
established departments dedicated to
researching and marketing products aimed at
addressing cities’ traditional and smart-city
infrastructure needs. But the market for such
solutions is still quite immature, and
the reality is that the technologies that are
© Stephan Zabel via Getty Images

being implemented in full-scale rebuilding
projects may not be suitable for projects
in which only incremental improvements to
existing infrastructures are required.
Our analysis of 50 smart-city projects in
Europe reveals that nearly all were launched
as pilots with tailor-made solutions rather
than as scalable initiatives. For the most part,
neither city officials nor technology vendors
have been willing (or able) to risk investing in
large-scale demonstrations—which is who will ultimately use, and in most cases Power electricity
why the financing for smart-city projects still pay for, the solution. measurement.
comes mainly from subsidies provided
by governments and research institutions Technology vendors and cities:
rather than local budgets. When smart- a complicated relationship
city initiatives are launched, there is huge We wanted to understand how cities and
variation in the way private- and public- technology vendors could collaborate more
sector representatives collaborate, as well as effectively on smart-city projects and
in how projects are managed within cities. grow the market for these solutions. So we
Our findings reflect the need for city partnered with the industry network
officials and technology vendors to come to Innovation Roundtable to conduct a series
a shared understanding about the require- of workshops and discussions with city
ments and restrictions associated with leaders and industry vendors from about 30
municipal development. The European Union European cities, mainly in Germany.
has taken a step in that direction with its Those conversations revealed a significant,
creation of the European Innovation Partner- but not insurmountable, gap between
ship for Smart Cities and Communities, each side’s expectations and the realities of
a program designed to encourage investment smart-city projects (see sidebar “About
in large-scale implementation projects the research”).
from a consortium of EU cities and industry
players. But besides pursuing funding What cities expect from
from national and supranational budgets, one technology providers
of the most critical tasks for cities and Collaboration among cities and industry
industry vendors is to spend more time players in the infrastructure sector started long
systematically listening to and learning from before the phrase “smart city” appeared,
one another, while still incorporating input but the implementation of different kinds of
from citizens and others in the local business complex (and thus riskier) technologies
environment. After all, these are the people requires vendors to adapt even more to

Open Data/IT
their audiences. The city officials we inter- work, city leaders say, because the products
viewed saw a lot of potential for improvement and services created for megacities are
in this customer interaction; they also had often inappropriate—by measures such as
valuable feedback to share about the current functionality, complexity, and cost—for
portfolio of products being offered. classic European cities with about a half
million inhabitants.
Customer interaction: More
appropriately tailored to cities No integration of solutions. The city leaders
From the cities’ perspective, many vendors we spoke with do not feel as though vendors
focus too heavily on product presentations are offering outstanding expertise in integrat-
and neglect to detail exactly how the proposed ing solutions, delivering operating models,
technologies can be integrated with existing and incorporating technology into the city’s
systems in complex municipal environments. local ecosystem—for instance, discussing
Officials say they are often left wondering how to involve local partners, and at what
whether the vendor truly understands the stages of the project.
challenges the city is facing. Specifically, they
cited the following issues: Proprietary solutions. Many cities are anxious
• The vendor’s explanation of the technol- about becoming dependent on a single
ogy is too complex. technology and provider in the course of
• The vendor’s presentation never refer- implementing a smart-city solution.
ences the decisions or specific challenges Industry standards for smart-city technolo-
the city faces. The potential value of gies are still emerging, and no one wants
the technology is therefore not transpar- to be locked in for the long term.
ent enough.
• The vendor often neglects to explain What technology vendors expect
how the financing and operating models from cities
are meant to work until much later on. Technology-firm managers shared with
• The city’s core issues are not ade- us these three main opportunities for
quately taken into consideration. This is improvement regarding their interactions
especially true in cases where data with city officials.
protection, dependency on providers, and
the reliability of the technology are A clearer agenda. The managers perceive
in question. that many cities are dealing with smart-city
concepts one project at a time, without an
Product portfolio: Suitable solutions overarching agenda. This is less than optimal
for midsize cities from the vendor’s perspective, since more
City representatives offered these three main important city projects could crop up and
concerns about technology firms’ products undermine the city’s long-term investment of
and services. scarce financial and political capital
in a smart-city infrastructure. The vendor
A focus on megacities. City officials believe therefore has less incentive to commit.
that technology vendors target most of Complicating matters further, smart-city
their attention on megacities and then try to technologies by their very nature veer
sell the same project-based solutions to a from the status quo—which means they may
mass market of smaller cities. This does not have a harder time getting added to the

agenda in the first place. In their consider-
ations of new technology investments,
city stakeholders may favor bids that refer-
ence solutions that have been used to About the
that point. They may limit their support for
riskier solutions. research
Less complicated stakeholder and project In 2012, together with the Innovation
management. Vendors told us that city Roundtable (IRT), we started a series of
officials fail to recognize how cumbersome the workshops and discussions with more than
management of smart-city projects can 60 representatives from 30 European cities
be for technology providers: these projects (mainly in Germany). The IRT is an informal
typically involve many different stake- network of high-ranking research managers
holders from within a city and from other from renowned German companies in
levels of government. A traffic project various sectors. Based on the workshop
in one major city required participation and results, a smart-city panel was formed; this
input from no fewer than 13 different city group meets regularly to discuss cities’
and government agencies, for example. In innovative technology projects and different
another city, responsibility for its various funding options, and to exchange ideas
websites was split among several different associated with smart-city development. The
people, and the webmaster controlled recommendations highlighted in this paper
only half the sites. are an outgrowth of this initiative.
Citizens’ support. The introduction of new

technologies always prompts some level
of skepticism and pushback, so it is critical
for those who will ultimately be affected ated with Stuttgart 21, and the project
by (and pay for) the smart-city project to turned into a political lightning rod. It was a
participate in discussions about its usage and key factor in the 2011 state elections.
potential effects. The managers we inter-
viewed noted there are limits to what they can Bringing cities and vendors together
do to convince local citizens about a project’s So, city officials believe the industry does not
potential benefits and outcomes. City understand them, and technology vendors
administrators must therefore take the lead in think dealing with cities is too complicated.
gaining support for the proposed project— For these perspectives to change—and for
outlining the branding and quality-of-life smart-city development to grow and become
benefits along with the financial advantages. a viable approach for economic growth—
The decade-long German railway and both sides must come to the table. Here are
urban-development project Stuttgart 21 some recommendations for bridging
provides a lesson in how vital citizens’ the gap.
participation is to success in major infrastruc-
ture projects: citizens and advocacy groups Recommendations for technology firms
that had not been involved at the beginning of Tailor your discussions with cities. Vendors
the project spoke out against the mounting should fundamentally rework their approach
expenses and environmental impact associ- to selling products, emphasizing how

Open Data/IT
Smart cities
Exhibit 1 of 2
Exhibit 1
Project presentations should be tailored to each
city’s individual needs.
Topics that should be covered in a presentation to city leaders
Project Relevance Operating Technical Organizational Possible

objectives to city model realization realization risks
Clearly articulate Show how the Explain the Give a simple Plan how partners Address cities’
the objectives product relates operating and brief will be involved on typical concerns
of a smart-city to the city’s model for new overview of local level
• Reliability
solution agenda technology, the new
emphasizing the technology Present a • Dependency
Demonstrate city’s own role communication issues
relevance to strategy for
• Data protection
concrete Detail the city’s winning over
city-specific expected financial citizens to the new
challenges commitment technology
solutions can be implemented and not the (Exhibit 2). Medium-size cities need smaller-
nuts and bolts of the purchase process. They scale solutions. Technology firms will need
should present fewer details about the to research and design standardized products
technical aspects of the hardware or software that are pitched directly to this cohort—
in play and answer more questions about products that incorporate lessons from larger
how it will be used from day to day: What is smart-city projects but also factor in the
the operating model? Who among the needs and opportunities that smaller cities
local partners needs to be involved in its face. Pricing structures and financing
rollout, and to what degree? Potential options may need to be configured differ-
concerns about data protection and interoper- ently, for example, given the unique
ability should be addressed during the first programs and infrastructures found in
meeting with city officials (Exhibit 1). smaller cities.
Develop solutions for midsize cities. Compa- Ensure interoperability. Vendors need to take
nies need to offer affordable solutions cities’ concerns about being dependent on
for midsize cities as a complement to their a single provider seriously and address them
existing solutions for megacities. After explicitly. One viable option would be
all, conurbations with between 150,000 and to use “open” interfaces that allow for better
5,000,000 inhabitants in the European integration with existing systems and that
Union account for 42 percent of GDP, whereas enable cities to switch to another provider (if
megacities with more than 10,000,000 necessary) at the end of a contract. This
inhabitants contribute just 12 percent would require the development and enforce-

ment of industry standards, especially for Recommendations for cities
data exchange (such as the Open Metering For smart-city projects to gain traction,
System used with smart electricity meters). technology vendors told us, city repre-
Although it may seem more appealing to lock sentatives need to be strong partners who
in cities for the short run, using open make fast, sustainable decisions. Their
interfaces will increase total market size (and responses point to the following three main
potential business for vendors) in the long actions for municipalities embarking on
run. The national and supranational agencies smart-city projects.
that are subsidizing the adoption of smart-
city technologies are increasingly including Formulate a clear political agenda. A project
“interoperability” as a prerequisite in implementing new technologies poses
their applications for funding—a development challenges that are different from, say, an
that vendors are not yet prepared for. And initiative to renovate roads. It requires
more cities will be willing to implement clear political will and strong support from
Smart cities smart-city solutions if they do not need to fear both local government and city administra-
Exhibit 2 of 2 a long dependency. tion. Officials may want to rethink the current
Exhibit 2
Midsize cities account for more than 40% of GDP.
2010, %1
Number of
GDP of EU cities by city population, Share of agglomerations/
share of total GDP population conurbations
100% = €12.3 trillion
Megacities 12 >10 million people 8 3

Large cities 9 5 million–10 million people 6 5
19 2 million–5 million people 17 27
42% Midsize cities

23 0.15 million–2 million people 23 196
Small cities
and rural 37 47
regions
1 Figures may not sum to 100%, because of rounding.

Open Data/IT
specifications in their request-for-tender research institutions, and local citizens. The

processes, for instance, to allow for the appli- management entity not only serves as a
cation of innovative solutions. In Bottrop, central point of contact for all these constitu-
Germany, for example, the city council and encies but also contributes much-needed
city administration jointly approved a project-management expertise.
model city agenda with the goal of greatly
reducing carbon dioxide emissions (see Engage citizens and local businesses.
sidebar “Innovation City Ruhr: Bottrop as City officials need to devise a compelling story
a blueprint for a region”). Subsequent to engage the citizens and local businesses
projects that contribute to this goal are now that are intended to benefit from an intelligent
easier to get approved because there is infrastructure. For instance, one city was
already a fundamental consensus; all parties looking for innovative uses for its redevelop-
are committed to adopting innovative ment sites. Instead of acting unilaterally,
approaches. The story was the same in however, and issuing directives, city officials
another German city, which partnered with a assumed the role of coordinator and sought
telecommunications provider on several input from a range of stakeholders. Over the
projects designed to improve city operations course of many events and workshops,
and citizens’ quality of life—adopting a it compiled and debated ideas submitted by
smart-metering system, for instance, and an citizens, administrators, experts, associations,
online program for registering children and local businesses. At the end of the
for kindergarten. This partnership required process, it was able to produce a white paper
a multiyear commitment between the listing potential new uses already endorsed by
technology vendor and city councilors and large sections of the population, thereby
administrators. Because this commitment making it more likely that the recommenda-
was in place, a subsequent leadership change tions would be approved.
did nothing to weaken the broad support
for this smart-city agenda.
Innovative technologies can help improve life
Bundle responsibilities. As we noted previ- in cities, make economical use of resources,
ously, smart-city projects require involvement and ensure stable economic growth. But there
from numerous departments of the city are numerous obstacles to overcome to
administration, local companies, and organi- ensure the successful realization of smart-city
zations. Cities need to help vendors by concepts. Our interviews with leaders in
mapping these partnerships, defining roles industry and local government, as well as our
and responsibilities, and serving as a analysis of intelligent-infrastructure
central point of access for negotiation and projects in Europe, paint a picture of a still
information. For example, officials in immature market. Cities, technology
Berlin created a dedicated management entity vendors, and public funding institutions alike
that is responsible for coordinating activities need to work together to further develop
associated with the development of the Urban this market. Indeed, only strong, systematic
Tech Republic project in the area of the collaboration and learning among all the
soon-to-close Tegel airport. The conversion players involved will truly turn this into the
of this site will require high levels of co- century of smart cities. n
ordination among local and federal authorities,
multiple technology vendors, a handful of

Quick Take
Innovation City Ruhr:

Bottrop as a blueprint for a region
The Innovation City Ruhr In 2010, a group of com-
project in Bottrop, panies from the Ruhrgebiet
Germany, is a prominent launched a competition
example of a joint effort to identify a city that could
from industry players serve as a model for
and a city administration to reducing the carbon
develop a smart city. footprint in an industrial
region. Its best prac-
Bottrop is a city of around tices could then be passed
120,000 inhabitants on to other cities in the
located in the western part region and, eventually, to
other industrial cities
© WOtto WOtto
of Germany. Given its

population size, Bottrop around Europe. For the
could be considered convening companies, the
a small city or rural region. winning city would provide
But it is part of the a real-world demon-
Ruhrgebiet, a large con- stration of the value of the mission of more Town hall,
glomerate of mostly smart-city solutions. than 120 projects across Ernst-Wilczok Square,
Bottrop, Ruhr, North
midsize cities that are the city, all of which are
Rhine-Westphalia,
home to more than Bottrop won this competi- coordinated by a manage- Germany.
five million people. As such, tion by presenting ment company dedicated
Bottrop has developed an a clear commitment to to just this task and paid for
infrastructure, labor reducing the city’s by a local industry group.
market, and other charac- carbon footprint from all This company offers a
teristics similar to its political players; single interface into the city
those of midsize cities. the mayor was part of administration for
The Ruhrgebiet was the project-evaluation all vendors and handles
the industrial heartland committee, for example. a number of complex
of Germany for a very Additionally, more stakeholder-management
long time but has suffered than 20,000 members of tasks, including com-
from deindustrialization the Bottrop community municating with federal and
over the past few decades. expressed their support in EU funding agencies.
Several of the cities the application process.
in this area are now look-
ing for new ways to The overarching agenda—
attract investments. to radically reduce
Bottrop’s carbon dioxide
emissions—informed

Open Data/IT Shannon N. Bouton, Kate Toews, and Jonathan Woetzel
Capturing
efficiencies
through smart
technologies
Smart data-driven solutions are allowing cities to do more with less.
Mayors and city-agency leaders around large US city is using an automated system
the world aspire to help their local economies to dim or turn up street lamps based on
grow. But economic growth does not auto- sensors indicating the prevailing lighting
matically deliver a better quality of life for conditions—saving the city as much as
citizens. In fact, growth can often have 30 percent on energy costs. Other cities (in
unintended effects on communities and the California and Ohio, for instance) are
environment. Investments in new busi- relying on centralized control systems to
nesses, for instance, can provide more manage their electricity substations—
opportunities for more workers but can also the facilities that contain power lines, trans-
result in congested roads and smog. To formers, circuit breakers, and the equip-
achieve smart growth—delivering environment used to measure energy output and
Shannon N.
Bouton
mental as well as economic value—many distribution. The use of automation
and Kate Toews city officials are using data-driven solutions to technologies can help cities dramatically
are specialists in reduce spending, create efficiencies, and reduce power outages and transmission-line
McKinsey’s improve service delivery. losses; this is particularly significant
Detroit office, and
when you consider that there have been five
Jonathan
Woetzel is a
Energy major blackouts in the United States
director in Some cities are using smart meters to better in the last 40 years, three of which have
the Shanghai office. match electricity supply with demand. One occurred in the past decade.

Water and analytics to assess crime patterns and
Several cities are using geospatial data, audio assign law-enforcement personnel to higher-
sensors, and smart meters to detect water risk areas. In New York City, the illegal
shortages and system leaks, and to schedule disposal of restaurant waste has been a signifi-
repairs and maintenance. Shanghai has cant problem that has contaminated the
embedded sensors throughout its pipelines to city’s water systems. Previously, it had been
provide real-time information about water difficult to determine which restaurants
pressure and quality. Engineers can use the were violating the rules. Through the use of
data to identify rupture risks and respond analytics, however, the city was able to assess
proactively. Through the use of these innova- reports of clogged catch basins, along with
tive technologies, cities can reduce water- data indicating which nearby restaurants had
system leaks by up to 50 percent and not reported using licensed waste haulers.
continually monitor the quality of water This information helped inspectors identify
designated for human use. which restaurants might be illegally
dumping waste. As a result, inspectors found
Transport instances of illegal dumping in 95 percent
Smart technologies can relieve traffic conges- of the site visits they made.
tion and reveal inefficiencies in how cities In Boston, citizens can report issues with
manage their public-vehicle fleets—the cars, garbage collection, potholes, or a number
trucks, and other equipment owned and of other common municipal problems through
managed by the government. San Francisco’s its Citizens Connect program. Residents
SFpark initiative collects real-time informa- can use the program’s website, call center, or
tion about available parking spaces using a mobile application to file a report. The
sensors embedded in the spaces. The infor- reports are geotagged, making them easy to
mation is posted to a public website, and map and locate, and directed to the appropri-
the system adjusts parking prices dynamically ate agency, where problems are resolved
in response to shifts in demand, charging as promptly as possible. When numerous
less in areas with many open parking spaces. Bostonians pointed out that bulk-item
Meanwhile, Washington, DC, and the trash pickup was difficult to arrange, the city
states of California and Texas rely on open responded by sending pickup dates in real
data and GPS transponders to monitor public time and automating the scheduling process.
fleets and streamline operations.
City services As these examples suggest, smart solutions

The use of smart technologies can help are allowing cities to do more with less—
facilitate and improve basic city services—for creating additional capacity within the con-
instance, garbage collection, facilities straints of existing physical infrastructures.1
management, and public safety. The Indian These technologies enable the collection
city of Pune uses analytics to identify of direct feedback that mayors and other local
accident-prone locations and isolate common leaders can use to win support for change.
factors in accidents (such as the lack of Their use attracts businesses that want to be
1
ow to make a city
H
crosswalks or traffic-light timings that are part of a thriving, positive municipality.
great, McKinsey &
too quick) so it can improve the city’s Most important, city officials can use innova- Company,
traffic infrastructure. A number of cities in tive technologies to offer citizens improved September 2013,
Pennsylvania are using geospatial data services and better quality of life. n mckinsey.com.

Open Data/IT Pedja Arandjelovic, Aamer Baig, and Bassam Chaptini
Capturing value
from IT: A ten-point
plan for the
public sector
Targeting select areas could help state and local governments improve the efficiency and
effectiveness of existing public services and enable the creation of new ones.
Comprehensive and innovative technology create more efficient public transporta-

strategies, capabilities, and infrastructure in tion, and communicate more effectively
the public sector are no longer “nice to with constituents.
have.” Today, information technology plays However, many more governments are
a central role in all aspects of the business struggling to find the right mix of people,
of government. From citizen-facing services tools, management practices, and systems
such as renewing drivers’ licenses online required for successful public-sector IT
Pedja to back-end processes such as analyzing tax projects. All too frequently, governments’
Arandjelovic returns for accuracy, excellence in IT efforts to deploy new technologies or
is an associate is a prerequisite for excellence in the upgrade aging systems generate extra layers
principal in
public sector. of complexity rather than solutions.
McKinsey’s New
Jersey office,
There are compelling examples of govern- Through our work with governments across
Aamer Baig is ments worldwide that have harnessed the globe, we have identified the following
a director in the power of technology not just to improve ten-point plan for capturing full value
the Chicago office, services but also to ensure that important from IT. (See sidebar, “The ten-point IT
and Bassam
policies are implemented effectively, fairly, on plan.”) By addressing each of these
Chaptini is
an associate
time, and on budget. They are using geo- agenda items, public-sector officials can
principal in the New graphic-information-systems technology and optimize their returns on IT investments—
York office. data analytics to speed trash collection, reducing costs, gaining efficiencies,

delivering new services, and improving the likelihood of a project’s success by a factor
citizens’ experiences with government. of three.
A large US government department had not
Engage stakeholders with clarified the business case for automating its
what they value business processes and modernizing its legacy
According to our estimates, about one-fourth IT systems, and so it was unable to priori-
of IT project failures are not caused by tize the various stages of these projects. It had
anything related to technology; instead, they also set a timeline of 40 to 44 months to
are the result of leaders’ misunderstanding of complete the projects but decided that all new
stakeholder needs and their inadequate functionality would be delivered only at
engagement with a broad stakeholder group. the end of the project. Costs for the projects
The first three items in our ten-point plan ran significantly over budget because the
focus on ways to better understand internal requirements were vaguely defined and the
and external stakeholders’ perspectives scope of the projects was excessively broad.
and gain their support. Government officials got the project back
on track by evaluating and prioritizing
1. Use rigorous business-case discipline the business requirements and redefining the
to shape and manage programs and ensure scope. The department realized it could use
value capture. Every discussion of public IT systems from other agencies to accomplish
policy today involves technology in a funda- some of the automation, and it restructured
mental way—either as an enabling tool the project to focus on three functional areas
or as a service offering. Indeed, IT is no longer that would enable automation of 80 per-
the domain of only the chief information cent of the department’s manual processes.
officer but of anyone looking to run programs By regrouping and going through the
effectively, which means that public-sector process of making the business case, the
leaders, in all roles and agencies, must ensure department was able to complete the
that IT investments are directly aligned project in 20 months rather than 44, while
with public-policy goals. However, our work reducing costs by 40 percent.
has revealed that governments generally
do not do a good job of articulating the 2. Go digital to improve citizens’ experiences.
benefits of their IT investments, estimating In many governments, citizens can access
costs accurately, and picking the right a number of services online. Taxpayers file
projects to invest in. In the case of one returns electronically, drivers renew
government, leaders had quantified benefits their licenses or pay parking tickets online,
in less than 15 percent of their portfolio and residents manage their government
of IT projects, estimated their costs fully in benefits virtually. Citizens’ satisfaction with
fewer than 50 percent of the projects, government services is strongly correlated
and had not identified the critical business with them having a choice of channel, easy
and implementation risks for any of the access to information, and simple and
projects. But making the business case quick service delivery. To get to the next level
actually matters. In our experience, leaders in e-government services, public-sector
who identify the specific benefits to be organizations must understand what func-
gained from each IT project, and who manage tionality citizens value most, gauge how
projects to achieve those benefits, can their agency compares with peers, and develop
reduce their costs by 30 percent and improve capabilities in critical areas such as online

Open Data/IT
marketing, website usability, and web basic daily services from the public sector.
analytics. Most important, governments will Individuals have access to more than
need to engage citizens, businesses, 160 online services, including unemployment
and individual agencies in contributing or benefits and property registration. They gain
creating applications and content. access to services through a physical
One US city did just that when it formed a identification card or an online personal
cross-agency team to study its licensing identification number; government
process for restaurants. The team collected officials recently added mobile access
input from members of the business via smartphones.
community and, based on the feedback, ended
up reengineering the entire process—for 3. Open up the data to spark innovation and
instance, cross-training health inspectors so create new and better services. While
they could conduct checks on behalf of much has been written about governments
other agencies and adopting an electronic achieving transparency through “open
format for many of the licenses being data”—freely available, machine-readable
issued. The process became much simpler as information with few or no user restrictions
a result: inspectors were able to complete and at low or no cost—many govern-
building checks in one or two weeks instead of ments have yet to master this goal for several
five or six. reasons. There is rarely a natural, central
In another example, officials in one owner of data; technology platforms tend
European government built an online plat- to be outdated and therefore do not
form that is changing how citizens get necessarily work well with external systems;
The ten-point IT plan

Engage stakeholders with what they value Strengthen core assets
1 Use rigorous business-case discipline to 6 Address the risks in legacy systems, and in
shape and manage programs and ensure modernizing them
value capture 7 Embrace cloud computing and the new
2 Go digital to improve citizens’ experiences realities of cybersecurity
3 Open up the data to spark innovation and 8 Build a pipeline of technology talent
create new and better services
Pursue innovative structures
Adopt best practices from 9 Explore public-private partnerships to get
the private sector a fresh start
4 Rethink IT procurement to improve timeliness 10 Spearhead intergovernmental partnerships
and outcomes to tackle common challenges
5 Pursue shared services that deliver
immediate results

and many existing privacy policies and agencies and has allowed the city to meet each
safeguards are out of touch with the realities of its objectives. The benefits to citizens
of the digital age. include improved municipal services and a
These problems are surmountable, window into government decisions
however. Governments that have formulated and activities.
open-data strategies in a systematic way
have improved their image, accelerated the Adopt best practices from
creation and adoption of innovative the private sector
services, and increased engagement with Compared with public-sector organizations,
citizens. One large US city launched an private-sector companies have made
open-data initiative with three goals: to create significant strides in addressing common IT
new mobile applications that would use management issues. The next two items
data from a number of agencies to provide focus on the lessons public-sector organiza-
real-time services to citizens, such as tions may take from the private sector’s use
a mobile app that would help residents plan and management of technology.
their commutes; to enable partnerships
among government, academia, and the private 4. Rethink IT procurement to improve
sector to address specific public-sector timeliness and outcomes. Public officials and
issues; and to create a process for posting service providers to the government generally
information about government deci- agree that the public sector’s approach to
sions, spending, and legislative operations to purchasing IT is outdated, time-consuming,
promote transparency and accountability. and ineffective. It is not uncommon for
To address issues with its aging technology a public-sector organization to take more
platforms, the city established a central than a year to purchase an IT service
online portal for collecting data sets from or product; subsequent IT projects can
across all agencies. To deal with owner- take multiple years to complete. As a
ship confusion, the project director selected a result, many governments end up buying
data-standards officer to set and enforce and implementing technologies that
stewardship rules and assigned individuals in are already outdated.
each agency to ensure that the data being Private-sector organizations have managed
stored complied with those rules. The to bring industrial-style procurement
standards officer’s role is a critical one: he discipline to IT purchasing. Governments can
or she collaborates with each agency to adopt a number of their ideas immediately
identify critical pieces of data to make open, without waiting for broader legislative reforms.
prepare the data for publication, post the Some public-sector organizations are
data in an accessible platform, and determine already doing so. In the area of sourcing, they
the frequency and channel for refreshing are differentiating between complicated
the data. To address policy concerns, the city and simpler, commoditized purchases.
established a standards committee that Additionally, some public-sector officials are
works with data stewards from each agency to making it a priority to hire staffers who
refresh policies, resolve questions, and have expertise in the strategic sourcing of IT,
create and enforce the standards and security while others are taking it a step further
protocols required to store private data. and building cross-functional IT procurement
The result has been a robust, open system teams charged with evaluating and select-
that facilitates information sharing among ing appropriate vendors. Some governments

Open Data/IT
consolidating their IT services. That is

because the introduction of new technologies
in the public sector has almost always been
fragmented. Individual agencies, bureaus, or
departments implement their own applica-
tions on their own servers, and the result is a
mismatched collection of systems and
business processes that can increase costs
and create inefficiencies.
By contrast, a successful shared-services
approach emphasizes pooled resources
and consistent practices. Additionally, a
customer-service mind-set is crucial.
Well-defined service-level agreements (SLAs)
should be put in place and communicated
clearly to every user in the IT services
ecosystem. Without SLAs, costs will rise,
© Tim Boyle/Getty Images
quality will drop, and customers will

find innovative ways to avoid using the
shared-services entity. To avoid this outcome,
important stakeholders from each cus-
tomer group should be invited to the planning
process early and included throughout to
ensure the consolidation exercise will not fail.
The Chicago have standardized their IT contracts One large US state recently created a single
Passport Agency and developed processes and benchmarks entity to provide the full spectrum of IT
provides pass-
for tracking vendor performance across services to nearly 50 agencies across the state,
port services to
residents of
government agencies. including application development and
Illinois and Michigan. The benefits of adopting private-sector end-user assistance. It is a bold initiative,
Since December practices can be significant. One US state was with challenges at almost every turn.
2001, all domestic able to identify ways to reengineer its entire The state supports a large employee base,
agencies have
procurement process, thereby cutting has a wide range of facilities and infra-
been issuing the
new photo-
its procurement time frame nearly in half. structures, and has traditionally outsourced
digitized passport. And one large US city built up its internal a lot of its systems-planning and design
capacity to negotiate contracts and take over activities, which require highly skilled IT
important planning and design activities talent. It has had limited visibility into what is
performed by vendors; it saved more than being spent on IT and what its employees
$100 million annually. are working on. Also, people from the
different agencies involved have been used to
5. Pursue shared services that deliver working within their own cultures, under
immediate results. Some government different management styles. The initiative is
organizations have the resources and spend- still in its early days, but state officials are
ing capacity of large global corporations, already seeing improved utilization of IT
but they still fail to achieve the benefits that assets, increased knowledge sharing among
private-sector organizations do from pooled IT staff, streamlined procurement

processes, and better systems management Some public-sector leaders are responding
through coordinated governance. to the aging-infrastructure challenge in
Designing a comprehensive IT shared- a thoughtful, surgical way. They are taking
services plan can take months, and the overall inventory of their existing IT setups
transformation will likely be a multiyear and identifying those systems that should
effort, but governments can make real head- be replaced and those that are worth preserv-
way in the first year. Officials who are ing and building around. One government, for
pursuing shared IT services should acknowl- instance, is focusing first on systems that
edge this timeline, establishing clear pose the highest operational risk (such as sys-
targets and milestones and resisting the tems for reporting taxes and managing
tendency to retreat from big goals as driver’s licenses) as well as those that require
implementation begins. significant changes because of recent
regulatory mandates (such as benefit-delivery
Strengthen core assets and health-care systems).
Many public-sector organizations have not
invested adequately to upgrade IT systems 7. Embrace cloud computing and the new
or improve the capabilities of their IT staff. realities of cybersecurity. Many public-sector
The next three items focus on the need organizations operate their IT infrastructure
for technology updates and new approaches without the discipline of professional IT
to talent management. service providers and below the scale required
to achieve cost savings and appropriate
6. Address the risks in legacy systems, and utilization of the infrastructure. Some
in modernizing them. The public sector public-sector IT executives have recognized
has invested heavily in technology, but many this problem and are mandating a review
of its investment decisions have been of and migration to cloud computing. Cloud
based on maintaining legacy commitments computing provides on-demand access
and meeting political demands rather to a shared pool of computing resources (for
than creating business value. As a result, example, networks, servers, storage,
many governments are spending much and applications) that can be delivered with
of their IT budgets to preserve systems that minimal management effort or service-
are either decades old or hurriedly provider interaction. The benefits of moving
upgraded here and there in response to a to the cloud include cost savings—sometimes
political mandate. The public sector has as much as 50 percent on hosting and
historically ignored this problem, electing to licensing—as well as improved systems pro-
apply Band-Aids. Given the number ductivity and resiliency. In a recent survey
of recent high-profile IT failures, however, of large infrastructure organizations in North
ignoring the problem is no longer an America, more than 90 percent of executives
option. Government leaders are discovering running large IT functions (in both the 1
Henrik Andersson,
the risks associated with maintaining, public and private sectors) said they were in James Kaplan, and
rather than replacing, aging systems—expo- the middle of designing or implementing Brent Smolinski,
sure that can affect organizations and a cloud program.1 However, the success of “Capturing value from
IT infrastructure
individuals. Imagine a 30-year-old benefit- these programs has been uneven, partic-
innovation,” McKinsey
delivery system going down and an ularly in the public sector. on Business Tech-
agency not being able to distribute vital To capture value from cloud computing, nology, October 2012,
payments to citizens. public-sector organizations should develop a mckinsey.com.

Open Data/IT
strategy informed by a detailed understand- computer and information-technology

ing of the applications, workload, and services degrees than it did ten years ago. The skills
eligible to be moved to a cloud environ- shortage is more acute in the public
ment. A one-size-fits-all adoption strategy will sector for a variety of reasons, including
not work. Public-sector leaders should compensation levels that are lower
establish a sound business case, with an than in the private sector, use of outdated
operating and financial plan to fund and technologies, and, sometimes, a culture
sustain the migration of infrastructure to the that stifles innovation and creativity.
cloud. This includes detailing the timing To add to these challenges, workforces are
and sequencing of, and usage allowances and aging across the globe and many IT
charges for, the IT services being migrated. workers will be retiring soon, taking with
Most important, public-sector leaders should them decades of institutional and
acknowledge important security consider- technical knowledge.
ations associated with operating in the cloud, Shoring up the IT talent base should be a
which can be structured as a public, private, top priority for public-sector leaders—
or hybrid environment. Leaders in public- and there are more recruitment and retention
sector organizations must examine existing levers available to them than they imagine
security policies, industry standards, data- or choose to exercise. In a recent McKinsey
handling practices, and information survey of nearly 500 private-sector chief
architectures. A comprehensive cybersecurity information officers, more than half said their
strategy is imperative and should be main tool for attracting and retaining top
predicated on protecting the most impor- IT talent was enhancing the culture of the IT
tant information assets from the most organization.2 Public-sector officials
likely threats. are finding the same to be true. One US state
recently conducted a comprehensive survey
2
Naufal Kahn and
8. Build a pipeline of technology talent. of its IT employees and identified a number of
Johnson Sikes, “IT Technology talent is scarce in both the public challenges. For instance, employees said they
under pressure: and private sectors, and demand for it is were frustrated by the lack of feedback
McKinsey Global rising. Some countries like China and India they were getting on their performance. They
Survey results,”
have anticipated the trend, more than also said they were dissatisfied with middle
McKinsey on Busi-
ness Technology,
doubling their output of graduates with tech- managers within the organization, whom they
Number 33, nical degrees, whereas the United States viewed as a barrier to bottom-up innovation.
Spring 2014. is producing fewer college graduates with Armed with these facts, the organization
Every discussion of public policy today involves technology

in a fundamental way—either as an enabling tool or as
a service offering.

designed specific interventions to address those cases where the effectiveness of existing
each issue—and by improving the structures may be limited.
culture for existing employees, it is also
creating an organization that will attract 9. Explore public-private partnerships to get
new recruits. a fresh start. Government officials can
Public-sector organizations may also sidestep or overcome many of the challenges
strengthen their talent pipelines by we have discussed in other sections by
partnering with universities and technical starting fresh—moving critical aspects of their
institutions to establish internships and IT projects into hybrid public-private
other programs to facilitate the recruitment enterprises. (In the United States, this could
of new employees. They can establish be a nonprofit entity owned by the public.)
relationships with local companies that might In this way, the public sector gains access to
allow their IT managers to do a public- private-sector talent and better procure-
sector rotation. They may also appeal to and ment practices. It can also establish clear
attract proven senior leaders from the accountability for the success of large
private sector who want to focus on public IT programs.
service later in their careers. In response to the failure of several large IT
To tackle retention challenges, public- projects—high-profile multiagency initia-
sector organizations can create assignments tives that were poorly executed and ended up
that allow employees rather than con- prompting formal public inquiries—one
tractors to learn and implement cutting-edge large US city decided to radically rethink its
technologies, further engaging them in delivery of technology services across its
the work of enabling public policy. Finally, 70-plus agencies and departments. Following
government leaders can improve the this reevaluation, it launched a city-owned
culture, energy, and morale of the IT organi- private organization to manage its highest-
zation by investing in nontechnical training priority IT projects. The creation of this
that helps IT personnel understand the entity is helping the city resolve its talent
agency’s broader operations and goals and problem by allowing it to compensate IT
relate to their peers in other divisions. professionals under a different pay structure
and creating a career path for talented IT
Pursue innovative structures professionals to grow rather than leave for the
The public sector has successfully used inno- private sector. The new entity is also help-
vative ownership and partnership ing the city back away from its overreliance on
models when it serves the public interest. vendors by establishing a shared pool of
For example, public transportation in IT knowledge (in project management and
many regions is delivered by publicly owned IT architecture, for instance) among
authorities rather than directly by employees who could provide independent
the government. Many of these authorities and expert views and by making the city’s
operate as corporations with a board IT-related performance transparent so that
appointed by elected officials, deliver critical vendors can be held accountable
services, generate revenue, and receive across agencies.
some funding from government. The last Governments that want to establish similar
two items in the ten-point plan focus on entities will need strong senior sponsorship
implementing such innovative structures for and a commitment to independent gover-
procuring and delivering IT, particularly in nance. Without the latter, some constituencies

Open Data/IT
may consider this approach a political been able to upgrade the services it pro-
instrument designed to avoid scrutiny rather vides its citizens while spending less than half
than a sincere effort to improve the delivery of what it would cost it to build its own
of IT projects. system. The “supplier” state is expected to
save about 20 percent in operation and
10. Spearhead intergovernmental partner- maintenance costs.
ships to tackle common challenges.
Most governments undertake the same kinds
of modernization projects and rely on the Implied throughout the ten-point plan
same types of technologies, but historically is a relentless focus on change management—
there has been limited cooperation between indeed, a scan of management literature
local or regional governments on large suggests that the majority of organizational
IT projects. Such partnerships can yield transformations fail because of insufficient
enormous benefits. Local or regional attention to people and culture. In the case of
governments can use one another’s existing IT-enabled projects, resistance to change
infrastructure and expertise, accelerating from certain constituencies will be inevitable
the time it takes to implement projects and for well-established logistical and political
significantly reducing rollout costs, opera- reasons, and because of the overwhelming
tional costs, and future systems-enhancement complexity of the rollout itself. To combat
costs. Such partnerships can also ensure this, governments should develop and com-
that governments are complying with federal municate clear and compelling stories
mandates and standards. that address the rationale for and relevance
There are challenges associated with such of doing things differently. They must
partnerships. Cooperating entities may also ensure that ambassadors for change are
need to draw up detailed agreements about embedded throughout the organization.
intellectual-property rights. They may Excellence in government is contingent
also need to come to a shared understanding upon creative, effective uses of IT. But
of public-sector procurement procedures and all too often, public-sector leaders are unable
policies, which, as we mentioned earlier, to implement their policies because of IT
are often not conducive to quick and efficient roadblocks, including competing commit-
implementation of new technologies or ments, regulatory restrictions, and
innovative programs. However, all parties can constant, ever-changing demands from the
The authors
reap large rewards. In one such partner- populations they serve. Taken together,
would like to thank
Kate Jackson
ship, one US state is offering another access to the ten-point plan presented here provides
for her contributions its health-benefit information system a comprehensive road map for navigating
to this article. as a shared service. The “customer” state has these obstacles. n

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Innovation in

government designed for new times

Innovation in local government:

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Copyright © 2014 McKinsey & Company. All rights reserved.

4 How government can promote open data and help

24 A closer look at open data: Opportunities for impact

32 Coordinates for change: How GIS technology and geospatial

44 Partnering to build smart cities

52 Capturing efficiencies through smart technologies

Government Designed for New Times 1

Andre Dua Diana Farrell

Government Designed for New Times 3

4 Government Designed for New Times

Enable value creation Manage risks Engage stakeholders

Government’s critical role

Government Designed for New Times 5

Accessibility Everyone has access Access to data is to a subset of

Cost No cost to obtain Offered only at a significant fee

Rights Unlimited rights to reuse Reuse, republishing, or distribution

6 Government Designed for New Times

Personal Individual genome Health-care records

Employee performance reviews

More closed More open

Government Designed for New Times 7

The expansion of open data, combined with advances in

8 Government Designed for New Times

Decision making New offerings Accountability

Government Designed for New Times 9

10 Government Designed for New Times

Accountability: Increasing transparency • Beginning in 2011, New York City released

Government Designed for New Times 11

efficiency, prioritize investments to capture in northern California that benchmarked its

Provider Catalyst User Policy maker

12 Government Designed for New Times

Government Designed for New Times 13

Many staff members and leaders at government agencies need to

avoid wasted effort, government leaders can Government as an open-data catalyst

14 Government Designed for New Times

Government Designed for New Times 15

trust—government can draw on its legislative mation on its Electronic Data-Gathering,

16 Government Designed for New Times

Individual risks Organizational risks

Safety Intellectual property

Potential mitigation strategies

Remove identifying information or

Invest in technological safeguards

Engage stakeholders to share

Risks in open data—and potential zations, such as confidentiality, liability, and

Government Designed for New Times 17

18 Government Designed for New Times

Government Designed for New Times 19

20 Government Designed for New Times

Government Designed for New Times 21

22 Government Designed for New Times

Government Designed for New Times 23

Public institutions and private companies are

24 Government Designed for New Times

Government Designed for New Times 25

26 Government Designed for New Times

Accountability: Increasing transparency • Beginning in 2011, New York City released