Smart Cities Part 3: SMEs and Startups, the Brains that Make Cities Smart

Smart Cities Part 3: SMEs and Startups, the Brains that Make Cities Smart 

Thought Leadership

This October, ADSME Hub focuses on smart cities. After looking at what a smart city is meant to be today and how Abu Dhabi is becoming increasingly smarter, we discuss the critical role of SMEs and startups in this transformation.

Smart cities are no longer a futuristic concept but a necessity to address the growing challenges of accelerating urbanisation. As cities around the world strive to become smarter, it’s easy to see how large corporations can contribute to this transformation; yet, the role of startups and small and medium-sized enterprises (SMEs) cannot, and shouldn’t, be overstated. Smart impacts small and vice versa.

SMEs, the Technology Enablers of Smart Cities

Smart cities are quintessentially entrepreneurial, in the sense that they use new technologies, particularly information and communications technologies (ICT), to improve their residents’ quality of life while reducing resource consumption. These technologies can find smart applications to address specific urban challenges around healthcare, education, construction, mobility, environment, safety & security, e-government, and tourism.

More agile and less risk-averse than legacy corporations, SMEs and startups are leveraging IoT (Internet of Things), blockchain, artificial intelligence (AI), and other innovative technologies to push boundaries in these key priority areas, all while fostering a knowledge- and collaboration-based environment. Their specialised skills and niche expertise are essential to identify and execute in a targeted, effective way the solutions that will effectively make a city smarter.

This is all the more important that these companies, often deeply embedded in their communities and likely to be engaged in local initiatives, understand the specific needs of their neighbourhoods and can, as a result, provide tailored, effective, and sustainable solutions. Collaborations between startups, SMEs, local governments, and larger corporations ensure that the city’s technological advancements meet the practical needs of the community.

Sustainable Answers to Real-Life Problems

The primary expectation of a smart city is sustainability – particularly its ability to address environmental concerns by reducing energy consumption and minimising pollution. In the GCC in particular, water scarcity and extreme heat make the need for efficient solutions even more urgent. Many SMEs and startups have a strong focus on developing eco-friendly solutions, from using sensors that monitor temperatures to leveraging behavioural economics and gamification to encourage people to make thoughtful decisions on resource use. They’re therefore pivotal in the creation and implementation of green technologies, including urban farming, water-saving systems, energy-efficient usage, renewable energies, circular economy, and more.

Additionally, in a world where urban citizens are digitally literate and expect the same from their government, ensuring that they’re informed and connected in an inclusive way is another important dimension of a smart city. ICT can help streamline and optimise government procedures, develop insight-driven policies, track performance and outcomes, and overall improve government efficiency. Smaller, innovative companies are already leveraging data analytics, smart grids, 5G, and IoT tools to create solutions that can benefit government operations, from mobility and logistics to cybersecurity.

SMEs and startups’ contributions to smart cities in terms of economic prosperity, innovation, job creation, and localised expertise are invaluable in creating urban environments that are efficient, sustainable, and responsive to the needs of their residents. By challenging and disrupting the status quo with innovative products, services, and models, they create new opportunities, transform industries, and strengthen the resilience, diversification, and competitiveness of a city’s business ecosystem. This is why governments, corporations, and communities must recognise and support the vital role that they play in this transformation, harnessing their power to create truly intelligent, connected, and sustainable cities for the future.

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