What sets future-ready cities apart?

In November 2024, ThoughtLab released a major new report on future-ready cities, called “From Future Vision to Urban Reality.” Its insights have proved valuable to city leaders across the globe and the broader ecosystem of organizations in the urban space. Here are some key findings from our research.

What specific factors set future-ready cities apart from others in terms of their approach to sustainability, resilience, and inclusiveness?

Future-ready cities are well ahead of other cities in future-proofing their approaches to sustainability, resilience, and inclusiveness:

Environment and sustainability. Some 46% of future-ready cities are already significantly ahead of their net-zero plans vs. just 5% of other cities. More have taken steps to: ?

·??????? Reduce greenhouse gas emissions, such as adopting climate budgeting (80%) and setting citywide emissions targets (78%).

·??????? Facilitate a green energy transition, such as by providing renewable energy targets and incentives (78%), investing in alternative fuel source infrastructure (76%), and promoting electric vehicles (74%).

·??????? Manage land use and open space, such as mandating building energy efficiency (84%) and building and maintaining more parks and green spaces (76%).

·??????? Manage waste, such as promoting circular economy practices (78%) and using recycling and treatment facilities (78%).

·??????? Expand their use of technology. More than eight in 10 future-ready cities have made significant tech investments to monitor air and water quality, and energy and water usage.

Resilience. With the pandemic a recent event, future-ready cities ensure they can withstand other unexpected disruptions. Sixty-eight percent develop a comprehensive resilience plan and work with the private sector to implement it. Over half (56%) provide leadership teams and staff with risk management and resilience training, and over four out of 10 have command-and-control centers to coordinate emergency responses.

Future-ready cities understand the critical role of technology in driving resilience. Over eight out of 10 invest in cybersecurity solutions and cloud-based IT systems; and almost as many invest in backup systems and data (77%), IoT and smart sensors to monitor urban conditions (76%), AI and machine learning (71%), early warning systems (70%), and digital twins for scenario planning (56%)?

Inclusiveness. Social equity is top of mind for future-ready cities. Some 64% use data to analyze progress on equity goals; 62% provide staff with inclusiveness training; 58% expand mixed-income housing and inclusionary zoning; 58% conduct equity assessments to identify disparities; and 52% partner with schools and employees to create jobs for marginalized communities.

Since low-income communities are heavy users of public transportation, future-ready cities ensure social equity and physical access for them: 72% offer discounted pricing, 64% improve transit services in low-income areas and ensure that it is safe.

Holistic solutions across departments. Crucially, future-ready cities know that urban challenges can be intertwined. For example, resilience is a key part of sustainability, and transportation needs to be inclusive. Future-ready cities excel at getting urban domains to work together to find solutions. That is one of the reasons that 92% of them feel confident in overcoming current urban challenges regarding these issues.

What are some of the challenges that cities face in achieving their future-ready goals, particularly in areas like transportation and urban infrastructure?

Since we last conducted this study in 2022, some of the top challenges around climate change, public health, and housing shortages have been reduced, although they are still among the biggest challenges for cities. Over that period, however, aging infrastructure rose as one of the biggest challenges for 28% of cities (up two percentage points) and inadequate transportation for another 25% (up six percentage points).

Due to a lack of investment over the years, infrastructure and transportation systems have become outmoded. Set up for a different time, these domains cand be very costly and complex to modernize. For example, a city leader for Montreal said: “Due to a lack of investment in infrastructure, our city is struggling with aging and deteriorating water and waste collection systems. In response, we are prioritizing repairs and maintenance to ensure the stability of our existing infrastructure before moving forward with new projects.”

Another major challenge is repairing or replacing urban infrastructure and transportation systems as they are in use by citizens and businesses. This is a particular problem for older, historic cities, such as Naples. According to a city leader there: “The historic city center presents a complex challenge for modern infrastructure and technology integration. But by adopting a phased approach and starting with pilot projects, we are successfully overcoming these obstacles and gradually expanding our initiatives to larger areas.”

Complicating matters further, city leaders often share responsibility for these urban domains with other levels of government and even the private sector. For example, 44% of? regional agencies and 38% of state or provincial bodies have the main responsibility or share responsibility with city governments for public transportation services. And more private companies (84%) have main or shared responsibility for energy infrastructure, compared with 65% of city leaders.

How are advanced technologies like AI and IoT transforming city services, and what are the most impactful applications seen so far in these future-ready cities?

The study reveals that artificial intelligence (AI) is revolutionizing how future-ready cities analyze data, generate content, and execute tasks. This transformation enables cities to enhance productivity, improve efficiency, address citizen needs, and offer new capabilities, such as real-time scenario planning.

Recognizing the power of AI as a transformative force, future-ready cities have made much greater progress than others in implementing it across urban domains: 66% use AI to optimize government operations vs 39% of others; 56% for living and health vs. 28% of others; 50% for mobility and transformation vs. 26% of others; and 40% for sustainability vs. 18% of others.

Future-ready cities are jumping ahead with generative AI (GenAI). 42% of future-ready cities are already making selective or wide use of GenAI vs. just 12% of others. In three years, the percentage of future-ready cities doing so will rise to 74%. They are also leading the pack in the use of digital twins, which increasingly draw on AI. Over three-quarters of future-ready cities plan to make selective or wide use of digital twins in three years.

Fifty-six percent of future-ready cities use AI to drive resilience and reduce risks, and the percentage will grow to 84% in three years. Other successful AI use cases cited by cities include traffic management, public safety, energy management, customer service, predictive maintenance, waste management, data analysis, urban planning, cybersecurity, and fraud detection.

IoT is core technology for the future of cities. Sixty percent of future-ready cities now widely apply IoT and sensors across their cities, and another 38% use IoT selectively. In three years, all future-ready cities will be using IoT, 84% widely.

Like AI, IoT is vital for building resilience, since it enables city leaders to monitor infrastructure, environmental, and other urban conditions in real time. 76% of cities now use IoT and sensors to drive resilience.

Future-ready cities use IoT data to run their cities in real-time. They include data from sensors into their data management systems, which they combine with other advanced technologies like digital twins, AI, and city brains to manage their cities. In many areas, IoT works together with AI to implement the use cases above, such as traffic management, urban planning, and predictive maintenance.

What support do cities need to implement future-ready frameworks and related technologies effectively?

?Becoming a future-ready city is not an easy task. It requires a forward-looking vision and strategy, as well as a deep understanding of how best to implement those plans. Our research provides city leaders with an actionable playbook of the most effective strategies, use cases, and digital solutions to address today’s thorny urban challenges and make progress on the road to future readiness. It also provides cities with valuable benchmarking data that will enable them to compare their progress and solutions with other cities, particularly those that are further ahead on preparing for the future.

Our study found that cities cannot become future-ready on their own. They require the support of innovation ecosystems, including commercial partners, from start-ups to technology giants; non-profits, from universities to foundations; and the public sector, including all levels of government as well as other cities. By working closely with these ecosystems, they can build cohesive, cost-effective support for their plans.

Funding is also crucial for success, which is why future-ready cities are going beyond traditional funding avenues over the next three years, and ramping up their use of new funding avenues, such as philanthropic contributions; ROI models (that analyze how costs will be recovered over time through cost savings and incremental revenue; policy-based tools, such as impact fees and tax increment financing; market-based instruments, such as bonds and crowdfunding; and private sector investments and partnerships.

Our full report on future-ready cities can be accessed here: https://thoughtlabgroup.com/from-future-vision-to-reality/

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