New Vendor Engagement Framework Helps Cities Work Smarter

By Melanie Nutter, Principal, Nutter Consulting and Betty Seto, Head of Department, DNV GL

In the past five years, leading cities across North America have made tremendous inroads to testing and deploying smart city technologies to address key challenges related to maintaining and replacing aging infrastructure, managing maintenance costs and providing improved services to residents and community members. Recent developments in technology and data platforms for mobility, energy, waste and water present new opportunities for increasing the efficiency and quality of municipal services.

However, a gap exists between how cities currently procure goods and services from vendors, and the vendor engagement processes and financing that cities need to implement new technologies. Bridging that gap is necessary to enable municipal staff to effectively implement their smart city strategies, whether to save energy, reduce water consumption, or other technological approaches to improving sustainability. They need a better way to get the right tools for the job.

Working in partnership, Urban Sustainability Directors’ Network (USDN), DNV GL and Nutter Consulting released a procurement framework for cities,  entitled Smart Cities Vendor Engagement Framework, looking to build innovative programs that leverage the potential of smart city technologies.

The framework is built on exploratory research and interviews conducted with over 12 cities that assessed both traditional procurement processes and new procurement models being used by cities to engage technology vendors. The case studies in the report range from the City of Chula Vista working with energy software provider Gridscape to build a smart grid, to cities like San Francisco and Somerville, MA creating innovation hubs and innovation labs, which can be the building blocks for a pipeline from ideas to implementation of new municipal programs.

Drawing on the expertise of the USDN network member cities and industry expert knowledge, the report highlights lessons learned and best practices for both vendors and cities to facilitate better working relationships. The goal of the Smart Cities Vendor Engagement Framework is to provide cities with different approaches to working with technology vendors to leverage the benefits of emerging smart technologies in pursuit of smart sustainable city goals.

One significant barrier to smart cities is related to the municipal procurement processes that can be a source of delay, set back and frustration in building innovative, smart city programs. The Smart Cities Vendor Engagement Framework delivers valuable lessons from cities that are field testing new procurement processes for a range of technologies and programs. For example, cities such as Seattle and Pittsburgh have created districts within the city focused on specific urban challenges. These geographic areas are useful for engaging with the public and building partnerships with businesses that can help solve the issues.

The report contains case studies spanning three broad categories:

  • Traditional Procurement: Request for Proposals (RFPs), Sole Source Contracts,
  • Partnerships: Public Private Partnerships (PPPs), Districts, Utility Partnerships
  • Innovative Procurement: Innovation Hubs, 3rd Party Competition, Platform Partnerships

In highlighting and publishing the procurement methods of cities with the most innovative programs, we hope to provide value to others considering the integration of smart, data driven technologies into their infrastructure and service delivery systems. For instance, one key challenge is for cities to get initial buy in from the private sector or business community, which can thwart efforts to pilot new technologies.

In the Seattle 2030 District case study, the city had been grappling with a way to implement an energy-use disclosure ordinance for commercial buildings. Seattle created a membership based district which allowed them to engage with an initial group of building owners to present technologies and explore their best uses across the building stock. Even something as basic as narrowing the geographic target area within the city has led to a clearer path for implementation of building energy efficiency technologies and a measurable improvement in energy use.

Ultimately, creating smart, sustainable infrastructure requires cities to partner and work with the private sector (as well as academia and the community) and to have systems and processes in place internally that will facilitate the most seamless interactions possible. Through experimenting with different types of arrangements as described in this vendor engagement framework, more cities will be able to create, test, and iterate new technologies and uses of data to advance sustainability and innovation.

The Smart Cities Vendor Engagement Framework is available for free download online.