CIO PANEL: PUBLIC-PRIVATE PARTNERSHIPS AND SUCCESSFUL SMART CITIES - Video transcript

Joe Kornik: Welcome to the VISION by Protiviti interview. I’m Joe Kornik, Director of Brand Publishing and Editor-In-Chief of VISION by Protiviti, our content initiative where we look into the future to examine the strategic implications of big topics that will impact the C-Suite and executive boardrooms worldwide. In this, our first topic, the future of cities, we’re exploring the evolution urban areas are undergoing post-COVID, and how those changes will alter cities over the next decade and beyond.

Today, we’re focusing in on successful smart cities, and specifically the role of public-private partnership in that success. We’ve got a great panel for you today. I’m joined by Peggy James, Dean College of Social Sciences and Professional Studies at the University of Wisconsin-Parkside; Michael Pegues, the CIO of the City of Aurora, Illinois; and William Martin, the CIO of the city of Racine; Wisconsin. Peggy, Michael, and William, thank you so much for being here today. You’ve all talked a lot about the significance of the public-private partnership and its role in the success of cities, both today and in the future. I know you all have perspective on that topic. So, let’s open up with a question for all of you about that public-private partnership and the role that relationship plays in the future of smart cities. Why is it so important to get that right? Why is it so important that we get that public-private partnership right for the future of cities?

Peggy James: Well, if I could start, Joe, first of all, thank you for having us. I think this is a really important discussion. I appreciate the fact that you’ve also allowed folks from outside city government to participate. I’d like to start off by at least making an observation that three-quarters of the folks living in the United States right now are living in small and mid-sized cities. In Wisconsin, the fastest growing cities that we had in 2020 with double-digit growth were all cities with less than 50,000 people. So, suffice it to say that smaller communities are revitalizing downtown areas, they’re developing commercial ventures and non-revenue producing property, they’re repairing roads, and they’re looking into using smart technology to improve transportation, improve healthcare, and actually improve utility provision across the board. Although these developments are really good for property values and increased revenues, our smaller communities simply don’t have the funds to leverage these projects at the outset. They can’t afford to make mistakes. A partnership, and I need to make sure that we understand this, is a long-term dynamic relationship rather than a simple contract for services; allows the city to actually share some risk, share some revenue, and also, from my point of view, share responsibility to the community. For us, it’s the last one that’s important. Economic development and quality of life become a shared public-private and community concern in this kind of a partnership and has the potential to increase transparency, reduce equity gaps, and meet community needs more than a one-sided development would do. The university is one of those agents that can actually help to connect the community with both the private and public sectors, to inform the partnership and to provide assessment of the value creation for the community.

Joe Kornik: Well, do you have any thoughts on that first question?

William Martin: Well, I think Peggy did a great job of really summarizing the landscape that we’re in. As someone who represents a city that is under a hundred thousand in population, and something like 98% of all American municipalities are that size or smaller, we really are not in a situation where we’re ever going to have all of the human talent, all the ability to research, and think about the forward opportunities. Financially, we just aren’t ever going to be in a position to do this all alone. So, for all those reasons, and so much more, it is not just a value added to have public-private partnerships, it’s essential that we could not possibly begin and sustain the transformation towards smarter city status without having the private sector, the higher education, and others at the table with us. That’s what really makes this an exciting opportunity and allows us to really grow in a sustainable way.

Joe Kornik: Michael?

Michael Pegues: Yes. Just a caveat on what Peggy has said, and Will, and I totally agree. I mean, just with all of the things that have happened here over the last year, and actually beyond that, I mean, municipalities themselves, we need to look at how we redefine standards, whether that’s public safety, city services, inclusive internet access, and just being innovative in economic development and attracting new businesses to the city of Aurora. It’s like, I get it, I’ve been here working for the city for about the last four years. The city’s job is to have good streets, have good sidewalks, to get the water bill paid, and things like that. Those are the services that the residents come to expect. The budgets are predefined according to those drivers. Now, as we go into this fourth industrial revolution when we start to look at cyber security, artificial intelligence, right?, infrastructure modernization, next generation technology, I mean, these are all different technologies that need to be used to advance us forward. The citizens really don’t care about that. Even more importantly, they don’t understand it, right? So, how do we make that transparent to the constituents so they see the value, they see the outcomes, they see the impact without all of the technology jargon behind it. Because those are just the underpinning foundation to help us push it forward. Looking at this is that municipalities aren’t in a position to drive innovation. That’s the bottom line. I mean, I’ve worked in the private sector. I’ve worked in Department of Defense. I work in a municipality now. We don’t do a good job at it. We do a good job at sidewalk street, cutting tree branches, and things of that nature. That’s why we have to partner with the universities, and more importantly, with the businesses that the private sector, who know how to get the best bang for their buck and get that ROI. They know how to model these services and these solutions. Going back to what Will said, actually, about — I’m going to call it the human talent or the people, the personnel — government just does not incentivize and/or attract the right talent to drive innovation. I mean, we need to come to a realization. Government means bureaucracy. Innovation is the opposite of that. The quicker we understand that, and we figure out models to basically manage that forward, the better off we’re going to be. I personally think, unequivocally, that that’s in public-private partnerships.

Joe Kornik: Right, a key part obviously of this. Will, I know Racine was awarded a North American Smart City designation and is the only city with a population under 100,000, I believe, to receive that award, which is a quite impressive feat. So, talk to me a little bit about what made that possible and what it does for the city of Racine moving forward.

William Martin: Well, no, thank you very much. We are so excited about the fact that we were able to win that designation in part working with folks like Dean James in the University of Wisconsin-Parkside. Bringing together the technical college, the four-year university private sector partners as well from the for-profit business sector, and having governments there, bringing all that together, we really were able — even though we’re the smallest ever, we brought together a coalition that was extraordinarily large. Knowing that, again, we just didn’t have the resources in the 360 to be able to think through all the implications, of policy, of the technology, of confidentiality. There’s just so many different aspects, and having such a small organization, this allowed us to force multiplier of having those public-private partnerships to get together and actually do a better job of moving forward as a group. The other piece of this, though, I would say equally importantly is our willingness to reimagine ourselves. We’re seen as a place that has long been defined by what we made here. Now, as a post-industrial city, we’re really reimagining ourselves as to how do we create through asset mapping and other thinking about what do we have to offer, what differentiates us. I think these are the processes that any city of any size really needs to think through as they’re considering their public-private partnerships and how they might achieve such designations.

Joe Kornik: Right. Michael, Aurora is a little bit bigger than Racine. I think it’s a little more than 200,000. Can you discuss the work you’ve done around attracting companies to Aurora? I know that’s been a big piece of your strategy, and how that impacts the city today and how it will continue to in the future?

Michael Pegues: Absolutely, Joe. That’s a very interesting question. I mean, one of the things that we did at the city of Aurora in trying to make it more attractive for businesses, we focused on basically making the city of Aurora kind of a test bed or an incubation lab, but not in the traditional sense of just creating an innovation district in a small area, but we’ve made the entire city an innovation district. We’ve coined it “the 605 Innovation District”; 605, why? Because it’s the first three prefixes of the zip code. We have five zip codes in the city of Aurora. The city of Aurora sits in four counties as well, which is very unique. So, we said, “Why don’t we just make the entire city the innovation district? Let’s not limit ourselves.” Because one of the main drivers was because of our fiber optic network that sits under the ground. We have a 45-mile ring that goes around the city, and about 50 miles of laterals that basically extend off of it. So, the city’s lit up like a Christmas tree. That’s pretty attractive to a lot of business, especially a lot of tech companies, and also small, medium, large, but more importantly, entrepreneurs, the small startup companies. Because they’re trying to find a place where they can go and test their products and services. That 605 Innovation District, it just creates a hub of innovation. We have the hub which sits downtown Aurora, but there’s different spokes throughout the city. We look at, basically, how we can ignite growth here in the city of Aurora by attracting those different companies. Some of the things that we’re doing is, we basically laid out what we call it The Thousand Jobs Initiative. That global startup initiative focuses on giving incentives to different businesses, whether it’s access to different new market tax credits, whether it’s giving discounts in terms of internet access with the fiber, if it has marketing, relocation imbursements, performance-based grants. So, all these different things are very attractive when you’re an entrepreneur or startup and you’re trying to grow your business, but as well — the larger companies as well. One of the larger companies that we’ve attracted out of many here is the Chicago Mercantile Exchange. Many people don’t know the Chicago Mercantile Exchange of Chicago actually sits right here in the city of Aurora. Why? Because of our assets. One, because of the location off of the I-88 corridor, which is our technology corridor hub. Two, because of the fiber optic network. We’re talking about high frequency trading. We got towers. It goes right back downtown Chicago to the Equinix Data Center, which is the telecom hub for the Midwest. Everything comes in and out of the Equinix Data Center. Also, it sits right next to ComEd power stations. You need power for data centers, right? You need fiber. We have — they have access to, I’m going to say cheap land compared to Chicago. Also, we have a mayor with a vision that is next to none. That’s how we’re attracting these businesses, right? We’re partnering with them, we said, “Here’s our infrastructure. Here’s some of our assets. How can we partner together to increase the GDP and the economic development for these different businesses?” That’s just one case study, and there’s a lot more. We just continue to grow.

Joe Kornik: Right. So, that collaboration is really interesting, I think, Michael. Peggy, I know collaboration between the university and the citizens, that idea of community readiness for smart cities is central to your mission. At least I think it is. Can you talk a little bit about that education process and where the University of Wisconsin-Parkside fits into that equation?

Peggy James: It absolutely is essential to our mission. I think it’s central to a lot of especially regional universities who have a strong tie with the community and have a commitment to increasing citizen well-being, not just for education, but economic development and just basically quality of life. I think the university actually brings a unique voice to these sorts of partnerships. I would say even though I know I’ve got two government folks here with me, I’d say that it’s not uncommon for governments to respond to community needs in ways that might favor some groups over others. That might not be intentional, but the fact is that some groups have louder voices than others. Some groups are more attuned to what’s going on. I think that the university can help transform that P3 relationship to what is a new term for this, and I say it just because I love acronyms, is a CBP3, which is a community-based public-private partnership. These partnerships, which include the community, are a much longer term than we might normally be thinking of, especially in our classic transportation P3s. They’re flexible enough to adapt to economic and community changes with community input. One of their objectives, typically, is equitable outcomes that are available for everyone. Maybe not at the same time, but over the long run. Many of these early CBP3s [Laughter] emphasize green infrastructure or environmental challenges, such as water usage and water provision. So, as I said, universities, especially our regional campuses, have the ability to connect community stakeholders to the partnerships throughout the entire process. I’ll give you an example at UW-Parkside. We’re located smack in the middle of two mid-sized communities and a number of smaller municipalities. We can serve, and we do serve as a convener, as a mediator, as a connection for all parties. The advantage to having this third agent is that we have a foot in both private and public spaces and a commitment to social equity as well as the economic development that would increase well-being. So, it’s sort of — I supposed you could call it a middleman, and many times, middleman actually do work in P3s. Often, they are regional development corporations, for instance, that have both a business and a community interest. The university can provide that function.

Joe Kornik: Thanks so much. Very, very important. I’ve got one more question. It’s may last one. If we could, let’s dream a little bit about Racine, Aurora, and smart cities everywhere in 2030 and beyond.

Peggy James: Well, I took you seriously on this. I want to warn people that by birth, I’m actually a political scientist. So, that’s naturally where my dream goes to. I decided to just mention that I think civic technology can be a game changer, especially involving the community more directly and more immediately into all decision-making processes, not just P3. With increased transparency and the ability to provide input, the community can become a creator of services and development projects rather than solely a consumer. So, we have the ability with IoT, not only to get information, but the technology to actually have people participate on a flatter platform in decision-making that circumvents the boundaries of physical town halls, and so on. They’re not only impactful in terms of efficiency. I believe that they have the ability to transform the entire political system in a way that will make participation more transparent and more equitable. An example of this is in Chicago, although it’s a large city, and I said I wasn’t going to mention large cities, there’s a group called the City Tech Collaborative, which is a non-profit organization, and it’s specifically designed to increase access and input for citizen engagement. So, this is a way in which people can have feedback, not just on the finished product, but on the creation of services, and on the input that tells them what it is that they’re going to find to be most important for them. One of the things that UW-Parkside is doing in this area is that not only do we have a certificate in smart city policies and civic partnerships, but we’re also — and Will is helping us with this — is that we’re working on a Smart City U for government officials. It will show people what sorts of platforms are most effective for engaging citizens. We also have a private sector focused on developing a smart workforce for the future. So, our center for research and innovation in smart cities has actually been designed specifically to provide that pivotal relationship that might be necessary for participation. So, that’s my dream. [Laughter]

Joe Kornik: Fascinating. It’s a great one. Will, I’m wondering if you have any thoughts around smart cities 10 years out, let’s say.

William Martin: I will say that the same way that roads, rails, and ports really supported the economic explosion of the industrial revolution, I believe that digital infrastructure will allow for the transformation to smarter cities and the community-wide connectivity that will be necessary to democratize innovation, opportunity, and hope. So, so many people have had to move to cities for opportunity. The more that we’re able to actually support people where they’re at through high-speed, low-latency connectivity is going to allow people, whether you’re on a tribal reservation, a rural town, a small city, or a metropolis, the ability to be able to connect, to collaborate and to contribute no matter where you are. I think that truly will be the democratization of innovation.

Joe Kornik: Yes, interesting. Michael, there’s still some dreams left out there. So, what do you have for us when you think about the next 10 years?

Michael Pegues: Yes, I know my mayor keeps telling me to wake up because I think I’m always dreaming, but yes, I mean, I totally agree with Peggy and Will. I think, and with this public-private partnership, the whole objective is to make it where you can develop, finance and put in place long-term sustainable solutions that focus on public infrastructure — whether mobility, energy, transformation — and social infrastructure. One of the things that we’re looking at as part of our public-private partnership with the funders and investment firms are what they’re called these independent investment benefit corporations, where while their objective is still incinerated revenue, they have a social responsibility with regards to generating that additional revenue as well. It’s not solely ROI from a monetary spectrum, but it’s the social impact. So, that’s important for us, partnering with that right investment firm, because once we have that in place, they can help us with those models to manage this infrastructure over time. Going back to another point we talked about is access. We always talk about — I believe that technology is that common denominator for local and global growth, right? The same way that cities provide water, electricity and gas, fiber optic connectivity is that fourth utility. It’s not a luxury. It’s a necessity. There’s been the cases where we have Chattanooga or Fort Collins where we need to get that access to the people that really need it. If COVID has proven one thing to us, because I believe it’s just — it was basically an experimental — it wasn’t an experimental, it was a real-life use case to say why we need fiber optic to the home for every family, for all the 64,000 residents that we have at an affordable price, so they can have access to city services, so they can have access to education. That’s when we start to close the digital divide. So, putting these models in place with the private side, with governance, and government, and being smart about our governance and putting policies in place, that basically brings all these different pieces together. That’s going to be the way of the future, because we have to make it for 30 to 40 and even 50 years to make this work. We can’t look at these projects in the time frame of one year. It just doesn’t do any good. We can’t get the return on an investment back within that amount of time. We have to stretch it out. We need to amortize it over the 30 years, where we take the burden of the budgets and the costs off our citizens, and we start to look at generating new ways to bring revenue to the city. Because if there’s one thing that government has, it’s convening power. The mayor can snap his fingers in a minute and get everybody in the room that he would possibly need to get something done. We need to be looking at leveraging that. So, that smart city of tomorrow, we need to make our plans future-proof. We need to be smart about it. We need to make them sustainable, and we need to get the right people around the table — private, public, the educations, the people, the citizens, and bring everybody into it, looking at it from an interdisciplinary perspective, and putting a plan in place. It’s not going to be perfect, but getting that plan in place and moving it forward.

Joe Kornik: Thank you so much, Michael. Thank you all. Really, really great insights from a couple of chief information officers of cities and a dean from the college of social sciences and professional studies at the University of Wisconsin-Parkside. So, thank you Peggy. Thank you, Will. Thank you, Michael for your time today.

MARC MORIAL, PRESIDENT OF NATIONAL URBAN LEAGUE, CHALLENGES CEOS TO INVEST IN CITIES - Audio transcript

Joe Kornik: Welcome to the VISION by Protiviti podcast. I'm Joe Kornik, Director of Brand Publishing and Editor-in-Chief of VISION by Protiviti, our quarterly content offering where we put megatrends under the microscope and look far into the future to examine the strategic implications of big topics that will impact the C-suite and executive boardrooms worldwide. In this, our first topic, “The Future of Cities,” we’re exploring the evolution urban areas are undergoing post-COVID, and how those changes will alter cities over the next decade and beyond.

Today, I'm happy to be joined by Marc Morial, President and CEO of the National Urban League, an organization dedicated to economic empowerment, equality, and social justice to elevate the standards of living for African Americans and other historically underserved groups. With 90 affiliates serving 300 communities in 37 states, plus the District of Columbia, the Urban League advocates for policies and services that close the equality gap. At the community level, the organization and its affiliates provide direct services that improve the lives of more than two million people annually. And now, I'm joined by Marc. Marc, thanks so much for joining us today.

Marc Morial: Thank you. I really appreciate you having me, and good to have a good conversation today.

Kornik: We've heard a lot about how COVID could potentially be the beginning of the end for cities, or how cities are maybe in trouble right now. And certainly, cities were hit hard, we know that. As we slowly begin to emerge from this pandemic, how do you think cities are faring right now, and how do you view their prospects short term and long term in terms of their future?

Morial: One thing that I will tell you is that the mayors of cities were champions. They were required to make difficult decisions like closing schools and closing businesses and closing, in effect, the economy. They were required to do it without a real national plan, they were required to do it in an environment of great chaos and uncertainty, and they were required to do it while their tax revenues plunged as they closed restaurants, hotels, and businesses.

So, this generation's mayors, I do not believe, have gotten enough credit for the difficult and challenging decisions they have had to make in a time of tremendous uncertainty. The one thing I'm confident of, urban residents are tough. They are strong, they’re resilient, they love their communities. I know that in some places, people had moved away from cities and moved to rural areas, they moved to suburban areas. I think that's probably, in some ways, going to be a bit temporary, because what we love as people is to gather, to cluster, to enjoy each other, to participate and be entertained, to be close to our friends, to be close to our family members. So, I think the future is going to be strong for cities but it's a tough road back.

We now have to rally as a nation. Communities have to rally to try to build a new normal. Build a better normal coming out of the pandemic. And I think that's the challenge cities faced. The cities have been rocked fiscally. Their residents have seen the toughest and most demanding problems with COVID. There have been deaths, and people died without the chance to respect their funeral. So, against that backdrop though, I feel fairly certain that if we—and I think most predictors suggest we get an economic bump next year, I think that cities are going to be on their way for a strong recovery rebound.

Kornik: I hope you're right. An economic bump would certainly be welcome news because as you pointed out, there had been a lot of layoffs, there's been a lot of cutbacks to services. And we have seen in both people and businesses sort of—the short-term trend at least has been leaving cities during COVID and even post-COVID. And there's certainly a distinct possibility that cities will see maybe significant shortfalls in revenue at a time when…

Morial: I think some of the larger cities like New York City, like Los Angeles, cities that are heavily populated, sometimes a bit crowded — I think that people who move out may—who could move out may remain because of the cost of housing. I think medium-sized cities or smaller communities may not have faced the same effect. When I look at American cities today, there’s this top tier of 10 to 12, 14, 15 mega communities, there’s New York, Boston, Washington, Chicago, Seattle, Los Angeles, Houston, Atlanta, Miami, and Dallas. But then there's Nashville, and there’s Chattanooga, and there’s Cleveland, and there’s Memphis, and there’s New Orleans, and there’s Wichita, and Kansas City, and Cleveland, and Pittsburgh. These are medium-sized cities. They're big cities but they’re medium sized. I think it remains to be seen if the pandemic had the same effect on them in terms of out migration of people as it did in a place like New York City where it's not—I have several friends. I'm sure people in New York City are more likely to have second homes. More capable of saying, “I can relocate and still do my job just as well, even though I'm not at my office as I traditionally have been.” So, I think it may not be the exact same picture or the same reality to each city. I think it depends on the region, I think it depends on the size, I think it depends on a whole host of circumstances.

Joe Kornik: Services and public services that are needed, unfortunately, are at risk, I think, in terms of potential tax shortfalls. Who knows what's going to happen with work—with the future of work.

Morial: Let me tell you. I think people are more mobile. I think that is a really, really good question. What is the future work and what will the business people feel? "Look, I don't have to invest in that much real estate. I have a smaller office because my workforce has demonstrated the capability to work remotely.” I think you could see some businesses doing that. But I don't think there will be a rule, I think there will be multiple, if you will, approaches. I mean, look, I have a workforce of about 100 employees. We’re in lower Manhattan. We’ll soon be moving uptown to Harlem. We're trying to determine what the best approach is. Right? Is it a hybrid approach? Is it come-back-part-time, come-back-full-time, come back in platoons? Lots of options to try to balance. We've got to keep our business moving. We got to keep our agency going.

But, on the other hand, what about quality of life? Sometimes you can enhance productivity when people don't have to commute an hour each way. Sometimes you can enhance productivity when people feel like, “Well, I really don't need to leave to take much. Maybe I’ll just go downstairs.” These changes—maybe it's easier for me in terms of taking care of my children if I don't have to go into the office. Maybe it's more efficient for me. All of these are going to be, I think, considerations of the new workforce. Of course, there are those who have those option and there are those restaurant workers, people that work at cleaners, people that work at hospitals who do not have those options. So, we're going to see a disparity or we're going to see different ways depending on the type of work you do. Different options.

Kornik: Sure, sure. If we take a bit of a step back and we think about some of the major challenges facing cities right now, the US cities, and there are—particularly, there are more—maybe they are more vulnerable residents. What do you think of the major challenges that need to be overcome in the next year short term or even longer term?

Morial: I think getting people back to work. Quality jobs that pay living wages is a big, big challenge for cities, but in the short run, we've got to get people back to work. People who are working are always better off than people who cannot work or do not work or unable to work. I think the issues of racial justice are going to continue to be issues that every community and every institution have to confront and grapple with because of the moment of 2020 and the awakening of 2020. So, there's no shortage of major challenges, I think, facing America’s cities. And some of these challenges are peculiar or specific to a city, some of them are part of just the broader challenges that the nation faces. Whether you live in a big city, small town, or in rural or suburban America, there's some ever present realities that we face.

I'm hopeful that we're going to have a strong economic growth. I’m also quite candidly hopeful that—and will be working hard, that the president will get a substantial part of this infrastructure planned. Because what I see in cities across the nations, deteriorating water systems, or problems with the electric grid; roads and bridges and transit systems, schools, parks, and playgrounds. We need that investment. Cities need that investment, because cities—many major American cities were products of the early 20th century. Cities grew, technology grew, and electrification, and new water systems, and new housing stock. Now, much of that infrastructure is now 100 years old. It's in need of renewed investment so it can last, so it could continue to produce the things that we need to have, a decent quality of life for all people.

Kornik: Yes, absolutely. And that sort of leads me into my next question, which is, what do you think needs to change as cities look to reinvent themselves? I mean, COVID has given, potentially, cities, a sort of a reboot, a chance to circle the wagons and come out stronger on the other side. It sounds like you're optimistic about the future of cities. What do you think needs to change?

Morial: I’m optimistic but it would still—we need greater focus, greater energy on housing affordability. If there's one thing that is a big risk for cities, is that their housing stock becomes unaffordable and that their housing stock becomes of inadequate quality. We have a problem with that already in America, where a lot of Americans face as much as 50% of their take-home income for rent. That reality has changed dramatically since the year 2000. In 2000, the average rent was about $600.00 a month, now it's up to $1,400.00 a month. That means it’s more than doubled. The people’s wages, average wages have not doubled. And that is just—you cannot get around the need to have a decent roof over your head, whether you rent it or whether you own it.

So, I think cities have to look to investing in housing, new housing, renovated housing, affordable housing, housing that matches the families of the 21st century. Sometimes smaller, sometimes more traditional. That is a big, big thing, I think, that needs to elevate and to change. I think the larger cities, and I see cities that once didn’t have traffic challenges, like Atlanta and Houston, have to rethink whether it's time for them to make significant investments—new investments in public transit, in rail systems. Otherwise, those cities become great cities but it becomes difficult to move around. It affects business growth, quality of life, economic development. Think of New York City. New York City is a beautiful creation. What would New York City be without its public transit system? A city maybe a third of its size, when you take the public transit system, when you take the subway system, you take the rail systems, whether it's Metro North, Long Island Railroad, New Jersey Transit; you take the buses and you amalgamate that, they—without it, the city could not move and could not function. Newer cities built in the automobile era, didn't invest in the same way in public transit, and then it becomes a limiter of growth. A limiter of your ability to grow, your ability to grow your neighborhoods, the inability for you to grow. So, I think I would identify housing, I would identify transportation, and always, always jobs, quality jobs.

Kornik: Absolutely. Yes, you've given us a lot to think about and I'm going to ask you, a) if we’re up for the challenge, which I hope we are. And b) when you look forward—I'm going to ask you to look a little further than just next year or next quarter, look a decade out. Do you think cities will still be, assuming they meet some of these challenges that maybe you put out there to them, will still be viable and dynamic and great places to live and work?

Morial: I think always, but we have to treat our cities as the jewels that they are. If you went to Tokyo, Beijing, Paris, Beirut and you stood out and said, “I'm from Illinois!” they might say, “Illinois? I think I've heard it.” But if you said, “I’m from Chicago!” “Oh yes, Chicago.” “I'm from New Orleans.” “Oh, yes.” “I'm from Atlanta.” “Georgia?” “Yes.” “Is that [Unintelligible]?” “No, It's a state in…” “Oh, yes, yes.” What's my point? As cities go, so goes ascension. We got to treat them like the jewels they are. They are the economic capitals, they are the cultural capitals, they are the media capitals, and they are also the place where multiple ethnicities and races and people of different backgrounds live together. And while there’s division and we have a great set of challenges, I do remain an optimist when it comes to the future of American cities. But I issue a warning. We cannot do what we did in the ’70s and the ’80s, which is redline and underinvest. We now have to overinvest.

Public investment is important, private investment is important. I've been on a bit of a campaign to encourage technology companies like the Googles of the world, like the Amazons of the world. When they invest in new facilities, look at America’s cities. Look at America’s urban communities, look at downtown Newark. Both Prudential and Panasonic have office buildings in downtown Newark. We need more American businesses. We need more major employers to look to cities as places to locate because then—and then make a commitment to the residents of those cities for those economic opportunities and those quality jobs.

Kornik: Marc, are we up for the challenge?

Morial: We’re up for the challenge. I think we are, but it's going to take—it’s going to take united front. It’s going to take a lot of work. It’s going to take a lot of determination, but we’re up for the challenge.

Kornik: Outstanding. Marc, thank you so much for your time today and for your insights. I enjoyed the conversation immensely.

Morial: I appreciate you so much. Thank you.<>Joe Kornik: Thanks for listening to the VISION by Protiviti podcast. Please rate and subscribe wherever you listen to podcasts, and visit us at vision.protiviti.com.

SCOTT LALIBERTE AND KRISSY SAFI ON PRIVACY, SECURITY AND THE CONNECTED SMART CITY - Audio transcript

Joe Kornik: [Music] Welcome to the VISION by Protiviti podcast. I’m Joe Kornik, Director of Brand Publishing and Editor-in-Chief of VISION by Protiviti, our new quarterly content initiative where we put megatrends under the microscope and look far into the future to examine the strategic implications of big topics that will impact the C-suite and executive boardrooms worldwide. In this, our first topic, “The Futures of Cities,” we’re exploring the evolution urban areas are undergoing post-COVID and how those changes will alter cities over the next decade and beyond.

Today, we focus on technology in cities. It’s no surprise that cities all over the world are becoming more digitized: everything from traffic flow and garbage collection to real-time meter reading and autonomous buses and taxis. There are, obviously, lots of big advantages to smart cities as they are commonly called but there’s also a darker side of all this interconnectivity. If hackers are able to penetrate these systems the results could be catastrophic and, doomsday scenarios aside, smart cities are becoming smarter and big data is getting bigger and there are more and more cybersecurity implications to consider, including privacy concerns, data breaches, identity theft, and malware attacks. The pace of all this technology is accelerating at mind-bending speed.

Fortunately, we have two great guests today who will help us sort it all out. Scott Laliberte, Managing Director and Global Leader of Protiviti’s Emerging Technology Group, and Krissy Safi, Managing Director and Global Practice Lead for Attack & Penetration Testing at Protiviti. Scott and Krissy, thanks so much for joining me today.

Krissy Safi: Hi. Thank you for having us.

Scott Laliberte: Yes, glad to be here. Thanks.

Joe Kornik: There are obviously lots of advantages to smart cities as they're commonly called but today, we’re going to discuss some of the potential problems or even dangers that could come from all this interconnectivity. So, curiously, what are risks that should be considered when we talk about smart cities?

Krissy Safi: This is really an important question to be talking through, Joe, because I agree, there are so many advantages and there are some really exciting things to think about with the efficiencies and benefits that these types of advancements will bring. But we do need to think about what are the risks associated with these benefits? What are the potential negative implications? So, looking at it from just purely a digital perspective, the biggest concern in my mind is really around data security and data privacy. So, if you think about all of the data that’s getting collected, processed, stored in order for us to realize the benefits of these innovations, you have to ask, “How could that data be of use and used against us if not managed properly?” For example, could it be used by others to pry into our lives, maybe where we live, what’s our routine, what does our schedule look like, maybe where we shop, what do we spend our money on, where our kids even go to school or maybe even what church do we go to or not go to. Maybe which political events do we attend?

Each of those things alone may sound harmless, inconsequential, but as you piece those individual bits of data together, it tells a pretty complete story of who you are. Okay, what could you do with that? Maybe you could become a target for stalking, could your house get robbed because someone knows so much about your comings and goings and your happenings and your habits. Or even worse, this is a particularly great concern I think to us is, could your actions be taken out of context and could really detrimental conclusions be drawn about you? So, just one basic example, let’s say that you leave the same bar most nights of the week with someone other than your spouse. With that information, someone could conclude that you're drunk and maybe you're having an affair when you really just work at that bar and the coworker walks you out to your car every night to make sure you're safe. So, just one simple example of what could happen when this data is taken out of context.

Scott Laliberte: Krissy, I agree. I think the data side of it is a huge concern and all the additional data that’s provided with smart cities and IoT just makes an existing problem of data security and privacy become even a bigger problem. I think many of us couldn’t even imagine that it could be a bigger problem than it already is today but that’s going to happen. The other part that I think we now need to worry about is smart cities employ IoT, Internet of Things devices, and these devices really are now bridges the logical and physical worlds. It’s not just the data that we have to worry about but these devices are able to perform actions that can have implications on human life and safety. Now, we just not only worry about the data side but we have to worry about the physical safety side of it. There was an example of somebody hacked into a water treatment facility down in Florida a few weeks back and was able to manipulate the treatments such that what should just have been the action of cleaning water to keep everybody healthy became making it dangerous to drink and potentially going to be able to kill or physically harm people. That just happened by hacking into that one water treatment facility.

With a smart city, now you have things like the power, right? The power grid could be affected. Traffic lights that are being run by smart systems that could be manipulated to cause accidents. Transit systems that are being run and managed that could have a bus have an accident, have a train have an accident, all these types of things now happening. If you think about just even some of the common attacks today now being performed in a new way, ransomware. Think about how devastating ransomware is to organizations right now if their data gets locked up and you can't have access to that data, “Oh, no. What are we going to do?” Well, pay the ransom or you're not getting access to your data. How about, “Pay the ransom or we’ll going to kill a whole bunch of people,” right? Or, “Pay the ransom or this action is going to happen and you now are responsible for all the safety of these people and their lives.” So, we now have to think about these implications and how we’re going to secure it with these new technologies that we don’t know a whole lot about, that we’re still figuring out the standards and the controls and how to protect organizations with these devices in those environments. So, we’re now fighting a new battle in a new tech surface in a new tech landscape with bigger stakes in the game and it’s a lot to think about. I mean, we really have to go into it with that view in mind and really looking at the way we assess and put the controls in place so that we’re ready to defend not just the data but the lives and human safety as well.

Krissy Safi: Yes. I mean and if you think about it too, all these devices are quickly coming to market. I mean, how do you help the developers, the companies building these products to ensure that security was built-in intentionally while not missing out on being the first to market. That’s one of the things that concerns me the most.

Joe Kornik: Yes. It’s really interesting. Scott, you pointed out or you started to take us down the path of some potential doomsday scenarios, talking about ransomware and whatnot. I know that with all this data, it could lead as you pointed out to something much more nefarious, hacking or something worse. What are some of those doomsday scenarios, if I could for a minute just sort of take us down that road a little further than maybe you just did? If we’re not focused on cybersecurity, what are some of the really bad outcomes that we could be looking at?

Scott Laliberte: I'm probably the wrong guy to ask because I'm always thinking about the worst things that can happen, the balance of the risk and reward. So, the doomsday scenarios are pretty significant. The doomsday scenarios are ones that I think really are the ones that lead to the loss of human life and those are the ones that really scare me, wide scale, right? So, like one traffic light being manipulated and there’s an accident. I mean that’s unfortunate but, it’s a travesty but you have that happen on a mass scale so every single traffic light in the city is manipulated in such a way it causes accidents every single intersection all the same time. Not only do you have mass casualties occurring at that point in time, first response systems are going to be overwhelmed. There’s no way you're going to be able to respond with that type of broad scale accidents in a timely and concise manner. So, those are the types of scenarios I think really scare me. Like ones that are mass attacks against a safety type system, it causes some type of accident for human life.

I had an experience early in my career. I won't say how many years ago it was but many, many years ago back when I was hands-on keyboard pen tester. One of my first pen tests was for a chemical-type company and I'm sitting in there, hacking away and got admin really quickly and got into some system that I didn’t know what it was. Because it was a whole green screen system at that time and I was sitting there trying to figure out what to do and doing manual commands to figure out what was available to me. Luckily, somebody from the point of contact from the client walked by and he’s like, “Stop, take your hands off the keyboard. You are at a pressure control system and you can blow the whole place up.” So, that very early in my career, gave me that appreciation of the doomsday type scenarios that can occur and how those logical and physical worlds can come, married together in a very bad way very quickly.

Joe Kornik: Scary stuff. Earlier, we discussed the sort of cameras on every corner and sort of all this data that’s out there and a big part of IoT in smart cities are those mechanisms, which can be very helpful but problematic as well. Last year, the mayor of San Diego ordered the city’s smart street lights turned off after the ACLU and other groups cited privacy concerns. So, this opens a whole Pandora’s box, I think. When it comes to privacy and data collection and surveillance, I mean where’s the line? It feels like we’re sort of approaching that line or maybe we already crossed it but when does safety become surveillance, I guess is my question.

Scott Laliberte: Yes, Joe. It’s such a tricky area that requires balance because we can have tremendous benefits to safety. I talked about all the bad things that can happen in this regard but there’s also so many good things that can happen and it comes with trade-offs, right? For instance, using the IoT and the AI machine learning that can come with it to be able to alert people to safety issues. Like there’s a safety concession in this part of the facility and you get an alert on your phone to avoid that area or it's able to detect a dangerous person in the crowd because computer vision can see that the person has a weapon or they're acting in a manner that would be consistent with somebody harming people. I already see that the person is harming people, you alert the authorities to take appropriate action. So, there’s so many ways that this technology could be used in a positive manner but then as you mentioned, you flip that, right? So, what if the action of that person isn't actually acting dangerous, it’s just perceived that way or it’s biased based upon characteristics that its models are using and learning and inappropriately identifying people as potentially dangerous. So, you have that kind of bias angle to it as well on top of the whole part about surveillance or the example of you're monitoring somebody going and all of a sudden you think they're having an affair instead of being escorted to their car for safety purpose. It’s an area I think regulation is going to have to really step in and lay down appropriate guidelines, and organizations are going to have to really be responsible in the way that they use that data and the way they're doing things.

I think that necessarily sometimes conflicts with the organization’s desire to be profitable and make revenue. Like a lot of companies want to take that data and figure out how do they monetize it and when you're monetizing it, a lot of times that’s when you potentially could be crossing the line of using it in ways that’re not intended to and violating people’s privacy and using it for things that it shouldn’t be. So, I think we’ve got to be very careful. Corporations and companies need to be responsible in a way that they use this. I think there’s got to be guidelines on what is appropriate as far as response and cooperation with authorities. I think the courts are going to have to also put forth good guidance as well of having to balance the constitutional rights of citizens with the need to protect that safety of others. It’s going to be a very tricky area that I think we’ll see cases kind of evolve over time but the keys to it, I think, are having good policies for the organization to follow. It’s well thought out and there’s good governance function over it and we get guidance put out by the government and other regulatory bodies as well as industry leading groups, and then the cooperation between government and corporations.

Krissy Safi: Yes. I want to go back to your questions, Joe, kind of around when does safety become surveillance, and Scott talked about there are certainly many benefits to those things but do we think that surveillance could drive safety? Scott had several examples of that and as I was digging into this case a little bit more, what happened in San Diego, there are a lot of opinion pieces out there saying, “People who are law-abiding citizens, they should be perfectly okay with the surveillance.” It's kind of one of those old adages that we even hear from like a government perspective. If you're following the law, you should be perfectly okay with that kind of surveillance and it just means that your family is going to be safer. They're catching the criminals, they're more likely to be caught because there’s now video footage or maybe they're going to be deterred because they know there’s cameras around, things like that. But when does it really truly becomes surveillance? It kind of goes back to, then, what is being done with that data? Who has access to that data? What is the retention period around that data? How is it used? Is it somebody is just looking through the data to find something that might be suspicious or is it used to investigate an event that happened as evidence of that particular thing?

So, I think it comes a lot down to that and transparency too. So, transparency for the citizens. That was a big case in San Diego, the citizens there felt like they were not informed thus the city was not being transparent about how the data, how the footage from those cameras was being used after the objective, the initial objective, of those cameras was changed. So, I think kind of going forward, adding on to what Scott is saying, is we need to think about, what are we looking like in the future. What kind of policies do we need to have in place? I think transparency is going to be a big part of that and standard regulations and rules about how that data is used and shared and secured, and retention policies, things like that.

Joe Kornik: Right. I think a safe way forward is, if you're outside in a public place, especially a city, you can probably expect that there’s a camera or maybe several cameras. I said outside, I hope it’s only outside. I guess inside as well, there’s potential that you're being viewed in ways you don’t realize. But I think it’s safe to assume that you're probably being recorded at almost any point in time. I think cities are—I think they're on the tough spot there. So, I'm curious your thoughts on public officials and cities or private companies. I mean obviously, a lot of these cameras are security cameras that are attached to private buildings and private spaces as well. I mean what steps should cities or private companies be taking right now to ensure that they're not going to be the target of a cyberattack?

Scott Laliberte: Companies got to realize it’s not, will they be a target? They are going to be a target and they need to be prepared for it. There’s no question, right? Everybody is pretty much a target today and as you put more smart technology, more IoT, you're increasing your attack surface. So, you're opening yourself up to be attacked in more ways. So, that has to be accepted. You just have to understand that you're in that situation. What they really need to do is perform a risk assessment and that’s a practice that’s common today, of looking at the risks and assessing the risks and asking the scenarios of what could go wrong and what needs to be protected. Those need to be reperformed and updated given the new technology, a new attack surface that exists with the smart technologies that are in place. Then you're really kind of focusing on those key areas. Where can you put the controls that have the most benefit? What are the highest risks that you need to address because you're going to have to prioritize? There’s going to be so much to protect. You're going to have to prioritize how you implement those protections and then really have a comprehensive program that implements procedures to identify issues, identify both the threats as well as the assets that need to be protected. Put in controls to prevent those attacks from being successful. Putting controls and mechanisms to detect the attacks when they are occurring so you can respond accordingly. Then you have to think about recovery, right? How are you going to recover?

If those five steps sound familiar to many people, that’s because they're the key steps in this CSF, cybersecurity framework, and they apply in technologies including IoT and smart technologies as well. But having those five areas is very important, you’ve got to have the layers of defense. The other thing is making sure that you build the controls and procedures, the designs and plans of smart cities. So, if you're in those early stages right now where people are deploying pieces or parts of the smart city or different technologies, it’s very critical that they think through the security and privacy implications in those designs now because as we all know, trying to go back and retrofit any of those types of controls into a design becomes more expensive and more difficult the further down the road you get with the deployment.

The other thing is making sure you're constantly revisiting those plans to make sure that they're up to date. The technology is changing so quickly. I mean like the technology that was in the forefront six months ago has changed from six and a half months ago, 12 months ago. The attacks that we’re seeing today from six months ago have changed. So, you constantly have to be relooking at your plans and your infrastructure and your assets to know, “What are the new attacks, what are the new controls, what are the latest updates I need to be applying to make sure that I am trying to keep them safe?”

Another aspect is skills, right? Meaning to recognize that the skills needed to secure and manage IoT and smart technology are different than that of your traditional IT infrastructure. The communications are different, some of the protocols are different. The operating systems and the firmware that they run are different. So, thinking that you're going to get a traditional server admin that can go in and secure and deploy IoT is going to be an unfair expectation to that person. So, you need to make sure that you're employing appropriately skilled resources either in-house or through partnerships and make sure that they're involved in the planning and protection of that infrastructure. Make sure you're accounting for life cycle management updates and then also we have to think about the cross-border implications and the broader implications because a lot of the jurisdictions have different requirements and a lot of their technologies involve people within jurisdictions, customers from different jurisdictions. So, until we get consistency in the laws and standards, you have to realize how those cross-border standards and laws pertain to you and how you’re going to be able to comply with them.

Krissy Safi: I’ll have one other thing to add to that, actually. I’ve seen our clients also going back to the vendors or the developers of these smart city products and asking questions around how did they build security into the product. Answering many of the questions that you said, what is their life cycle update process, their security update process. All of those kinds of things that actually, sometimes doing a “bake off” between competitive products to see who is responding to the security findings,  the quickest store or who has less impactful or more impactful findings, things like that. So, really kind of taking it to the next level and holding our manufacturers of smarter city products, holding them accountable for the security too and making it a purchasing decision.

Joe Kornik: So, I just have one more question for the two of you. You have been very, very helpful for a fascinating conversation around cybersecurity and some of the darker recesses of potential hazards. I want to look a little bit forward. I mean, this is the future of cities that we’re talking about here and smart cities are only going to get smarter and big data is only going to get bigger. So, what do you think will sort of end up in terms of cybersecurity and privacy as it pertains to smart cities in say 2030 or even beyond that? I mean look as far out to the future as your mind can take us.

Krissy Safi: And yet so true. Smart city technology and the proliferation of the data that’s associated with that is only going to grow. What I find interesting too and some of the opinion pieces and just, generally, looking at different generations of consumers is, consumers are generally okay with the collection and usage of their data. They click okay to the agreements really without reading through. They just click through, click through, “What’s going to make my life the easiest,” and they expect that their data is going to be collected and shared, but going back to where do we need to go though, I think really comes down to that transparency, making sure that it is transparent to our consumers that the data is being collected, what it’s going to be used for and then having the governance and oversight of how that data is collected, shared, and retained. The personal security ramifications that we mentioned earlier could be significant. So, having the basics of how is that data collected, shared, retained, and policies and worrying about the cross-border implications and are we streamlined, things like that.

Scott Laliberte: Krissy, your point around consumers being able to drive change is going to be very important. Hopefully by then, we’ll have some type of balance and consistency between the different jurisdictions, the state laws, the federal laws, international laws. But given what we’ve seen in the past, I'm hopeful but also skeptical at the same time. I think consumers have to realize, as Krissy said, that they too can drive change and because they have these companies in the pocketbook, right? Like if they stop using products or stop using companies because of the questionable practices that they have with the use of their data or putting products out that aren’t secure and they're putting people at risk. They need to take action and I think we’ve seen the publicity of some of the questionable actions of big tech but I don’t think we’ve necessarily seen the consumers react to that in such a way that those companies felt enough pain in order to promote change. With social media and the ability for people to organize very quickly and have actions when it just looked like how the stock market was able to be manipulated with social media, those types of things being applied to trying to drive the behavior of manufacturers and companies that implement this technology, I think that could be a very powerful tool. I balance that with something like a DuckDuckGo browser that does take actions to protect your safety. How many people use that versus some of the other more traditional browsers that openly tell you they're going to sell and use your data, right? Until we, as consumers, start to embrace, “You know what, maybe I need to give up a little bit of functionality or a little bit of ease for a little bit of greater privacy and protection.” I fear that the change will be slow and, hopefully, we’ll see that evolution continue and the consumer will drive it.

One of the thing I will say just about 2030 is the technology landscape is going to continue to evolve. It's going to be different and we’ll have some new challenges that we have to deal with, right? Quantum computing is evolving very quickly. It’s going to really radically change the way computing occurs today. It has use cases that we’ll be able to resolve that we can’t even think about solving today. That’s going to open up great safety, potential possibilities but also open up new threats that we’ll need to think about and there are others beyond that. So, we’re just going to have to stay on our toes and really keep applying those same risk assessments and counter balance of benefit versus controls as we go forward.

Joe Kornik: There’s no playbook for this, right? Thinking nine years in the future is hard enough when we’re thinking in the non-big data world, right? I mean, how quickly that exponentially increases the amount of data in the world and how that can be used and the technology advances faster than we can keep up with. But that’s why we have you, Scott and Krissy, to help us sort of go out and to keep us on the straight and narrow as we move forward. So, thank you for a fascinating discussion. The Age of the Jetsons I think is coming quicker than we might be ready for and like I said there’s no playbook for it. We’re just going to have to figure out as we go and thanks again for your time today and, again, helping us sort through some of these issues today.

Krissy Safi: Thank you.

Scott Laliberte: Thank you. Thanks for having us.<>Krissy Safi: Yes, thank you.<>Joe Kornik: Thanks for listening to the VISION by Protiviti podcast. Please rate and subscribe wherever you listen the podcasts and visit us at vision.protiviti.com.

GREG LINDSAY ON THE WAY WE LIVE NEXT - Audio transcript

Joe Kornik: Welcome to the VISION by Protiviti podcast. I’m Joe Kornik, Director of Brand Publishing and Editor-in-Chief of VISION by Protiviti, our new quarterly content initiative where we put megatrends under the microscope and look far into the future to examine the strategic implications of big topics that will impact the C-suite and executive boardrooms worldwide. In this, our first topic, “The Future of Cities,” we’re exploring the evolution urban areas are undergoing post-COVID and how those changes will alter cities over the next decade and beyond. Today, we’re joined by Greg Lindsay, a senior fellow at NewCities and also Director of Strategy for LA CoMotion — an annual mobility festival in Los Angeles — and a visiting scholar at New York University’s Rudin Center for Transportation Policy and Management. Greg is a futurist, urbanist, author, journalist, and all-around expert in how cities of tomorrow will look, feel and function. Greg, so great to have you here. Thanks so much for joining me today.

Greg Lindsay: Thanks for having me.

Kornik: Greg, as we begin to rethink cities and their futures, there are a few big issues that sort of come to mind for me. Trends that probably were happening but were probably accelerated by COVID, I would say, and one of those trends that I think we need to take a deeper look at is around real estate. People with means left cities during COVID. That was well-documented. And obviously, companies shuttered offices in favor of remote work. I think one of the biggest stories about cities post-COVID and the future of cities is really about real estate, both commercial and residential, and of course the tax base that it represents for cities. I know you’ve done lots of work in that space with Brookfield Properties and others, so I’d love your take on what you sort of see in the urban real estate market and about how those shifting demographics could impact it going forward.

Lindsay: Well, you know the truth is, it’s still a little early to tell, because the big question is “How real is the remote work revolution?” We’re seeing right now, in the States in the particular, the companies want them back. Jamie Dimon canceling all of his Zoom meetings because he’s “over it,” [Laughter] but a lot of workers still want to have that kind of flexibility. They’ve gotten used to this lifestyle. I think it’s going to be a lot of butting of heads and experiments that will have to play out before we sort of see where that goes.

But I do think it’s a good thing for cities that we are seeing employers return to that and not throwing away their real estate portfolios as some of those bankers, CEOs threatened to do early on. But it will raise really interesting questions about, “Will we need as much office space?” If so, what does that do to the valuations of that which has, of course, implications for the tax base and for cities? What will the conversations be? That, to me, is a really interesting area about, can we convert some of that Manhattan real estate into the housing New York desperately needs and the Bay Area desperately needs. Will we see new types of mixed-use real estate?

If I have to choose a category type that I think is deader than dead, and it was already pretty dead, it was the suburban office park. Like, why would you ever go to a suburban office park? Even if you live there, stay at home. [Laughter] So, it will be really interesting to see whether that die-off of commercial real estate happens, not in the center of cities as people thought a year ago, but would really happen in sort of the ex-urban fringe and whether that can pose an opportunity to build more walkable places that people like. There’s a whole body of literature that showed before the pandemic, real estate premiums accruing to places that were walkable or bikeable or that have those kinds of amenities to it. So, I think that’s really interesting. I personally suspect that people will rekindle their love affair with cities. That they’re going to find that being at home all day in the suburbs is going to lose its charm. We’re already seeing studies, for example, showing that traffic is way up in the afternoons, totally predictable. All of those trips that you could take on foot in the middle of Manhattan or any other city near an office, you’re now doing in your car at that level of scale, and that traffic adds up. So, it will be interesting to see.

But yes, I think the really important thing in the short-term, with the Biden administration and others, is that we make sure that transit systems and the other sort of things that keep cities going don’t suffer huge permanent cutback in service and lose riders because, otherwise, that’s going to have cascading effects going forward.

Kornik: To your point, we’re social creatures, right? We want to be out amongst each other, we don’t want to be cooped up in our houses on Zoom calls all day. It’s clearly getting old. I’m glad you mentioned transit, because I do think that another key piece of the future of cities’ puzzle is around mobility, specifically sort of autonomous and connected mobility. I know you’ve done some work in this area with Toyota and some other companies. I find this fascinating, that soon we could have sort of autonomous drones, or flying taxis, I guess, is the non-fancy way of saying that, sort of buzzing around cities and maybe over 160-year-old underground in London or over the 120-year-old subway system in Manhattan, which I just find a really interesting dichotomy there. So, help me wrap my head around sort of mobility and the future of mobility as we talk about specifically, obviously, urban mobility. Help me wrap my head around that.

Lindsay: One thing we’d say for certain is the future is electric, right? This massive surge towards EVs. The Ford F-150 Lightning I am seeing now described as the potential real game changer. Solving all the cultural issues, having all of that incredible battery power that you can use to decentralize the grid and push for renewables. So, that’s really interesting there. Yes, the big question mark is, again, sort of the public transit in the backbone of cities and how they suffer the most during this while people with means fled to their suburban homes and bought cars and bought them in droves. So, I think that’s really interesting.

But yes, I’m more focused I think particularly on the revolution and personal electric mobility. It’s happening in Europe more than in the States. Germany, I think more than 10% of households now have electric bicycles. The French, huge adoption during the pandemic of this. Forward-thinking cities like Paris, Milan, Madrid and others, they had personal subsidies. You can get up to €1,000 to buy an e-Bike or a scooter, they put investments in bike lanes. Those cities made it a lot more attractive and could reduce their reliance on cars while you didn’t have to travel in the subway, which was safe the whole time I should add.

I think that’s a really interesting thing going forward because this gets back to the larger trend of what I think is exciting, as you said, about micromobility and robotics there, is that like for 70-80 years, we had one foreign factor that dominated the car, and now we have this Cambrian explosion of new types of devices. I think, for example, the real use case for autonomy, which, when you get down to it, it’s a camera, LIDAR sensors that get cheaper over time. It’s not going to be a self-driving car, it’s going to be this whole new types of species, of urban robotics for delivery, for conveyance of things. I think autonomous scooters are actually going to be really interesting. I’ve seen a handful of prototypes by Tortoise and others. The notion that you could walk out of a building and with a tap of a button, your own personal vehicle could come to you, of any size that you can use, I think is really powerful.

The one thing I’m a little uncertain on right now is the urban air mobility as I think we call it there, UAM. To me, the most interesting question about that will be the NIMBYs, right? We, once upon a time, we’re going to have supersonic transport in this world and we shot it down because of noise worries. No one’s figured out how to make a drone quiet yet. I know in Los Angeles, which is really the frontier of helicopters and UAM in the States, people hate that for the noise variations. So, I think this is going to be a really interesting challenge about that confluence of real estate, and neighbors, and law that hasn’t been figured out yet, even if the tech gets mature enough, which it increasingly is. So, we’ll see. The one thing I’m pretty sure, it’s not hyperloop. I don’t see the point of building giant steel tubes on the ground when you can just as easily get on a plane or take a train.

Kornik: Right. I guess it would be not in my backyard airspace, I guess, is we’d have to add an AS to the end of NIMBYs, right? Yes, that’s interesting. One other area I think as we get into these renewables, and cities will obviously have to adjust, because how the infrastructure is set up will determine a lot on how people will get around cities. With the renewables and with a lot of the things that we just discussed, there are, obviously, climate impacts and sustainability issues, which I think would be a huge win for a lot of those electric vehicles that you just mentioned. We’ve already seen some people in cities, and indeed, some cities themselves sort of being forced to relocate because those places may soon be unlivable. I mean, when we talk about climate change and the ultimate impacts it could have. So, take me through a little of what you see on the climate front in cities for the next decade. Let’s say 2030, 2040, and even 2050, if you want to go that far out.

Lindsay: Well, I’d say I think the changing climate still is one of the great cognitive dissonances of our time, like this notion that we’re going to be able to adapt and mitigate to survive in almost any climate. I think it’s admirable what a lot of cities are doing in terms of decarbonizing. I just saw that Des Moines, I think, wants to take out every fossil fuel out of its urban grid mix by 2035. I think we’ll see a lot more push for that. But the real question, which is really the one that public officials don’t want to have is, is that we can’t save every place, right? The sea levels will rise, the wildfires will burn, the extreme heat will get hotter, and we’re going to have make tough choices. Tough choice is not about telling you were to live at least, but where you want to invest, right? Like if we’re going to invest $2.25 trillion, like the Biden administration wants to do, should we be putting that in Miami or should we be putting that in wildfire zones? We already see the insurance industry, for example, desperately wants to drop policies in Central California and the state won’t let them, and all sorts of problems with the national flood insurance program as well.

I don’t know. It’s a really tough conversation, and one I’ve tried to convene several times in my work, and on one really wants to talk about it other than sort of the planners who are concerned, and about wealthy people will leave just like they left during the pandemic for those suburban homes. Wealthy people will pick up and they will buy real estate in Burlington, Vermont or some of those upstate towns that many New Yorkers move to, where the land is attractive and will only get more so. But what about those who are left behind, how do we help those communities that will suddenly, all at once, get much poorer as property values drop and so forth?

So, we need to create more programs like that, I think, in the States. And globally, about thinking about where should people move? What are the mechanisms to steer them away? Insurance and market incentives are one thing, but hopefully, we can delineate some of those risks.
Now, by 2030, I’m not sure it will be in place there, but I think it’s going to become more and more apparent. Heat waves will be more often, and I think the biggest threat that is posed to San Francisco and also some of the cities in the Pacific Northwest, is that despite how great their climate is overall, if you’re a family and you have to spend a week or two each year indoors with air filters because the wildfires are burning, people are going to vote with their feet, and that will affect the long-term consequences for those cities, which at one point last year, by the way, I think Vancouver, Portland, and Seattle were all the most polluted cities on Earth for at least a week during the wildfire season.

Kornik: Crazy. And it’s going to have sweeping impacts as we go forward. I think it’s hard for people to focus — it’s hard to focus two years out, let alone 10 years or even more — 30, 40, 50 years out for some of these things. But certainly, it will be a very different globe, I think, in 2050 and beyond. What we are seeing is sort of these new cities from scratch that are sort of popping up all over. Talk about a place that’s really a difficult place to live from a climate perspective. There’s a city called Neom in Saudi Arabia that’s sort of a prime example that’s launching, and they have something called The Line. It’s sort of an energy-efficient city, it’s going to be carbon neutral from the jump. So, this is a complete change of sort of how cities have evolved and been built slowly over hundreds and even thousands of years. What do you make of these sorts of reverse-engineered cities that we’ll continue to see — will we continue to see more of this type of development happening, and will we see any of it happening in sort of our more established world’s-greatest-cities that we’ve come to know and love?

Lindsay: Yes, Neom is a fascinating project. Right? It’s like the total climax of the Dubai model of development and creating its own special legal zone in addition to the technology described. I do like the fact that The Line, which is literally a line that will preserve most of the site’s wilderness, will have a spine that’s going to be hyperloop or high-speed rail, but every neighborhood will be a so-called five-minute city. So, I think it’s really interesting. They’re trying to basically use remote work and personal transport and these systems and keep it together. I would be very curious if they can make that workable.

But yes, I’ve been studying instant cities for more than a decade and find them fascinating on multiple levels. One of which is like, just how hard it is to build a city. No matter how much time and effort a team of architects and engineers can put into it, they can still never replicate that lived-in feeling because you just need so many little hands about it. But yes, I mean — before Neom, there was Songdo in South Korea, which is also aimed to be the world’s most sustainable city, and did some great work in integrating the systems together. I think what these instant cities are best at are — yes, they’re prototypes. They’re prototypes for what you can achieve if you network all the bits and pieces of technology together that work well on their own, like district heating and cooling, and various films you can put on office windows to basically reduce energy loss, and — you know, this whole checklist. Songdo has pneumatic tubes for waste collection and burning into clean electricity for example.

The larger problem is that as fast as these cities get built, they don’t get built fast enough. We call them “instant cities,” but when I visited Songdo, there was a sprawl all the way around the urban edge that popped up long before they ever even broke ground on the sustainable district. So, it kind of underscores that urbanization is going to happen much faster than any of these prototype cities can do, and I think that’s why it’s important that at the same time we pursue these, we needed to think long and hard about how do we build like an open source kit of parts for the bottom billion? For the people who are hand-building their homes and cities in what we would call slums, but of course, [Unintelligible] and all these great cities around the world that are often in the most crucial real estate, right?

Dharavi, the largest slum in India, is in the middle of Mumbai. But how do we get solar panels to them? How do we give them sustainable building materials and do it so cheaply so these people can do that for themselves? I think that’s one of the critical challenges as well. Figuring out what that prototype kit of parts looks like at the bottom as well as the top.

Kornik: Yes, interesting. That clearly will be an indicator of where we go, right? How we sort of take care of the bottom billion, as you refer to them. Okay, so let’s talk a little bit about where we’re going. Time to put on sort of the futurist hat, if you will. Take me to 2030 and even further out you’d like. Give me a few thoughts about what cities will we — a decade from now, or like I said, even further out, how will they be different, what might surprise me, what’s going to catch me off guard, and ultimately, will they still be viable and dynamic places to live and work? I mean, how optimistic are you on sort of the long-term future of cities?

Lindsay: I’m, ultimately, I guess more bullish than I ever have been, ironically. They survived the pandemic. I mean, it survived every pandemic before that, but they survived a pandemic coupled with the technology that for 50 years, we thought would render cities obsolete. Like Alvin Toffler, Marshall McLuhan, they all predicted the death of cities because of the kind of remote work tech that we have now, and it still hasn’t happened. At this point, I don’t know what could kill cities. Perhaps there will be rising seas or fires.

But you know, if you want to talk 2030, I could give you a specific vision, and I will just have to paint it for you because this is a podcast and we don’t have images [Laughter] for once. I was part of a team of architects that is redesigning the Champs-Elysees in Paris, and what’s really interesting about this project is that it started before the pandemic or any of these trends, it started because Parisians hate the Champs-Elysees. It’s populated purely by tourists.

So, the challenge was how do we create a boulevard that Parisians will love? My friend, Philippe Chiambaretta, I was one of his mobility consultants. We took out the cars much as we can. We put in — imagine autonomous shuttles, and micromobility, and pedestrians. We expanded the tree cover and the cafés, and sort of reinvented it as a place for Parisians, which I think is a really interesting trend post-pandemic as well, because we’ve all kind of realized like how much of our cities are designed for global tourism and designed for global travelers. Like Times Square, utterly useless in a pandemic as it turns out. How can we rethink that?

So, I think it’s a really interesting example because, yes, we imagine a place that’s more human, that’s more walkable, that’s more inviting to people. Philippe describes his goal as re-enchanting the Champs-Elysees. So, perhaps by 2030, we’ll see, at least the world’s most successful cities, will have re-enchanted themselves, investing in that kind of infrastructure for people that will draw them to cities. Because if you can work from anywhere, then you’re going to have to have a reason to want to be there. And then for everyone else, I think it’s an open question.

I mean, I look at Dubai as really the sort of example of where we’ve stretched global urbanism. A city that’s put together more by code and nodes there of living in one district and working in another, and all sort of bound together. I think Miami is sort of going that route right now too, with all the tech bros moving there from Silicon Valley. Will people choose cities that have warm beaches, low tax rates, and a climate that’s great now but not so good in the future? Will people move more north as we start to see climate change?

That’s one of the reason I live in Montreal. I’ve explicitly thought about this and written about this. And yes, I think if there’s one thing we could think about in 2030, is that we’ll all be thinking a lot harder about where we live and why we live in cities. We’re no longer going to take this for granted. I think we’ll see in the United States, a wave of migration that has not existed in decades. Americans have moved less and less over line and now as they can re-emerge, they’re going to reevaluate their life choices. And yes, I think we can be certain that’s going to happen a lot in the rest of the world as well. We’re going to see waves of migration, and the most successful cities will be the ones that can handle that wave and be able to be invited into their residence. I think that will occupy us at least until the middle of the century.

Kornik: Yes, fascinating stuff. It’s interesting to think that far out and think about cities. That’s what, two-thirds, if not, three-quarters of the world’s population will end up in a city in the next decade or so. That’s our future. I mean, cities’ future is humanity’s future essentially. So, Greg, great stuff. Thank you so much for taking the time to be with me today, and fascinating conversation. I appreciate it.

Lindsay: Thank you so much for having me.

Kornik: Thanks for listening to the VISION by Protiviti podcast. Please rate and subscribe wherever you listen to podcasts, and visit us at vision.protiviti.com.

HOW QUANTUM COMPUTING WILL IMPACT THE FUTURE OF CITIES - Video transcript

Joe Kornik: Welcome to the VISION by Protiviti interview. I’m Joe Kornik, Director of Brand Publishing and Editor-in-Chief of VISION by Protiviti, our new quarterly content initiative where we put megatrends under the microscope and look far into the future to examine the strategic implications of big topics that will impact the C-Suite and executive boardrooms worldwide. In this, our first topic, The Future of Cities, we’re exploring the evolution urban areas are undergoing post-COVID and how those changes will alter cities over the next decade and beyond.

We’ve got a good one for you today as I’m joined by Konstantinos Karagiannis, Associate Director of Quantum Computing Services for Protiviti. When we talk about how technology will impact the future of cities, we certainly need to include quantum computing in that equation. Simply put, quantum would enable problem-solving capabilities, involving a number of variables and potential outcomes at amazing speeds not attainable with conventional computers. Quantum-inspired algorithms could bring innovative solutions and approaches to product development, reduce time to market, optimize customer delivery, and speed up data transfers, but what impact could it have on the future of cities around the world? For that, I’m bringing in our expert, Konstantinos Karagiannis. Konstantinos also hosts The Post-Quantum World Podcast. Thanks so much for being here, Konstantinos.

Konstantinos Karagiannis: Yes, thanks for having me.

Kornik: Okay, so this is a big topic. Let’s level set for just a minute if we could. We’ve sort of been hearing a lot about quantum computing for a few years now, so what is it? Where are we in sort of the maturation stage and how far have we come to this point?

Karagiannis: Yes, so quantum computing uses the mysterious nature of quantum mechanics to deal with a type of computing that was never possible before. Quantum computing is not just about building a computer that’s faster, but it’s also about building a computer that does things in an entirely different way. Most people are familiar with classical computing where you have binary, that’s zeroes and ones, that allow computation. In quantum computing, we have something known as a quantum bit, which, thanks to superposition, can be both zero and one at the same time, and it sounds weird. It doesn’t sound like a big deal, but with the right algorithms written to take advantage that, you can do things that have been impossible in the past or will become impossible just because of size. So dealing with a lot of data is a lot easier for a quantum computer. A classical computer, every time you try to improve it, it’s a very linear progression. People now look at Moore’s law. Classical computers get more powerful every couple of years or so. They double every couple of years or so. Quantum computers though, if you just added one of those quantum bits I told you about, you’ve just doubled the power of the machine, just to give you an idea how those things get explosively powerful over time.

We’re still a little bit in the early days as far as maturation. We haven’t been able to prove a usable quantum advantage just yet, but we’re on the cusp. In fact, it could come as soon as this year that we’ll be able to prove some practical application that is just done better by a quantum computer even today, even with the machines we have now. What’s next would be taking these machines and making them even better, and we have plenty to discuss about that today, I’m sure. [Laughter]

Kornik: Okay, so when we talk about cities specifically, where do you the see the biggest benefits of quantum computing as it relates to cities?

Karagiannis: Yes. So, those algorithms I told you about, that if you have them, just take advantage of the machine, they’re going to allow some pretty impressive things to happen on the space of cities. The big three with quantum computing is basically anything involving optimization, anything involving machine learning, or anything involving simulation, and all three of these things apply to the cities. The biggest one we’re going to see first would be optimization, because there’s a type a quantum computer called an annealer, and there are certain types of problems already that if you apply an annealer to them with a little bit of classical assistance, so you sort of have like classical computers doing some of it and an annealer doing the quantum part, we’re already starting to see things that are approaching advantage.

For example, you can do an experiment where let’s say you have a city that has had some kind of catastrophe and they need to distribute goods to multiple locations in the most efficient way, we’ve already seen experimentation done on D-Wave’s hybrid system where a classical machine learning algorithm would try and find the best approach to deliver those goods, and it would take, let’s say, 27 miles of driving to get them to all the locations, and then the quantum computer was able to figure out paths, timing and everything to do it in only 20 miles of driving. So, from 27 miles to 20 miles, that’s pretty decent, and you can imagine how that would start to explode if you add in more variables, like weather or avoid this street because of crime or whatever. Quantum computers just do really, really well at handling larger and larger amounts of data, so we expect this type of thing to hit all avenues of smart cities, all types of planning with optimization. Just regular delivery routes, the classical traveling salesman problem people probably have heard about. It’s this idea of true efficiency, and to me, a smart city is not a smart city if it doesn’t have a perfect efficiency, right, and it just becomes a complicated mess with traffic jams and all sorts of things like that.

Then, you move on to the pure machine learning side. Anywhere the machine learning is sort of touch a smart city, it will just be better with quantum given time. We’ve already seen the extrapolation of this happening, so anytime you’re trying to make intelligent decisions or automate processes, you’ll find that a quantum computer will be able to do things in thousandths of the time that it would take a classical machine, and then eventually gets even more exaggerated. What’s fascinating is this isn’t going to be like a neck-and-neck arms race with classical and quantum. Whenever quantum proves advantage in an area, that will be it. It will be almost like a straight line up if you think about graphing its performance. It’ll never be like classical could catch up again. Just add one qubit and you’ve doubled the system, et cetera, so over a course of a few years, quantum computers are going to seem to be practically [Laughter] magical at the things that they excel at.

Then, on the simulation side too, we see massive impacts of that affecting cities. You’ll be able to do simulations about risks, simulations about how things will literally go, building materials can be improved by simulating which types of molecules handle stresses better. Basically, anything where you want to try and make a guess about how a certain flow on any given day will be, and in the numerous intricacies in the city, quantum machine learning algorithm would just be much, much better.

Kornik: I’ve read quite a little bit about this quantum apocalypse that’s coming. I guess that means the day when quantum computers will be able to crack encryption, which certainly sounds bad. I know on the smart city side, there’s quite a few concerns around cybersecurity, but I would imagine that this is sort of on steroids. So, tell us a little bit about that, the quantum apocalypse, and tell us how bad could that be and what could it mean for cities, and what can be done about it.

Karagiannis: Yes. Way back in 1994, Peter Shor, a mathematician, came up with an algorithm that showed that we’d be able to reverse two very large numbers that were used to make an even larger number, which is basically the secret behind RSA, another type of public key encryption, like elliptic curve. So, once a quantum computer gets powerful enough, which could be five years away—it also depends on, like, if we can link them together, sometimes it might be able to do work more efficiently in the future, it remains to be seen. So, when that happens, all the old ciphers, because of this algorithm, will be able to be sliced apart. This will affect Bitcoin too, and other cryptocurrencies.

So, for a smart city to excel, it would have to build on what we call post-quantum cryptography. NIST is currently working on new math-based ciphers that could replace RSA. Within three years or so, we expect to have fully approved and vetted new ciphers that can be put in place to avoid that quantum apocalypse. So, building a smart city, it would be smart to already consider from now having the crypto agility needed to build those ciphers in.

Kornik: Yes, interesting. A couple of timeframes there, you mentioned a few years out from that. The speed of all of this—I mean, it seems a little mind-blowing, to me at least, a mere mortal. [Laughter] Can you put together sort of a timeline short-term of where we’ll be maybe in a few years in terms of quantum computing in cities? I mean, I know this is a little bit of a riskier proposition when talking about something that moves at the speed of quantum, but can you even hazard to guess as to what could be possible, say, a decade from now?

Karagiannis: Yes, absolutely. I talk about quantum timelines all the [Laughter] time with our customers. Some of them are concerned just about the crypto apocalypse we were talking about, so for them, the timeline is like just from now start looking at being able to adapt to have these new post-quantum solutions in place, but in general, they’re also concerned about how soon they can see real benefit with quantum. So, this is kind of how I see the timeline from what—these aren’t even just guesses. This is sort of like based on roadmaps and things from the people making the machines themselves. Within this year to next year, we’re going to actually see true quantum advantage in areas of optimization because of the amazing work being done with annealers, so that type of quantum computers are already getting pretty mature. It can only solve certain types of problems, but when mapped correctly, we’re already seeing—we’re just about there.

For example, like we could do portfolio optimization now where if we were picking how to invest money, it might not be as accurate as classical, but it will be literally 1,000 times faster, so once we tweak the accuracy, we have the advantage. There’s all sorts of little tweaks and things like that that have to be made, so we’re going to see that with smart cities, too. If anyone wants to apply optimization back to any kind of NP hard type of problem, like a traveling salesman going everywhere without repeating your steps, we’re going to see advantage in that area within a year. So, this is the beginnings of the benefit to a smart city, and it’s already here. About two years from now in 2023, we expect to see multiple 1,000 qubit and up machines, and those are going to start to do really amazing things. The other type of quantum computing are gate-based, so that’s where you’re going to see explosive benefits to doing quantum machine learning, quantum simulation like I talked about. That’s really exciting, how close that is. Around 2023, I imagine there’s going to be a headline-generating paper almost every week, [Laughter] talking about how now we can do things so much better than we did before. That’s just 2023. Then by 2024, we’ll start seeing more interconnects and links, and the ability to connect quantum computers together to have them behave as if they were one machine.

So, it’s not like when you’re trying to do grid computing now that you’re doing a little piece of a problem, and then sending the answer. You’ll almost be able to think of all of them as one machine, kind of sending calculations and progress over special connections for this quantum sort of internet. That’s really, really soon. In 2024 and 2025, we should start seeing explosive growth in the power of the machines because of that interconnect capability. Then, as far as a decade goes, I would say—I mean, Google has already announced that they plan on having fully error-free quantum computers by 2029, so that’s definitely within the decade. Once that happens, quantum computing, there aren’t even have to be any technical hurdles really to making it work. It’ll sort of be like, “Is it a type of problem that quantum is better at?” You just effortlessly encode it and really make it run. It should be quite an amazing time. The interfaces for programming are getting better too, so I can see that within a couple of years, it will be possible to just apply quantum in multiple areas without having to build it from the ground up [Laughter] every single time. This is really the most exciting time. That’s why we’re putting so much focus on it here at Protiviti.

Kornik: Right. Will we see like actual—like when we move around a city in 2030, will we have noticeable differences or will it be so baked in to sort of everything that’s happening around us that we won’t be able to see it in action?

Karagiannis: Yes, because of the areas that it touches are going to make the big changes themselves, I don’t know if people will be aware of what’s happening. I mean, we all see how machine learning, AI, in general, has made life a lot easier. They’re going to notice that AI, all of a sudden, magically got a whole lot better, [Laughter] practically overnight in some areas. I don’t know how aware people are of this all the time, but anything that they thought that AI was doing a decent job at, all of a sudden it’s going to be doing a really great job at, so that could impact everything from like autonomous vehicles —they’ll just have that better sort of grid back-up or brain that is giving them the extra information they need to make better decisions. A city will be more hyperaware of these cars that are moving through it, for example. It will be able to give more real-time feedback and make predictions about where a car will be in a few moments and plan for it. So, quantum might make possible those terrifying images you see of cars shooting through intersections without any traffic lights because they’re all autonomous and slicing the neck out of each other. As much as I love this technology, I don’t know if I want to be in one of those cars. [Laughter]

Kornik: Yes, it’s going to be interesting to say the least. Konstantinos, before I let you go, can you tell us a little bit more about the Post-Quantum podcast that you recently launched?

Karagiannis: Yes.

Kornik: Where can people find it and what can they expect from it?

Karagiannis: Yes, it’s on all the platforms. You could just search The Post-Quantum World. Every episode, I talk to a company, a representative, a researcher, someone who is having a big impact on quantum today. We’ve already had some of the big machine makers, like Honeywell, we’ve had Microsoft who has their Azure Quantum platform where people could code, so it has a business focus too. Anyone who listens to it is going to hear about technology, what’s emerging and what's new, but also what it means to them, what it’s going to mean to—in the case of Bitcoin, like what it would mean to basically—and what if cryptocurrency was cracked by quantum computer and everything to, “Hey, what are the use cases? What are the things that my company can start getting benefits from immediately or in the near term? We try to cover it all and make it somewhat understandable. [Laughter]

Kornik: Yes, I’ve given it a listen. It’s fascinating stuff. Thank you so much for your time today. Konstantinos Karagiannis, our Associate Director of Quantum Computing Services for Protiviti where he’s out there fighting the fight and helping our clients on a day-in, day-out basis to face the future with confidence.

Karagiannis: Thanks.

Kornik: Thanks, Konstantinos.

FUTURE OF CITIES: THE VIEW FROM THE MICROSOFT TECHNOLOGY CENTER - Video transcript

Joe Kornik: [Music] Welcome to the VISION by Protiviti interview. I’m Joe Kornik, Director of Brand Publishing and Editor-in-Chief of VISION by Protiviti, our new quarterly content initiative where we put megatrends under the microscope and look far into the future to examine the strategic implications of big topics that will impact the C-suite and executive boardrooms worldwide. In this, our first topic, The Futures of Cities, we’re exploring the evolution urban areas are undergoing post-COVID and how those changes will alter cities over the next decade and beyond. Today, I’m joined by Kathie Topel, a Director in Protiviti’s Business Performance Improvement Practice, and Charles Drayton, the Chief Technical Architect and Healthcare and Life Sciences Lead at the Microsoft Technology Center in Chicago where he helps customers transform the way they engage their patients, employees, and partners. Kathie is going to be doing the interviewing today, so I’m going to turn it over to her to begin. Kathie, it’s all yours.

Kathie Topel: Thanks, Joe. Welcome, Charles. I’m so glad that you could join us here today. I will just start off by saying if you could tell us a little bit about the Microsoft Technology Center and what your actual role is there.

Charles Drayton: Yes. At the Microsoft Technology Center, I am the Chief Technical Architect in the Chicago Office. I’m also the Worldwide Healthcare Experience Lead for all of the MTCs. So, what the MTC is, as a Microsoft Technology Center, think of it as a people, place, and process. So, when it comes to people, we have an entire team of technical architects who cover the entire breadth of Microsoft technology. When it comes to places, there are places like the MTCs, and we have about 40 of them, or more than 40 of them, worldwide. In each place, we have a number of replica facilities. In Chicago, for example, we have a replica healthcare space that looks just like a hospital and that is designed to showcase not just the future of technology, but some of the technology innovations that we’re doing today that customers can take advantage of. When it comes to process, we can help organizations with a wide variety of subjects. We manage hackathons. We can do architecture design sessions. We can do strategy briefings. We can give you demonstrations of brand-new technology or existing technology. So, there’s quite a bit that we do at the MTCs.

Kathie Topel: Charles, when you hear the topic “Future of Cities in 2030 and Beyond,” what’s the first thing that comes to mind for you?

Charles Drayton: I think there are probably two things that come to mind to me. First is sustainability and the second is connectiveness. So, sustainability, I think anyone who’s been following the news, you understand that one of the big challenges of our time is on sustainability, green energy, the environmental crisis that we have right now. I think we’ve taken our eye off the ball a little bit with what’s happening with the pandemic, but I think very soon, it’s coming back to the forefront. So, in 2030, I think there’s going to be the end result of a significant push towards building the future city in a way that can be energy efficient, that can be self-sustaining. Things that can be green in nature that not only are designed to be zero emissions but to be negative emissions, and it’s actually one of the things that we’ve committed to doing at Microsoft with our Microsoft campus in many of the offices that we own.

The second thing is connectiveness. I think increasingly, you’re starting to see the end of the office as we know it, and in place of that, we’re going to see more people who are permanently working from home. So, the question then becomes, “How is it that you can have the same experience at home that you would in the office?” We’ve already seen a trend towards that in the past several years, and I think by 2030, that’s going to be further accelerated to the point where a vast majority of people are most likely going to be primarily working out of their homes. So, I think having a connected hybrid virtual sort of space is going to be a major trend that you’re going to see by 2030.

Kathie Topel: We all know that the pandemic has impacted our thoughts of the future. What pandemic outcomes do you believe have altered the current view of the future of cities and beyond versus, let’s say, a pre-pandemic view?

Charles Drayton: Yes. I hinted at this with my previous answer a little bit, and I’m not going to say the office concept is fatally wounded. I think the office is never going to go away, but I think there’s going to be a significant shift in how people work. We’re going to see more of a shift towards a hybrid workplace where you have some people who are working in the office and some people who are working from home. That’s definitely going to be something that has proven to be successful during the pandemic when people were forced to do it that I think it’s here to stay. The other thing you’re going to see is as a result of that, you're going to see a fundamental shift in urbanization.

So, I think the trend — it’s funny how this works, where there’s always this migration path that goes from cities to suburb, suburbs to cities, cities to suburb, and it seemed to vary from generation to generation. I think what we were seeing, up until the pandemic, was a move away from the suburbs back to the cities. You started seeing these revitalizations of urban areas and downtown areas, and now, I think it’s trying to see the reverse of that again. The pandemic, I think, has forced people or compelled people to start thinking, “Hmm, maybe I need more space. If I’m going to be stuck with you, [Laughter] in that limited square feet all day every day, maybe we get a bigger bedroom,” right? So, I think we’re starting to see a move now towards more suburban areas, more rural areas. You’re seeing people now who have vacation homes. You just think, “My lake house might not be a bad place to live permanently.” I think you’re going to see something about permanent, or at least for this generation, shift towards that, but I think with that is going to come more demands for better infrastructure to support high speed internet in some of these places to support more services in some of these places because increasingly, they’re going to find that becomes a permanent location for a lot of people to do their business out of.

Then, finally, it’s going to quicken the development in general of rural areas. I think with some of the demographic shifts that are taking place where you see millennials and Generation Z people now moving out of places like San Francisco and moving more to rural areas, you’re going to see a quickening of the development of those areas than I think they had originally had planned because of the fact that they’re going to bring their job demands with them and there’s going to be a shift in labor force and labor demands that match that as well.

Kathie Topel: I know infrastructure has been in the news a lot lately. Multiple bills are being debated around making investments in infrastructure and modernizing large parts of our country. What do you see as a relationship between the future of infrastructure and the impact it will have on cities of the future?

Charles Drayton: Yes. I think there’s going to be kind of three things that we’re looking at. The first one is going to be, as I mentioned before, sustainability, connectiveness, so I talked a bit about that initially, but I think those are going to be key pillars of infrastructure. I think any investment in infrastructure, regardless of what happens with the bill currently being debated right now, it’s all going to come back to how it is that we’re able to narrow the gap between urban areas and rural areas. I think for a long time, the development in technology and development in the infrastructure in these urban [areas] has caused the development of that to outstrip the development of rural areas. I think in many respects, they’ve been left behind, but I think if this infrastructure thing works out, you're going to see a lot of investments in rural areas to really bring them more in line with what urban areas developed or with what urban areas have to offer now.

So, it’s going to be appealing to younger generations who, I think, are already starting to move to areas like that, and it’s also going to, I think, narrow everything from the education gap to the development gap, and this is something that is particularly powerful for minority communities or for poor communities who typically are over-represented in rural areas. I think it’s going to create more opportunities for them. I think it’s going to create a somewhat more equitable future if this is pulled off the way I think everyone is hoping for it to be. I think part of that, part of the end results of that is going to be things like the dispersing of the workforce.

So, once you have infrastructure available, that you have high speed internet in both urban areas, suburban areas and rural areas, I think it’s now going to make for a, I think, safer and more comfortable environment for generations of knowledge workers, and you’ll find that knowledge workers are increasingly outstripping a lot of the former blue-collar workers as those jobs start to shrink and you’re going to see that replaced with more of a knowledge-based workforce. The third, I think, is going to be finally starting to look at the internet as a commoditized utility.

I think for a long time, we saw that as luxury, and because we saw it as a luxury, it was difficult to think of it as something that was a driving force behind things like income inequality or performance differences within different communities. Like, why is it certain neighborhoods tend to have students perform better than others, and I think we’re starting to see research now that says the internet as a universal human right, is something that, when commoditized, can really go a long way towards levelling the playing field. So, I think a lot of the investments in infrastructure are really designed to help start closing some of these income and performance gaps that you see in a lot of these areas.

Kathie Topel: Charles, you shared at the beginning with us that the healthcare exhibit at the MTC is an amazing view into what can be possible. What influence will the possibilities for healthcare organizations have on the future of our cities?

Charles Drayton: Yes. I think we’ve already started seeing this. It’s funny, I’ve been in healthcare for a long time, and for many years, we had telehealth technology that we would try and sell to hospitals, and they will always, “No, it’s not really necessary. We don’t see ourselves as people who would ever really see patients outside the hospital or outside of the doctor’s office.” Obviously, that all changed with the pandemic, and similar to how people who had previously never really done online shopping, who are sort of resistant to it, suddenly discovers the joys of amazon.com for the first time, and they never go back because they’ve realized how easy it is. Sort of like my mother. My mother was sort of a person who would always go to the store no matter what. I’d say, “Amazon Prime.” She’s like, “But you can’t look at your groceries. Why would you do something like that?” Then, she realized she had no choice. She realized how convenient it is, and now, she can go back to the store anytime she wants; she’s not doing it.

I think it’s a very similar thing now where hospitals are beginning to realize that actually virtual care isn’t so bad. Actually, there are great opportunities to create a continuum of care that takes place. So, not only can we care for the patient when the patient is within our four walls, but we can continue the dialogue and we can continue the monitoring of the patient even after the patient is discharged or even after the patient leaves the doctor’s office, because many things that happen with the patient that will lead to complications, that will lead to readmission takes place after their discharge. Did they refill their prescription? Did they take their medication? Are they following through on post-discharge instructions? You had no real way of verifying that traditionally, but now with virtual care and ability to combine that with things like continuous vitals monitoring and having that sort of connected ecosystem of health makes it much easier to start getting a lot of these early signals from patients. So, is a patient taking 45 days to refill a 30-day prescription? If so, I want to know about that so I can do an outreach with them. If we have rehab, some sort of physical rehab for the patient and they have some sort of connected watch, are they taking the requisite number of steps? If they’re not, I want to know about that because it may mean that they’re not really following through on the post-discharge instructions. Are they weighing themselves regularly because they have to get their weight down to a certain level in order to qualify for a specific type of surgery? Are they on track to do that? A lot of these things take place at home, and increasingly, hospitals and healthcare organizations are realizing that and they’re starting to make more investments into it.

So, going back to this idea of future cities, when we start looking at the commoditization of the internet as a whole, and now, making internet available at little or no charge in all kinds of rural communities. Now, when you look at these underrepresented communities in terms of the number of hospitals that are there or the number of stores that are there that sell fresh foods, we’re now able to extend our ability to care even out to them. I think that’s another way of beginning to close the gap that has historically existed between vulnerable communities that are often rural communities, or even urban communities that aren’t close to hospitals or to fresh food sources and how do we bring that care to them to create a more equitable environment for wellness overall.

Kathie Topel: With the virtualization of collaboration, it’s changed the way we socialize, work, and live our lives. The ability to collaborate and share from anywhere allows each of us to make different choices now. How will these different choices impact real estate and what role might technology play a new trend to emerge for cities?

Charles Drayton: [Laughter] So, I’m glad you… it’s a very timely question you asked. I’ve been looking for some income property for a while. I believe, to diversify a little bit, and so I’ve been looking for these sort of multi-unit places and I’ve been consistently outbid anywhere in the south. Like, I cannot buy a home in Dallas. I cannot buy a home anywhere in Georgia. Every time I try, I’m sort of outbid by these all cash offers that are like 10% over asking, and I say that to say, from a real estate standpoint, people understand the fact there are some significant demographic shifts that are going on in terms of where people are moving and how people are living. I think some of the things that you’re seeing now are being manifested in this kind of rush for purchasing real estate in warmer climates or in more suburban areas and rural areas, and I’m definitely feeling the results of that. I think it’s going to lead to more demand for better infrastructure. Similar to some things I have been talking about throughout our conversation here, the demand for high-speed internet everywhere. So, not just in downtown Chicago do we get gig internet, but how do we get it everywhere and where does it show up everywhere because you’re going to see more of these virtual calls. So, I think you’re going to see increased support and demand for investment in infrastructure as we start seeing, from a real estate standpoint, more and more families moving to areas where, traditionally, they haven’t been. Those are some of the things from a residential standpoint that you’re going to see as a change or a shift when it comes to real estate. From a commercial standpoint, I think one of the things that you’re going to see is, I’m going to call it an urbanization of the suburbs.

So, as people start moving out into rural areas more and they start moving out to suburban areas more, you’re going to see a move away from urban areas of commercial offerings and bringing them more into suburban and rural areas. So, as Generation Z-ers and Generation Y, people tend to go, you’re going to see more restaurants and shops open up around them. So, you’re going to see a decrease in demand for commercial real estate perhaps in urban areas, but if you’re going to see an increase in demand for commercial real estate in some of these suburban areas as you start providing some of the comforts of the urban environment that they moved from into suburban environment. So, you’re going to start seeing perhaps — these are all of the guess that I have — the shrinking of major cities, and instead, the growth of these many metropolises in some of the satellite areas. I think that’s where a lot of commercial real estate opportunity is going to be. I think you’re also going to see a fundamental shift in retail as you’ve been seeing already, and this is just sort of exacerbated things a little bit more, but in really interesting ways.

So, I’ve worked with a couple of commercial of real estate companies and one of the things that they were sort of excited about with this is this shift away from malls as being places where you go and shop to malls as being centers of recreation, particularly around many of the suburban and rural areas where it’s not simply a place where you have these stores, but it’s kind of your work/play area. I think you’re going to see a resurgence of that in some of these rural places as organizations start creating these kind of satellite metropolis cities out of what were formerly fairly barren rural areas.

Kathie Topel: Charles, if you can leave our viewers with just one thought of “The Future of Cities for 2030 and Beyond,” what would that be?

Charles Drayton: I want to show you a little something here. I like to introduce you to Pria. Pria is a robot and Pria is something that was initially designed by a company that was acquired by Stanley Black & Decker. What Pria does is she’s a pill dispensing robot, and a pill-dispensing robot can do everything from having virtual meetings with the physician to dispensing pills, to monitoring your vitals. So, if there is a spike in something, if you have AFib, she’s able to give you an early intervention and say, “Hey, this might be something that is potentially a medical emergency.” I think Pria, and things like Pria, are going to be increasingly key components of the future, and that’s from the healthcare standpoint. I did something recently that talked about this idea of senior isolation. The fact that senior homes couldn’t get visitors for a full year, I mean that lead to a mental health crisis within senior homes, and one of the ways that we talked about addressing that was through senior gaming.

So, there are gaming leagues that are formed in places like Pennsylvania that create this virtual community among seniors where they can be connected to each other and to their loved ones, and to everyone else, even if they can’t physically be there. So, increasingly, you’re going to see this idea of community emoji and technology starting to be merged in a way where even if we are remote, we’re going to be closer together than ever. I think those are really good examples of that. So, my thinking is in the future, you’re going to see a stronger sense of community, but you’re also going to see more virtualization. So, you’re going to see the combination of the two of them in very unexpected ways, or since it’s 2030, I can be entirely wrong about all of it because technology moves that fast.

Kathie Topel: Thanks so much, Charles, for your insights here today and your participation. We truly appreciate it, and you brough us so many ideas for the future and we’re very, very excited for it. Thank you.

Joe Kornik: Thanks, Kathie, and thanks, Charles. Charles, a real rock star, brings his own visual aids with him, some real estate advice, and a little couple of jokes thrown in there for good measures. So, we always appreciate that levity, Charles. Thank you so much for your time today. We appreciate it.