Originally published by Pike Research, Matter Network, and Reuters.

Throughout history, municipal governments have tried to provide their citizens with essential public services. But in making the most of taxpayer money, these governments have often been muddled by the complexities of administrating “systems of systems” – dozens of city departments, which perform hundreds of functions, depended upon by thousands of citizens. Government services often suffered from inefficiencies because they were fractured, outdated, and difficult to monitor. But this no longer has to be their story.

New opportunities for smart governments are emerging from advances in the field of information technology. Driving these advances are smart software systems that can interpret complex data sets and help guide operational interaction. Public leaders can use these smart systems to help solve some of their most challenging problems. For example, smart systems can radically reduce carbon emissions; The Economist reported that they “may well be humankind’s best hope for dealing with…global warming.” Because smart systems can improve how data is managed and acted upon in almost any setting, they mean big changes in the way governments spend taxpayer money. Pike Research expects that governments worldwide will spend over $100 billion throughout this decade on new infrastructure for Smart Cities. These smart cities are the next-generation global hubs of sustainability, innovation, and citizen well-being.

As my colleague Eric Woods reported, IBM’s launch of the Intelligent Operations Center is a major move in the smart city market. It now enables cities to better consolidate resources and operations through interactive software, which employees can use to communicate and collaborate. It’s insightful to see IBM’s smart city vision, which includes networked health care, transportation, public safety, utilities, education, and social services. Achieving this vision primarily comes through collecting and mining citizen data – medical data, traffic data, crime data, energy data, academic data, tax data – for streamlining city services in these arenas. The upshot is more convenient and less expensive government services for citizens. For city leaders, grabbing the lowest-hanging fruit is actually quite easy: City employees can manually feed much of this data into software systems at very low costs. So governments can take the first steps toward more intelligent operations without big engineering deployments. They simply hire experts to deploy networked software solutions and then catalyze institutional adoption.

In this sense, resource management software is a good tool for cities with financial challenges. It is designed to reduce disruptions from emergencies and enable better coordination of projects that span multiple departments. But it is no panacea to the financial challenges that many cities now face. Indeed, local governments in the United States face record job losses in the coming months due to dwindling budgets. But these governments can combat this crisis of operational capacity through smart systems – they can do a lot more with a lot less. Exploring the costs, benefits, and financing mechanisms of these smart systems is thus an important step for government leaders.

After doing some independent research, public leaders can respond to this opportunity by organizing smart systems advisory committees, which are composed of city engineers and citizen volunteers. This would be similar in scope to the sustainability advisory committees now emerging in many cities, but better postured to recommend technological infrastructure advancements. The mission of this new group would be to advise government adoption of smart systems. Its vision would be to optimize city logistics for generating the largest return on taxpayer money in terms of economic growth, citizen well-being, and environmental sustainability. The committee would primarily perform cost-benefit analyses and project procurement services. Through the initiatives that will emerge from this policy instrument, public leaders can inspire bold new visions for smart cities, which use information technologies to empower and serve their citizens in ways once uneconomical, if even imaginable.

Lance Legel is an intern at Pike Research with a focus on smart grid infrastructure, smart meters, and the smart energy home.