Ideas in Action

March 17, 2017 | Posted by: Morris Orchard

Public value in the disrupted city

The emergence of disruptive technologies and business models is exciting for consumers, but it doesn’t diminish the responsibility of public value organisations to articulate and work for the public interest: in fact it makes it more urgent.

Platforms like Uber, AirBnB and AirTasker were unheard of a few short years ago and are now household names. New technologies are disrupting established business models in a range of industries around the world, offering the potential for better goods and services, but also impacting livelihoods and representing a pace of change that exceeds the ability of governments to regulate.

A recent example is the advent of ride-sharing, which has presented a regulatory challenge for governments globally. State and Territory governments in Australia have responded with a spectrum of approaches with varying appetites for reform, but all have significantly trailed the expansion of a maturing industry, leaving incumbents and new entrants without certainty.

While it’s always going to take a while for governments to set up the rules of the game for disrupted industries, they can do more, earlier, to describe how new business models can be consistent with and support the public interest, and public value organisations can help them articulate this.

A couple of disruptions to watch on the horizon relate to how we get around, with the increasingly real prospect of autonomous vehicles, and how we get our energy, through less centralised models of generation and storage.

Disrupting mobility

Autonomous vehicles hold the opportunity to service some of the coverage gaps in our public transport network and provide travel options for those currently with limited choice. But the lack of a driver doesn’t get around the geometry of a car in a growing city. Inducing extra demand for car travel rather than planning an integrated city will create the congested and disconnected carmageddon that autonomous vehicle champions purport to be preventing. Increasingly autonomous vehicles are being regarded as the evolution, not of private vehicle ownership with a driverless car in every driveway, but of car share schemes with a flexible and efficiently-used fleet that makes it possible for more people to ditch car ownership entirely. But this vision requires a clear direction and narrative from governments and public value organisations to break path dependency well before the minutiae of a regulatory system are able to be settled.

Disrupting energy

Advances in battery technology suggest a potential for more distributed energy production and storage, making some of our electricity network capacity redundant and supporting a more significant contribution from renewable sources. This represents a difficult proposition to a complex market with incumbent operators who have invested in infrastructure and have an interest in maintaining the current operating model to derive a return on this investment. The benefits of disruptions to energy markets should be enjoyed equitably and due consideration given to the circumstances of people with limited capacity to adapt or for whom energy costs represent a significant proportion of their household expenditure.

In both of these examples, there are opportunities for great community benefits, but also the potential to erode public value. In the current climate more than ever it is important to consider the people who benefit least from economic and technological shifts.

A place for public value amidst the disruption

In the disrupted city and economy, the role of public value organisations is to advise communities and governments on how disruptive technologies can contribute to the public good, and warn them of scenarios where disruption can cause harm. Disruption that enforces existing inequities is not true disruption.

Governments should take courage to speak openly and early about the sort of society that the community wants, and that disruptive technology should contribute to. Where governments provide clear direction, even before the rules of the game have been codified, disruptors know where they can play without fear of being stymied or even regulated out of existence.

One thing to watch is the Victorian Government’s response to Infrastructure Victoria’s (IV) 30-year strategy, once finalised, as IV’s strategy flags the emergence of disruptive innovations across all sectors. The response will be an opportunity for the Government to promote its achievements and its commitments over the forward estimates. It should also be the instrument that the Government uses to articulate a broader agenda that steers the course of economic and technological shifts for the widest possible benefit, with a clear plan for those with least to gain.

Cube Group has runs on the board when it comes to strategic foresight and articulating the contribution of organisations to public value. We think some areas ripe for disruption are:

  • Better support for people to ‘age in place’,
  • Affordable transport choices for people living in under-serviced areas,
  • New forms of housing tenure that give renters greater security, and
  • Incentivising preventative health.

We’d be keen to hear about major shifts on your organisation’s horizon. 

Solar Panel

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