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Unleashing your potentialHow to drive innovation at the Australian local government level

Unleashing your potential: How to drive innovation at the Australian local government level. © Microsoft Australia 2016. 2

Contents

Introduction 4

Why learn from Boston? 5

Five ways to make your area more innovative 9

1. Create a safe environment for experimentation 11

2. Reimagine community engagement 14

3. Understand the importance of space and place 17

4. Use technology to unleash data and improve services 20

5. Develop a long-term vision and a supportive culture 22

Contact Us 24

3Unleashing your potential: How to drive innovation at the Australian local government level. © Microsoft Australia 2016.

“Having early wins and demonstrating the success of what you can do, so that people look at it and say ‘Wait a second, I didn’t expect city government to do that!’ helps set the tone, and it helps attract more people to the project.”

Jascha Franklin-Hodge Chief Information Officer City of Boston


Local governments across Australia are focusing on innovation for two key reasons. The first is to find new ways to meet the rapidly changing needs of residents and businesses, while streamlining operations and managing financial constraints. The second is to increase the economic and social opportunities in their areas by supporting the ambition of individuals and local businesses to foster their success and social impact.

While few would argue with these goals, most local governments are finding it hard to make substantial progress towards achieving them. To provide some practical advice, Microsoft recently partnered with peak local government organisations and experts from the City of Boston to run innovation-focused workshops in four Australian cities. This paper provides key takeaways from those sessions, based on the successful approaches tried in Boston, contributions from attendees and other examples of innovative service delivery.

This report is also the next chapter in Microsoft’s vision to promote Joined-Up Innovation across Australia. This vision is based on the belief that Australia’s prosperity depends on making better connections between all parts of our innovation ecosystem, from entrepreneurs and established businesses to researchers and investors. We also believe local governments can play a huge role in fostering these connections by creating the right environments across the nation and unleashing the potential of their local communities.

Every individual and organisation in Australia is facing the challenges and the possibilities of digital innovation. The challenges are to remain relevant, to adapt and to maintain fairness in our community. The possibilities are to embrace digital innovation, to learn from and participate within the innovation ecosystem and ultimately to prosper from the disruption. Our hope is that this report and our ongoing work in Joined-Up Innovation will help councils and other organisations to confront those challenges and grasp the possibilities.

James Kavanagh National Technology Officer Microsoft Australia

Belinda Dennett Director, Corporate Affairs Microsoft Australia

Introduction

Why learn from Boston?

6

Despite being 400 years old and a significant city in the world’s largest economy, there are a surprising number of parallels between Boston and Australian local government regions. For starters, the City of Boston is relatively small, being home to just over 600,000 residents. It also faces issues that any government can relate to, including ageing infrastructure, limited funds, challenging weather, and competition from neighbouring areas for talent and capital.

In addition, Boston is experiencing a profound change in community expectations as residents come to believe the city’s government should be as responsive – and as readily able to share information – as the consumer online services they now use each day. While managing these expectations, the city must also help the Commonwealth of Massachusetts reinvent its economy away from traditional manufacturing towards new areas of business.

Most importantly, Boston is succeeding, which makes it a great location to learn from. From 2010 to 2013, Massachusetts increased the number of people working in information technology (IT) related jobs, for example, from 175,000 to 214,600. These individuals earned an average of US$121,000 a year and their work generated a further 418,700 indirect and induced jobs, concentrated in the City of Boston and neighbouring Cambridge.

Despite Boston and Cambridge being home to many strong businesses and institutions such as Harvard University and the Massachusetts Institute of Technology (MIT), achieving that kind of technology-driven growth was unusual in the US in the post-recession environment. It was also unusual for any American city to grow high-technology jobs outside the famed Silicon Valley area in California.

The dividends have also been felt outside the IT and biotechnology sectors, with Boston generating many other innovative businesses in sectors such as food and manufacturing. The city is also successfully retaining more young individuals in the area after they complete their studies. Furthermore, many people are choosing to return to live in the city.




Opening the Innovation District Boston recently transformed 1,000 acres of underutilised industrial land in the south of the city into a booming Innovation District. The precinct opened in 2010 and features an integrated mix of commercial offices, housing and cultural facilities. It has become highly desirable for businesses and residents, and created 8,000 jobs in the local area.

Launching BOS311 The city has enhanced its interactions with residents by introducing a smartphone application and phone service called BOS311. Formerly known as Citizens Connect, this app allows Boston residents to improve their neighbourhoods by reporting issues such as potholes and graffiti.

Recent iterations of the app make it possible to show residents that an issue has been fixed and send them a picture of the crew that did the work, putting a human face on the city and changing public perceptions of services. Not only did the app significantly reduce pressures on Boston’s call centre, the city is also using data from the application to continually refine its services and hold itself accountable.

Here is a sample of Boston’s innovation initiatives, some of which are discussed in more detail in the rest of this report.



Creating a city innovation team BOS311 is just one of numerous innovations that have been developed by a group called the Mayor’s Office of New Urban Mechanics (MONUM). MONUM was established in 2010 as a ‘Department of Innovation’ within the city’s local government. With a staff that has grown from two to 12 people, the group runs ‘experiments’ on behalf of larger departments to trial potential new services and initiatives. A key part of MONUM’s mandate is to reduce the reputational and financial risk that can undermine the city’s capacity to innovate.

Making the city safer, greener and more equitableBoston has introduced a wide range of initiatives to reduce crime and improve the liveability of its densely populated areas. These include new bike lanes, public spaces and art installations. Its energy efficiency measures have seen it ranked as one of America’s most sustainable cities.1 Boston has also rolled out free WiFi hotspots to provide more equitable access to the internet for all residents.

Reinvigorating the city’s reputationPerhaps Boston’s biggest achievement has been to re-establish its reputation as a national and global innovation hotspot, which is in turn making it attractive to the types of talented young people most likely to make the city dynamic and commercially successful. This is a comeback for a city that was seen as a major centre for technology in the 1980s and early 1990s – the era of large computers – but has more recently taken a second seat to Silicon Valley. Boston is now regularly rated among the world’s five most innovative cities and is seeing numerous large companies establish a presence in the city.

Download

Boston Innovation Ecosystem ReportFor an in-depth look at Boston’s innovation ecosystem, Accelerating Australia’s Innovation Ecosystem, found at the link below.

This was prepared by Microsoft Australia after a comprehensive tour of the city by a delegation of Australian business and public sector leaders in 2015.

Download joinedupinnovation.com.au Email [email protected]

1 Arcadis (2015). Sustainable Cities Index 2015. Retrieved from www.sustainablecitiesindex.com

http://www.sustainablecitiesindex.com

Five ways to make your area more innovative


The following focus areas were discussed at workshops held in Brisbane, Canberra, Melbourne and Sydney during June 2016. They are also informed by Microsoft’s wider experience in the Australian local government sector and our work with customers.

The workshops were presented by Microsoft in conjunction with the Australian Local Government Association, the Municipal Association of Victoria, Local Government NSW and Brisbane City Council. They also featured presentations from the following experts from the Boston area:

Nigel Jacob Co-chair, Mayor’s Office of New Urban Mechanics, City of Boston

Nicole Fichera General Manager and District Hall representative, The Venture Café Foundation; Former Innovation District Manager, City of Boston

Jascha Franklin-Hodge Chief Information Officer, City of Boston

Chris Freda Urban Planner and Designer, Sasaki Associates

Love the concept of public entrepreneurs coming out of the City of Boston #joinedup

@nicodonnell @newurbanmechs: “managing risk means managing communication.” New tagline for the ‘Dept of Failure?’ Innovation in local govt #joinedup

@citywright

Co-creation with citizens & breaking silos = way forward to transforming cities! Let’s dare to experiment! #joinedup

@iriphon

Great panel discussion about nurturing innovation - ideas can happen anywhere! #SEQ #joinedup

@SEQMayors



With responsibility for key aspects of planning and the long-term provision of essential community services, local governments have traditionally focused on creating robust operational processes and have worked to extended planning horizons. Faced with high levels of scrutiny from residents and other stakeholders, and limited funds, they have also tended to avoid taking risks on projects or ideas that could fail.

This conservative approach has worked well in the past. However, the arrival of digital technologies including the internet and smartphones is changing community expectations about service delivery and responsiveness. It has also changed the options that are available to councils to meet those new requests and expectations. Together, these changes are creating a need and a capacity for governments to reimagine the way they work.

One of the ways that the City of Boston has responded to this shift is to create the Mayor’s Office of New Urban Mechanics, or MONUM. This small internal business group is explicitly designed to allow the city to investigate new areas of demand and to trial new approaches in a fast and low-risk way.

According to Co-chair Nigel Jacob, MONUM allows departments to try new ideas more quickly, cheaply and safely since it runs limited trials. The risk element is vital because – like local authorities the world over – the City of Boston’s operational departments are very reluctant to fail when it comes to delivering services, or even to be seen to fail.

In the digital era, governments need to work in new ways

The City of Boston has created an innovation group to allow for experimentation

Innovation involves risk and potential failure, but the impact can be managed

1. Create a safe environment for experimentation



“MONUM’s efforts are being supported by the City of Boston’s central IT group, which is making use of flexible cloud computing services to give it and other groups the computing resources they need to run such trials.”

How MONUM runs ‘experiments’ for the City of Boston’s departments

Potential Projects

Explore Experiment Evaluate (+ Hand-Off)

Scale

End

Fail


An example of a trial that is running through MONUM is an initiative to introduce parking sensors in Boston that will show where street parking spots are available. While innovative, the system will be complex to implement and may not proceed. By allowing MONUM to run the initiative as an experiment, the city can gather information and logistical insights without announcing the sensors as a definite initiative.

As the diagram below shows, MONUM considers a broad range of ideas. It then formalises some of these into small experimental trials and evaluates the results.

Where an idea, such as the traffic sensors, proves viable MONUM hands it back to the relevant city department to scale it up into a mainstream public service. In other cases, an experiment may be deemed successful but difficult or inappropriate to turn into long-term service. And some simply fail.

“What we’re seeing in government is that the pace of technological change is increasing every year,” Jacob says.

According to City of Boston CIO Jascha Franklin- Hodge, the city can no longer plan in terms of three- to five-year technology cycles and expect to keep up with the rapid evolution of digital devices and apps or the growing amounts of data that cities need to manage.

Nigel Jacob Co-chair, Mayor’s Office of New Urban Mechanics, City of Boston


Cardinia Shire Council reinvents its workplace with technology

There are great examples in Australia of local councils using the latest digital technologies to reinvent the way they work internally. These have allowed them to become more responsive to their communities and improve the satisfaction and retention levels of their staff members.

Cardinia Shire Council in Victoria, for example, has recently implemented a suite of Microsoft technology to move to an activity-based working (ABW) model. By changing its internal phone system and introducing video-conferencing and other collaboration tools, the council’s team is now able to work more efficiently and from any location.

“We looked at activity-based working as a platform to make the organisation more agile and able to respond a lot quicker to customer expectations.” Di Ashton, Project Director Cardina Shire Council ABW rollout

http://www.youtube.com/watch?v=EU4lWAdtYqM




Community engagement should be continuous

Digital tools make it possible to reach more people in more depth

Delighting and surprising residents can help open conversations

2. Reimagine community engagement

Another key strategy employed by the City of Boston and progressive councils around Australia is to change the way they engage with their communities. Instead of developing new ideas largely behind closed doors and then presenting them to the community, these councils are trying to establish a continuous conversation with residents. The ethos is to ‘build with the customer’ and to treat residents as a valuable resource rather than an obstacle.

.

In the case of Boston, this is being achieved through new high-tech approaches such as the BOS311 hotline and mobile phone app, and social media channels that allow the city to maintain near-instant two-way communications with residents. It also includes old-fashioned approaches such as converting a former bomb squad truck into a mobile ‘City Hall to Go’ service that tours the city, giving residents easy access to public services.

10+



Whatever the technique, the aim is to establish what Chris Freda from the urban planning firm Sasaki Associates calls “infrastructure for engagement”. This infrastructure should make it possible to have planning conversations with residents that run from envisaging to inhabiting and help build trust and confidence. This contrasts with to engaging with the community in short bursts, such as when a council seeks feedback on development plans.

An example has been the development of a public park and wider area in the South Boston area called The Lawn on D.

Instead of establishing a plan upfront and implementing it, the city and Sasaki put in place a minimum of public facilities and have been running a range of temporary initiatives in the space to see how residents want to use it.

These comprise sports equipment, concerts, a pop-up bar and food services. Sasaki is also employing mobile apps and other techniques to gather the community’s views and will gradually use all these observations and inputs to set a final master plan for the area. The city used a similar approach to create a new public transport master plan via its Go Boston 2030 campaign.

Freda noted that his firm has tried to make the community engagement process fun by using workshops and even portable kits of tables, chairs and other items that can be found in a public park to engage the community. He said this has helped to interest the silent majority of residents – or “80 per cent” – who are typically disengaged from city planning.

“Our job is to get to that 80 per cent because that represents the diversity that makes communities vibrant. We are constantly looking at ways to get to that 80 per cent, and one of the most successful strategies is in this idea of delighting and engaging people in interesting new ways.”


Chris Freda Sasaki Associates


One workshop delegate asked how her council could expand its community engagement and consultation efforts without also establishing unrealistic expectations about its ability to respond to all the feedback it might receive to avoid disappointing people.

Community engagement tip: How to avoid overpromising

Q.

A.The advice offered by the Boston team is to engage openly with the local community and encourage an extended debate, rather than treating consultation as a box-ticking exercise. However, it is also essential to set clear parameters about what is up for discussion.

For example, a council may say it is seeking input on how a new park should be designed and used, rather than whether there is a park at all.

It is also important to promote the public review process and any outcomes that arise from public input, to provide feedback and build confidence in future consultation processes.


One of the biggest debates for Australian and overseas local authorities is whether it makes sense to create innovation precincts and if so, how to go about it. Boston’s success in transforming its 1,000 acres in South Boston into a thriving Innovation District shows that positioning an area as innovation-focused can be a powerful tool for creating an identity and attracting residents, businesses and investment.

This model has certainly been pursued in a range of locations throughout Australia, such as the Carlton Connect area around the University of Melbourne; the Tonsley Park region of Adelaide, which is currently being reinvented; and the well-established Brisbane Technology Park, which is now the city’s premier business park and home to more than 150 companies.

Nicole Fichera, who led the development of Boston’s Innovation District and remains closely involved in its growth, says that “while the concept of innovation precincts is sound, there is no one-size-fits-all approach to follow. In particular, councils should consider the strengths and weaknesses of areas while also understanding what innovative individuals and businesses want”.

For instance, an urban area with technical universities can create places that support the growth of software and design companies. However, a rural area with strengths in wine production may become a centre for related innovative activity.

It can be effective to designate areas as innovation districts

Councils should review their area’s strengths and ask what innovators want

Partnerships are key with developers, businesses and service providers

3. Understand the importance of space and place




For the IT start-ups that many councils want to attract, that list typically includes affordable office space, housing for young professionals, proximity to similar businesses and a vibrant cultural scene.

Boston has even developed the expertise in areas such as shared office facilities. According to Fichera, creating innovation districts comes down to the smallest details, such as whether there are good systems for storing food in shared fridges and doing dishes in shared offices. “It’s that level of detail,” she says. “You need to know how to manage shared spaces – there are many stories of failed co-working spaces.”

“The community knows what it wants and what it doesn’t want.”

Governments should seek to learn from past innovation district initiatives that haven’t lived up to expectations and consider what obstacles prevented their success.

Fichera adds that the key to fostering innovative economic and social activity is to encourage connections and collaboration between the people in a community. She says this can be seen most clearly in Boston’s Innovation District as well as the Kendall Square area of Cambridge, where MIT, other research groups, businesses and start-ups all mingle or ‘bump and connect’.

One key way this was achieved in the Innovation District was to attract major start-up accelerator MassChallenge (see masschallenge.org), as a cornerstone tenant for the area. Close partnerships with developers to extract a public good outcome were also vital (District Hall case study on page 19).

No matter what the context, the lesson from Boston is to recognise that innovative organisations will have a checklist of needs that a local government area must meet.


http://masschallenge.org

http://masschallenge.org


District Hall: Partnering with developers to create a focal point

District Hall is a 24-hour facility that offers free and paid desk space, internet connectivity, event space and meeting rooms to residents and local businesses. It has become a central meeting place for the city’s innovation community and features facilities such as a café, bar and restaurant. These hospitality elements make the space inviting and accessible to a wide range of visitors, while adding night life to a new area of the city without established facilities.

The hall is a single, street-level building with large, open entrances and a distinctive design. This has ensured that the structure reinforces the area’s innovation branding and that the facilities inside are easy to reach. This is intentionally unlike many other innovation centres, which are often on high floors of office blocks and closed off behind security gateways.

A key reason for the success of Boston’s Innovation District has been a high level of cooperation and shared vision on the part of the city and the major land owners and developers active in the area.

The clearest manifestation of this public–private cooperation is District Hall, a unique building at the centre of the precinct that was built and donated to the city by the area’s largest land owner as part of its wider development activities. Crucially, the partnership with the developer was made as part of the broader agreement to develop the land – not as something that the city tried to negotiate after the deal.

Learn more at www.districthallboston.org

http://www.districthallboston.org


Local governments are awash with information about their regions and communities, yet they don’t always have systems in place to gather and gain value from this data. This has been recognised as an issue in the City of Boston, leading it to reform IT operations in at least four ways that are all aimed at using information to better inform the way the city works.

The first is to better collect and analyse information available through services such as BOS311 to better understand and predict community needs. In effect, every citizen’s smartphone can become a source of input for a government. The city is also finding ways to harness latent data such as using information from the GPS receivers already in city buses to provide a mobile app that tells residents where school buses are at relevant times.

Second is to provide better information about the city’s activities to decision makers. This information is collected in a scorecard featuring key performance indicators, such as how many school buses arrived on time. In addition, these scorecards are helping to improve the accountability of government leaders internally and with the public.

Third is to make it easier for departments and others to access and make connections between existing stores of information. For instance, the city has made it possible for fire fighters to quickly draw data from seven databases to understand potential threats such as hazardous chemicals or building materials for a property. This information is gathered while the fire team is en route to the emergency and provided before they enter the building.

Finally, the city is publishing many of its data sets publicly to allow others to use that information to build new community and commercial services.

According to City of Boston CIO Jascha Franklin-Hodge, these changes are part of the civic tech movement across the US to use data and technology to change the way governments work internally and with the community more broadly.

Much of this change is being driven by the arrival of cloud computing, which is making it feasible for governments to create services and manage large amounts of data more quickly. “All of this information is an incredible resource to us to think about how we can improve quality of life,” he says.

Data is a powerful resource for expanding services and improving operations

Councils should consider how information can be used and shared

Cloud computing is making it easier for governments to launch services

4. Use technology to unleash data and improve services



Manly Council gets smart about traffic control

One Australian local government that is actively embracing cloud computing and artificial intelligence technology is Manly Council in Sydney.

In 2015, the council began using its network of CCTV cameras and Microsoft Azure Machine Learning to detect irregular behaviours, such as vehicles parking illegally in bus zones in the busy beachfront area.

The council is now exploring how the same technology could be used to better detect community safety issues in crowded areas and even advise the public on surf conditions.

“Azure Machine Learning has been trained on 10,000 ‘normal’ or ‘control’ images from the camera, so each time we upload an image it makes a judgement as to whether it’s normal or whether there’s some sort of anomaly,” says Nathan Rogers, Manly Council’s CIO.

“If Azure Machine Learning tells us there’s an anomaly, we have a script on our end that will email the right people so they can immediately go and check out what’s happening.”Nathan Rogers CIO, Manly Council


“Find the young, keen person in the room and invest in their enthusiasm.”

A final lesson from successful cities is that the introduction of an innovation agenda requires both visionary leadership and cultural change within government and the wider community.

Much of Boston’s recent success can be traced back to the vision set out by the late Mayor, Thomas M. Menino, who led the city for twenty years until early 2014. These policies have since been maintained and built on by the current Mayor, Marty Walsh, and range from property (developments) to reinforcing the idea that Boston is a place where people create world-changing innovations. This is captured in the phrase “code something that matters”, which can be seen proudly displayed on subway ads and shown elsewhere around the city.

A centrepiece of Boston’s vision is the Innovation District but Nicole Fichera emphasises that the city achieved many of its goals in the area by communicating its vision and applying its planning powers, rather than by making large spending commitments.

In fact, the city’s resources comprised little more than Fichera’s time and cheap, widely available tools such as Twitter, which were then used to engage others with enthusiasm for the project. Fichera advises councils to embrace and empower the next generation.

Working with the City of Boston is also highly attractive to graduates and interns because they get to work on interesting problems affecting people who live in the city.

According to Franklin-Hodge, Boston has sought to effect cultural change within the city’s government – including by bringing in professionals with experience in the private sector such as himself – and is seeing those changes ripple out to the community. “The potential to transform people’s perceptions of what government is and what it can do is just enormous,” he says.

Innovation needs to start at the top with a clear vision

Cultural change within government sets a tone for the region

Progress can be made by changing narratives rather than spending money

5. Develop a long-term vision and a supportive culture



“Having early wins and demonstrating the success of what you can do, so that people look at it and say ‘Wait a second, I didn’t expect city government to do that!’ helps set the tone, and it helps attract more people to the project,” Franklin-Hodge says.

Chris Freda also notes that numerous smaller cities and Tier 2 cities across the US are being reinvented as innovation centres by collaborative groups of local authorities, property developers and residents.

This reinvention is happening in major cities such as Detroit, where local authorities are improving neighbourhoods that became rundown after the decline of earlier industries such as car manufacturing. Part of the approach is to make these areas greener and more pedestrian-friendly so they are more desirable to start-ups and younger residents.

Other smaller centres that are being successfully reinvented in the US include Gainesville in Florida and Raleigh in North Carolina. In these locations, the local community is often building on cornerstones such as strong local universities and research communities. They are also adding or renovating business and residential facilities to make their areas more appealing to talented individuals.



“The selling points for these centres were usually lower costs of living and a higher quality of life.”Chris Freda Urban Planner and Designer, Sasaki Associates

Contact usTo learn more about the points discussed in this paper and how Microsoft can help your local government area transform to become an innovation leader, please contact:

Visit: Microsoft.com.au/citynext

Start your digital transformation journey, email us at: [email protected]

James Kavanagh National Technology Officer Microsoft Australia

Email [email protected] Twitter @dgtladaptive

Belinda Dennett Director, Corporate Affairs Microsoft Australia

Email [email protected] Phone +61 3 8320 5970

http://Microsoft.com.au/citynext

mailto:BostonInnovationAU%40microsoft.com?subject=Digital%20Transformation%20Journey

mailto:james.kavanagh%40microsoft.com?subject=Unleashing%20Your%20Potential

https://twitter.com/dgtladaptive/

mailto:belinda.dennett%40microsoft.com?subject=Unleashing%20Your%20Potential

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