How smart cities will change supply chain management: a technical viewpoint

Abstract

Smart city initiatives could be expected to radically change the ways businesses are organised. This paper is a first step to understand the role of smart cities in supply chain management, with a specific focus on supplier networks. In this paper, the following question is posed: How will smart cities change supply chain management? Further, a conceptual framework for understanding the important factors that appear to affect the integration of smart city initiatives in the supply chain is developed. Additionally, examples are collected that illustrate the interplay of smart city initiatives with supply chain management. Ultimately, the objective is to identify the key elements driving integration and their influence on supply chain management, as well as provide insights on productive methods for developing, introducing and managing smart city innovation.

Keywords:

• Big data
• framework
• smart city
• supplier network

Acknowledgements

The authors would like to acknowledge the support of Eve Coles and also MIT’s Chris Caplice in developing their project, in Boston, from May to August 2013. The authors also would like to thank Patrick Hennelly, Leeds University and Elcio Tachizawa, Universidad Carlos III de Madrid, for their ideas that contributed in the early stages of this paper.

Notes

1. One of the primary reasons manufacturing is conducted across the globe is to achieve economies of scale; a single huge plant can reduce production costs. But what if new manufacturing technologies and production processes dramatically diminish these economies of scale? Additive manufacturing and programmable robotics are just two examples. Production can be decentralised into smaller, perhaps regionally based manufacturing clusters that are closer to population centres. Caplice (2013) suggests this raises the question of: ‘why ship products half way across the world and funnel them through ports when a more customized product can be built across town?’.

2. Some observers point out that ‘smartness’ as a term is more politically neutral than ‘eco-city’. Thus, iterations of the term smart (‘smart city’, ‘smart growth’, ‘smart development’) are more palatable in countries where a large body of public opinion associate eco-cities with sustainability and greenness, and thereby with highly liberal or progressive politics (RPA World Cities Planning Committee 2014).