As increasingly more ‘networked’ cities emerge, the application of information and communication technology (ICT) is set to challenge existing systems and drive change in the way cities work, a new report released by Ericsson states.

The latest Networked Society City Index forecasts that city inhabitants, rather than institutions, will drive urban progress, suggesting a bottom-up urban development.

“With ICT, people have effective tools to turn ideas and new thinking into powerful actions,” the report states, adding that it often starts with a practical need, such as an improvement in living conditions, for concepts to rapidly impact on city life.

ICT offers people new opportunities for taking the lead, explains Ericsson head of the Networked Society Lab Patrik Regårdh.

Grassroots initiatives are now expected to drive urban innovation, with a move to a more connected peoplecentric governance, where individuals participate to a greater extent in urban planning, information sharing and decision-making.

The growing development and application of ICT is set to be a game changer for people to influence both public and private stakeholders, the report points out.

Ericsson Consumer Lab head of research Michael Björn agrees. He outlines in the latest Consumer Lab report, ‘Smart Citizens’, that, as citizens use ICT to keep informed and make smarter decisions, the cities they reside in will also become smarter.

Previous studies showed consumers increasingly leaning on Internet services to alleviate some of the frustrations experienced in urban hubs, which indicated a “powerful” bottom-up push for change.

“We are becoming smart citizens . . . and, through our changing behaviour, efficient practices and smarter social norms are developing in our cities,” the Consumer Lab report notes.

Citizens want to use their smartphones to alleviate concerns about health, improve communication with authorities and navigate urban traffic, Björn explains.

While people are increasingly establishing cooperative initiatives to tackle social problems, the new innovative solutions within the “networked society” will alter the traditional view of what defines gross domestic product (GDP) growth, Regårdh says.

He predicts that GDP will be “redefined” to capture a “new understanding” of sustainable value creation and wealth in cities and nations, as collaborative consumption, or sharing economies, signal a shift in consumption from ownership to access.

“High-density cities can use network technologies to do more with less by renting, lending, swapping, gifting or sharing products, instead of increasing consumption and production,” the Networked City Society Index report suggests.

Regårdh says GDP currently fails to include this type of value creation within a networked society and this leavers leaders at risk of making poor assumptions of growth.

Meanwhile, organisations will need to “step out” of traditional models and mindsets in a more connected and individualised society.

The application of ICT innovations will drive down a company’s fixed costs, while other structural corporate changes will emerge with the introduction of new cloud-based services and automation, besides others.

Further, innovative ways to communicate will “usher in new collaborations and more dynamic formations that redefined the core purpose and functions of companies”.

“Tomorrow’s networking organisations will be more flexible and efficient; they will have more access to human capital and less need for financial capital; and they will be better equipped to maximise resources,” the report says.

Stockholm ranks first – out of 40 countries – in the Networked City Society Index, followed by London, Paris, Singapore and Copenhagen.

The Index examines the links between the cities’ ICT maturity and the triple bottom line, namely social, economic and environmental, and shows how ICT can support sustainable urban development.

Delhi, Mumbai, Lagos, Karachi and Dhaka are the five lowest-ranking cities, while Johannesburg secures a ranking of 29.

The index also shows that cities with a low ICT maturity ranking are seemingly “catching up”, as their maturity growth rate outpaces that of the high-performing cities.