Data alone does not make a smart city

Why data and digitalisation projects in local authorities often fall flat – and how a new handbook can help them succeed

Berlin, 5 May 2025 – Local authorities hold valuable data that could be used to manage traffic more efficiently, improve public services, and make cities more sustainable. Yet, in practice, much of this potential remains untapped. A research team from the Alexander von Humboldt Institute for Internet and Society (HIIG) and the Berlin Centre of Competence for Water (KWB) has explored why data-driven projects in public administration so often fail to materialise. Legal uncertainties, unclear responsibilities, and a lack of structures and processes frequently prevent digital innovations from moving beyond the planning phase. To address this, the researchers have developed the Data Governance Guide – a digital handbook offering practical guidance for independently planning, implementing, and embedding data-driven projects into administrative routines. The guide aims to help overcome the digital backlog in Germany’s cities and municipalities. The Data Governance Guide is now freely available online at hiig.de/data-governance-wegweiser.

“Many smart city projects fail before they even properly get off the ground,” explains Professor Dr Max von Grafenstein, Head of Research at HIIG. “One of the biggest challenges is that public administrations often don’t know how to use data in a legally secure way,” says the legal expert. Legislative frameworks for data collection and processing are frequently unclear, offering little practical guidance for local authorities. This issue particularly affects public services that promote the common good – essential services such as energy supply, public transport, and healthcare. “In these areas, the uncertainties are especially critical,” adds von Grafenstein.

Another major barrier is the fragmented data landscape. “Relevant data is often scattered across different institutions and companies,” explains the researcher. Data protection regulations and business confidentiality concerns further complicate data sharing. To effectively use and ideally consolidate such data, clear structures within municipal institutions are crucial. “However, clear responsibilities and standardised processes for handling data are often missing,” von Grafenstein points out. This challenge extends beyond local administrations to municipal enterprises, transport providers, and utilities. “Data alone does not make a smart city – without functioning processes, its potential remains unused,” he concludes.

Data Governance: A practical tool for local authorities

To facilitate a more strategic approach to data management, legal scholars, urban planners, and designers from HIIG and KWB spent two years working closely with municipal institutions. “We didn’t just develop theories behind a desk,” stresses von Grafenstein. “Our goal was to equip public administrations with practical tools that enable the implementation of digital innovations such as autonomous public transport systems, smart energy solutions, or digital citizen services.”

Until now, many digital projects have failed not because of technology itself, but due to a lack of structures and processes. Strategy papers from external consultants often proved ineffective, as administrations lacked the frameworks needed to put them into practice. Moreover, a long-term strategy was often missing: many data-driven initiatives remained isolated pilot projects without being sustainably integrated into administrative workflows. “This means that insights and new processes were not permanently established – they remained one-off actions that faded away once the project ended,” explains Dr Maurice Stenzel, Project Coordinator at HIIG.

The Data Governance Guide closes this gap. It helps local authorities address the critical questions and set up the necessary processes to embed data use successfully and sustainably into decision-making. “Effective data governance creates the organisational, legal, and technical conditions needed to resolve data conflicts in a way that enables secure and efficient use,” says Stenzel. “It’s not just about data protection – it’s also about clearly defined responsibilities, standardised processes, and agreed rules for data management. Public administrations must be able to control who accesses which data and under what conditions it can be used by authorities, businesses, or citizens.”

Practical testing in Berlin

The research team tested the application of data governance in practice through a case study on air quality management in Berlin. Working with city administration departments, environmental agencies, research institutions, and civil society, they trialled new processes for collecting, analysing, and using environmental data. “It was important to us to ensure the Data Governance Guide actually works in practice,” explains Maurice Stenzel. “That’s why we developed it from the outset alongside administrative experts and tested it through real-life use cases. This approach ensures that local authorities across Germany can apply it to their own data-driven projects.”

In the city of Haßfurt, the digital handbook is already being successfully used to develop a digital strategy and design data catalogues. The early results show: the Data Governance Guide is not an abstract concept, but a proven, practical tool that helps municipalities structure and sustainably implement digital projects. “With the Data Governance Guide, we are providing an essential building block for breaking the digital deadlock in Germany’s towns and cities,” summarises Jochen Rabe, who co-developed the project alongside Max von Grafenstein during his time as Managing Director of KWB (now at RSUP).

Press Contact
Frederik Efferenn | Tel. +49 30 200 760 82 | presse@hiig.de

Research project
The Data Governance Guide is the result of the research project Data & Smart City Governance using the example of air quality management, conducted jointly by HIIG and KWB. The project is funded by the Governing Mayor of Berlin – Senate Chancellery – with support from the German Federal Ministry for Housing, Urban Development and Building and the Kreditanstalt für Wiederaufbau (KfW).

The Alexander von Humboldt Institute for Internet and Society (HIIG)
The Alexander von Humboldt Institute for Internet and Society (HIIG) researches the development of the internet from a societal perspective to better understand the digitalisation of all areas of life. As Germany’s first research institute focused on Internet and Society, HIIG emphasises embedding digital innovations within social processes. Based on its interdisciplinary expertise and as part of the Global Network of Interdisciplinary Internet & Society Research Centers, HIIG seeks to develop a European response to the challenges of digital transformation.

Berlin Centre of Competence for Water (KWB)
Founded in 2001, the Berlin Centre of Competence for Water (KWB) brings together science, research, and consultancy to advance sustainable water management. Its focus is on applied research across the entire water cycle. Together with partners from academia, industry, and public administration, KWB develops innovative solutions for liveable and future-proof cities. By linking cutting-edge research with practical implementation, KWB supports municipalities, policymakers, and infrastructure providers in developing sustainable and forward-looking water management solutions – and beyond.