Municipal IT service providers are important and reliable partners of the municipalities. Municipal sponsors, members or shareholders can assign contracts directly to their regional municipal IT service providers (in-house business). This creates a long-term cooperation with little organisational effort.
However, competition is an important driver for innovations in smart cities and smart regions and thus for innovative digital solutions for cities and municipalities. Young, agile start-ups have been offering a wide range of services for public clients for several years. One obstacle for cooperation between municipalities and start-ups lies in innovative procurement and the tender process.
However, there are already a large number of successful innovation projects by municipalities and start-ups. The municipality Kirchheim near Munich uses a start-up's sensors to monitor the health of the city's trees, and for the Hanseatic City of Hamburg, a start-up's algorithm automatically translates website content into so-called simple language. The examples show that it is advisable for municipalities to be more courageous in seeking diverse sources for their digital transformation.
