Half of the world’s inhabitants—3.6 billion people—live in cities. The proportion is the highest in mankind’s history, and it is growing fast. By 2030, 60 percent of the population—5 billion people—will be city dwellers. The ways in which cities develop and cope with such rapid urbanization are of huge importance to citizens. But they matter to others too. Cities are the main source of global economic growth and productivity, and they account for most resource consumption and greenhouse gas emissions. Urban development therefore matters to the well-being of all the world’s occupants.
The formidable task of managing growing cities in ways that support and drive economic growth while reducing pollution and safeguarding resources led McKinsey & Company to launch, in 2011, the Cities Special Initiative (CSI). The aim is to help those in the public, social, and private sectors to make informed decisions about city development strategies, and to help them build the skills to implement those strategies. This is not a new space for McKinsey. Research by the McKinsey Global Institute into the economics of urbanization, collaboration with think-tanks such as the Urban China Initiative, and client work with city leaders, private developers, and city service providers all testify to McKinsey’s engagement in urbanization. This latest report by the CSI—“How to make a city great”—examines what it takes to advance a city’s performance.
Various studies have looked at how cities perform in economic, environmental, and social terms, and ranked them accordingly. Such studies help us to understand the elements of a great city. But they do not tell us what their leaders do to make them great. Moreover, an absolute measure of performance risks masking the efforts that have helped some cities to rise from low down the rankings.
This research starts to fill that gap. Through analysis, case studies, and interviews, we sought to learn what mayors and other leaders do to make their cities better places in which to live and work. The findings make clear there is no single method. Rather they suggest that successful leaders find a balance between three areas. They achieve smart growth, which means securing the best growth opportunities while protecting the environment and ensuring that all citizens enjoy prosperity. They do more with less. And they win support for change by delivering results swiftly. The report describes some of the managerial practices they deploy.
We are grateful to the city and community leaders who talked to us in detail about their visions, philosophies, successes, and failures. Their experiences form the basis of our findings—and, we hope, will inform others in their task of improving the cities in which so many live, and upon which so many more depend.