I don't think there is reason to suggest that diplomacy wouldn't keep working in a similar way.
Why does the North Korean leadership insist not only on having the nukes necessary to preserve their reign -- the ability to strike South Korea or Japan should be enough to guarantee that they won't be invaded -- but also an intercontinental missile capable of destroying mainland American cities?
One thought is that they still harbor dreams of taking the South. In this view, they wish to neutralize the Americans by holding their cities hostage. They attack southward, and the Americans do nothing lest the SF Bay -- including Y Combinator -- is destroyed.
They didn't need that ability earlier because they always had a big brother (always at least one of the USSR and China) that would do that "seriously hit the USA" part for them, if the USA supported South Korea in attacking them.
Nowadays, they can't be that sure about that support anymore. The USSR is gone, Russia has its own problems, and China seems to only support them because they don't like giving the USA more influence, not because they share a view on communism. The logical (in the logic of deterrence/arms races) conclusion is that they need their own capability for doing that.
The only positive thing working for the target when it is a city is that ICBMs are likely to fail to hit and detonate precisely as intended.