You can't play a world where there are machines thinking and you're not using them

Interview published in Business Insider

The digital age is now a reality and the pandemic has only accelerated the trend that was bound to come in the next few years. But there are people who have known this for decades.

Miguel Fernández Díaz is CEO of Innovation Strategies, a Spanish company that applies cutting-edge technology to offer real digital transformation solutions to companies.

Having worked for EY, ITP and Gartner Group, this specialist in the intersection between technology and business founded Innovation Strategies in 1997 in an attempt to see what technology could be used to support a solution for any type of business.

His latest success story is Iberostar, a company he has been working with for 20 years. The company headed by Fernández is responsible for all the innovation and digital transformation of the hotel company, which was recently awarded for the best user experience at the Tourism Innovation Awards for implementing a new and immersive booking solution, where the user can hyper-personalise their room and book it from the hotel map in 3D.

"We are going to radically change how hotels are booked. The moment customers see this way of doing it, they won't want to go back," says Fernández in an interview with Business Insider España.

Headquartered globally in Mallorca, Innovation Strategies works for companies on five continents. In addition to Iberostar, the technology company has helped clients of large companies around the world in this transformation.

"We are not important, but our clients are often very important. We make wedding dresses: these are not the wedding, but they are expensive and complicated and can't go wrong on the day of the event," he explains.

More than 20 years after its creation, the pandemic has been the best year in the company's history, reaching 6.2 million euros in 2020. In 2021, they expect to reach 7 million.

Intensity and speed: the two axes of technology

"I always say that we are in level 3 of technology: there are those who invent it, those who experiment with that technology to see if it works and then there are us, who when we have something that really works, we apply it to everything".

Innovation Strategies was the first Spanish company to be certified in Amazon Web Services because they quickly detected that the cloud was going to be fundamental. "We jumped in head first, having to explain to people what it was and why we had to get into it, but nobody understood it," he says.

In these almost 30 years in the industry, Fernández says he has seen it all and, he says, everything that has happened so far has been a preparation for what is to come. "The big leap in innovation starts now," he says.

At his company, they are looking to change the customer and employee experience by increasingly using artificial intelligence (AI), the internet of things (IoT) and data. "The world is going to change radically based on these three things, and I don't know if it's necessarily for the better," he says.

His experience in the digital world has made him realise that we tend to confuse intensity with speed and he assures us that we believe that change is going to be very fast, when normally it is more intense and slower, as happened with the internet or Amazon: "When Amazon only sold books, we thought it was the bomb, but nobody ever imagined that Amazon was going to be what it is today and what it is going to be", he explains.

The next big trend? Fernández is clear: "The confluence of IoT with traditional computing, what is the physical world with the virtual world. I think they are going to get confused and there is a huge opportunity, as happened with e-commerce," he says.

Fernández foresees a world in which your own kitchen will be the one to warn you that your microwave is going to break in three weeks' time. Not only that, but it will also search online shops for appliances that fit your needs and budget and will even be able to schedule a date for the technician to install it. "All you have to do is agree, the rest will be done for you by the machine because it knows all your preferences," he says. "Children are going to find it hard to know what is alive and what is not".

In this spiral of trends, Fernández does not quite see a place for virtual reality (VR). "I think that the ugly duckling in all this is VR, which is not going as fast as it should. I don't think anyone has really nailed it yet.

Getting good data: a tougher challenge than it looks

"Our big problem with large companies is that it is difficult to get good data, much more difficult than it seems," he says.

As Fernandez explains, getting the oil out of the basement costs. It takes a couple of years to organise, create reliable data sources and homogenise them. It's a "dirty plumbing" job that has to be done to make it shine upstairs. There are companies that have the patience and resources to do it and there are many others that don't, so "there is going to be a worrying polarisation".

The expert comments that it used to be difficult for companies to listen to them on the subject of digitalisation. Now, however, they say: "I don't know what needs to be done, but it needs to be done quickly".

Now that companies are beginning to be aware of the relevance of data, the next change will come from two things, according to the expert: on the one hand, that people really make decisions based on data, something that "almost never happens" because we tend to rely on intuition, despite what the numbers say, and companies that know how to make decisions based on data "are going to make a big leap". Once this has been achieved, the next step will be to trust the machine to make decisions.

"We made a machine learning model of clustering the behaviour of tourists that predicted what they were going to buy based on their web browsing. So the machine decided which product customers were likely to buy based on 16 variables and offered it to them. The human brain cannot cope with working with 16 variables. Despite that, we weren't able to sell it to anyone, because they thought the machine was going to take their job because they didn't understand it," explains Fernández, adding that they now make simpler models that can be explained to customers to gain their trust.

"You can't play in a world where there are machines thinking and you are not using them. I don't know when it will reach everyone, but that leap has already been made," he says.

AI is questionable depending on its use

According to Fernández, AI is only being used in two places: the United States and China, but in different ways.

The Americans, he explains, have used it to create the attention economy, where the business is in keeping the user hooked to a screen. "Allowing this is questionable," he says. "In China, they add surveillance. You can't do that with police, but you can with AI," he says.

"Well-managed information produces magnificent results and poorly managed information produces very big problems," he says.
For this reason, and although he considers AI to be a "very interesting" mathematical achievement applicable to a multitude of problems, he considers its use to "enslave people's attention and make a profit" to be questionable. "It requires supervision because it is amoral," he adds.

Innovation Strategies says it is necessary to use this tool but in the right context and without causing harm.

Although it is not clear what the real impact of this technology will be on humanity in the coming years, for Fernández it is a gift to be able to work in this changing era in the world of technology. "If I die tomorrow, I have lived much longer than 99% of humanity. Technological development has given us an incredible privilege," he says.