AI is changing more than technology. Peter Hinssen and Mikis Waschl discuss why facility management leaders must rethink business models, digital strategies and the way value is delivered to thrive in an increasingly unpredictable future.
Artificial intelligence is accelerating change across every industry, but simply adding AI to existing processes won't deliver lasting results. Recorded live at World Workplace Europe, Erik Jaspers is joined by Peter Hinssen and Mikis Waschl to explore how AI is reshaping facility management, why digital transformation was only the beginning, and what organizations must do to build stronger data foundations, embrace digital twins and rethink how value is delivered. They also discuss the economics of AI, Europe's role in the future of technology and why today's leaders must prepare for a world that is never normal.
This episode is sponsored by SiteMap®, powered by GPRS. Learn more at sitemap.com/ifma
Timestamps
Mikis Waschl: [00:00:00] Just dumping AI on existing processes is not gonna deliver an ROI case. Yeah. Okay. It's gonna, it's gonna deliver maybe small efficiency gains, but they're gonna be eaten up by the increasing cost of AI, by the increasing cost of energy.
Erik Jaspers: Right.
Mikis Waschl: So I don't think that's gonna be the future, the best solution to just dump AI on existing processes. The question is not how can we do AI? The question is how bold are, are we in rethinking our business? Yeah. And in rethinking how value is delivered.
Host: Welcome to ConnectedFM, a podcast connecting you to the latest insights, tools, and resources to help you succeed in facility management. This podcast is brought to you by IFMA, the leading professional association for facility managers. If you are ready to grow your network and advance in your career, go to IFMA.org to get started.
Artificial intelligence is accelerating change across every industry, but simply adding AI to [00:01:00] existing processes won't deliver lasting results. IFMA fellow Eric Jaspers is joined by Peter Hinssen, a renowned global speaker, bestselling author, and leading expert on innovation and leadership, and Mikus Woschel, a chief digital officer, to explore how AI is reshaping facility management, why digital transformation was only just the beginning, and what organizations can do to build stronger data foundations, embrace digital twins, and rethink how value is delivered.
They also discuss the economics of AI, Europe's role in the future of technology, and why today's leaders must prepare for a world that is never normal. Now, let's get into it.
Erik Jaspers: My name is Erik Jaspers, chair of IFMA EMEA board of directors, and I'm here today with two very in- interesting people, I think, in the realms of of technology as it relates to facilities management, which is Peter Hinssen and Mikkes Ma- Waschul. And [00:02:00] uh, can I please ask you to introduce yourselves because that would probably be a better way than me reading out anything, right?
Peter Hinssen: Ha- happy to do that. Thank you for inviting me. Really nice to be here. My name is Peter Hinssen. I am a technology entrepreneur. I did startups when I was younger. I've been teaching at London Business School for 15 years now on technology, innovation, and disruption. And one of the strange things is I started writing books about that, and I just finished a new book called The Uncertainty Principle: How to Survive- Yeah
in a World that Seems to Have Gone Crazy.
Erik Jaspers: Yeah. Still the case, I guess, isn't it?
Peter Hinssen: Still the case, yeah, absolutely.
Erik Jaspers: And you've been presenting for IFMA prior as well in America while we were there.
Peter Hinssen: Couple years ago. Yep. Yeah. Absolutely. Yeah, yeah. Yeah. And, and the conference is, is something that I do a lot of lectures, I do a lot of keynotes.
I enjoy that because you meet a lot of different people. Yeah ... you see different industries.
Erik Jaspers: Yes.
Peter Hinssen: I have been invited to conferences where I never thought they had conferences about- Right ... those subjects.
Erik Jaspers: Okay.
Peter Hinssen: [00:03:00] But it's always wonderful to learn new things.
Erik Jaspers: Okay. Thank you, and thank you for being with us.
No, happy to be here. It's great to have you as a as a person to talk to about the industry. Now Mikis, can you introduce yourselves?
Mikis Waschl: Yes, happy to do so. Thank you very much for having me. Pleasure to, to be here with the two of you. My name is Mikis Waschl. I'm an entrepreneur. I try to digitize the German-speaking facility management companies.
We digitized more than 20 million square meters in 10 years. And in 2022, I decided that I wanted to do something else. And I'm now Chief Digital Officer of Hunders Group which is a world market leader in formwork scaffolding and- Yeah ... shop fitting.
Erik Jaspers: Yeah. Okay, to set the stage of the conversation today I, I think as to see theme of, of this event is it's of course about AI, but beyond that is about digitization.
I think the whole theme of digitization is having a, a more and more influence on, on the, on the FM business. But [00:04:00] apart from that, Peter as a question, what's happening today? What's, what's, what's the headline of what's happening today in in technology that is relevant in your view to FM?
Peter Hinssen: So, I've been in the world of technology for some time. So I graduated in '93, which means that for the last 33 years, I have been in the world of IT and digital- Yeah ... and technology I have to say, it has never been faster moving. It has never been more intense. It has never been more exciting, and it has never been more scary at the same time.
Right. And I think for a long time, I personally believe that the digitization, and that's the wave that we've seen in the last 10, 15 years, was something that if you would ask me, "What is your crowning achievement? What have you done- Yeah ... in life?" I would say, "You know what? It's digital. That's, that's what I've done."
I've, I've gone from analog to digital in many, many industries and many, many markets and helped companies make that transformation.
Erik Jaspers: Right.
Peter Hinssen: I'm now starting to [00:05:00] believe that the digitalization was the appetizer. It was the beginning.
Erik Jaspers: Yeah.
Peter Hinssen: And I think the main course that we're having right now is AI, and that is more intense, that is richer, that is more complex, and I think more profound than anything I've ever seen.
It's also the most craziest of markets because the technology market in itself-
Erik Jaspers: Yeah ...
Peter Hinssen: used to be something that was, I have to be honest, relatively boring. I mean, the technology market, huh? Yeah. Didn't change all that much, huh? No. And you had the big players, the Microsofts and the Oracles and the Salesforces and...
But now, all of a sudden, in the last, I would say 18 months, that entire technology landscape has become liquid. Yeah. I mean, the traditional players that we used to have a couple of years ago, where you have to make choices, am I gonna go for Oracle or Salesforce or whatever, that was pretty clear. All of a sudden, that has completely turned into quicksand.
Yeah. And at the same time, [00:06:00] you see that the world of AI has now become a mainstream theater. I mean, I just came back from the US. And, you know, the big debate in the US was the enormous fight that happened in the world of AI between Anthropic- Yeah ... the maker of Claude, and the US Department of War.
Erik Jaspers: Yeah.
Peter Hinssen: Where the US Department of War said "We like your technology, but we want complete autonomy over how we use the technology."
Erik Jaspers: Yes.
Peter Hinssen: And Anthropic said, "You're free to use... Well, you can pay for the technology and then you can use it" Of course ... "but you cannot use it for mass domestic surveillance and autonomous weapons."
Right. And the Department of War says, "But we want that." Yeah. And eventually it became a big fight. I mean, the big cover this week on Time Magazine is the war of AI, where you see Pete Hegseth- Yeah ... the Secretary of Defense, and the CEO of Anthropic- Yeah ... Dario Amodei, fighting it out. That is high drama.
This is like, you know, a gunfight at the AI [00:07:00] corral.
Erik Jaspers: Right. And interestingly enough, a few days, I think it's two yet, two days ago, that Microsoft announced they're partnering with Anthropic.
Peter Hinssen: Exactly.
Erik Jaspers: And against, let's say, the political move to put them into a risky area or you can't work with this or you can't deliver to the American military- But
Peter Hinssen: that's my point.
I think what we're seeing is that the world of technology isn't the world of technology anymore. Right. The world of technology has become, you know, political, geopolitical. Yeah. It has an impact on work and society. Right. And it's accelerating so fast- Right ... and it's in a world that is actually almost very difficult to just understand what is going on.
I mean- Right ... I've been, as I said, in technology for 33 years, but I have never had so much difficulty in keeping up- Yeah ... because things are changing so rapidly. Oh, yeah. It's horrible. So it is the never normal for sure.
Erik Jaspers: Yeah. Sure. Okay, and then switching to you, h- what do you, what do you see in this respect from your end, from your point of view?
Mikis Waschl: [00:08:00] Well, I think this, this era we live in provides a unique opportunity for, for us as facility managers here to finally evolve from delivering output to deliver outcome.
Peter Hinssen: Yeah.
Mikis Waschl: To, to evolve from delivering a service or a workplace to delivering an impact on productivity of a company of- Yeah ... of, of people who work in a building.
Yeah. I think that's a unique opportunity that, that now is here. At the same time we, we, we live in a, I would say, constant mismatch because buildings exist for 50, 60, 70, 80 years- Yeah ... and software exists for three, four, five years, maybe it's even less as it's getting faster and faster. It is. And on top of this we have a- crazy situation that actually the digital twin of a building is not part of the asset itself.
Erik Jaspers: Yeah.
Mikis Waschl: As we change contractors, we start at zero all over, all over again. Yeah. So, I think that's gonna be a, a massive change the next couple of years because the digital twin is b- gonna be part [00:09:00] of the asset finally.
Erik Jaspers: Yeah. Wh- when you talk about it, I visualize that, like, as we- we've been talking about when the transactions on building take place, they, the, the business people still look at the hardware, the bricks, and the concrete, while we s- have been stating the digital twin is, is part of the definition of a building.
Now, going, putting that into the context of AI Could you say that if you would have this broad definition of a building so the hardware connected to its digital twin, you bolt on AI, you have a new type of operation perspective, so to say, right? I've been working for an IWMS company, and if you look what we're doing in the, in that realm, in, in operations, there's of course this structuring of information, make it humanistic in order to interact with it.
But now is it conceivable that you would basically have a digital twin formulated based [00:10:00] on a, a g- a good definition of that, of this ontology of the data that you bolt on AI and do a completely different approach to operating buildings?
Mikis Waschl: Absolutely. I do believe so. You ha- you will have to change the operating model because otherwise, if you don't fundamentally change the way how value is created, you're just gonna end up in doing, in doing pilots, huh?
You're gonna end up in summarizing meetings nobody needs anymore with with Copilot. Yeah. So I do believe you, you will have to change the, the, the f- do a fundamental shift in changing the operating model because that's gonna really deliver the business impact and, and, and the way how value is created.
Erik Jaspers: Right. In- To you, Pieter, in that sense, looking at the development of AI and what you see in the world happening, how do you see that this impacting business itself and business models that we see happening today around buildings, operating buildings or other examples of how it transforms [00:11:00] thinking about the business model itself?
Peter Hinssen: So I, I really fundamentally believe that we had a lot of discussion about disruption during the digital transformations, and we saw a couple of new models, and we saw quite a lot of disruption in a certain amount of markets. I think AI is probably going to give us more disruption, and not just technological, but model disruption as well.
But to Mikus' point, I think one of the interesting things is that when I look at that world, and, and my world is AI and technology, yeah? Yeah. And, and sometimes I have an opportunity to think about what it means for this industry and, and buildings. I think there's two things. First of all, I think the quality of information The foundations are still absolutely vital.
Mikis Waschl: Yeah.
Peter Hinssen: And in every sector where there is disruption, you can clearly see that those people who understand how to build quality data foundations, they're the ones who can actually think about disruption. Right. And honestly, in this industry, I think there's still an enormous amount of work to do [00:12:00] to get the foundations in place.
Right. The second thing is when you think about model disruption, I think the, the, the really interesting thing is, how can you become more relevant to a certain customer base? Right. How can you become more relevant to the people that are making the decisions? And I take a really stupid example because when you look at the car- Yeah
I mean, I'm gonna do a hypothetical question for you both, right? Tomorrow you get a brand-new car. Yeah. Tomorrow you get a brand-new BMW, okay?
Erik Jaspers: Yeah.
Peter Hinssen: That's a good gift, right? Yeah.
Erik Jaspers: Yeah. Nice. Thank you.
Peter Hinssen: The moment you get into the car, you have two choices. You can either say, "Wow, this is a brand-new BMW. I'm going to use the navigation system that comes with the BMW," or the first thing you're gonna do is you're gonna try and connect your CarPlay, Android CarPlay, Apple CarPlay, to bypass the BMW system.
Yeah. What are you gonna do, Erik?
Erik Jaspers: To be honest, I had them in both, and then I made the choice [00:13:00] what I liked the most. Right. But I, I certainly added my own navigator to the existing one.
Mikis Waschl: CarPlay.
Peter Hinssen: CarPlay, huh? And that is a fundamental thing because there is a very interesting analogy where these car companies make amazing products, but the experience that you have as a user on whether that is a smart and intelligent experience is no longer- Right
the car, but is actually the layer on top. Right. And I think this is going to be super interesting to understand how that plays out because that could really change the entire model, and I think personally, we're gonna see more disruption.
Erik Jaspers: Right So would you conceive in this, just to prolong this example, would it be kind of an intelligent e- entity then, that car, that's more interactive than it is even today?
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Peter Hinssen: I mean, let's be honest. I mean, we live in a world where a car used to be very simple and it got you from A to B. Now it's not so simple anymore because in the world of electric and in the world of complexity, you have to have somebody who is your intellectual partner. Because if I'm gonna be driving from here, The Hague, back to Belgium, it's 350 kilometers.
Mikis Waschl: Right.
Peter Hinssen: I'm gonna have to think about, you know, how much charging am I gonna have to do? Where am I gonna charge? I mean, your [00:15:00] car becomes, you know, a more intelligent partner. Yeah. You want a more mature, intelligent relationship. Yeah. I think honestly, same thing is gonna happen to buildings, right?
Erik Jaspers: Yeah.
Peter Hinssen: And then the question becomes, I mean, are you gonna have a simple digitalization with a little bit, or are you gonna go the extra mile?
And are you gonna see people who really understand how to create value to end users, value to people- Right ... who are going to use the building?
Erik Jaspers: Right.
Peter Hinssen: And you know, when I ask the question to many people, most people, when I use the car analogy, they say, "Oh, you know, well, I mean, I, I probably will use CarPlay because they are the ones who really make that relevant for me."
Yeah. I am still gonna use the old systems when, when I have to put on the massage in my BMW chair. Yeah, yeah. Still there. Because that's,
Erik Jaspers: that's something
Peter Hinssen: I can't do with CarPlay. Yeah,
Erik Jaspers: yeah. So what's your perspective on that when you look at your business in, in buildings and, and value propositions that lie ahead?
Mikis Waschl: Well, well, I fully agree. I mean, yesterday we heard the sentence, I think it was, "A car is a, is an iPad on wheels," right? It, it delivers- [00:16:00] Yeah ... the value of an iPad. And maybe the primary purpose is not anymore to, to, to, to drive a car and have a nice driving experience, but to be connected and, and, and, and the, the value delivery has become different.
And the same happens in, in construction industry and, and, and our demand for, for buildings. Maybe in 10 years' time we will laugh about the fact that today's buildings don't talk to each other, and that they are not interconnected and there is no connected supply chain. Yeah ... so it's, it's fundamentally gonna change, and it has to change because coming maybe to, to, to the industry I'm in now, the construction industry, the current situation is that by 2040 we will face a 40 trillion productivity gap because the demand is growing much faster-
Peter Hinssen: Yeah
Mikis Waschl: than the productivity.
Peter Hinssen: Right.
Mikis Waschl: There is studies that say that in the last 20 years there was a zero productivity growth in construction industry.
Peter Hinssen: Yep.
Mikis Waschl: So we have a... We are facing a 40 trillion productivity gap. At the same time, construction industry, until three, four years ago, was third to [00:17:00] last in terms of digital maturity.
And I said was, because agriculture has overtaken. Yeah. Farmers- Yeah ... have overtaken. You know, we are s- now second to last. Right. Huh? What's last? Hunting. Hunting.
Peter Hinssen: Hunting. Yeah.
Mikis Waschl: So the potential is there, the need is there. Yeah. And when I, when I read this Financial Times, I think article last week about Jeff Bezos founding a 30 billion startup- Yeah
Aiming to buy industrial companies that- Yeah ... failed on digital transformation and that did not move fast enough. Yeah.
I think the stage is set for fundamental change, and those that don't- Yeah, yeah, yeah ... well, will become dinosaurs fast.
Erik Jaspers: Okay. To this topic, because you've, you've both have been for a long time in the industry, IT industry, of course.
I have some concerns I would like to share with you and see whether how you respond to this. What I've learned in my trajectory in, in, in IT is that the fundamental principle of [00:18:00] distributing your technology in IT has been create something interesting, provide it cheap- Make sure the adoption is there and then raise your price.
Now, what strikes me in-- when we talk about the application of AI is that it is-- it seems to be in a financial perspective, it seems to be based like our experience that we have in social networks, meaning everything is almost for free. At the same time, what we see happening is thousands, almost thou-thousands of billions being invested in infrastructure, model training, agent development, and so on, and so on.
And investors will want revenue want, want to have a return on investment, of course. That must get into the-- certainly in the B2B market where we are as a facility management. We are in the B2B market. It's not marketing that will provide the revenue. How do you look at the [00:19:00] financial perspective and, and investment decisions around the applications of AI looking into that future?
Because I would be inclined to think that in five years from now, the price of service on AI services will rocket like tenfold, twentyfold
Peter Hinssen: Well, it is, I think the strangest moment to understand the financial dynamics, right?
Erik Jaspers: Yeah, isn't it?
Peter Hinssen: So I've been teaching at London Business School for 15 years, and I'm one of the few technologists there.
We have a lot of people there who are for example, experts in corporate finance.
Erik Jaspers: Yeah.
Peter Hinssen: And when I talk to my corporate finance colleagues, they say, "What the hell's going on?" You know? Yeah. "We, we, we can't make heads or tails of this."
Erik Jaspers: Yeah.
Peter Hinssen: For me, OpenAI is the greatest example. Yeah. OpenAI is a company that everybody thinks, "Wow."
I mean, they're doing something very interesting. They introduced us to this new world three years ago. Last year, the total commitment in infrastructure of OpenAI was a trillion dollars. Right. And I [00:20:00] think last year was the year that we went from a billion to a trillion as a normal measure- ... of looking at these things.
Erik Jaspers: Yeah.
Peter Hinssen: In the end, as you said, somebody's gonna have to pay this back, right? I mean, this is something you cannot just do for philanthropy. No. This is something where somebody is going to have to pay for this. OpenAI last year lost $83 million every single day. Every single day. And then you realize that that could be a, a bubble of epic proportions.
One of the interesting things in Silicon Valley now is I heard somebody say that two weeks ago. Somebody said, "What if OpenAI is the new Netscape?"
Erik Jaspers: Yeah.
Peter Hinssen: And I thought that was really interesting, 'cause- Yeah ... Netscape, for the older people who are listening, eh- Yeah ... was the company that introduced us to the World Wide Web.
Yeah. They provided the browser, huh? Yeah. And everybody thought, "Wow, what a cool idea, the World Wide Web."
Mikis Waschl: Right.
Peter Hinssen: Netscape was the most spectacular IPO in 1995. Right. And in the end, they didn't make it, huh?
Mikis Waschl: Right.
Peter Hinssen: So you could now see [00:21:00] that people are throwing money at the wrong things. Right. I mean, are these companies like Anthropic and, and OpenAI who provide the models, are they going to ones who reap the benefit from this?
Or is it gonna be the companies that provide the infrastructure, the compute power? I, I always ask chief technology officers today- Yeah ... one question. In 10 years' time, are you gonna spend more on IT or less on IT?
Mikis Waschl: Okay.
Peter Hinssen: That's a very simple question, right?
Mikis Waschl: Yeah.
Peter Hinssen: And most of them have no clue. The only thing that they are capable of telling me is they said, "You know what?
We'll probably spend less on software but more on compute." Right. "Because we're probably going to use- Yeah ... a lot of this." Yeah. "Instead of buying- Yeah ... software licenses-" Right "... we're going to use the compute power to make AI work." Right. But at this moment, we're in a situation where nobody knows how those finances are going to play out.
The only thing we also realize is that a lot of people who are now experimenting with AI, they're starting to see the bill. [00:22:00] Yeah. And corporations are probably going to have to seriously, you know, understand this could be a big factor going forward.
Erik Jaspers: So how do you look at that pricing,
Mikis Waschl: well, first of all, I think I, I would have an interesting follow-up question in, in case somebody answers the first question.
What's gonna be the, the, the, the ratio between HR budget and IT budget in 10 years? Right. But every- I, I- That's a good one. I think it, it also brings me back to my, to, to one of my first points. Just dumping AI on existing processes is not gonna deliver an ROI case. Yeah. Okay. It's gonna, it's gonna deliver maybe small efficiency gains, but they're gonna be eaten up by the increasing cost of AI, by the increasing cost of energy.
Erik Jaspers: Right.
Mikis Waschl: So I don't think that's, that's, that's gonna be the future, the the, the best solution to just dump AI on existing processes. The question is not how can we do AI? The question is how bold are, are we in rethinking our business? Yeah. And in rethinking how value is delivered.
Peter Hinssen: Yeah.
Mikis Waschl: And I think that's, that's the right approach.
Ju-just ask your CIO or some, [00:23:00] some IT department or, or your CDO to start doing some pilots with AI You're gonna end up with more pilots than airlines, but nothing takes off. Yeah,
Erik Jaspers: okay. So we're coming-
Peter Hinssen: And I like that analogy. Yeah. And I, I heard something last week that I thought was really interesting.
The, the, the amount of pilots that are being done, I think is a disaster. And, and I heard somebody say, "All these pilots that companies are doing, it's like, eating snacks all day."
Erik Jaspers: Yeah. "
Peter Hinssen: It's really bad for you." Yeah. And there's like a, a quick rush where you say, "Mm, that was a good Mars bar." But in the end, if you only eat snacks, it's really bad for you, and I think that's what happening with the pilots right now.
Erik Jaspers: Very interesting. So we're coming to the close almost, but I have- Already ... one question. Yes. For, for a sh- a, a difficult question for a short answer, or an indication anyway. Because we're here at World Workplace Europe. And of course, looking at the global developments Europe the theme in Europe is digital autonomy.
How do you [00:24:00] look at that in this perspective? And is there... What do you see happening or what do you expect happening in Europe in, in trying to reach some of that? P- probably a, a full autonomy is a, is a crazy thing to think about. But what's your perspective on that?
Peter Hinssen: So I think it's one of the most interesting subjects being debated at the moment.
We saw the French basically saying, "We don't wanna use Zoom anymore. We don't wanna use Teams anymore." That's really good. The problem is at this moment, there is virtually no alternative.
Mikis Waschl: Right.
Peter Hinssen: And I think what happened in the last couple of years is that Europe didn't do a very good job at building its own capabilities, infrastructure.
We're now surrounded by, you know, on the left, the Chinese, on the right, the US, which are the superpowers in this new age- Right ... of technology. And a number of people in Europe are saying, "Who cares? We never had a mainframe industry in Europe, but our banks could buy an IBM mainframe." Right. I think this time is [00:25:00] different.
Yeah. I think we need to invest. Yeah. But I think many people, policymakers, underestimate how long it takes for these things to really materialize and become viable. And I think if we do this, it has to be a massive effort. We've done it before. We've, we've been able to build something like Airbus in the past- Yeah
where you have different cultures and different- Yeah ... countries coming together to build something unique. Yeah. But unless we have the resolve to do an Airbus-like type of thing, I think it is a delusion. Thank you. Your perspective. Well, I agree. I think Europe is maybe lagging on, on technology and on AI, but there is things where Europe is very good and very competitive.
Mikis Waschl: M- maybe it's sustainability. It can be engineering. It can be safety standards. So maybe trying to connect the dots to, to, to facility management and to World Workplace, I think what Europe could deliver is- Trustworthy industrial AI standards for buildings, because that could connect [00:26:00] our European strength with a topic where we are maybe lagging, Yeah
AI. Yeah. But still we could create a benefit out of it.
Erik Jaspers: Okay. Well, gentlemen, thank you very much for the conversation. We could probably- It was a pleasure. It has been a pleasure, and thank you for being with us today.
Peter Hinssen: Thank you. Thanks for inviting me.
Host: Thanks for tuning into the Connected FM podcast. If you enjoyed today's episode, please take a moment to rate and review the show because it really helps us reach more listeners just like you. And don't forget to hit the subscribe button so you never miss an episode. See you next time.