Since the industrial revolution, machines have been replacing manual input resulting in greater productivity and reduced costs. Now in the technological revolution, artificial intelligence (AI) is further changing the nature of work – and has taken over from capital investment and labour as the key driver of business growth.
By combining human strengths of expert knowledge and creativity with the speed and scalability of AI, the complementary capabilities achieve significant performance improvements. In fact, the impact of AI technologies on business is projected to drive an up to 40 per cent increase in labour productivity by enabling a more efficient use of time. AI can bring benefits to any field involving digital data – from healthcare to education, manufacturing to sales – and it can incorporate video or text, images or automated voice recordings.
In today’s world, for businesses to compete they must be customer-obsessed. AI empowers firms to build comprehensive profiles of customers and then re-orient their business processes around their needs and expectations. And the efficiency boost from the technology means that staff can be freed up to spend time diligently serving customers.
So what are the misconceptions about SMBs?
Levels of AI adoption are high for large corporations, and 47 per cent of the more advanced enterprises have applied an AI strategy to their mobile apps. This compares with 27 per cent for less mature businesses.
There are significant misconceptions about the requirements for AI integration and a perception that it is still the domain of the giant corporations. But, there are many reasons why small and medium-sized businesses (SMBs) are in fact better placed to adopt the technology.
While the likes of tech giants Amazon and Facebook incorporate AI throughout their processes, 41 per cent of SMBs believe it is too complex for their needs. But AI does not need to be complicated. The basic principles it addresses – targeting the right market, optimising response rates, customer service, and cost reduction – can be applied to businesses of any size. The important consideration is to have a set of clear, measurable objectives and apply the relevant data and technology to support them.
To be truly data-driven a business must have smart KPIs, that are clearly defined, applied consistently, and incorporate a flagging system for minimum and maximum indicators. Once these are established, AI can accurately monitor operations, and enable prompt and effective responses – for optimal performance levels. AI can vastly simplify processes, while ensuring consistency of applications.
One advantage of the shift to cloud computing is that SMBs no longer need to invest in the huge technological burden of in-house data management applications. Now, AI can provide the automation, insights, and connections to support IT infrastructure – without the debilitating cost. The funds required are far outweighed by the business advantages.
Becoming data-driven and customer-oriented isn’t primarily about introducing AI and other advanced technologies – the principles must be incorporated across the whole organisational structure. It’s about putting the customer first and foremost – and keeping flexible and responsive to their needs. The use of data and automation is key to doing this – as it enables decision-making to be based on accurate and meaningful insights at scale – but it’s how this information is directed towards customer needs that is crucial.
What makes SMBs so suited to the implementation of AI?
SMBs have a major advantage over larger corporations – by their very size, they can be nimble and flexible in decision-making processes. Organisational changes can be brought about quickly and processes rapidly adapted to technological innovations. SMBs also tend to have younger founders and management teams, who are less likely to be stuck in traditional procedures, and hence are more willing to take calculated risks, step out into new territory, and grasp the advantages of latest technology.
Additionally, SMBs can undertake product testing on a small scale, with nominal investment, and adjust the parameters before pushing it out to a wider market – and they can do all of this far more quickly than the larger corporations. Importantly, they are closer to their customers, so are better placed to monitor feedback and react to consumer preferences – adjusting their offering to suit.
How can SMB’s use AI?
Customer service is one of the most exciting areas for SMBs to put AI into practice. Resource-strapped SMBs can bring in chatbots powered by AI to take the weight off staff dealing with customer enquiries, and subsequently free up their time to handle more complicated cases. The technology in this area has advanced rapidly in recent years to the point that Salesforce’s Einstein Next Best Action can additionally draw on contextual data to provide recommended next steps for customer service staff. This helps to make high quality, attentive customer service a feasible achievement for a more stretched team. AI also aids customer retention. Predictive modelling draws on historical data to help companies identify customers most likely to take their business elsewhere, who can then be targeted with personalised communications and offers, incentivising them to stay loyal. The predictive modelling technique can be insightful for all kinds of SMBs from subscription-based businesses trying to identify those least likely to renew, to retailers honing in on customers that are at risk of abandoning their stores.
AI is one of the technological innovations easily adopted, and adapted to by SMBs. By using it to improve customer retention, identify sales opportunities, optimise customer service, and increase efficiency they can continue to drive innovation and compete with big businesses.
Rita Martin, AI Practice Lead, 4C