Is AI Adoption by Small Businesses Inevitable?

Daniel Rodriguez, CTO of UDT, was featured in Business News Daily discussing AI adoption by small businesses.

May 30, 2018

By Adam C. Uzialko

Most small businesses don’t want to be first to adopt a new type of technology. It’s often smarter to wait and see if something becomes mainstream. But there’s a tipping point at which you fall behind the times, making your company appear dated and inefficient compared to your competition. Could this be the time to get serious about adopting artificial intelligence – or risk your company’s relevance?

AI has already emerged as an essential solution for many large companies with vast amounts of data. But what about small businesses? Today, AI might seem like an abstract or far-off concept to small businesses. While it’s true that AI is still in its infancy, many small businesses are already leveraging the technology, if indirectly.

Do small businesses that refuse to adapt to AI technology really risk losing out on a competitive advantage or, worse, closing their doors for good? Business News Daily spoke to experts on the AI industry’s growth about when adoption of this technology will reach a critical mass, and what small business owners should know.

It’s still very, very early.

The good news is that nobody has missed the boat on AI yet. The development of AI technology is still in such an early phase that there really hasn’t been enough time for anyone to fall too far behind, especially not small businesses.

“I believe we are in the very early adopters stage when it comes to implementing these technologies in the small business space,” said Daniel Rodriguez, CTO at UDT.

Luckily, Rodriguez added, small businesses can leverage cloud-based solutions when the time comes to easily and affordably scale up AI technology. “Many AI solutions today can be delivered in packaged offerings, which limits the cost and risk of building your own, and cloud continues to be the great equalizer for businesses to deploy at scale without the traditional investments in expensive on-premise systems.”

You might already be using AI without realizing it.

Many third-party companies that small businesses contract with are already implementing machine learning and AI into their operations. Small businesses especially work with a lot of cloud-based applications and outsource many supporting operations, such as marketing services and customer support.

Many companies are now integrating AI and machine learning algorithms into their business-to-business services, meaning small business owners might already be leveraging AI.

“Currently, most small businesses are not directly implementing AI technology. However, they may be taking advantage of AI technology if they outsource tasks such as market research, marketing and advertising,” said Marcel Shaw, systems engineer for Ivanti. “Today’s leading advertising and marketing firms are using AI technology to better understand the market and the customer. Small businesses that outsource to companies that use AI technology will gain a competitive advantage over those who do not.”

For example, chatbots using natural language processing are making huge strides in customer service, enabling small businesses to handle a larger volume of customer inquiries without dedicating additional manpower to the task.

Don’t put the cart before the horse.

While AI solutions sound exciting, it’s important to question why and when a small business might really need to adopt the technology. An essential ingredient for AI to really work is a large data set, and many small businesses simply aren’t capturing the volume of data that demands AI intervention.

“The hard truth is most small and medium-size businesses have no immediate use for AI. To leverage AI and machine learning technology, you need a lot of high-quality data,” said Eric Moller, CTO of Atomic X. “Even a company that is collecting data, but hasn’t really found any use for it, would not necessarily benefit greatly from leveraging AI. You really do need to have data and be using it in some capacity before AI and ML starts to become useful.”

If you don’t need to contextualize vast troves of data, many AI solutions will actually be worthless. Before adopting AI, be sure to understand specifically how you’ll be using the technology and establish key performance indicators to determine whether the solution is really achieving your goals.

“Don’t overbuy,” Rodriguez said. “Small businesses rarely require [the same type of learning as big businesses], so matching the business requirement with the right type of technology will ensure you are not overinvesting and potentially deploying something that is overly proprietary.”

Moller suggested small businesses study the AI industry not to identify technology to adopt, but to pick up on potential threats to their business models early. Many AI products and services that are in development today, he said, could be a significant threat to certain small businesses tomorrow. By staying apprised of what type of AI solutions are in the pipeline, small business owners can be more prepared to pivot and adapt to survive the inevitable disruption that will come along with AI proliferation.

The bottom line

Small businesses really don’t need to be making moves on the AI front right now. A smart course of action for small businesses that wish to prepare for the coming wave of AI innovation is to study the industry and find out which solutions are out there, and begin thinking about what an AI strategy might look like for them in the long term.

Moreover, AI doesn’t matter without the proper data sets and data governance infrastructure, so small businesses thinking about implementing AI solutions should also begin capturing data and putting a team in place for the proper management of that data.

“For AI adoption to be successful, small businesses need to start consolidating all their business data into one resource so AI systems can yield accurate predictions,” said Sanjay Malhotra, CTO of Clearbridge Mobile. “Small businesses should start by researching all the AI tools in consideration and run a thorough test on one segment of their business. It’s essential to fully understand how AI will impact operations before handing over access to your entire database.”

It’s easy to get excited about the promises of AI, but jumping in head first can be risky, especially for small businesses with limited resources. Mass adoption remains a long way off, so put to rest any concerns about being left behind.

Right now, it’s time to do the necessary research and begin prepping your organization for adoption accordingly, but remain skeptical of lofty promises and always develop a firm understanding of exactly how an AI solution (like any other solution) will generate a return on investment for your business.

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