How AI Can Help Startups And Small Businesses Thrive?
by Abdul Aziz Mondal Business Intelligence Published on: 26 September 2023 Last Updated on: 26 September 2024
The rapid rise of artificial intelligence (AI) has captured the imagination of headline writers and tech CEOs the world over. At the same time, the rise of AI has struck fear into many ordinary workers and small business owners who feel threatened by its potential capabilities.
The reality, however, is arguably more prosaic, though also potentially encouraging just like any other new and wide-reaching technology – for example, the internet, email, or personal computers.
AI is simply a tool that can offer huge benefits for business operations and improve efficiency in a number of areas if properly used. But what can AI do for startups, small businesses, and entrepreneurs, who often face significant challenges in relation to staffing, work capacity, and scaling, and how can they learn to manage it to their advantage?
In this article, we examine AI, the potential areas of its application for small businesses, and how it can help save time and make working operations more cost-efficient. We also look at the importance of specific AI capabilities such as augmented analytics, the ways that people involved in specific industries can develop their skills in these areas, and the best methods for combining the power of AI with the valuable human resources already in place in your company.
The true dawn of AI
AI refers to the simulation of human intelligence processes by machines, especially computer systems. Examples can include machine learning, where algorithms are used to solve problems that would be too labor-intensive for humans to carry out, such as processing and drawing implications and conclusions from large datasets, and also deep learning, an advanced subset of machine learning that performs more advanced functions such as processing natural language, detecting fraud, and analyzing customer/client activity.
Although AI has been around in one form or another for some time, it has only truly entered the public consciousness relatively recently, with the advent of widely accessible and often freely available technologies such as ChatGPT.
While it is perhaps overhyped at times, there is no question that AI presents tantalizing possibilities in a wide array of fields, from medical diagnosis and group analytics to translation, IT development, and scientific research.
One area in which it could be particularly useful, however, is in the world of startups and small businesses, where you can typically find straitened circumstances, extremely tight budgets, and often a small group of staff performing a variety of different roles. In this kind of challenging environment where time is often extremely scarce, any kind of assistance is worth its weight in gold. So, what can AI do to help?
Lending a helping hand
To take one example, most of the people who work in startups are filled with incredible enthusiasm, convinced that their innovative products are going to drive real change in the world. At the same time, they are often stuck doing relentless and uninspiring jobs, such as logging system adjustments, typing up sales figures, or filling in spreadsheets.
In many of these cases, AI has a ready-made solution, whether it’s automated IT records, deep analysis of revenue streams, or high-grade accounting programs. In the best-case scenario, when these kinds of solutions are implemented – usually with some human supervision, of course, especially in the early stages – workers will then be freed up to pursue more meaningful and exciting tasks.
For the CEO, there are often some concerns about allowing AI to perform these kinds of tasks. It is easy to worry about the loss of control, and also the lack of a human touch. There is much logic to this: it remains vital to keep in mind that there are many things that humans are likely to do better, such as offering customers an empathetic and understanding response when dealing with a complaint, elaborating complex business strategies, or motivating staff.
At the same time, within each of these examples, we can also identify more formulaic or predictable tasks – such as automated responses to initial customer inquiries, data analysis on sales and production figures, or processing appraisal statistics – where the use of AI can augment services, reduce the burden on staff members, and in some cases help avoid or eliminate human error.
Free up human capacity in customer services
One area in which AI can be especially useful is in customer management. As we indicated above, if someone has made a significant complaint against the company and is causing genuine problems, then a phone call or even a face-to-face meeting will likely be far more effective than forcing them to deal with a machine.
Yet we also know that chatbots, conversational AI, and automation communication tools can be used to handle a variety of more routine inquiries, particularly in the initial stage, where a fast response is important, and where they can also be sorted into more or less urgent requests.
In many cases, these kinds of systems have the potential to either eliminate the need entirely for a dedicated customer service team, or – more likely – enable customer service specialists to devote more time to high-end clients or the most problematic cases. Customer relationship management (CRM) software augmented by AI can also be used to help create more streamlined workflows, such as sending automated order confirmations or receipts and tracking orders.
Indeed, AI also has the potential to completely transform supply chain management processes through sophisticated, automated systems that not only process and track orders, but also communicate with suppliers about replenishing stocks and manage a range of other administrative tasks, from billing and payment reminders to data privacy consent forms and order modifications. Again, the principle is the same: use AI to increase efficiency, reduce costs, and free up human capacity for value-added tasks.
Helping to sell
Sales and marketing is another area in which AI has the potential to help small businesses with their sales and to drive growth. For example, AI can be used to analyze consumer data in relation to general behavior, demographics, and preferences to create customized marketing campaigns.
In many cases, because AI is able to collect, analyze and draw conclusions from a huge amount of data, and then calibrate the parameters based on the results obtained, these kinds of campaigns can be even more effective than those designed by humans alone.
In addition to helping to produce valuable targeted content, such as social media ads and email promotions, many companies also employ AI to assist in more in-depth content production, such as product descriptions and news articles. However, it should be noted that the latter are often edited by a human contributor, and in many cases must be marked as AI-generated content so as not to fall foul of new regulations.
AI is capable of analyzing complex aggregated sales figures to produce reports virtually in real-time. Often, through the use of augmented analytics – which combine AI and machine learning algorithms – these kinds of reports are able to not only produce sophisticated presentations of key metrics, targets, and KPIs but also help the sales team to identify areas of strength and potential for improvement.
Augmenting analytics
In fact, many experts believe that augmented analytics could be a true game changer for many small businesses. Again, in a rapid, fast-paced environment such as a startup, the ability to extract, interpret and leverage data in real-time has the potential to create a significant competitive advantage and a huge boost to the business intelligence of the organization in question.
Indeed, by skillfully combining the formidable human skills already in place with the additional brain power of AI, business leaders have a significant opportunity to increase operational efficiency and reduce costs, and also bring customer sales, marketing, and the strategic aspects of their business to a whole new level.
Finally, AI can also be a huge help to small businesses in the field of IT and data security, where costs today often remain high despite the fact that most security firms already employ a significant amount of automation. Yet there is also a wide array of software options available that can use AI to help protect companies from threats such as cyber-attacks, data breaches, and malware.
While a security consultant may still be necessary, if funds are tight, it might make more sense to devote some time and energy to installing a customized, AI-based security system that can run independently, without the need for regular and costly interventions.
Knowledge through education
Particularly in light of the above, there is no question that business leaders require a firm grounding in the world of AI. While many people who work in business choose to either ignore AI or assume that they will be able to learn about it on the job, others prefer to seek out knowledge in this new area. One potential route to do this is through formal education, with MBAs and other business management qualifications now covering the specifics of AI and augmented analytics.
A Doctor of Business Administration (DBA) in Business Intelligence program from Marymount University in the US, for example, not only prepares graduates for leadership with modules on management, problem-solving, and critical thinking skills but also emphasizes the importance of data-driven research, business intelligence and the real-world application of new technologies.
These kinds of courses are typically taken by mid- to senior-level professionals who have substantial experience in business management, but who would like to further develop their skills and expand their knowledge as preparation for confronting both age-old and brand-new challenges in business.
There is always more to learn
Of course, even if someone has decades of experience in the world of business and has graduated from this kind of course, there will always be more to learn in the field of AI. Fortunately, there are plenty of other educational opportunities in this area, from formal training courses on AI to conferences, workshops, and webinars that can provide valuable insight into both the latest developments and how to best manage and integrate this new capability.
Most business leaders will also look to experiment with different possibilities and explore the potential of AI themselves, ideally in collaboration with coworkers who have a high level of expertise in this field.
There is also a lot to be said for carrying out personal research – there is a great deal of information out there, and sometimes it pays to read up on the topic and do one’s best to understand what might be appropriate or not for the business in question. In fact, there is probably no area of business today where things are changing quite so rapidly, which makes a positive approach to lifelong learning absolutely essential.
Finding the right balance
In terms of the future use of AI by startups and small businesses, it should again be stressed that while AI might be effective at identifying and managing security threats, it is never likely to function as a comprehensive replacement for human intervention. Instead, AI should arguably be used to perform basic, repeatable tasks, or in connection with aspects of business operations where using a human to carry out the same work would be prohibitively expensive and in all likelihood less accurate and efficient – collating and analyzing big data, for example.
Even in these cases, some degree of human supervision is recommended to ensure that no issues are mishandled, misinterpreted, or wrongly assigned. It is also worth noting that even the smartest of AI is largely dependent on the data and the parameters we feed it.
Indeed, while for small businesses there is clearly much to be gained from using AI, it is also important to be aware of not only its limitations but also its potential to emerge as a genuine competitor. Accountants, for example, are under threat from automated accounting systems, translators from machine translation, and even marketing consultants could potentially lose out to AI software capable of creating sophisticated analytics, beautiful content, and even marketing strategies.
Here, the key to surviving and thriving is to learn how to utilize AI in combination with human activities that create added value. After all, we can assume that most businesses have access to the same AI tools, given that they are usually readily available and rarely prohibitively expensive.
However, if that’s the case, then once again it will be the human factor that makes the real difference, both in terms of learning how to best utilize the AI tools available and also all the additional value that they can bring to the table.
A world of possibilities
The rise of AI is occurring with dizzying speed and threatens to revolutionize the way that we do business. While we cannot truly know or predict the extent to which it will truly change things, there is no question that it offers up a large array of possibilities. Small businesses and startups in particular would do well to explore the options available in this arena at the very earliest opportunity.
Not only does AI and digital transformation in general provide companies with innovative ways to reduce costs and perform simple tasks, thus freeing up funds and team members for more rewarding and sophisticated challenges, but it can also be used to greatly improve operational efficiency, and also provide priceless business insights in a wide range of different areas.
To truly benefit from the advantages that AI has to offer, business leaders need to be aware of its characteristics and learn how to best manage it and integrate it into their existing business operations.
This requires time, dedication, and a willingness to experiment. It also requires a team that is open to using new technologies and that is keen to learn how to harness them to the company’s advantage. Yet given how important AI is likely to be, this is a step that needs to be taken.
AI should be embraced, understood, and then applied to achieve specific goals. If business leaders and their teams are able to successfully exploit AI and match it with the power of human capabilities, then their company will be well-placed for a positive future.
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