Love it or hate it, artificial intelligence (AI) is here to stay. Your small business has probably embraced some digital strategies already. Now, it’s time to take a look at what AI can do for you.
Per Microsoft, “Something has AI when it can process information without an organic brain. It’s not alive, but it can sort information.” That processing is essentially a series of programmed if/then statements.
Contrary to what Hollywood movies (e.g., The Terminator) portray, AI won’t be taking over the world anytime soon. AI can, however, help businesses gain value.
According to McKinsey & Company, AI has “the potential to create between $3.5 trillion and $5.8 trillion in value annually across 9 business functions in 19 industries.”
Source: “Notes From the AI Frontier: Applications and Value of Deep Learning,” McKinsey & Company.
Those are impressive numbers, but what does that mean to your small business?
Most likely, your small business already uses AI. That auto-complete function when you text? That’s AI.
Fortunately, you can use even more AI in your small business without breaking your budget or hiring data scientists to implement it.
Almost any repetitive task could be a candidate for using AI technology.
You’ve probably already used a chatbot for customer service—perhaps to receive technical support for a cable outage or make an online payment for property taxes. That chatbot and AI-powered knowledge base eliminated or reduced human time during your interaction.
One estimate says that the “average customer service call lasts six minutes. Four and a half of those minutes, or 75% percent of that time, is spent by agents manually looking for the right information.” Letting AI take its first shot at finding and presenting the information frees up customer service representatives to handle complex problems.
Email marketing software also uses AI. Remember those workflows you configured in your mail software to send customers a welcome email or invite them to use a discount code on their birthday? You can thank AI for that.
AI enables software to write email subject lines that generate better open rates or create a hyper-personalized newsletter. No more agonizing over an email subject line? Who wouldn’t cheer for that?
AI also integrates well with the customer relationship marketing (CRM) process.
For example, the wine industry realized that younger generations tend to use the internet for wine purchases. Online merchants reaped the benefits of using AI-powered tools to help guide inexperienced customers to wines that matched their taste requirements.
AI can segment your customer list and create personalized call-to-actions based on where your customer is in their customer journey. Repeat customers may act upon a CTA that recognizes and rewards their past orders (e.g., “You enjoyed our apple pie last month. We have fresh ones available today!”). New customers may respond better if the CTA includes social proof (e.g., “Don’t you want to join 25,000 other savvy wine drinkers by signing up for our monthly newsletter?”).
AI can help detect abnormal patterns to generate alerts. Credit card companies have been using this function for a while—notifying you or even freezing your card when a suspicious transaction occurs. Your bookkeeping software might flag an entry as suspicious (it knows your car can’t hold $1000 worth of gasoline).
Microsoft suggests the benefits of detecting unusual behavior can actually go beyond stopping malicious or inaccurate transactions and potentially open up new customer markets for your business. Their example is a plumbing-supply company that receives a large order from a non-traditional customer. A follow-up call reveals a new use case for plumbing-supplies (artists need supplies, too!), and voila—a new customer market appears.
Another example is the insurance industry using AI and predictive analytics to help underwriters make risk calculations for complex customers. Would you want to guess the risk for a customer who recently completed a safe driving course but owns a Dodge charger and has a history of speeding tickets?
Manufacturing businesses can use AI to help reduce the cost and time spent on quality checks (e.g., AI and robotics can check part tolerances quicker and more accurately than humans). AI can also predict equipment failure and maintenance needs reducing the “line down” syndrome that means lost revenue.
Gartner predicts AI usage will continue to accelerate rapidly. For example, by 2023, many routine HR inquiries—Where do I find my benefit plan information? How do I submit a new W4?—will be “initiated through conversational platforms.“ The employee will use an interface that allows them to ask the question in their own words. AI (whether a chatbot, a virtual assistant, or another tool) will help find the information they need.
Tech giants like Microsoft and Facebook, who have money to spend, will continue to be the innovators and early adopters of new AI solutions.
Small businesses are more likely to incorporate AI as it becomes cost-effective or embedded into software solutions they are buying. Some AI features will be the norm (e.g., autocorrect of misspelled words). But complex AI features may take a while to gain traction in cash-strapped small businesses. Very few small companies can program complex AI software, load large amounts of data, or integrate systems (e.g., using AI and IoT in a warehouse).
Like any technology, AI growth has some hurdles ahead.
Bias in AI is a concern as engineers may program their own biases into the technology, or skewed or limited data may produce unreliable results. These biases could mean AI suggestions (e.g., who gets what medical treatment or the financing terms for a client) aren’t objective.
The “black box” problem—data goes through non-transparent algorithms to produce a result—suggests that end-users will still rely on their gut to validate AI suggestions. In simple terms, how many times has autocorrect presented the wrong word, and you had to override it?
Bad actors may use AI maliciously. Gartner predicts that “In 2023, 20% of successful account takeover attacks will use deepfakes to socially engineer users to turn over sensitive data or move money into criminal accounts.” That means that it won’t just be your grandfather falling prey to phishing scams.
AI will be part of your small business’s future, so take steps now to prepare. Think about what steps you need to take to capitalize on AI’s benefits, including defining the business problem and the value of solving the problem. You may have to rework business processes, buy software or equipment, and train employees. Don’t be afraid to embrace financing to help you achieve your AI goals.