Many small business owners recognise the positive effects AI could have on their business but are not ready to take the leap. Jerzy Filatow, Accounting Domain Manager and AI Strategist, MYOB, explains why this could be a mistake.

When it comes to AI adoption, smaller Australian businesses are trailing their medium-sized counterparts. But with real benefits being realised in both productivity and profitability, those holding back risk being left behind,

A recent MYOB survey of 1000 small business owners and operators (with 0-199 full time employees) found only 19 per cent are using AI, however a further 21 per cent plan to. Twenty-nine per cent don’t intend to and 29 per cent are undecided.

Many of the small business owners polled express concerns about AI’s complexity and the investment required for implementation. Yet, 44 per cent of them acknowledge AI’s potential impact on productivity and industry evolution in the next five years.

MYOB also surveyed 505 medium-sized businesses (20-500 full time employees and over $5m turnover) and found AI use is much more prevalent. Seventy-seven per cent of respondents use it in some way, with the most popular functions being marketing, social media posts, writing reports, and financial monitoring and analysis.

Across the board there’s a clear recognition that AI, particularly large language models (LLMs) and generative AI, can enhance productivity and decision-making processes, and better control automated systems.

Why aren’t small businesses embracing AI?

It’s worth noting that AI has become an umbrella term to describe computers attempting to do human tasks. In fact, many businesses would consume and use AI without even knowing, as it has long-powered search engines and other daily technology uses.

The sort of AI we now think of when we use the term is LLMs or generative AI, made significantly more accessible by programs such as ChatGPT.

It’s not that small business owners don’t see the opportunity at hand for LLMs and generative AI. They know tech solutions improve productivity and, therefore, profitability. They also know digital solutions save them time – and time is money.

However, at the risk of generalising, small business owners can take time to warm up to new technologies.

They might perceive new tools to be more complicated than they really are. Or they might not have the time to invest in assessing and implementing them.

Small business owners are also experts in their own fields – they’re not necessarily across all the latest tech developments and what they mean for business. They’re also less likely to have dedicated IT teams on the payroll.

There’s something about these newer LLMs and generative AI. However, that leads to even more hesitancy.

Conversational AI can be unnerving in its ‘humanness’, and while these tools arguably make AI more accessible to less tech-literate people, they can also make real humans feel uncomfortable.

Of course, AI’s ability to potentially perform tasks faster and more accurately than humans can also be unsettling.

But small business owners do want to be more productive; to get from A to B as quickly as possible. And so much of what LLMs and generative AI can do improves productivity and business outcomes, while also saving time. That goes for businesses of all sizes.

Of the surveyed small businesses already using AI, 81% said they have seen increased productivity, and 88% said that it has saved them time.

Be bold, or fall behind

To a point, small business owners are right to be cautious.

AI-generated content can be unreliable and should always be fact-checked. There are also data security issues to consider when using any third-party tool – especially those available for free online.

But our survey found 6 per cent of small business workers are using AI anyway, without informing their manager. Another 22 per cent say their manager knows about some AI use, but not all of it.

If your employees are using LLMs or generative AI anyway, they should be educated on best practices and security, to protect them, your data, and your customers.

All workplaces should consider implementing an AI tooling policy to ensure that everyone is on the same page when it comes to the responsible and safe use of AI. As a starting point, templates for AI usage and tooling policies are available online and can be customised to the needs and size of the business.

You should also ask what employees are getting from these forms of AI that makes their jobs easier, and what that could mean for your business.

To use an example from MYOB, we’re piloting software that suggests snips of code for programmers. During this pilot we have seen a 30% code acceptance rate and reported time savings of up to five hours per week, per person. This equates to approximately 300% to 400% return on investment.

Embrace the productivity boost AI can deliver

We know our customers see increased productivity when they move from spreadsheets into a business management platform. When they start using LLMs or generative AI in smart ways, they level-up again.

AI can remove language barriers, automate repetitive tasks, and allow small teams to do more with fewer resources. It evens the playing field.

Entire businesses can be built using AI. Existing businesses can be fortified by it.

In 2024, we expect to see continued development and innovation in this space, and no one is so far behind today they can’t catch up.

Yes, AI should be used responsibly, but it’s not something to be afraid of. It’s something to consider with curiosity and an open mind.

The mid-sized businesses are already doing it, and seeing tangible, financial returns.

For small businesses, the real risk is letting your competitors get there first.

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https://www.kochiesbusinessbuilders.com.au/ai-and-tech-will-help-businesses-grow-in-2024-myob-reports/