How AI Can Help Small Businesses: A Real-World Guide

"Homo habilis" - the "handy man" - Artificial intelligence can be a modern tool in anyone's hands. A successful, better tool that surpasses its predecessors, designed to empower its user with exceptional abilities.

Before diving into specific examples, let me clarify what I mean by "small business." According to the "Office of Advocacy - U.S. Small Business Administration," companies with fewer than 500 employees are considered small businesses. These companies are broken down by industry, as shown in the table below. You can easily categorize yourself based on the number of employees.

Since the required profile, business model, capital, and other factors can vary significantly across industries, I believe a simplification is needed to ensure we're on the same page. Companies can differ significantly in terms of employee count, but their complexity may not necessarily increase with the number of employees. I didn't want to be completely general (since I mostly found articles like this), but with a more specific search, you're more likely to find information relevant to your business profile. For example, searching for "How AI can help small businesses in manufacturing?"

As shown in the table below, there are almost 31 million small (less than 500 employees) companies in the US, with the latest data indicating around 33 million companies.

Office of Advocacy - U.S. Small Business Administration (Small business count by size and industry)

So, what do I consider a small business? And how do you know if the following information applies to you?

Introspection

We could examine the stage of your business, its profile, the size of its operating capital, or even adopt a process-oriented approach. To simplify, ask yourself these questions:

• Do your market players, customers, and competitors talk about artificial intelligence or its use? If so, it's more than likely relevant to you, and you should continue researching or even discuss it with a company that has a similar profile and is ahead of you in this area.
• Do you know which part of your business you want to strengthen with artificial intelligence? I like to use the value-chain-based thinking model (see: https://www.cisl.cam.ac.uk/education/graduate-study/pgcerts/value-chain-defs), but for simplicity, I'll break it down into three areas:
  
  - Business acquisition: All activities that support business acquisition
  - Sourcing: Activities related to the delivery of the service or product that ensure everything is in place for the operation
  - Operation: Activities related to the delivery of the product or service
• Every development, including artificial intelligence, involves some investment. What time and budget do you have available to implement this topic? You can benefit from artificial intelligence even with a smaller budget (even indirectly), for example, by using a monthly subscription-based digital product that costs a few hundred dollars a month and is built on an AI solution.
• Do you know any companies or individuals who are well-versed in this area? Engaging experts can save you a lot of time and money in the medium term, including faster and more accurate discovery of the area you want to develop, or the first-round evaluation of the technology you want to use. This way, you can avoid a lot of unnecessary circles.

Once you've considered the questions related to your own business, it's essential to look around and see what solutions and examples exist in the market. To save you time, I've collected what I consider to be practical for a small business from the six links below. This will make it easier to reflect on the AI connection to your own business, which can help you develop the right strategy.

Looking Outward

By reading through the following articles, I've tried to gather in one place what areas might be affected for a small business when it comes to applying artificial intelligence. These are fundamentally very general. I'll categorize them into the three areas mentioned above (business acquisition, sourcing, operation):

• https://www.investopedia.com/how-small-businesses-can-use-ai-tools-8609366
• https://www.forbes.com/sites/allbusiness/2023/11/17/how-small-businesses-are-using-ai-and-how-your-business-can-benefit-too/
• https://hbr.org/sponsored/2023/03/3-ways-small-businesses-can-use-ai-to-drive-growth
• https://bipartisanpolicy.org/blog/navigating-the-era-of-ai-implications-for-small-businesses/
• https://www.techdonut.co.uk/business-software/essential-business-software/ten-ways-that-ai-can-help-your-small-business
• https://www.forbes.com/sites/melissahouston/2024/04/12/how-ai-tools-can-make-more-money-for-small-businesses/

Before you start digging into these links, please consider the following:

The sudden surge in artificial intelligence is due to the rapid development of "natural language processing" and "image processing procedures" (the significant increase in computing power over the past decade played a role, see the growth of NVIDIA). I mention this because classic artificial intelligence has many other benefits and uses, but for a small business, these two areas, "text" and "image" generation/interpretation, will usually be relevant, and even then, it will be one of the already developed, commercially available solutions, such as ChatGPT/Gemini/Dall-E, etc. So, all elements of the table above (business acquisition, sourcing, operation) are somehow related to text and image generation.

Therefore, by reading through the linked articles, I've gathered for you in one place what topics artificial intelligence is being applied to. These are fundamentally very general. I'll categorize them into the three areas mentioned above (business acquisition, sourcing, operation):

There are items I've categorized in multiple places, and two outliers that fundamentally belong everywhere:

• Fostering innovation, growth
• Artwork

While video is also mentioned as a topic, text-to-video generation is one of the "hot/trending" topics today, which many companies are experimenting with. Here are a few links as a point of interest:

• Open AI video generation model,
• Meta Text-to-Video Solution,
• or Google's video generation solution.

Of course, there are also digital products that only assist with a step in video editing and do not generate full videos.

Text or Image Generation/Interpretation

A practical approach might be to try applying this to one of your company's areas. The table above, broken down into three areas (business acquisition, sourcing, operation), represents an idea that can be used to write a well-defined goal. Of course, these goals can be compared after a proper cost-benefit analysis, and it can be determined which goal the company's budget can finance. Artificial intelligence can be applied in the process of achieving these goals, i.e., image or text generation or interpretation. Of course, don't forget other time and money investments, as these can be complex problems and often require some human involvement.

This is crucial; it's best to think that someone will save time by using a better tool, whatever tool they use for any idea.

Therefore, from the Forbes article, I listed out startups here. These are all AI startups that provide some kind of AI-enhanced digital tool:

Example AI-based Digital Tools:

• Upmetrics—Tool for writing business plans with 400 templates to choose from
• ClickUp—Cloud-based project management tool
• Jasper—Content generator for articles, blogs, social media posts, and marketing copy
• Zoho's Zia—Sales tool for lead generation, lead management, data collection, and writing sales copy
• ChatSpot by HubSpot—Free sales and marketing tool, even if you’re not a HubSpot user
• DALL-E 2—Creates realistic images from written descriptions for creative development
• Manatal—HR recruitment tool
• Motion—Calendar tool to track your time and build itineraries
• Lumen5—Video creation tool
• Otter.ai—Meeting assistant tool that records conversations, takes notes, transcribes interviews, and generates summaries

I hope you see that these products can be used to achieve the goals written for the ideas belonging to the three areas above. These are usually subscription-based digital products that don't place a significant financial burden on the company. However, they can lead to dependencies, and often, they either know much more than they should or they don't know precisely what they should, so the company may need to use multiple different digital products.

Another approach that might be conceivable for a small business is much more raw and requires more thought. You'll need to delve deeper into the understanding of the models used for natural language processing and image processing, bringing them to life. Connecting two software programs, i.e., integration, usually comes into play here. In this case, to achieve the goal, we use multiple smaller, rudimentary building blocks and connect them.

An example is when a company supports its own marketing activities with artificial intelligence by automatically translating once-written text content to multiple platforms, saving time for the marketer (content repurposing).

No matter whether we choose a monthly subscription product OR custom automation AS a better tool, value must be created in the end, which is usually saved time or an opportunity for success.

A Short Digression

In our experience over the past four years, the proportion of companies that not only claim but actually use some form of artificial intelligence to improve their product or process has increased significantly. Previously, it was common for many companies to claim, as a marketing tactic, that they used artificial intelligence (of course, on a "fake it till you make it" basis). Actually, even today, the number of companies that actually build artificial intelligence models hasn't grown significantly, rather the number of companies that are able to use or integrate so-called off-the-shelf models has grown. At Lexunit, we have successfully used both highly customized and off-the-shelf solutions for more than a dozen projects at our partners, but we still have a lot to learn. This area is changing rapidly from year to year, and it's a challenge to keep up. So far, we've succeeded.

Conclusions

Artificial intelligence can help your business in many ways. With a little creativity and methodical approach, you can map out where you have the opportunity to apply intelligence. And maybe in which area it's worth applying, or whether the topic even applies to you.

Obviously I've used Artificial Intelligence to finalize my writing and I certainly will use it for the next article as well. But I do not want to overuse it, because the human touch is important. I save time by using a more advanced technology.

FAQ

How AI can help business development?
Artificial intelligence can help with content creation, which can be images or text. It can help create messages, landing pages, and marketing materials. It can help with research or idea generation.

How does AI save businesses money?
By reducing the time a certain task requires thanks to a better, more efficient tool for even a complex task.