Turning anxiety into advantage: how SMEs can make AI work for them
By Johann Aguirre, founder of Cachi AI
According to the Office for National Statistics, AI adoption among UK businesses has risen from approximately 12% to around 35% since late 2023.
However, adoption levels differ considerably depending on the size of a business and the sector in which it operates.
Larger, established organisations may be deploying AI in sophisticated ways, from AI-powered robotics and digital twins to autonomous manufacturing. But that doesn’t mean smaller and medium-sized businesses (SMEs) don’t have plenty to gain from AI too.
Saving time on repetitive tasks
For SMEs, AI is often most useful when it comes to automating repetitive or routine work. These are tasks that tend to require less creativity, judgement, analysis, insight or opinion; areas where human employees can add considerably more value.
Automating this kind of work gives employees more time to concentrate on activities that benefit from genuine human thinking and expertise.
Customer service is a good example. Customer enquiries can be viewed as a pyramid: at the broadest level are the large number of straightforward questions that can be answered quickly, while a smaller proportion involve more complicated issues that require more thoughtful, detailed responses.
Using AI-powered chatbots as the first point of contact means the majority of straightforward enquiries can be handled within seconds, at any time of day. Employees can then focus their attention on more complex or nuanced requests. The result can be a reduced need for employees to handle routine customer service queries, while customers receive faster responses, whether from a chatbot or, where necessary, from a human operator.
Other popular SME applications for AI include invoice processing, lead qualification, extracting key information from CVs and arranging meetings.
Consolidating software
These are all useful applications, but one of the biggest opportunities for a strong return on investment comes from consolidating software.
Instead of introducing AI as yet another standalone application, businesses can use it to bring together multiple manual tools that were never designed to work seamlessly with one another. This can make day-to-day operations considerably more efficient.
It’s common for SMEs to subscribe to separate platforms for meeting transcription, customer support, email marketing, content creation, data analysis and numerous other functions.
Software-as-a-service (SaaS) subscriptions can quickly become expensive, resulting in significant recurring costs for business owners.
There is also the issue of time. Employees may spend considerable amounts of their working day moving between different applications and manually transferring information from one system to another in order to complete a process.
Every manual transfer also introduces the possibility of human error. Even experienced and highly capable employees can make mistakes when dealing with repetitive administrative work.
AI that can search across multiple systems, summarise information and complete repetitive processes can allow employees to work from a single interface for more of their day. It also means their time can be redirected towards work that genuinely benefits from their knowledge and expertise.
Saving just 20 minutes each day can translate into meaningful productivity gains over the course of a month or a year. Some SMEs have reported reducing their costs by as much as £500 a month by using AI to consolidate software systems.
There are governance and security benefits too. Working with fewer platforms and vendors means fewer accounts and login points, which can reduce potential opportunities for cyber-attacks. Practical requirements such as compliance and data retention can also become easier to manage, saving SME owners both time and money.
Cutting the red tape
Compared with large organisations, SMEs generally have less internal red tape. They tend to have fewer organisational layers, meaning decisions can often be made more quickly.
Of course, SMEs are still subject to the same legal and security obligations as larger businesses. Internally, however, their processes are often more straightforward.
This can give smaller businesses an advantage when introducing new technologies such as AI. An SME owner may effectively oversee several functions at once, from department leadership and IT to legal and finance, making it easier to reach and act on a decision.
Even where several people are involved, employees in smaller organisations often work closely together, meaning feedback can reach decision makers quickly and directly.
Larger organisations may have formal governance processes involving risk assessments, pilot schemes and multiple approval stages. An SME owner, by contrast, can often make a decision based directly on what they believe will benefit their business, with considerably less friction.
Where to begin
It’s perhaps easier to start by explaining where not to begin. Business owners excited about AI’s potential may be tempted to automate everything simultaneously. This can mean trying to run before they can walk and selecting projects without a clear objective.
The better approach is to start small.
Look first for straightforward, repetitive tasks that take up a significant amount of time for you or your employees. Meeting summaries, data entry and invoice processing are good examples. These activities can consume considerable working time while also being well suited to AI assistance.
Initially, it’s sensible to avoid complex or business-critical processes so that any potential risks remain limited.
It’s also worth remembering that AI works best when it solves problems that genuinely make people’s working lives easier. Think about the tasks you or your employees dread doing. In many cases, these will be repetitive and time-consuming activities that take valuable time away from more productive, creative or engaging work.
Prioritising tasks that happen frequently can help SMEs see greater benefits from AI more quickly. A five-minute task carried out 200 times a week is likely to provide a greater return than a two-hour task that only needs to be completed once a month.
It’s important to establish measurable outcomes so you can determine what is and isn’t working. This could include hours saved each week, shorter processing times or fewer errors. Measuring these results helps businesses establish whether AI is delivering genuine value and, if it isn’t, identify where its use should change.
This is particularly important when employees are introducing AI while reporting to managers. Without measurable results, it can be difficult to demonstrate a clear return on investment.
Busting a few myths
Many SME owners recognise that AI is becoming increasingly important, but common misconceptions can make them hesitant to adopt it.
One of the biggest concerns is that AI will replace employees. Business owners may fear that introducing AI will create uncertainty, resistance or even lead to job losses. For SMEs, however, AI is often most valuable as a way of supporting employees rather than replacing them, essentially, making their jobs easier.
Bringing employees into the process and asking them to identify their biggest pain points can help reduce anxiety while ensuring AI is introduced in areas where it can have the greatest practical impact.
Another misconception is that AI is only accessible to large companies with substantial budgets. Some SMEs assume they will need to spend thousands of pounds before seeing any benefit. In practice, some of the most valuable early applications are relatively simple, and SMEs can achieve significant benefits from them too.
There are also concerns that AI makes too many mistakes and could introduce inaccuracies into business processes. This is a legitimate concern. AI can make mistakes when it is implemented poorly, used without sufficient oversight or not regularly reviewed. It isn’t a magic solution, and the quality of its output depends heavily on the information and instructions it receives.
AI-generated outputs should therefore always be reviewed, particularly when they contribute to important business decisions. Human approval processes are essential. For businesses moving beyond off-the-shelf AI solutions, bringing in an AI engineer can also help avoid problems further down the line.
Conclusion
AI isn’t exclusively the preserve of large organisations with large budgets. For SMEs, some of the biggest opportunities lie in tackling everyday repetitive tasks, allowing employees to dedicate more of their time to higher-value and creative work.
The SMEs most likely to benefit from the AI revolution are those that begin by identifying genuine problems and employee pain points, then test straightforward AI solutions and measure the results.
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