As AI continues to advance, UK SMEs are increasingly looking for ways to harness their strength to drive business growth and stay competitive in today’s fast-paced market.
Here, we’ll explore the many benefits of AI for SMBs and how they can leverage advanced digital technologies to achieve operational excellence, improve customer engagement, and gain valuable insights.
Artificial intelligence revolution in the business world
Artificial intelligence refers to the development of machines or systems that can perform tasks that previously required human intelligence. As AI technology becomes more accessible, accessible and affordable, it is starting to play an important role in the functioning of businesses across various sectors, particularly for small and medium businesses looking to stay competitive and grow in the UK market.
Artificial intelligence and its impact on small and medium enterprises
AI has the potential to bring a myriad of benefits to small and medium businesses, including increased productivity, better customer service, better logistics, and smarter supply chains. By integrating AI-powered tools and processes into their day-to-day operations, small and medium businesses can achieve greater efficiency, freeing up employees to focus on the tasks that matter most and enabling businesses to scale rapidly.
Increase productivity through automated processes
Automating time-consuming, routine tasks with AI can greatly increase the productivity of small and medium businesses. For example, natural language processing (NLP) models such as ChatGPT can handle a wide range of customer interactions, from answering basic questions to solving complex problems. Thus, employees can devote more time to high-value tasks that require creativity and critical thinking.
Productivity gains through an enhanced workforce
AI-powered tools can help employees do their jobs more efficiently, resulting in work productivity improvements that contribute to overall business growth. According to a PricewaterhouseCoopers report, labor productivity improvements are expected to account for more than 55% of GDP gains from AI between 2017 and 2030.
Better customer service
AI can help small and medium businesses deliver personalized experiences at scale, resulting in enhanced customer satisfaction. By deploying AI-powered chatbots, small and medium businesses can provide self-service options to customers while enabling service representatives to focus on more complex issues.
Better upsell and cross-selling opportunities
AI can predict cross-selling and up-selling opportunities, highlighting the right recommendations to customers at the right time. This can significantly increase the revenues of small and medium businesses and help them maintain their competitive edge in the market.
AI can analyze large amounts of data, provide comprehensive insight and support better decision-making in supply chain management. This can help small and medium businesses overcome supply chain difficulties and improve their operations.
Initiatives to adopt artificial intelligence for small and medium companies
Recognizing the huge potential of AI for SMEs, several initiatives have been launched to support the adoption of digital technology. For example, the Hartree National Center for Digital Innovation (HNCDI) program has awarded £4.5m to Cardiff University, Newcastle University and Ulster University to set up SME Engagement Centres. These axes aim to provide targeted support to small and medium-sized companies to improve their competitiveness and growth through the adoption of digital technologies, including artificial intelligence.
Real-world examples of SMEs using AI
SMEs across various sectors are already leveraging AI to enhance their operations and drive business growth. Here are some real-world examples of how AI is being used by SMEs:
Deploy chatbots for self-service customers
AI-powered chatbots can efficiently handle customer inquiries, allowing businesses to provide quick and accurate responses to their inquiries. Not only does this improve customer satisfaction, but it also frees up service representatives to focus on more complex issues.
Provide personalized recommendations
Small and medium businesses can use AI-based algorithms to analyze customer data and make personalized product recommendations, similar to the way Netflix, Amazon, and Spotify do. This can lead to more engaging and effective marketing campaigns, which ultimately leads to increased sales and customer loyalty.
Improve products and processes with data-driven insights
AI can help small and medium businesses improve their products and services by providing valuable insights based on customer data analysis. For example, AI can be used in agriculture to maximize yields by determining optimal planting strategies, nutrient management, and pest control methods.
Designing marketing campaigns and communications
AI enables small and medium businesses to deliver personalized marketing communications at scale, replacing the traditional one-size-fits-all approach. By using artificial intelligence to analyze customer data and preferences, companies can create highly targeted and relevant marketing messages, resulting in higher conversion rates and higher ROI.
Artificial intelligence applications across industries
The benefits of AI for small and medium businesses can be felt across various industries, as companies increasingly look for ways to leverage advanced digital technologies to improve their operations, interact with customers, and gain valuable insights.
Online retail
Artificial intelligence plays an important role in e-commerce, allowing online retailers to provide personalized recommendations, design marketing campaigns, analyze customer reviews, and efficiently categorize products.
customer support
AI can greatly enhance the customer service experience by providing self-service options and enabling service representatives to focus on more complex issues. Deploying chatbots and AI-based tools can help small and medium businesses meet the growing customer service expectations in today’s market.
logistics
AI can help small and medium businesses manage their logistics by providing better insight into end-to-end operations and supporting data-informed decision making. Using AI-based analytics, companies can assess risks and disruptions in their supply chains and implement strategies to mitigate potential problems.
Embracing AI for a brighter future for SMEs
As AI technology continues to advance, UK SMEs must embrace its potential to drive business growth and remain competitive in the marketplace. By integrating AI-powered tools and processes into their operations, small and medium businesses can achieve greater efficiency, improve customer engagement, and gain valuable insights that help inform their business decisions. With its ability to understand and respond to natural language and its wide range of potential applications, AI can be a powerful tool for small and medium businesses as they strive to thrive in a rapidly evolving business landscape.