(This article Series on artificial intelligence For board members and senior executives. )
Companies that are not market leaders need every edge and technology advantage they can find. Artificial intelligence (AI) is emerging as a transformative force for small and medium-sized businesses. AI promises a competitive advantage, leveling the playing field for those looking to compete with industry giants. In this article, we explore how agile and innovative-minded companies can leverage AI to redefine the rules of engagement and turn challenges into unparalleled opportunities for growth and innovation.
For example, many companies are using AI to personalize their marketing and provide highly customized customer experiences. Small businesses can compete with global brands by delivering personalized messages that make customers feel special. Companies creating software can use AI code generators to create new applications faster and more efficiently. AI will also level the playing field in online marketinghelps small businesses identify social media platforms and key influencers.
Putting AI solutions into practice: Small business success stories
AI has become a catalyst for innovation that gives small and medium-sized businesses a competitive edge. Let's take a look at some use cases that show how AI is giving small businesses a competitive edge.
- Bella Sante, a small group of three medical spas in Massachusetts, is using AI to modernize customer service. The company used a call center to handle incoming calls, but it did not have enough staff to handle the number of calls. Rather than hire more staff, Bella Sante deployed an AI-powered chatbot to answer customer questions and route incoming calls. Using machine learning, the chatbot has become so advanced that it can handle 75% of calls from customers and route 25% of incoming calls to human operators.
- Phorbia is an automotive supplier committed to bringing new technology products to the industry. The company was formed in 2022 through the merger of Faurecia, a French manufacturer of automotive interiors and zero-emission systems, and Hella, a supplier of lighting and vehicle electronics. The company needs new talent to move from traditional manufacturing to automotive technology, which means an improved recruitment strategy (' 6 ways to leverage AI (including ChatGPT) to solve the labor shortage in 2024). By implementing an AI-powered recruitment system, Forvia increased the number of applicants from his website by 3.5 times, attracted 90,000 job seekers, and increased procurement productivity by 30%. .
- Romark Logistics Gain competitive advantage in the supply chain industry with AI. Romark is a third-party logistics provider serving consumer goods, pharmaceutical, and retail customers. As your company continues to grow, you need to maintain a high level of inventory accuracy. As labor shortages continue, Romark invested in his AI-powered drone for inventory tracking. Drones patrol warehouses, scanning barcodes and comparing that information with warehouse management system software to track inventory.
- danone group Manage your channels and retail inventory using AI analytics, including AI-powered demand modeling. The AI ​​system enabled the company to reduce forecast errors by 20%, sales losses by 30%, product obsolescence by 30%, and demand planner workload by 50%.
- hungry root Use AI to perform predictive analytics and offer vegan, gluten-free, and diet meals to your customers. The company uses its AI to analyze past orders, shopping behavior, and user input to create a list of recommended meals based on past preferences.
These are just a few examples of how AI can be applied to give small businesses a competitive advantage. Any company can use AI to improve operations, improve customer experience, develop new products, and increase revenue (see Increase revenue with AI).
How AI will impact your business
To maintain your competitive advantage, track emerging AI trends and consider their potential impact on your AI strategy. Here are some trends to keep an eye on.
- Generation AI – Companies are increasingly using generative AI for a variety of purposes, including research to generate insights and answer questions. Generative AI can power content creation and mine unstructured data for insights, helping you respond to RFPs, translate marketing materials for international markets, review customer contracts for regulatory compliance, and more. (See References). Generative AI – the key way CEOs drive value).
- automation – Autonomous business systems will impact every industry, from self-driving cars to self-checkout at grocery stores. Automation promises increased productivity. McKinsey estimates that 30% of activities in 60% of occupations can be automated, so everyone from factory workers to executives can increase productivity by working in tandem with machines. It is expected that this will happen.
- cyber security – According to IBM’s Data Breach Cost Report, the average cost of a data breach in 2023 was $4.45 million. The report also states that companies using AI-driven security can save an average of $1.76 million annually compared to organizations that don't. AI security tools are ideal for analyzing behavioral patterns, predicting the consequences of anomalous behavior, and preventing hackers from entering corporate networks.
- analysis – It is becoming increasingly difficult to sift through the growing tsunami of data to gain meaningful insights. AI-powered analytics solves problems. AI quickly sifts through vast amounts of data to find relevant information that can help your business grow (see 5 ways AI can help increase revenue). CEOs and executives are increasingly relying on AI analytics to make data-driven decisions.
Successfully implement an AI strategy
Regardless of the potential applications of AI in small businesses, AI efforts must be closely aligned with business goals and customer needs. Identify areas within your organization that could benefit from AI, such as marketing and customer support. When evaluating potential AI opportunities, define clear goals and identify KPIs to measure success. Also, consider implementing a pilot project to see how well AI fits within your organization and identify potential issues with integration, interoperability, security, etc.
Maintaining competitive advantage through continuous AI innovation
Companies seeking maximum benefits from AI must be adaptable and open to continuous AI innovation. Consider creating a Center of Excellence (CoE) to explore new AI applications. Encourage managers and staff to adopt AI, suggest new ways to improve operations, and encourage company stakeholders to collaborate on new AI initiatives.
If your organization wants to compete with large enterprises, you need to include artificial intelligence as an ongoing part of your strategic roadmap. Be proactive and leverage AI. Develop a sustainable strategy that combines AI technology, strategy, and innovation to give your company an unfair advantage over better-funded competitors.
If you are interested in learning more about how AI determines business winners and losers, how you can leverage AI for your organization's benefit, and how you can manage AI risks, please contact us at Please contact me. glengor.com. I write and speak about how senior executives, board members, and other business leaders can use AI effectively. Click to read past articles and receive notifications of new articles. Click here for the “Follow” button.