Author’s note: On September 27, 2024, I presented a webinar with the same topic. While this article can stand on its own just fine, I would encourage you to watch the recording as well. The audio-visual medium always has a certain dimension that can’t be translated into the written word. Watch the on-demand recording here.
Artificial intelligence (AI) is everywhere these days, from how we shop online to how businesses operate. While it has been around in various forms since the 1950s, the last two years have seen AI move from novelty to mainstream. There is definitely an element of hype, and one could argue that we still have a long way to go before this innovative technology hits maturity. But to dismiss it entirely as “all hat and no cattle” would be short-sighted. Business leaders in the SMB and mid-market space are still debating whether investing in AI is the right move – and what aspect of AI they should invest in. Consumers and Enterprise businesses on the other end have already bought in, and are largely the bookends driving the buzz and adoption race.
What Does AI Mean for Your Business?
When we talk about AI for business, it’s not just the fancy robots or algorithms you see in movies. It’s about using technology to make things a little smarter and more efficient. It’s about tools that make your team more productive by helping them research and analyze information faster, delegate rote processes, help with the writing process or even with coding; and it’s about tools that can help your leadership make sense of large chunks of business data to make smarter decisions instead of relying on superficial readings of reports and their gut; it’s about agents that can support your customer service and HR teams by relieving them of the burden of answering the same questions again and again; it’s about complex solutions that can increase operational efficiency and predict points of failure. These AI tools run the gamut from simple and cheap with a quick return on investment, to large, complex undertakings that require a substantial budget and carry high risk.
To state the obvious: AI doesn’t solve problems by magic. It’s a tool. A powerful one, sure, but like any tool, its value depends on how well you use it.
Why Invest in AI?
The first thing to ask is: “What problem am I trying to solve?” That’s where a lot of businesses go wrong. They get caught up in the hype and throw money at AI without really understanding how it can help them. Don’t chase a trend; take time to brainstorm and identify where there may be opportunities for AI to make an impact in your business and then evaluate the tools in the marketplace to find the one that’s right for you.
For example, let’s say you’re struggling to keep up with customer inquiries. AI-powered chatbots can handle routine questions, freeing up your team to focus on more complex issues. But if your customer service already runs smoothly, investing in that particular AI solution might not be necessary.
On the flip side, if you’re drowning in data and have no clear way to analyze it, AI can help by identifying patterns and insights that would be impossible for a human to spot.
Understand that some of the things you are looking to accomplish may not be possible with the tools available today; some of the more difficult tasks may require workarounds or less-than-elegant solutions. Hitch your ride to tools where this is a track record of new features and functionality being added at a regular clip.
And you can take comfort in the knowledge that data shows businesses realize an average return of $3.50 for every dollar they invest in AI, typically in 14 months (Source: The Business Value of AI, Microsoft, November 2023).
Prioritize Data Privacy, Security and Governance
Deploying an AI solution into a business or corporate environment requires preparation for and attention to data privacy, security, and governance. For example, Microsoft Copilot integrates deeply into your Microsoft 365 tenant and can find information in SharePoint, OneDrive for Business, e-mails, and interact with sensitive company information.
While the Copilot service itself is secure and operates with great consideration for the privacy of your business data (e.g., you can only find e-mails you sent or were a recipient of), you are responsible for ensuring that security roles are properly designed and assigned to individuals and groups of users in your tenant. Without it, data could accidentally be exposed to individuals without appropriate clearance and cause irreparable harm.
Having a focus on Data Privacy and Security and establishing clear Data Governance policies will not only protect your organization but also foster trust in the AI tools your teams use. It is strongly advisable to lead with an audit before rolling out any set of AI tools.
The Misconceptions About AI
There’s this idea that AI is going to take over jobs or run your business for you. That’s not how it works. AI isn’t replacing people; it’s enhancing what they can do. Think of it as an extra set of hands that can sift through vast amounts of information or handle repetitive tasks.
But – and this is important – AI is not foolproof. It requires setup, training, and ongoing adjustments to be useful. It doesn’t just “learn” everything on its own. You can’t plug it in and expect it to solve all your problems. And even the most reliable of AI tools are prone to hallucinate every once in a while, so it’s always necessary to verify before you trust.
And no, it’s not going to give you perfect predictions about the future either. It’s great at spotting trends and automating certain tasks, but like any technology, it has limitations, and its predictions are only as good as the data available to it.
How to Approach AI Investments
The smartest way to think about AI is to look at it as a long-term investment. You’ll need to spend time and resources upfront to implement it correctly, and the benefits might not show up right away.
But if you plan carefully and align AI with your business goals, it can be a game-changer. It’s not about being the first to adopt the latest technology but about adopting it in a way that makes sense for your specific needs.
Start small. Test AI on one part of your business to see if it delivers the value you expect. Maybe it’s automating reports or managing customer data. Once you see results, you can think about expanding AI’s role in other areas.
Is AI the Right Fit for You?
This is where you have to be honest with yourself. Not every business needs to jump into AI right away. Some industries will benefit more than others. If your operations are already running smoothly and efficiently, significant AI-spend might not be warranted, nor may there be a substantial return on such investment. You could look at smaller opportunities like daily productivity AI enhancements that can be covered under OPEX.
However, if your business relies heavily on data, customer interaction, or operational efficiency, AI could be essential to stay competitive or get ahead. It’s also worth considering for businesses that are in a fast-moving industry where innovation is key to survival.
Final Thoughts
AI has enormous potential to transform businesses, but only if it’s done with a clear strategy in mind. It’s not something you add for the sake of looking innovative. Before you invest in AI, take a step back and evaluate what your business actually needs. Understand that AI is a tool, not a miracle solution, and with the right approach, it can be one of the most valuable investments you make.
Investing in AI doesn’t have to be complicated, but it does require thought, planning, and a willingness to experiment. When done right, it can streamline operations, offer better insights, and ultimately provide an edge in a competitive marketplace. The key is understanding its potential while being realistic about its limitations.
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