Artificial Intelligence (AI) is a game-changer for marketing, sales, and customer service, and companies of all sizes are racing to take advantage of it. Technological breakthroughs, like Generative-AI (GenAI), unleash new possibilities for what your teams can accomplish, while also freeing up their capacity to concentrate on strategic business tasks. With AI, Small and Medium Enterprises (SMEs) can easily provide personalised support and keep up with customers’ rising expectations.
According to the article “AI adoption a key concern for Singapore company bosses”1 published in Jan 2024, nearly four in every five (78%) respondents in Singapore say that AI is already impacting what their organisation can achieve, while 41% state they will invest in advanced technologies such as AI to respond to the changing market environment.
With any new technology, establishing data regulations and guidelines upfront is essential. AI cannot exist without data, and its success depends on trust. AI is the number one priority for many business leaders today, so bridging the trust gap should be a priority. Having reliable data and being transparent with its use and management are key facets to bolstering trust from your customers and building a solid foundation when introducing AI functionalities.
Crafting an effective AI strategy for SMEs is crucial for staying competitive in today’s rapidly evolving business landscape. Let’s dive into some actionable steps and considerations:
- Begin by understanding where your business stands in terms of AI adoption. Have you already experimented with AI in specific areas? Are there any existing data assets or processes that could benefit from automation or augmentation through AI?
- Identify pain points, inefficiencies, and opportunities where AI could make a difference. This assessment will guide your strategy.
Guideline #1:
Identify a use case. GenAI-powered chatbots with Natural Language Processing (NLP) capabilities provide a more user-friendly experience by understanding and responding to complex queries dynamically, unlike rule-based chatbots.
2. Define Clear Objectives:
- What do you hope to achieve with AI? Improved efficiency? Enhanced customer experiences? Cost savings? Revenue growth? Be specific about your goals.
- Align these objectives with your overall business strategy. For example, if you’re aiming to streamline customer support, AI-powered chatbots might help with customer acquisition, improve customer retention and reduce churn.
Guideline #2:
Define clear objectives with specific business metrics, such as using AI-powered chatbots to provide instant responses to prospective customers, thereby increasing inquiry-to-sale conversion rates and boosting overall top-line revenue.
3. Start Small and Scalable:
- SMEs often have limited resources, so it’s wise to start with manageable projects. Choose use cases that can demonstrate value relatively quickly.
- Consider low-risk applications like automating repetitive tasks, optimising inventory management, or personalising customer service responses and interactions using AI-powered chatbots.
Guideline #3:
SMEs can leverage Microsoft Copilot Studio Bot2 to integrate AI-powered chatbots, configure routing rules for incoming requests based on context, and monitor bot conversations and effectiveness in real-time through dashboards.
4. Data Readiness and Quality:
- Data is the lifeblood of AI. Ensure your data is clean, well-organised, and accessible, and invest in data quality initiatives.
- Explore cloud-based solutions for data storage and processing, as cloud platforms often provide scalable infrastructure for AI workloads.
Guideline #4:
Accurate and reliable data is crucial for AI success, making data preparation essential. SMEs may face challenges with data access and accuracy, necessitating careful consideration of data ownership, security, and privacy when using cloud-based AI solutions.
5. Select the Right Tools and Technologies:
- Research AI tools and platforms suitable for SMEs, focusing on user-friendly options that do not require extensive technical expertise.
- Consider using pre-built AI models (e.g., for NLP, image recognition) to accelerate development.
Guideline #5:
SMEs using Microsoft 365 can easily start their AI journey with Microsoft Copilot, an AI-assistant embedded within familiar applications, though they should be aware of the potential risks and rewards of AI adoption, as highlighted by Harvard/Boston Consulting Group research3.
6. Build Internal AI Competence:
- Train your team or hire talent with AI skills, and encourage continuous learning and experimentation.
- Collaborate with trusted advisors, industry associations, or AI-focused organisations to stay informed about trends and best practices.
Guideline #6:
SME management teams can attend AI seminars and workshops to understand the potential risks and opportunities of AI adoption. By supporting your AI journey with education and strategic planning, we help you seize opportunities to drive growth and solve business problems. Explore our BDO AI Interactive Map4 to visualise the possibilities with AI integration.
7. Ethics and Privacy:
- Address ethical considerations early. Understand the impact of AI decisions on customers, employees, and society.
- Ensure compliance with data protection regulations (e.g., GDPR) and maintain transparency in AI processes.
Guideline #7:
SMEs should recognise that organisational data may flow to external systems, potentially beyond compliance boundaries. Establishing a robust governance framework grounded in Responsible AI principles is crucial. The Model AI Governance Framework for Generative AI5 from IMDA serves as an excellent reference, and BDO is here to support you with guidance on setting up and effectively implementing this governance framework.
8. Change Management and Culture:
- AI adoption requires cultural shifts. Foster a growth mindset within your organisation.
- Involve employees in the process, communicate the benefits of AI, and address any fears or misconceptions.
Guideline #8:
AI adoption in SMEs fosters a culture of adaptability, innovation, and continuous learning, driving both individual growth and a shared sense of purpose within the organisation. The MIT Sloan Management Review-Boston Consulting Group6 report underscores AI’s pivotal role in shaping a growth-oriented workplace culture, advancing organisational success.
9. Monitor and Evaluate:
- Implement key performance indicators (KPIs) to measure the success of your AI initiatives and regularly assess if you are meeting your objectives.
- Be prepared to iterate and adjust your strategy based on real-world results.
Guideline #9:
Regular maintenance, monitoring, and staff training are essential for AI systems to ensure proper functioning, manage bias, and address issues like AI hallucinations effectively.
10. Stay Informed:
- The field of AI evolves rapidly, so stay informed about new developments, case studies, and success stories.
- Attend conferences, webinars, and workshops focused on AI in business.
Guideline #10:
Singapore offers numerous resources for organisations embarking on the AI journey, including public seminars, events, and support from entities like AI Singapore and IMDA, which provide guidance, talent development, and access to AI-related grants and support schemes available for SMEs.
In summary, SMEs planning to embark on the AI journey should incorporate AI into their strategic business plans. Selecting the right AI tools and training employees will help SMEs manage the increasing volume and variety of data, providing a competitive edge. While harnessing AI to deliver business value is achievable for all SMEs, business leaders must be ready to address emerging regulatory concerns to stay ahead in the AI race.
Article by:
Gerald Tang, Associate Director, Cybersecurity
References:
1AI adoption a key concern for Singapore company bosses: https://www.frontier-enterprise.com/ai-adoption-a-key-concern-for-singapore-company-bosses/#:~:text=In%20Singapore%2C%20nearly%20four%20in,to%20the%20changing%20market%20environment
2Microsoft Copilot Studio bot: https://learn.microsoft.com/en-us/dynamics365/customer-service/develop/bot-escalate-end-conversation
3Harvard/ Boston Consulting Group Research: https://www.bcg.com/publications/2023/how-people-create-and-destroy-value-with-gen-ai#:~:text=GenAI%E2%80%99s%20competence%20advances.-,The%20Value%20at%20Stake,-Our%20findings%20make
4BDO AI interactive Map: https://www.bdo.com/insights/digital/ai-roadmap
5Model AI Governance Framework for Generative AI: https://www.imda.gov.sg/-/media/imda/files/news-and-events/media-room/media-releases/2024/01/public-consult-model-ai-governance-framework-genai/annex-nine-dimensions-of-the-proposed-model-ai-governance-framework.pdf
6MIT Sloan Management Review-Boston Consulting Group: https://web-assets.bcg.com/85/90/95939185404cbd901aba0d54f1d7/the-cultural-benefits-of-artificial-intelligence-in-the-enterprise-r.pdf
Recommended Reading:
A playbook for crafting AI strategy: https://www.technologyreview.com/2024/08/05/1095447/a-playbook-for-crafting-ai-strategy/