AI and automation for small businesses: time well spent
Since the widespread dissemination of the internet in the 1990s, we’ve watched digitalisation grow exponentially – integrating into almost every aspect of our lives. Individuals and businesses now have access to such a huge volume of information that we’re looking beyond our own brains to help tackle it.
It’s estimated around 15% of businesses in the UK currently incorporate artificial intelligence (AI). This proportion increases as businesses grow, with larger companies using more of it. Given the countless benefits of AI, and the acceleration of digitalisation by years during the COVID-19 pandemic, we’re likely to see even greater uptake in the coming years.
What are AI and automation?
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The Oxford English Dictionary definition of AI is “the capacity of computers or other machines to exhibit or simulate intelligent behaviour”. We’ve all seen movies where machines or robots can think and learn independently.
Machine learning allows large volumes of data to be processed quickly, and with the collection of more data, modelling can be altered to improve future performance i.e. the machine learns.
Automation differs from this slightly. It represents work done by machines or computers that was previously carried out by humans. Automation can be made ‘intelligent’ by including algorithms that allow decision-making based on the processed data.
How using AI and automation could benefit small businesses
Whatever your ambitions – freeing up time, upgrading your business processes, scaling your company, or reducing expenditure – AI and automation can probably help you get there.
Save time by streamlining processes and removing unnecessary admin
Time is precious, and small business owners have very little of it going spare. A third of small business owners want to save time, but it can be difficult to know where to start.
Automating the repetitive administrative tasks involved in day to day running of the business saves you and your employees time by reducing the burden of unnecessary manual tasks. This frees you up to focus on more important growth strategies or client-facing relationship-building work.
Automation could range from reminder emails and invoice generation to approving employee expenses or payroll tasks. Xero recently introduced its new accounts payable automation feature, which allows you to set up a workflow for supplier invoice approval.
Eliminate human error
To err is human; there will inevitably be one or two errors in anything inputted manually by a person.
Automation and AI eliminate this, leading to more accurate data feeding into management reports (which could affect decisions on how the company is run) and annual accounts (which could influence stakeholder interaction with the business and even impact investment). It could also protect the business’s reputation by preventing late supplier payments (automated accounts payable) and supporting client relationships.
Cash transactions can be automated, reducing the risk of misappropriation. Real-time monitoring of data due to the speed of automated data processing allows any unusual activity to be reviewed and corrected immediately. This is also an opportunity for continuous auditing, which may improve the prevention or detection of fraud within the business.
Understand cash flows in real-time
Cash flows are often a headache for small business owners. Using automation to manage cash allows real-time analysis and tracking of spending. It can be set up to flag when cash flows are tight and allow you to prevent problems before they arise.
Increase employment opportunity
One of the biggest fears relating to AI is the belief that it will eventually make human roles redundant. AI and automation have been gaining traction across a spectrum of industries for years, yet unemployment sits at the lowest rate since 1974 (3.5%).
The World Economic Forum predicts that contrary to replacing jobs, automation will actually create a net increase of 58 million jobs – two-thirds higher-skilled, one-third lower-skilled – as employees are freed up from manual tasks and available to take on more complex work. It’s also expected to boost GDP, contributing an additional (predicted) 5% to the US GDP in the next five years.
Improve customer service
Removing mundane administrative tasks from your employee’s to-do lists frees them up for more client-facing work. The extra face time could work wonders for your client relationships and could even boost word-of-mouth recommendations to prospective new clients.
AI and automation can also be used to collect and analyse customer data, monitor trends, and target marketing to customers most likely to respond to it. Browsing history, purchase history, and product views can all be analysed to personalise consumer experiences.
As a rule, automated processes are more efficient than manual ones, which saves your business cash in the long run. It either reduces your need for administrative staff or frees up your current staff to focus on work that will help the business grow. The lower rate of error could also prevent reputational damage, by reducing the risk of missed or error-prone work.
Ways to introduce AI and automation to your business
Numerous software and applications are now available to help streamline the running of your business. Accounting software, such as Xero – proudly used by More Than Accountants to manage our client accounts – has automated features to facilitate the finance side of things. Other types of software are also available, that include features such as customer relationship and email management, and many can scale with you as the business grows.
AI and automation can be built into various areas of business:
- Marketing campaigns
- Creation of marketing material
- Follow up on potential leads
- Data analysis to help decision-makers
- Internet research
- Energy-saving (smart metres)
Let More Than Accountants help
More Than Accountants provides an opportunity to outsource your finance function and let us take care of the numbers for you. We use Xero accounting software and Dext Receipt Reader for a seamless financial experience.
Dext allows you to directly scan receipts with your phone’s camera, then the software extracts and analyses the relevant data and stores the receipt digitally. It communicates directly with Xero to keep all your financial information together and complete, without you needing to waste time inputting invoice information manually.
Make your life easier
If you’re new to AI and automation, it can seem a daunting prospect. But you probably already use AI at home without really noticing it. Anything connected to the Internet of Things and controlled via it (remote-controlled heating, and lights, for example), smart devices (hi Alexa…), or even the helpful chatbot on your banking app are all examples of AI in action.
Time is the most precious of commodities, and automation is an excellent way to free up more of it. When it comes to business processes, single workflows can be applied to hundreds of transactions, and simple algorithms can help when it comes to decision-making.
Oxford English Dictionary, viewed 18 October 2022
Anon 2022, Why automated accounts payable is great for your clients, Xero, viewed 18 October 2022
Anon 2022, Unemployment, Office for National Statistics, viewed 18 October 2022
Nirale S 2018, Your ultimate Cx destination, Servion, viewed 19 October 2022