Unlocking the true potential of small businesses with AI

SME Publications/ SME XPO 2024

By Paul Veck, AI Partner Development Manager, Microsoft UK

Startups, by the very nature of their formation, are the rule-breakers of business. Their aim is to be innovative, fast-moving, creative, and disruptive – and emerging technologies often go hand in hand with this ambition.

Many of them have successfully defied norms and shattered barriers to become some of the world’s biggest brands, with innovative technologies often supporting their rapid growth. You just need to look back at how the plethora of now hugely successful businesses grew through an early shift to the cloud. Technologically getting ahead of your competition is, often, a key to success.

And, despite a challenging economic environment, the startup ecosystem in the UK remains resilient. Almost half a million new startups were launched in the first six months of 2023 and a 4.5% increase was reported in newly registered companies compared to 2021-2022.

For those fledgling businesses, artificial intelligence (AI) presents extraordinary opportunities – whether it is in improving your or your employees’ productivity or turbocharging your customer experience. However, working out how to harness AI to truly benefit your business can feel daunting and potentially, not immediately accessible. In fact, a recent report from GOV.UK found that only 15% of all small operations have incorporated AI into their business to date. This leaves huge scope for small businesses who can identify how to harness AI, to outpace their peers.

Businesses can integrate AI into their operations in several ways, depending on their designed outcomes. For small businesses, integrating AI tools to enhance the customer experience, broaden your in-house capacity, reduce costs, and increase efficiency, might be immediate priorities. Currently, there are two key ways AI can help you do just that: help you better understand your existing data and apply these learnings to deliver a more personalised employee and customer experiences.

Unlock the treasure trove of unstructured data

Data is a goldmine for customer insights, trend forecasting and growth potential, but without advanced data analysis tools and a dedicated data scientist in the team, many early-stage businesses were previously locked out of potential insights within their unstructured data.

AI has flipped this challenge on its head. It’s able to analyse vast amounts of unstructured data at scale and pull-out key findings, which can then be applied by startups to help them solve problems, make decisions and derive other value from information that had otherwise been inaccessible.

As this process becomes increasingly sophisticated and streamlined, startups can use AI to bolster, enhance and fine-tune their personalised marketing strategies much faster than manual analysis alone. These insights can then be applied to elevate customer satisfaction, engagement and loyalty, leading to improved business outcomes.

Some key first steps to converting unstructured data into structured data using AI:

  • Define your input and output format: To ensure you get the correct output, you must be specific about the information you’re seeking. AI can turn data into various forms including tables, reports, or spreadsheets, however without clear direction, it’s easy to receive unwanted data outputs. Create clear prompts and action steps by providing examples of what your outputs/inputs should resemble. The more examples you provide, the better the model can learn from them and produce better suggestions. There are various free resources available to enhance your understanding of AI prompts, including Copilot Lab and more.
  • Fine-tune the model: As companies harness the potential of AI, fine-tuning their AI models will be a significant element of their learning process. Fine-tuning allows startups to personalise their AI models, yielding enhanced performance, outcomes and faster decision-making that is tailored to their organisation.

Apply AI to take hyper-personalisation to the next level

Many startups are founded to solve a specific consumer frustration or business challenge. If the solution is right, it can, initially, sell itself. However, just like with any business, long-term customer attraction and retention are key, and hyper-personalisation is now a crucial element to any customer (or employee) engagement strategy.

To this end, startups now have the power to create their own ‘copilots’: imagine a chatbot which understands your product or service, knows your processes, harnesses your internal data, excels in troubleshooting, and provides a level of personalised service that rivals traditional call centres.

In fact, according to a recent Microsoft Work Trend Index report, 64 per cent of people reported that AI tools allowed them to improve and personalise customer engagements. Responses can be delivered more quickly, to more customers, without forsaking the personal touch.

To this end, generative AI is a critical and indispensable tool for businesses seeking to better understand their customers, and in turn, deliver a more engaged and relevant customer experience. It’s just a question of which startups can leverage the technology effectively sooner rather than later to unlock their true potential.

Revolutionise startups as we know them

Microsoft is revolutionising the startup landscape by empowering them to create personalised copilots, transforming customer interactions and reshaping the user interface paradigm with the help of Copilot Studio.

Startups with an early adopter’s mindset are always looking for best practice when it comes to deploying new tools and technologies. AI can help founders to unleash their businesses’ true potential by supporting business growth, extracting valuable customer insights and improving efficiency. Time they would have spent delving into data can now be better spent on other, more meaningful tasks. Microsoft for Startups Founders Hub is committed to assisting startups to accelerate innovation by providing access to industry-leading AI services, expert guidance, and the essential technology needed to build a future-proofed startup.

SME Publications/ SME XPO 2024