SMEs slow to embrace the productive potential of AI

SMEs slow to embrace the productive potential of AI

Just 15% Australian SMEs have implemented Artificial Intelligence (AI) technology in their business or will do so soon, while 85% have no plans to use AI in their near future.

The headline finding is contained in the most recent SME Growth Index Report by ScotPac, Australia’s leading non-bank business lender.

A deeper dive into SME attitudes to AI revealed the following:

  • 51% of SMEs said they are aware of AI technology but had not yet fully grasped its potential benefits or impacts.
  • 28% of SMEs said they had no knowledge of AI technology.
  • 4% of SMEs said they felt AI was either a competitive threat or cybersecurity risk.

Of the SMEs that have adopted some form of AI technology, twice as many were in a growth phase compared with declining growth SMEs.

While most SMEs surveyed did not offer a view on what areas of their business AI will likely influence, the top three applications identified by those who responded were:

  1. Customer service
  2. Identifying new business opportunities
  3. Sales / Business Development Management

ScotPac CEO, Jon Sutton, said that while the application of AI technology among SMEs was low for now, several factors pointed to that situation changing rapidly.

“As SMEs become more aware of the application of AI in areas like customer service, marketing, inventory management and education, it is inevitable that adoption rates will increase,” Sutton said.

“There is an understandable level of fear and scepticism about some of the impacts of AI technology, including job displacement, data privacy and workflow changes.

“However, the potential for AI to increase SME productivity while reducing wage bills and contractor costs will be a compelling proposition for many businesses,” Sutton said.

Sutton said one of the main impediments for SMEs in implementing AI technology will be upfront costs.

“Investment in areas like hardware, software, IT talent acquisition and employee education will all be required upfront before AI efficiency gains are realised in the longer term.

“The good news for SME owners is that specialist advice on relevant AI applications and implementation is becoming more readily available.

“When businesses are ready to invest in the AI infrastructure or expertise they need to be fit for the future, ScotPac’s team of experienced lending specialists are on hand to deliver the right working capital solution,” Sutton said.