SMEs Can No Longer Afford To Do Things The Old Way

Crunch time may have arrived for small and medium businesses that have held off adopting AI, as relentless cost pressures make tech-driven productivity improvements one of the few ways left to defend the bottom line.

Higher interest rates, persistent inflation and a relatively tight labour market have stretched margins thin, leaving businesses desperate to boost efficiency. But while productivity gains have been hard to find across the economy, artificial intelligence is being touted as one possible solution to the crisis.

“Honestly, AI is like nothing I’ve ever seen,” says Productivity Hub founder Debbie Eglin, who has been helping businesses do more with less for decades. “You’re going to save a huge chunk of time. For most people, time equals money that you’re then saving as well.”

For businesses to make meaningful improvements to productivity, Eglin says they need to look beyond individual tasks and rethink how work is done, with AI and automation built into the process.

AI Doesn’t Feel Like Other Tech Advances

Eglin encounters two common attitudes when speaking to SME owners about AI: they’re cautious because they don’t understand it, and they’re worried everyone else is ahead of them.

“There is so much noise out there about AI at the moment,” she observes. “It’s almost like a paralysis because it’s so overwhelming. People are feeling like they’re very behind and there’s almost a sense of embarrassment that, as business leaders, they should already be across it.”

This can become a self-fulfilling prophecy; they don’t know where to start with AI, so they don’t, then they end up even further from the cutting edge. “It’s hard as small to medium business owners. They have so much going on, they’re wearing all of the hats, and this is just adding another layer of pressure,” Eglin says.

People find jargon confusing – since there is no defined directory of terminology, even for words as central to AI as ‘agent’ – and some mistakenly think technical expertise is required. But the greatest misconception, Eglin says, surrounds what the technology can actually do. “Most people are using it for copywriting. They’re using it to improve website copy, marketing copy, email copy. They might be using it as a better Google search and not really understanding what it can offer them,” she says.

Rather than equating AI with software, she recommends thinking of an LLM like Claude or ChatGPT as a team member.

“Treat it as an intern. Treat it as someone who has knowledge in the area but needs training on your business, your processes, how you do everything,” she says.

She says leaders find this approach more relatable.

“That’s an easier concept for them to understand than ‘there’s a robot here that’s doing all of this work for me.’”

If You Don’t Know Where To Start, Then Start Small

When SME owners say they don’t know where to begin with AI adoption, Eglin’s advice is to start small and target tasks that add to the cognitive load.

“I get a lot of my clients to begin with what I call the one percenters,” she explains. “They’re those little jobs that eat up a lot of time but are really, really easy to hand off. It’s those types of things that really add up to burnout.”

Potential uses include report writing, marketing development, industry and client research, weekly team communications, and pulling custom data outside the capabilities of a CRM. Eglin is also seeing a move towards AI agents as personal assistants, which manage calendars, draft email responses and keep the to-do list updated.

“Those kinds of tasks are really easy for people to set up in the first instance and gives them the confidence that it isn’t going to do any damage to their business. So, it’s kind of a safe area to play in,” she says.

Eglin acknowledges safety is at the heart of some business owners’ concerns, and agrees there is information, particularly sensitive client data, that shouldn’t be shared with an unsecure chatbot, such as an employee’s personal account. This is where a company policy governing AI is useful.

“I think it all comes down to your own ethics and what you’re comfortable with,” she says.

In her experience, cautious mindshifts shift once people see tangible productivity benefits.

“By having your AI agent do real work for you – not just things that you are pushing and requesting each time, but actually doing autonomous work for you – then obviously you’re going to save a huge amount of time.”

Fix the Process Before You Add the AI

The more significant productivity gains occur when businesses move beyond the one percenters and start addressing the bigger picture, Eglin says. Before the advent of AI, she spent 20 years helping SMEs improve systems and processes, and says the same principles apply now.

“If you haven’t got a strong process, then it’s gonna be a mess, and putting AI into a bad process is just going to amplify that mess really, really quickly,” she says.

This is particularly true for SMEs still reliant on manual admin. “There are so many businesses out there that are still running the business from the business owner’s head,” she observes. “Get those processes out of your head and get them documented.” She recommends tools and software be integrated, filing systems streamlined, and processes automated where possible.

She offers her own discovery call briefing process to illustrate possible time savings. When a call is booked, folders and templates are automatically created and an AI agent researches the client to produce a one-page backgrounder. After the call, AI uses the transcript to create a proposal for review and to pull ideas of real-world problems for marketing. “What might have taken me 90 minutes is done within seconds,” she says. “That’s a really easy example of bringing AI and automation into place.”

Employment Hero CEO Ben Thompson agrees embedding AI into workflows is ‘game-changing,’ but adds that it’s not just appetite that prevents owners from going all in. “It is the accumulated weight of existing compliance and regulatory cost that leaves owners with no time or capital left to invest in new technology,” he explains. “The tools exist. The businesses ready to use them exist. What Australia needs to do now is get serious about accelerating AI adoption, not adding to the red tape that’s already holding small businesses back.”

Rather than spending days or weeks of their own time learning about AI, Eglin says it may be more cost effective for some business owners to seek external advice. But she adds there are plenty of resources for those who prefer to DIY, including free training materials from AI labs. “Just start playing with it and seeing the time savings and cost savings that you can get.