Opinions expressed by Entrepreneur contributors are their own.
AI burst out of the labs in 2022, and by now, just about everybody has heard of it. AI has also progressed exponentially in the last three years. Experts have said that within a few years, AI will affect everything from healthcare to brainstorming and beyond. They have also declared that we are entering an era that will affect humanity like nothing before it.
If you don’t employ AI soon in your business, you may not be able to compete. But how do you begin? The following case study is about my experience installing AI in a small business. The objective of the project is to increase the value of the company so it can be in a position to sell. We decided to employ AI to accomplish this.
Related: 3 Ways to Prepare Your Business For an AI Future
A classic case of treating business ownership as a job
The company is a small wholesale produce company. It is a third-generation company, and it has a good brand and reputation.
The business owner has been working nights in the warehouse processing orders for 40 years. He feels that he is the only one who can handle this function because it is so complicated. Problems often arise.
There is a key employee who has been with the company for 15 years, who takes over when the owner goes on vacation.
Our first task was to get the owner out of the warehouse, turn that job over to the key employee and have the owner function as the CEO.
The owner was reluctant to do this as he thought he might lose revenue. He finally made the decision in the fifth month of the project.
The adaptation period
After working nights in the warehouse for 40 years, the owner needed time to adapt not only to his sleeping regimen but also to letting go of his former job. We lost a lot of time employing AI in the company. However, getting the owner out of the warehouse was a huge factor in moving forward.
The owner wanted to start AI-ifying his company with order processing because that clearly was the prime workflow in the company, and he was concerned that someone else had taken over after his 40-year tenure.
Inventory control is a major function in this business. Since the product spoils, it needs to get in and out of inventory as quickly as possible. So, the company had contracted with a third party to handle inventory control about three years before we got involved. We immediately developed a dialogue with the third party, and they were very cooperative. However, the main contact left the company, and there were rumors that the company was in trouble, so we put order processing on hold until we were sure that the third party would remain in business.
Related: Why You Should Incorporate AI into Your Business — and How to Do It the Right Way
The big pivot
Very soon in this holding pattern, we decided to pivot to marketing so we could move forward. If the owner hadn’t been so persistent in requiring order processing as the first to employ AI, we would have started with marketing.
Over 90% of companies employing AI start with marketing. It is quick and easy to implement, and good prompting using ChatGPT can have a huge effect on most of the functions without the need for complex automation. It’s also a gentle way to introduce AI to the employees. They can see it in action without it threatening their jobs.
The first thing we had AI do was to develop a marketing plan specifically for a small wholesale produce company. The plan was initially focused on the customer base, and the first task was to develop a customer survey to determine their feelings about the products and services that they were receiving, as well as their wants and needs going forward.
Another huge problem
We immediately encountered a problem. The company had never done marketing. They have about 200 customers obtained by word of mouth over their 80 years in business. Consequently, they have no CRM with the necessary information to send the survey. They had different lists for different functions, which had different contacts and often no email address — and often the contact they had was not the decision maker.
Two administrative people were assigned to develop the CRM, and they would do that in their spare time. Finally, the owner hired an experienced marketing freelancer to help with the CRM and continue with the marketing effort going forward.
We may need to resend the survey to non-respondents a few times before we get a statistically significant number of respondents for data analysis. We will develop a detailed marketing plan based on the results of the survey analysis.
The rumors about the financial problems of the third party proved false, and when the marketing plan is running smoothly, we will return to applying AI to the order processing workflow.
We will also continue to interview the owner to source data for the training bot and the customer support bot.
Related: AI for the Future: 5 Powerful Reasons Small Businesses Should Jump on Board
What we learned
The takeaway from this case study is basically a lack of preparation to employ AI. But that wasn’t the owner’s fault. He wasn’t expecting AI. It was also an unusual situation where the owner worked in the warehouse for 40 years, and the company had never done any marketing. This is an exaggerated example of an owner working IN the company and not ON the company. If it weren’t for his desire to make his company a valued asset in the marketplace, we wouldn’t have made the progress that we did.
Preparing for AI is basically creating an environment that makes employing AI quick and seamless. The attitude of the staff is critical, as is the documentation of the company workflows that will be AI-ified.
Understanding the importance of preparing for AI can make the difference between success and failure in perhaps the most important business decision you will ever make.
This story originally appeared on Entrepreneur
