In the age of AI, small business fundamentals still matter most
Over the last few years, the artificial intelligence (AI) boom has taken every industry by storm, and with this wave of innovation, many small business owners are feeling overwhelmed. If they’re not using it yet, are they going to be left behind?
I hear this question almost every day from small business banking clients. They want to know what they should be doing with AI, how other businesses are using it, and whether adopting an AI-powered workflow will be the magical key to financial success. It reminds me of the early days of the internet — back then, people understood that this powerful new tool was going to be important, they just didn’t know what to do with it.
The difference now is speed. While the business owners of yesteryear had nearly a decade to figure out the mechanics of websites, emails and, eventually, social media, the rapid adoption of AI technologies in the last year alone has many small business owners rushing to incorporate AI into their businesses, even if they’re not yet sure where it fits or what it could solve.
My advice to clients who ask this question is simple: Before you rush to AI, take a real look into your own business.
Start with the problem, not the tool
Whether it’s AI or anything else, one of the biggest mistakes I see small business owners make is starting with a solution and trying to find a problem it can solve. AI can absolutely be useful for small businesses. It can help with marketing, streamline operations, and improve how you identify and reach customers. But if you don’t know what part of your business needs help, or what specific AI tools can address those needs, adding AI just to check a box is just one more thing to manage.
Incorporating AI into a business just because everyone is talking about it isn’t going to help that business grow or flourish. At the end of the day, the availability of AI tools doesn’t change business fundamentals. Successful business owners have a deep understanding of what areas have the best potential for growth, where they need to streamline efficiency, and the unique problems they are facing. Before rushing into AI adoption, I always recommend business owners start with an issue they’re hoping to solve, then do the work to understand how (and if!) AI could help be a part of the solution.
Business is a long game
Despite the rapid advancements in technology and industrial production the world has seen over the last few centuries, the basics of business have remained relatively unchanged. Whether a business owner is operating in the modern age or in Colonial Williamsburg, successful business owners have a firm grip on what truly matters: Taking care of customers. Knowing the numbers. Protecting business accounts. Building relationships. These aren’t new ideas, and they’re not going away just because AI has entered the chat.
Having worked with business owners through multiple periods of historic uncertainty — 9/11, the 2008 financial crisis, the COVID-19 pandemic — I can tell you the businesses that navigate change best usually aren’t the trend chasers. They’re the ones who already have a solid footing. They’re not overextended. They understand their margins and know their customers, and they know how to roll with the punches.
You don’t need to reinvent your business every time the market changes. Making smaller, deliberate adjustments is the key to sustainable success. If you stay on track, you’ll get where you’re going.
Relationships are still a competitive advantage
Today’s small business environment is dominated by service. When a customer can order anything they need online — often faster and for less money than it would cost to buy locally — customer experience is paramount to customer retention. Even in the age of AI, there are still things technology can’t replace: personal service, familiarity, and the experience of being known.
That’s where small businesses continue to stand out. They can’t out-scale the largest companies, but they can differentiate themselves in ways that bigger organizations often can’t. When a customer walks into a place where they’re recognized, where the service feels intentional and the experience is consistent — that’s what brings them back.
Staying steady in an ever-changing environment
Throughout history, small businesses have always had to adapt. Through the rise of the printing press, the industrial revolution, world wars or the evolution of AI, the best businesses have always been able to pivot and stick to the fundamentals when times get tough. What’s different today is how quickly new pressures come and go, and the instant access we have to the news of new technologies, interest rates, broader economic shifts and international relations.
With the ability to access all the information on Earth with the tap of a touch screen comes intense pressure to respond to everything immediately. But in most business cases, that’s really not necessary. Staying focused on serving your customers, running your business with discipline, and building strong relationships is always going to be the backbone of a strong business.
AI will continue to evolve, and so will the economy. But the businesses that succeed over time usually are the ones that stick with the fundamentals and keep getting them right.
• Stephen Ball is senior vice president and head of business banking at Byline Bank.