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Future of AI Q2 2024

Why generative AI tools can help SMEs catch up to the competition

Neon metaverse futuristic concept. Closeup on middle aged woman with laptop in office.
Neon metaverse futuristic concept. Closeup on middle aged woman with laptop in office.
iStock / Getty Images Plus / CentralITAlliance

Lamia Kamal-Chaoui

OECD Director of Entrepreneurship, SMEs, Regions and Cities

With generative AI tools, SMEs can swiftly generate detailed data analysis of their operations, personalised business strategies, new product concepts and custom promotional materials within seconds.

While artificial intelligence has long been harnessed by industry giants to dissect data and streamline operations, the advent of affordable and accessible generative AI tools has now put that potential in the hands of SMEs.

Rapid adoption of generative AI

Recent insights from the OECD’s new Digital for SMEs Survey show clear momentum among SMEs in adopting generative AI services. Within a year of these tools becoming publicly available, 18% of SMEs have been experimenting with them. This whirlwind of change presents new opportunities but also new risks for SMEs and the governments seeking to support them.

Digital divide risks widening

First, there is the risk of widening digital divides. The SMEs that were quickest on the uptake were those that were already the most digitally savvy: 23% of digitalised businesses use generative AI, compared to 13% of their less digitalised counterparts, putting the latter at risk of falling further behind in digitalisation.

SME cyberattack vulnerability

Second, there is the risk that generative AI tools leave SMEs more open to more sophisticated cyberattacks. Worryingly, given that most security breaches are caused by human error, our survey showed that only 11% of respondent businesses engage in cybersecurity training, and 6% perform regular cybersecurity assessments.

Support SMEs’ secure tech adoption

Governments must now up their game to help SMEs to adopt these technologies securely and strategically. Some initiatives have already emerged, such as the UK’s Department for Science Innovation and Technology’s GBP 7.4 million ‘Flexible AI Upskilling Fund pilot’ to subsidise AI skills training for SMEs in the professional business services sector, providing grants that cover up to 50% of training costs.

How governments can break through to SMEs

Yet, one of the toughest jobs governments will face will be to ‘cut through’ to busy entrepreneurs. We found that only 18% of reporting SMEs are knowledgeable about government support for digital tool adoption. Reaching them and winning their trust could get even harder as malicious actors themselves use AI tools to impersonate government services.

As generative AI continues to create a buzz in business, this groundbreaking technology could level the playing field for SMEs. Governments must provide support to make this happen — and unleash their potential to thrive in an increasingly digital world.

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