The Business Advisory Blog

The Business Advisory Blog

Insight, news and updates from Alliott NZ Chartered Accountants, Auckland New Zealand. The views expressed here are the views of the author and should be discussed in further detail should an article be relevant to your individual circumstances.

While every effort has been made to provide valuable, useful information in this publication, this firm and any related suppliers or associated companies accept no responsibility or any form of liability from reliance upon or use of its contents. Any suggestions should be considered carefully within your own particular circumstances, as they are intended as general information only.

Greg Millar
Published on

What is AI and why is it relevant for my small business?

Xero Tech article

  • Artificial intelligence (AI) has become a household term in recent years, but not everyone fully understands what it is or how it can benefit them, particularly when it comes to small businesses
  • The term "artificial intelligence" was first proposed in 1955, and since then, AI has captured the human imagination
  • From industrial robots to driverless cars, and even foolproof computers, the potential of AI has intrigued us for decades.

Nowadays, AI is no longer just a concept; it has become an integral part of our daily lives.

It powers products and services such as Netflix, Spotify, and various app stores. By analyzing our watching, browsing, and purchasing habits, these products offer us a personalized experience that is only possible because of AI.

For small businesses, AI can be a powerful tool that helps save time, create a better customer experience, and provide helpful insights. However, just because AI is available does not necessarily mean it should be used. The key is to think of AI as a tool like a hammer, which can be helpful in the right situations but potentially dangerous in the wrong ones.

When used effectively, AI can create a partnership between humans and machines that delivers faster and better-informed decision-making. For example, if you are managing paper bills and invoices in a program like Xero, AI can quietly help you every time you upload a new document, thanks to intelligent form filling and credit note detection. Similarly, as you reconcile your bank statements, AI can suggest the best matches from your contacts and accounts.

To determine if AI is right for your small business, consider a current business challenge you are facing.

If you can answer the problem in a couple of seconds and if five other humans would likely come to the same conclusion, then AI is likely going to do a reasonable job of answering that question or completing that task for you.

There are two main types of AI: general AI and narrow AI. General AI is a reasoning entity that can tackle varied tasks and learn from experience. In contrast, narrow AI is highly efficient at performing a specific task. While general AI is not yet ready for mainstream usage, narrow AI can help small businesses remove toil from everyday tasks.

One of the main contributors to negative AI outcomes is bad data.

The accuracy and quality of the data fed to AI algorithms are crucial to their performance. Therefore, keeping accurate, up-to-date, and consistently categorized accounts is essential to avoid negative consequences.

AI can be a powerful tool that can benefit small businesses. When used effectively, it can provide a better customer experience, save time, and offer helpful insights. However, it is crucial to understand the type of AI that is best suited to your business and to ensure that the data fed into AI algorithms is accurate and of high quality. As AI continues to advance, small businesses can benefit from this technology to improve their operations and better serve their customers.

Considering Xero for your business? Alliott NZ's Xero Certified Advisors in Auckland are here to answer any questions or to help your business upgrade to using Xero.

Source: Xero

Topics: artificial intel cloud accounting digital disruption small business technology Xero