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AI Natives: Small Businesses Gain Power
26 Feb
Summary
- AI-first software enables SMBs to operate like enterprises affordably.
- Increased competition from AI vendors offers more choices and power.
- SMBs must manage upfront investments in data readiness carefully.
A new wave of AI-native software vendors is emerging, promising increased choice and capability for businesses, particularly small and medium-sized enterprises (SMBs). This trend, akin to the rise of cloud-native services a decade prior, suggests a potential influx of new AI-based applications.
These AI-first solutions will enable SMBs to emulate enterprise operations with advanced features at a reduced cost. The growing competition among AI vendors is expected to give buyers more leverage, potentially driving down prices. This environment will also benefit from low-code and no-code platforms, reducing the reliance on expensive technical talent for software creation.
While the long-term savings and productivity gains are significant, SMBs must exercise discipline in their deployment strategies. Careful management of upfront investments in data readiness, integration, and governance is essential. Focusing on measurable business outcomes, rather than pure experimentation, will be key to realizing the cost advantages offered by these new AI tools.
The proliferation of AI-native challengers, often focusing on specialized use cases, creates a more diverse marketplace. This dynamic allows SMBs to opt for modular, targeted solutions over large, monolithic platforms. Concurrently, the adoption of AI necessitates workforce evolution, with organizations needing to build AI literacy and adapt roles for effective implementation and collaboration.
