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AI Risks for Small Business: What to do Before You Get Started

3-minute read

Courtney Hayes

Courtney Hayes

22 June 2023

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As a small business owner, you’ve likely been bombarded with news of AI’s immense potential. And with the rapid influx of new and exciting AI tools, it’s easy to get swept up in the frenzy. But like any great power, AI also comes with hazards, and finding the right balance may feel like a high-wire act. So before you embark on your AI journey, let’s evaluate and manage some of the potential risks and help you develop policies to maximize the rewards for your small business.

Potential AI Risks

As a freelance copywriter, I’m well aware that AI will likely impact my small business in ways I can't yet imagine. And while the benefits may provide a competitive edge, reliance on AI tools also can have downsides, such as layoffs and skill erosion. One study by Goldman Sachs predicts that roughly two-thirds of all U.S. jobs could be partially automated by AI.

Change can be scary, and there’s much to consider before embracing AI as part of your business strategy. Let’s dive in:

AI tools are trained to use vast amounts of data, including copyrighted material. If AI-generated content closely resembles an existing copyrighted work, it may violate intellectual property rights. Small businesses should avoid inputting copyrighted materials as part of their prompts and always review final content to ensure it doesn’t plagiarize existing material or breach copyright laws.

2. Bias and discrimination.

AI systems can perpetuate and amplify biases present in the data used to train them. Carefully review AI generated content to ensure that it aligns with your business’ values and ethics. By taking these steps, your business can leverage the power of AI while remaining inclusive and ethical.

3. Hallucinations.

With all its awe-inspiring potential, artificial intelligence has limitations. And contrary to what the title implies, AI tools are not all-knowing. They are machines that mimic human thought and behavior. And like humans, they occasionally make mistakes. ChatGPT and Bard openly admit that their systems can sometimes “hallucinate” plausible-sounding but incorrect answers.

Before You Get Started with AI

Today’s AI cannot replace human creativity and common sense. And human oversight will be crucial to ensure accurate and appropriate results. So before you get started, let’s explore some of the steps you can take to help your small business successfully optimize AI’s potential:

1. Conduct an AI audit.

As a first step, take a look at where AI might be able to help your business. Is it writing helpful blog content or sales materials? Could you use it to write product descriptions?

2. Explore affordable AI.

If you’re new to AI, consider starting with free products like OpenAI’s ChatGPT that require no coding or training. A step-by-step guide on how to get started with ChatGPT can be found here. By experimenting with free AI tools, you will begin to understand its full potential and gain valuable insight for potential future investment.

3. Evaluate AI tools.

If you need a more targeted solution, it’s crucial to vet a range of tools and platforms carefully. Are they easy to use and implement? What value do they add beyond free AI options? Do they “talk” well to your other operating systems? Is the solution scalable? And does it come with high-quality support? Talk to experts, read reviews, and test options to determine the best fit.

4. Conduct a cost-benefit analysis.

Before investing in an AI system, conduct a cost-benefit analysis. Is the potential cost and the time needed to get up to speed on an AI tool something that can save you time or help improve sales?

5. Consult with an AI expert.

AI is evolving at lightning speed, and new AI-powered tools are hitting the market daily. If you’re feeling overwhelmed, you’re not alone. Consider consulting with an expert who can guide you. AI can be a powerful tool for small businesses, but only if you’ve developed the expertise to manage it properly.

6. Establish AI policies and procedures.

Ready to take the plunge? Before you do, it’s crucial to establish a policy of human oversight to avoid inaccuracies, bias, and potential copyright infringement that could damage your brand. This may include training employees and setting guidelines for collecting and using data. And if you plan to publish AI-generated content, consider talking to a lawyer first.

A system of regular audits also can help ensure safe and ethical use. Once you’re up and running, avoid entering sensitive or proprietary information in your prompts. Some AI tools may save this information as part of its ongoing learning process.

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Courtney Hayes

Written by

Courtney Hayes

Born and raised in the fishing port of Gloucester, MA, I grew up listening to the sea stories of local fishermen. My first job was “chum girl” on my dad’s tuna boat, where I spent my formative years covered in fish guts. Since then, I’ve worked as a researcher, blogger, and writer for documentary films. When not at work, you can find me surfing the cold waters of the North Atlantic or searching for warmer waves around the world.

Courtney writes on a number of topics such as risk assessment, starting a small business, and financial resources.

This content is for general, informational purposes only and is not intended to provide legal, tax, accounting, or financial advice. Please obtain expert advice from industry specific professionals who may better understand your business’s needs. Read our full disclaimer

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