The tech stack revolution: Here’s how MSMEs can be empowered with AI for the future

As technology continues to evolve, we are witnessing a seamless integration of concepts that were once confined to science fiction into our everyday reality. Artificial Intelligence (AI) exemplifies this shift, as it moves from the realm of imagination into practical implementation. AI has now seamlessly integrated itself into our daily lives, fundamentally altering the way we work, communicate, and interact with the world around us. From the moment your smart speaker greets you in the morning to the personalised recommendations that fill your social media feeds, AI is subtly shaping our experiences. But its impact goes far beyond mere convenience. AI is now revolutionising industries from the tech giants of Silicon Valley to the start-ups disrupting the retail sector. Take your favourite online clothing store for instance. AI analyses your browsing habits and past purchases, suggesting clothes and accessories that match your style and budget.  Targeted social media ads based on this data ensure you see what you might love, creating a more engaging and satisfying shopping experience, fostering brand loyalty. This is the power of AI in action.

A recent report by PwC predicts a staggering future: AI's contribution to the global economy could reach $15.7 trillion by 2030, surpassing the combined output of China and India. But the benefits of AI aren't reserved solely for global titans. It's rapidly becoming a game-changer for even the smallest businesses. MSMEs, from local artisans to online retailers, are embracing AI to not just streamline tasks and boost productivity, but also to drive groundbreaking innovation. We've moved beyond seeing AI as a threat to human jobs. Instead, it's become a tool that empowers businesses of all sizes to think more creatively and compete more effectively.

AI for Enhanced Efficiency and Productivity

Imagine freeing your employees' time from repetitive tasks like data entry, bookkeeping, and scheduling. AI-powered solutions can automate these mundane functions, allowing your team to focus on strategic endeavours that drive business growth. This way AI can enable significant cost savings as manual processes often incur high time and resource expenses.

Another way AI enables efficiency in operations is that it can analyse data to identify bottlenecks and inefficiencies in your workflows. For instance, a McKinsey study revealed that early adopters who implemented AI-enabled supply chain management enjoyed significant improvements compared to slower-moving competitors. These improvements included a 15% reduction in logistics costs, a 35% decrease in inventory levels, and a whopping 65% increase in service levels.

Personalised Experiences for Satisfied Customers

The impact of AI extends far beyond just efficiency gains. It's a powerful tool to drive customer satisfaction. AI allows MSMEs to unlock the knowledge quest of vast customer data, allowing them to understand individual preferences and buying patterns with incredible detail. AI can personalise promotions and loyalty programs based on buying habits. A customer who primarily purchases baby products might receive targeted discounts on diapers or wipes, making them feel valued and increasing the likelihood of repeat business. This level of personalization fosters a stronger connection with customers, making them feel valued and understood. In fact, AI-powered customer analytics can increase customer satisfaction by up to 30%.

E-commerce Enablement Platforms: AI for Smarter Decisions

E-commerce enablers are a vital force in the digital marketplace, providing a range of tools and services to support D2C brands. For instance, one of the key challenges D2C brands face is choosing the right courier partner. This decision hinges on numerous factors, including delivery speed, freight costs, and ultimately, customer satisfaction. Here's where AI steps in, empowering e-commerce enablers to offer intelligent tools that analyse a vast amount of data, encompassing over 50 key points. These data points include factors like COD remittance rates, Return-to-Origin (RTO) rates, pickup performance by the courier, and their overall delivery success rates.

By analysing this comprehensive data set, AI can recommend the most suitable courier partner for each individual shipment. This ensures efficient deliveries, minimises returns, and ultimately leads to a more positive customer experience for the client set.

Going beyond efficiency: AI-Powered Innovation

AI-powered chatbots can answer basic customer questions, provide product recommendations, and even troubleshoot simple problems. This allows MSMEs to offer 24/7 customer support without additional staff. Another big thing is that AI-powered drones can be utilised for tasks like aerial inspections or deliveries in remote locations. A report by EY-FICCI predicted the Drone industry to boost the manufacturing potential in India to $ 23 billion by 2030. This technology can also open doors for businesses, particularly in sectors like agriculture, construction, and healthcare, expanding their operational reach, creating entirely new business models, and fostering social good. Delivering medical supplies in remote locations in critical times may no longer be a challenge for healthcare companies in the future. 

Getting Started with AI: A Guide for MSMEs 

While AI might seem like a complex technology reserved for large corporations, the reality is that numerous user-friendly and affordable AI solutions are readily available for MSMEs. A practical approach to get started with AI would first include assessing a business's specific needs and challenges. Consider areas where repetitive tasks consume valuable time or where data analysis could lead to better decision-making. Secondly, exploring pre-existing AI-powered tools and services designed for MSMEs can offer numerous benefits. Many of these come with free trials or tiered pricing plans to cater to different budgets. It is also important to remember that this adoption would require a step-by-step approach, overhauling the entire operation at once may cause challenges. Begin by implementing AI in a targeted area, such as automating customer service inquiries with a chatbot. This will allow businesses to assess the impact and ROI before scaling up.

AI can allow MSMEs with not just automation to  survive but innovation to thrive in the competitive landscape. This ecosystem is not just ChatGPT anymore, Indian founders are making a wave with brands like ChefGPT, BeautyGPT and what not- proving that AI’s potential knows no bounds. Hence, it's clear that as technology continues to evolve, AI will undoubtedly play an even more significant role in shaping the future of MSMEs, empowering them to become more efficient, data-driven, and innovative.

Views are personal. The author is Chief Product Officer, Shiprocket