By 2025, AI is expected to add $315 billion to the Australian economy. But if you’re running a small business without an AI policy, that boom could come with a bust.

If you’ve used Canva’s Magic Write, Xero’s auto-categorise, or Grammarly’s tone checker, you’ve already invited AI into the workplace. No sci-fi takeover, no robots in the storeroom – just clever algorithms baked into the tools you use every day. But while AI can be a productivity game-changer, using it without clear guardrails could land your business in hot water. And that’s why every Aussie small business needs an AI policy.

Not next year. Not when you “have time”. Now.

Think of an AI policy like the digital equivalent of locking up the shop at night. It’s not about red tape, it’s about protecting your business from avoidable mess.

Without a basic plan in place, small businesses risk:

• Accidentally breaching customer privacy laws
• Publishing inaccurate or misleading content
• Making decisions based on biased or incomplete AI outputs

The case for commonsense guardrails

Policies often get a bad rap in small business circles – seen as something for the big end of town. But this isn’t about adding paperwork. It’s about reducing risk and giving your team (and yourself) clarity. A basic AI policy should include:

• What tools your team are allowed to use
• When and how to fact-check AI outputs
• What types of content AI should never be used for (e.g. legal, financial or medical advice)
• Who is responsible for reviewing and approving AI-generated content

Imagine the following: A regional NSW tourism operator uses AI to write a blog post promoting local drives. The tool recommended a route via a road that had been closed for months. The post is published unchecked, leading to lost bookings and frustrated customers. A simple policy could’ve prompted a quick double-check and saved the PR headache.

Big business is already on it

Westpac, SEEK, and Woolworths are just a few of the major Aussie brands already training their teams and rolling out AI usage guidelines. Why? Because they know the risks of getting it wrong – and the competitive edge of getting it right. Global rules are also tightening. In 2025, the European Union began enforcing the AI Act, which bans high-risk AI applications and introduces strict transparency requirements. Aussie businesses exporting, partnering overseas, or simply wanting to stay ahead will need to be aware of these emerging global standards.

Writing a policy is easier than you think

The good news? You don’t need to be a tech whiz or have a compliance department. A one-page AI policy can be enough to guide your team and avoid most of the common pitfalls.

At a minimum, your policy should:

• List approved tools
• Set boundaries around what’s appropriate for AI use
• Outline a simple “review before publish” process
• Nominate someone as the go-to person for questions

This isn’t about fear – it’s about future proofing your business, and its reputation. For a great starting point, check the Australian Government’s AI Ethics Principles. You wouldn’t let a new staff member open or close your business without training. You wouldn’t let someone write a contract without a review. So why let AI make decisions, write your content, or interact with customers without a second look?

AI can be an incredible business ally. But like any powerful tool, it needs some commonsense rules around it. An AI policy helps you and your team stay productive, compliant, and in control – not playing catch-up when something goes wrong. It’s not about being techy. It’s about being smart.

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Depending on which media you subscribe to, you’re either reading about how Artificial Intelligence (AI) will end civilisation or about how it will revolutionise business.

I believe 2023 is the year we see AI significantly affect small businesses. I’m also mindful we need to approach new platforms with eyes wide open and a dose of healthy scepticism.

Take ChatGPT as an example. I’m the first to advocate for jumping on and testing out everything this platform offers. I’m also clear with my clients that it essentially thinks it’s a toaster until you tell it otherwise. You, my dear business owner, remain firmly in the driver’s seat for how you choose to use it. And, like learning to drive, it is entirely up to you to know the manual back to front, if you want to see real benefits.

“I see a greater increase in jobs occurring because of AI.”

Before you shout “Bah Humbug!” and close your mind to new AI, please consider the AI tools you are already using and the enormous value they have brought to your business.

When was the last time you asked Google to find a new destination? What about locating a coffee shop open near you?

That’s Artificial Intelligence.

Are you using Xero, MYOB, Quicken or another cloud-based accounting platform? Are you running financial reports or generating your BAS? You’re using AI.

Maybe you schedule your social media content or have a chatbot connected to your website or social platforms. Perhaps you’ve already got them answering questions like your opening hours.

Yep, AI.

This latest evolution, particularly the natural language processing platforms (among which ChatGPT has received the greatest publicity), is just the newest development in the tools we are already using. 

Once you realise you’re already reliant on some very sophisticated technology, it’s only a small step to test the waters of what else AI can offer.

How would you like to automate some routine tasks? Gather customer insights? Or quickly and easily analyse market trends to make better business decisions? 

AI is evolving at lightning speed. You can either grab your surfboard and ride the wave or,, well, pack up your board, go home and tell people how unfair it was that your business never worked out. 

I hate being that black-and-white, but right now there’s a line in the sand challenging you to adopt and adapt to new AI.

At this article’s start, I promised a healthy dose of scepticism. So, let’s look at some of the potential pros and cons.

Pros and Cons

Pro: Automation of repetitive tasks

I questioned you earlier about your use of cloud-based accounting platforms. You may have yet to consider a lot of the heavy lifting they do: tracking expenses, generating reports, running wages and spitting out BAS saves you considerable time each month and reduces the risk of errors. Have you ever calculated how much time that one little tool gives you back each month?

What about customer service? Responding to customer enquiries promptly and efficiently is critical to building loyalty and maintaining your reputation. However, handling customer service inquiries can be time-consuming and pulls focus from other essential tasks. 

We’ve seen the rise of AI chatbots in handling enquiries and providing quick, efficient responses. These chatbots are easily integrated into a website or your social media and it means your customers get the information they need at a time that suits them.

Chatbots can be programmed to respond to a wide range of common questions, such as opening hours, business location, order status, shipping information and product specifications. They can provide customers with recommendations and personalised information based on their previous interactions with your business. This all builds your relationship with customers and increases their satisfaction.

Let’s call that a win for AI.

Con (kind of): Privacy and cyber-security

We’ve become hyper-aware of the damage to a brand’s reputation when there’s a security breach. Trust takes a long time to build and a short time to ruin.

With the growth of AI and our dependence on the interconnectedness of our systems, data privacy and security should be top of mind. AI technologies can collect and process sensitive data, including customer names, addresses and credit card numbers. How your business handles, stores and shares this information is something for serious consideration.

While I’ve placed security in the ‘con’ category, it’s more something to remain vigilant about. Scammers and hackers are not going away, so we must implement robust cyber-security measures to protect data and comply with relevant privacy laws and regulations.

Pro: The ease with which AI can pull customer insights

AI-powered marketing tools can quickly analyse vast amounts of data to uncover patterns and preferences. This means we can hyper-personalise marketing strategies to provide a more customised experience. 

Used well, these insights lead to increased client value, ‘stickier’ customers and new product or service opportunities. AI-powered analytics will quickly and easily allow you to analyse market trends and stay ahead of the competition by making informed decisions around product development and pricing.

Let’s chalk that one up as (another) win.

Con: Potential impacts on jobs or wage stagnation

This is the ‘Chicken Little’ of all AI terror-induced arguments. Let me share my view (which is not necessarily shared by this publication). AI will replace some of the more tedious data entry-style roles but I see a greater increase in jobs occurring because of AI. If you look online right now, you’ll see a new role emerging for ‘prompt writers’. These people are the critical thinkers learning to manipulate and get the best from ChatGPT and the like.

AI may impact your wage overhead if your business has previously required numerous data-entry roles. You will need to consider how to support, encourage and train staff to become the conduit between AI and your business.

Let’s call that ‘the one to be mindful of’.

Pro: Inventory management overhaul

AI-powered inventory management systems can provide valuable insights into your business’s performance. From sales trends to product popularity and customer behaviour, these insights allow your business to make informed decisions about product offerings and marketing strategies. The systems can automate the process of reordering products, reducing the risk of stockouts and improving the overall efficiency of your supply chain.

We’ll take that as a win for productivity and profitability.

Con: AI implementation can be costly and time-consuming

Time will be the most significant con for many small-business owners. With new and emerging technologies, we need to invest in resources to learn how best to use them.

Some platforms require a financial investment up front, while others impact on our productivity while we learn to integrate them with existing systems.

There is no way around this; it will definitely impact your business – at least in the short term.

Let’s wrap things up. 

Life is never as simple as saying ‘AI good’ or ‘AI bad’. We must weigh all the pros and cons around further implementing AI into our businesses.

The important thing for 2023 will be to remain curious and look for ways to reap the many benefits AI has to offer. That means we need to learn all about it first.

This article first appeared in issue 40 of the Inside Small Business quarterly magazine

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Wouldn’t it be lovely if we could pick up where we left off, dust off the ‘open for business’ signs and wait for the hungry throngs to beat down our door?

But business has fundamentally changed and so has consumer behaviour. Everything from exercise to medical appointments has become available online. QR codes are a universally accepted language and Australia Post research shows that November 2021 was the largest ever online shopping month in Australia, with a staggering 76 per cent increase from November 2019.

In just months, technology forever changed business – for business owners, suppliers and consumers. But what role can technology play in rebuilding our small-business sector after COVID?

Adopters and delayers

If we look at the age spread across small-business owners, you’ll quickly realise there are a whole lot of Gen Xers (over 40). In fact, over 63 per cent of all small-business ABNs are registered to people over 40. These folks (who include me) did not grow up as digital natives. The fast-moving nature of technology leaves many of us feeling overwhelmed and frustrated. There are too many options, not enough clarity and we’ve been burned by digital providers too many times.

“It’s time we start thinking of our technophobes as the client and put them at the centre of better solutions.”

I call this group my technophobes. They’re the ones who realise digitising their business could have huge upsides, but they don’t know where to start or whom to trust. So, they do nothing. They drag their heels and delay making decisions in the hopes an easy solution will present itself.

On the flipside of the coin are the early adopters. These are the folks who see opportunities in technology. And, while it’s not a club exclusive to the under 40s, those who don’t recognise a VHS or cassette tape certainly make up the majority.

They are quick to try the latest software or hardware. They invest in upgrading their knowledge and they aren’t shy about test-launching a new product or service to see how the market responds. They are nimble and they realise that some of what they trial won’t suit their long-term requirements, but they also know some will pay off hugely. I’ve observed that these adopters tend to grow faster and bigger. They typically employ more people and they often have more than one business venture at a time, so they’re always looking for ways to simplify and speed up their operations.

These two sides of the same technology coin (the adopters and delayers) represent a digital divide across the country. This is the divide we need to address to see significant growth within our small-business sector.

The role of government and corporations

So, how do we close this gap, overcome the technophobia and get small business humming again? To begin, the government needs to get serious about the situation. Research that CPA Australia conducted last year pointed to the major investment ($325 million) Singapore is making to assist small-business owners with their digital transformation. We’ve seen some investment at a federal level, and our state governments have offered some grants over the last few years. But we don’t have the grassroots ‘hand up’ kind of support that is required to make a difference.

Next comes the role of the corporate end of town. A sizeable group of corporations rely on small businesses as their clients. Let’s assume that 10 per cent of small businesses don’t make it through the next two years (and that’s a conservative figure). What would that mean for the bottom line of these corporations? Imagine the shareholders wondering what happened to their dividends. Think about the job cuts as the loss of small-business clients shrinks businesses. Corporations can avoid all this by assisting their small-business communities with understanding and implementing the various ways technology can streamline activities and increase profitability and improve sustainability.

The win for big business? Clients would have more reason to remain loyal. They would probably become even more profitable for the larger companies and they’d certainly be stickier to their products or services. The increased profitability that a digital transformation would deliver would far outweigh the short-term cost to government and corporations.

How do we overcome technophobia?

Beyond engagement from large organisations, we need to totally revamp our thinking on how we best assist our technophobic business owners. The general consensus has been to offer virtual training (even well before the pandemic). The thinking was: Give people webinars and they’ll learn. Offer them YouTube sessions and they’ll pick it up. Give them a downloadable training series, they’ll be fine.

But they aren’t fine. They are overwhelmed by the amount of information on offer. They are frustrated trying to choose someone they can trust. And some of them literally don’t have the bandwidth. I have travelled to many regional towns that are only now getting internet speeds faster than a stroll.

We cannot continue to cajole these folks with purely digital solutions. This is the generation that needs to connect, to build trust, to feel safe enough to ask the ‘dumb’ questions. I’ve trained small-business owners who would not click on a Zoom link until I walked them through it. Now, they join webinars and participate in group learning, but it took time and in-person effort to get them there.

It’s our responsibility to meet these folks where they are. In marketing, we promote the value of building relationships with clients and putting the customer at the centre of a business. It’s time we start thinking of our technophobes as the client and put them at the centre of better solutions.

What we need to be doing

We need hybrid training solutions. We need boots on the ground showing our technophobes how to cut through the digital noise. We need supportive learning environments, where they can see people just like them getting digital wins and showcasing how it has improved their business.

We need to encourage tiny steps, not try to convince people to change their entire business model overnight. We need to show them how to track and measure the adaptations they are making in their business, then celebrate their wins as they come.

We’re not looking for huge leaps forward for most of our business owners. We’re not asking for double-digit growth year on year. We just need to guide them towards implementing technology to improve their business in small ways, to start. Then we’ll see overall increases in productivity and profit that, in turn, will lead to job growth and better economic sustainability.

Technology is the road to rebuilding small business after the pandemic but only if we overcome the technophobia that’s at the heart of Australian business.

This article first appeared in issue 36 of the Inside Small Business quarterly magazine

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