CHAUDHRI: Canadian small businesses falling behind on AI. Is caution costing us?

“If you don’t fail, you never learn how to succeed.”

That was the advice Behrad Bayanpour, general manager of Powerpay, shared with me when we spoke recently about the challenges facing Canadian small businesses. It struck me because, as an entrepreneur, I know first hand that experimenting with new ideas and building a tolerance for the risk of failure is part of the job. 

And when it comes to artificial intelligence, Canadian small businesses appear to be watching and waiting, as opposed to experimenting with the technology itself. 

A few weeks ago, I attended a Powerpay event where the company, which provides payroll services to more than 46,000 Canadian businesses, shared findings from a survey of 356 customers. 

To me, the results of the survey shed some light on what Canadian business is thinking and where our pain points lie.  

Numbers tell an interesting story

The numbers tell an interesting story about the state of entrepreneurship in this country.

Approximately 63% of respondents say running a small business has become more difficult, while 75% report significant pressure from rising costs, productivity challenges and economic uncertainty.

Yet 45% still anticipate revenue growth.

While the economic outlook is encouraging and optimistic, the bigger story was how few businesses are embracing AI. 

Only 19% reported actively using AI to streamline their operations. Another 26% are considering adopting it within the next 12 months, while roughly 55% have no plans to do so.

According to these findings, more than half of these businesses have no immediate plans to participate in AI adoption. To me, that either means the technology is too expensive for the average business to consider, or many business owners still do not see the value in the investment. 

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AI tools costly

I can understand the hesitation. I founded and operate a small business, and while there are some AI tools that appear to create greater value for clients, they are costly.

These tools can supercharge some of the work you do, and possibly support the creation of a superior product. And one must be quite cautious before implementing a new AI tool. Once implemented, it is hard to know how easy it could be to make a change, if needed, at a later time. 

And unlike large corporations, small businesses cannot afford to spend money experimenting indefinitely.

Bayanpour made an important observation during our conversation: small business owners are “not technologists.”

They need technology that makes their lives easier, not another responsibility.

But the survey also revealed something about the future of employment.

While approximately 45% of businesses anticipate adopting AI within the next year, only 24% are looking to increase their headcount.

That gap suggests employers are looking for ways to grow without necessarily adding more employees.

As an employment lawyer, I see both the opportunity and the risk. Technology that allows employees to spend less time on repetitive tasks could improve their working lives. But if businesses use AI primarily to avoid hiring, I expect employees will quickly feel overtaxed.

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Privacy, confidentiality, accuracy concerns

There are also legitimate concerns about privacy, confidentiality and accuracy. Employers cannot simply hand over sensitive information to an AI platform and hope for the best.

Canadian businesses are already operating in an extraordinarily competitive environment. We need companies that can grow, hire, innovate and compete internationally.

But the results suggest that AI tools are not yet meeting the expectations of the consumer. Limited small business investment, means these tools have some ways to go before an everyday business owner makes the investment. 

My advice to entrepreneurs is to start small. Find one process that consumes too much time, experiment with an AI solution and measure whether it actually delivers value. Include your employees in that process. Do not, however, set it and forget it.

Not every technological innovation deserves our money or attention. But refusing to experiment carries its own price.

Bayanpour’s observation about failure is worth remembering.

The businesses that succeed tomorrow may not be those that embraced new technologies first. They may be those that were willing to try, make mistakes, and learn before their competitors did.

Have a workplace problem? Maybe I can help! Email me at sunira@worklylaw.com and your question may be featured in a future column.

The content of this article is general information only and is not legal advice. 

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