Artificial intelligence (AI) has been a catalyst for a huge amount of change in the small business arena.
AI apps, tools and solutions are everywhere, offering increasingly sophisticated ways to automate your processes and add value for your customers.
On average, over a third (38%) of small businesses in Australia, New Zealand and the UK have used, or are considering using, AI according to new research from the global hiring platform Indeed.
But what does AI do for your small business? And what do all the highly technical pieces of jargon mean?
To help you demystify AI, here’s a glossary of some key AI terms
1. Artificial intelligence (AI)
AI is the simulation of human intelligence in machines. AI allows machines and software algorithms to learn, problem-solve and automate certain tasks. For small businesses, AI can help to streamline your operations and enhance your customer service. It can also provide data-driven insights for better decision-making that drives your growth.
2. Machine learning
Machine learning (ML) is a subset of AI where systems learn from data, without any additional programming. In other words, ML helps an AI solution learn by itself. For small businesses, ML helps your AI tools improve over time, helping to automate your basic tasks, personalize customer experiences, create content and provide predictive analytics.
3. Data source
A data source is any location where information is stored, like customer databases or website analytics. If you’re using AI in your business, these data sources provide the raw material for machine learning. The more expansive your data source, the more targeted and refined your outputs will be, and the more opportunities there will be to add value with AI.
4. Data analytics
Data analytics examines your raw data to draw insightful conclusions. For small businesses using AI, analytics can give you deep insights into customer behavior, market trends and operational efficiency. The reporting you get from proactive data analytics is invaluable, allowing you to make business decisions that are based on solid evidence and data.
5. Algorithm
An algorithm is a set of rules that a computer follows to solve a specific problem. In AI, algorithms allow machines to learn from data, make predictions and automate certain processes. For small businesses, this translates to rules and AI processes that make tasks more efficient, answer customer FAQs or give you deeper data analytics.
6. Generative AI
Generative AI creates new content, like text, images or code. Chat GPT and Google Gemini are two well-known generative AI tools. For small businesses, you can use generative AI to automate your content creation, produce copy for marketing materials, create images and video and even personalize your customer interactions on the phone, or through chatbots.
7. AI prompt
An AI prompt is a text input that instructs an AI model to generate a specific output. You type what you want and the AI tool attempts to create the output you’ve requested. This could mean asking AI to improve the writing of your sales email, or to generate an image for your marketing flyer. It could also be a prompt to analyze a data set to look for a specific trend or pattern.
8. Voice AI and natural language processing
Voice AI uses natural language processing (NLP) to understand and respond to your spoken commands. It’s the technology that powers tools like Siri and Alexa. For small businesses, voice AI allows you to automate your customer service via chatbots, automate the answering of your business phone with voice AI agents or carry out voice-activated searches etc.
9. AI hallucination
AI is a massively useful technology. But it’s not perfect!
AI hallucination is when an AI generates false or nonsensical information, and then presents the output as fact. For small businesses, this can lead to incorrect customer responses, misleading marketing content, or flawed data analysis. Because of this inherent potential for false outputs, you must always review your AI content, especially factual content, to make sure it’s true.
Talk to us about introducing AI into your business
If you’re still an AI newbie, don’t worry. In this series, we’ll run you through the basics of AI, the main terms and the AI tools and agents that can transform your business.
The following content was originally published by BOMA. We have updated some of this article for our readers.