Why SMEs Hesitate to Adopt AI

The Good Stuff, with Pete and AndyEpisode: AI and Stewardship in SMEsHosts: Pete and Andy, with guests Bill and Gabe from ADAPTEpisode Overview: Pete and Andy explore why small-medium enterprises struggle to adopt AI despite its transformative potential, and how succession thinking principles might unlock the path forward. The conversation reveals the intersection of business stewardship, role clarity, and AI implementation.Key Discussion Points:00:05 Defining Stewardship - The non-operational decision-making that encompasses vision custodianship and organizational leadership in SMEs01:23 Three Business Roles - Vision custodian (owner/capital deployer), organizational leader (strategy/culture), and technician (delivery/execution)04:44 The Reactive Trap - As businesses grow, founders become more reactive and stewardship acumen drops, even though they started as proactive entrepreneurs10:23 The Cruise Boat Test - What happens if you disappear for three months? Most SME businesses wouldn't survive11:32 Intrinsic vs Extrinsic Motivation - Many businesses chase growth because "if you're not growing, you're dying" rather than asking what will actually make the owner happy17:34 Role Clarity First - Understanding you wear multiple hats (owner, director, vision custodian, technician) is the foundation for making better decisions22:19 The Unavoidable Truth - There's no way around the work, only through it. You must commit time to design the business you want27:20 Vision Creates Peace - A detailed vision provides clarity for decision-making even during chaos and overwhelming pressure28:35 AI Benefits Small Business - Counter to popular belief, AI is a decentralizing force that empowers high-agency, resource-constrained entrepreneurs30:35 The Intelligence Form Factor - When intelligence shifts from $100k human units to cents-based AI units, small businesses can finally compete33:15 The 50% Revenue Opportunity - Real potential for SMEs to increase revenue by 50% while maintaining the same overheads through AI-enabled capacity35:39 Problem-First Thinking - Stop talking about the technology; start with genuine business problems that need solving38:16 Why Adoption Lags - Uncertainty, lack of trust, overwhelming noise, and no clear pathway prevent action despite recognizing the opportunity40:26 Democratized Intelligence - AI allows you to access skills you don't have by simply talking to it in language you both understand43:44 The Trust Problem - We hold AI to higher standards than humans; one failure destroys confidence despite humans making errors constantly47:12 Building Trust Over Time - Need enough trust to take the first step, then build confidence through consistent positive outcomes52:32 Demonstrating Understanding - The roll cards exercise proves you deeply understand their problem, which builds immediate trust55:11 Core SME Challenge - Lack of time and constant resource constraints; always too much to do with too little capacity56:59 Working With AI - Stay involved as vision custodian for direction, architecture, and testing; let AI handle execution01:01:34 Mindset Shift Required - AI is probabilistic, not deterministic; requires different thinking than previous technology waves01:09:25 Vision as Working Asset - Detailed written visions reviewed monthly/quarterly to maintain alignment and guide all decisions01:16:31 Peace Through Clarity - When everything's chaos, knowing exactly what you want allows you to take small steps with confidence01:23:07 AI Role Cards - Give AI specific roles with accountabilities, decision rights, skills, and guardrails to perform reliably and build trust01:27:32 Human Flourishing Vision - Same revenue, same employees, but everyone works 20 hours per week instead of 50