Automate admin, stay human: how small businesses use AI wisely

Artificial Intelligence (AI) is now firmly mainstream. But what does it mean for small businesses? We asked over 170 of our customers - all UK small business owners - to share their thoughts. A staggering 81% said they’re using AI, with 54% saying they use it frequently in the day-to-day running of their business.

For many of our respondents, time-saving was a major driver. 58% of business owners told us they think AI helps them save time in a variety of ways. 

“It speeds up everything I do and gives me fast access to information that would have taken more time and more people to produce,” explains Mick Merrick, a senior partner in financial services. 

For photographer Ian Georgeson, “It takes on the repetitive desk work that used to eat into my evenings… As a one-person business, every hour I get back is an hour I can spend shooting, editing or finding new clients.“ 

But AI doesn’t always save time - if the time it takes to manage the tools outweighs the work they replace, it can inadvertently become a time sink. With access to AI built into so many of the tools and software you use today, it’s easy to get pulled down a rabbit hole by tweaking AI prompts or digressing from your original task - especially when you’re trialling and testing how best to use AI for your business.

“The measure of a good AI tool isn’t purely what it can do. It’s whether it actually makes the work better, faster or easier,” explains Charlie Bell, FreeAgent’s Head of Brand Design.

So, what can you do to ensure you’re using AI efficiently to boost your business, while avoiding common time sinks?

Start simple with automation

If you’re keen to shave time off admin work using AI but don’t know where to start, smart automation can be a straightforward and effective route - especially for bulk or repetitive tasks like getting paid. 

“There are more straightforward uses of AI, like machine learning, that are very mature… sometimes businesses just need organised automation rather than true AI. That is a lot more affordable and provides a decent foundation for AI,” explains Gareth Williams, Director of Field Enablement Consulting, a company that helps organisations adopt digital technology.

When it comes to your accounting admin, you can start delegating tasks like invoicing and taking payments with confidence using FreeAgent. For example, if you have repeat customers or clients each month, FreeAgent’s recurring invoice profiles automatically invoice a customer for the same amount monthly. Or you can create a late payment reminder template that will automatically send an email reminder when any invoice is unpaid and continue to chase if they slip into overdue.

Be specific about what you need

If you are going to use generative AI, you should think of it as an assistant who’s keen to always go ‘above and beyond’. Without constraints, it may take the opportunity to do more, sometimes involving assumptions that lead you both in the wrong direction. This can backfire and end up with you spending more time undoing, refining or supervising than it would take to complete the task yourself.  

“It sent me down a rabbit hole looking for a particular fault because I’d badly explained the [issue I was trying to fix]. I blindly trusted it… Don’t switch your brain off,” warns Jordan Duggins from laptop and PC repair company LaunchLayer. 

And it’s not just your own use of AI that can trip you up, says photographer and filmmaker Leo Johnson. “I had one job where the client used AI for a shot list and sent me out looking for a piece of street art to shoot. The building it was on had been demolished three years prior, and the art no longer existed. Hours of my day wasted looking for it,” he explains. 

To avoid costing you precious time, be very clear with your tasks and avoid open-ended queries or requests. “AI is only as good as the information and context it has available - it’s not a mindreader,” explains Michael Scott, from IT consultancy Caracal Lynx Limited.

Think of AI as your handy assistant, not your replacement 

When you run your own business, you can find yourself pulled in countless directions as you juggle roles and responsibilities. The right AI tools can help to lift some of that burden, provided you identify the right areas for it to support you and your team. One of the most popular being tedious admin. 

“For a small creative business, AI works best as a capable assistant, not a replacement for the creative work. The photography, the client relationships and the final judgement are still mine. What it’s changed is the admin load,” explains photographer Ian. “Writing captions and keywords for hundreds of stock images used to take hours, and now it takes a quick review.“

Robert Owen, Director of SMD Construction Consultancy, saves time by delegating specific tasks that require processing or reviewing lots of data to AI. “Reading and checking reports can take up to a day, AI does it in seconds. Finding the cheapest products used to mean checking every product website, AI does this in seconds. Reading up on technical issues could take hours, AI does this in seconds,” he says. 

AI helps the small team at  IT infrastructure managers company Dogsbody Technology to scale up their customer base. “It helps us solve problems faster, reducing the amount of research, trial and error, and repetitive work involved,” says Founder and Director Dan Benton.

“Everything is still checked by our team, but tasks that previously took hours can sometimes be completed in minutes. This allows our small team to support more customers without increasing our headcount.” 

Invest time in training your AI tools 

It’s worth investing the time upfront to find the right solutions for you and your business - and then training it properly - says Rik Smithies, owner of software consultancy NProgram Ltd. The more you use AI, the more it will learn and adapt to your ways of working. 

“I teach [AI] to do things, which takes time, but after that it can do it semi-automatically,” he explains. “It needs constant checking but it saves time. And it can do things that I basically cannot do (it knows technical things that I do not).”

For marketing and business strategist Keir Whitaker, AI has saved time through “speed to final product, whether that’s a blog article, a sales page, a new web page or a new feature. I am still actively involved in the process but I feel I have trained it enough that it knows my style and the final product is more of a conversation than me plugging away at something word by word. It’s therefore quicker and allows me to do more with the same amount of time.”  

Similarly, for Holly Hinton, Managing Director of Web Goddess - who provide strategic web design for charities and SMEs - investing time in training AI means she can now rely on it for certain tasks. “Because we have trained it to take our standard processes and run them automatically when asked, it saves us having to start from scratch or even a template each time,” she explains.

But be wary of inaccuracies and hallucinations 

“AI can be confidently wrong! It can give very convincing answers that turn out to be incorrect, sometimes wasting more time than it saves,” warns Dan from Dogsbody Technology.  

You may have heard the term ‘AI hallucinations’. This is when generative AI models, like Large Language Models (LLMs) provide false information as fact. For example, a recent test by fintech firm Saturn found the most popular AI chatbots ignore tax changes and hallucinate rules when asked for financial advice. ChatGPT, Claude, Microsoft Copilot, Grok and Gemini provided wrong answers to financial queries 57% of the time on average, according to their research.

Do your own fact checking and review every output that you entrust to AI, says academic Damien van Carrapiett. “Take it with a pinch of salt and always double check its output before committing to any wide-scale (or expensive!) changes,” he says. “It should be used in support of the business, but the human rudder is vital.”

And remember why your customers hire you

When you’re considering where you can save time with the help of AI, think about what you’re comfortable entrusting to it and what you want to keep 100% human. Depending on your business and industry, that might vary, but as a business owner or decision maker, it’s up to you to make that call. “Use the tool [AI] as an extension of your own mind, not a mind of its own,” says strategic brand writer Nick Carson. 

It can be easy to fall into the trap of over-reliance on AI to save time or effort, but be wary that it may show in your work. “Avoid using it carte blanche for your brand - there is a tendency to sound the same as others. Your brief is essential, but your review and addition of personality is key to successful outputs,” says Ben Hopkins-Lefevre, Founder of Hopkins-Lefevre Marketing.

Before you decide where you want AI to help your business, ask yourself: what do your customers or clients value from the product or service you offer - and what aspects are tied specifically to you and your talented (human) team? Then consider what tasks you’d like to offload to AI to free up more time to focus on that important work. 

Are you an accountant or bookkeeper? Find out more about how FreeAgent uses AI to lighten your workflow.