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AI Challenges for Small Businesses

Artificial Intelligence is designed to solve business problems but can quickly become the cause of them. If you are considering harnessing the power of AI in your business, read our shortlist of the AI challenges that you should watch out for in your small businesses. The latest generative AI solutions Artificial Intelligence is nothing new – the first AI program was written by Christopher Strachey at the University of Oxford in 1951. However, the world has recently been rediscovering the possibilities of AI following the release of ChatGPT on 30 November 2022. ChatGPT is what's known as generative artificial intelligence (generative AI). That is, using AI to create new content in seconds by responding to prompts. The content could be written, images, music, audio or video. Generative AI can be used to create an ‘about’ page, a corporate white paper, or even a tagline for a marketing campaign – the possibilities are endless. It's important to note the more detailed your prompt the more accurate the end result. In just a few short years the range of generative AI platforms has increased considerably with Google (Gemini) and Microsoft (copilot) growing in popularity. But they are far from the only options available. Depending on your specific needs there is a vast number of generative AI tools you can use. They are: Writing and editing tools Video creation tools Image creation and editing tools Voice and music creation tools Website builders Presentation apps to streamline creating presentation slides. And this is just the tip of the generative AI iceberg. The difference between AI and generative AI While it might sound strange, many businesses, including small businesses, have been using AI for some time. Known as non-generative AI, or discriminative AI, it is artificial intelligence focused on analysing and classifying existing data rather than creating new content like generative AI. This could be: Analysing company data. Producing business reports and forecast projections. Filtering job applications for HR. Calculating accounting figures. Personalising marketing campaigns. Debugging and fixing code. Providing customer service via chatbots. Responding to social media posts. The challenges of implementing AI AI technology remains experimental, and many companies who choose to use it are effectively acting as test-cases, discovering both its possibilities and flaws. Business leaders investing in AI systems should evaluate the risks and challenges that come with using innovative tech for business processes. Making roles redundant The biggest AI challenge for businesses is the ethical implication of reducing the need for human workers. Ideally, AI should enhance productivity and simplify jobs without making them redundant. Many businesses benefiting from digitalisation will intentionally deploy AI in a supporting role. Used in this way, AI can automate lower-level and repetitive tasks, freeing-up employees to perform more high-value work. Using AI tools can increase efficiency and allow employees to deliver projects faster. When generative AI creates new content, it is not yet at a stage where it can be used immediately. Generative AI creates the new content by pulling in information from existing content across the internet. All written content will still need to be reviewed, edited, and any statistics included verified and the source cited. This can still only be done by a human. The financial cost of AI for businesses The amount of money you invest in AI will be determined by the scope of your initiatives. If you are using AI to create written content or web graphics, the process will be quick and only cost a monthly subscription. However, if you plan to use AI to analyse your company data, this could easily be a significant investment. Businesses often need higher computing power, database integration, or even a lengthy process of data training. Data security in the age of AI While AI increases the amount of information you have to make critical business decisions, it also increases the risks of mishandling sensitive business and Personally Identifiable Information (PII). While businesses are using AI to enhance processes, cybercriminals are using it to create sophisticated malware and phishing scams. Ensuring customer data is properly secured is one of the biggest AI challenges for small businesses. Many businesses implement additional cybersecurity measures, such as multi-factor authentication or encryption to ensure they maintain strong data protection and governance. Lack of technical skills As a branch of machine learning and data science, AI is a specialised skill set that demands extensive knowledge and training. A routine change to your AI system might require a programmer to write neural network algorithms. This is every bit as complicated as it sounds. To maximise the benefits of AI in your business, you may need to outsource to external tech specialists or invest in training your existing IT staff. Either way, small businesses should carefully consider the ongoing costs involved. The importance of data quality The results of AI are only as good as the input data. In most businesses, data is siloed, disorganised or of low quality. Unreliable data poses a major obstacle for businesses looking to benefit from AI. The quality of data will have a direct influence on the performance, reliability and accuracy of your AI results. A key benefit of high-quality data is AIs ability to identify and correct inconsistencies in real time. Through Machine Learning (ML) and high-quality data it's possible for AI to detect anomalies and predict the possibility of future errors based on consistent past mistakes. AI utilise the dataset to fill in missing values-based information. So called “dirty data” can be outdated, inaccurate, incomplete, or inconsistent, and must be cleaned before it can be used. Most businesses contemplating large data-driven AI projects will start by evaluating the amount of work required to prepare their data sets. Inputting the wrong information results in getting the wrong information out. And that can be costly, especially if it relates to payroll and miscalculating wages. The future of Artificial Intelligence for small businesses There is always an opportunity for businesses to increase operational efficiency, and companies have a lot to gain from embracing AI. For small business owners, the cost is likely to be the biggest barrier keeping them from exploring the full potential of AI tools. However, with demand growing and the industry making rapid progress, AI is likely to be much more affordable. In the coming years, expect to see businesses of all sizes lean into the possibilities and benefits of AI. Please note that this is general information. Peninsula is not an IT specialist – you should consult an AI expert before implementing any changes in your business.

Guide

Stress Leave

A survey conducted by Statistics New Zealand has found that 1 in 5 New Zealand workers report always or often being stressed by work. In addition, New Zealanders who reported high workloads have two times greater odds of experiencing high psychological distress. These numbers are a growing concern for small businesses and employers who are already juggling multiple roles and responsibilities. The guide below explains workplace stressors and how employers can manage stress leave requests. Stress in the workplace There are several reasons why employees may be stressed in the workplace. Some of the most common reasons are: Unreasonable workload. Bullying  in the workplace. Restructuring of the workplace. Change of position, duty, or responsibilities. Dangerous work environment with a lack of health and safety precautions. Toxic work environment. Exposure to trauma. Isolated working conditions. Common signs of stress Often, the signs of stress are not made clear to everyone in the workplace. It is common for employees to hide the symptoms of stress, out of fear of being punished or judged by others. However, there are common behaviour patterns for employers to look out for: Anxiety. Reduced productivity. Illness and disease. Antisocial behaviour. Low morale. Lack of engagement. A combination of one or more of these symptoms is a good indicator that a person is stressed. Of course, due to the complex nature of mental and physical stress; it is important to avoid jumping to conclusions. In conversations with employees, employers must be sensitive and considerate of any support that can be provided. Stress leave While stress leave is not defined in New Zealand legislation, employers have health and safety obligations to provide a safe work environment for all employees. This includes monitoring, identifying, and managing workplace stress. Stress leave is an optional type of leave that employees may get access to in case of workplace stress. Whether this leave is available, paid or unpaid, is completely up to the employer. If an employee becomes ill due to stress, they can take sick leave under the normal conditions of sick leave. An employee who needs additional time off beyond their sick leave entitlement can negotiate with their employer regarding the length of leave and whether the leave is paid or unpaid. It is up to the employer to decide if they are able to accommodate additional time off of work due to stress. However, an employee can dispute their decision if they feel the amount of time off has not been adequate. Managing stress in the workplace Employers have an obligation to provide a safe and fair work environment for all employees. To comply with their duty of care, employers must monitor employee performance, workload, and the kind of tasks they are performing. If an employer discovers signs of stress or suspects an employee is stressed, these concerns should be discussed so a solution can be found to manage the problem. Whether or not the stress is caused by the workplace, employers can advise employees to visit a doctor or employee assistance program to identify the source of the problem. Employers are not legally required to do this, but it is part of their responsibility to reduce threats to health and safety in the workplace. Employer obligations around stress leave In an ideal situation, employees would not need stress leave as employers will mitigate stress and create positive and healthy workplaces. However, in situations where the need for stress leave does arise, what are employer obligations in New Zealand? Stress is classified as a mental health concern and forms part of an employer’s health and safety responsibilities. Employers must handle any situation that concerns stress responsibly and support the employee as needed. Other than the health and safety responsibilities, there are multiple benefits to reducing stress and improving mental well-being in the workplace, such as: When employees are healthy, their productivity is boosted. Improves company culture and morale. Makes recruitment easier. Employees are motivated to stay committed to their roles and the company. If an employee has been diagnosed as suffering from work-related stress, the employer should review the employee's workload, duties and overall working environment to assess whether these have contributed to the employee's stress. It is recommended to have a meeting with the employee to discuss their stress, work and how to prevent future absences once they are fit enough to attend. You may need to investigate if there is a wider issue that needs to be addressed or if the business is able to make reasonable accommodations to facilitate the employee's return to work. Stress leave policy If an employer wants to implement stress leave in their workplace, then it is highly recommended that they establish a stress leave policy to outline its parameters. The policy should set out clear and consistent practices for requesting stress leave and the potential responses to those requests. It will communicate to the employees that they can discuss their concerns without retribution or judgment from the organization. The stress leave policy should outline a reasonable course of action to manage work-related stress and assist employees in any way possible for them to recover and get back to work. The policy can include: Reason for taking leave (can be broad if the employee doesn’t wish to disclose). Duration of the leave. Return to work plan. Certificates/Evidence necessary. In the stress leave policy, emphasise the type of evidence considered acceptable by the company. An employer can ask an employee to submit a medical certificate although the certificate doesn’t need to specify anything other than their unfitness for work. Before you draft a stress leave policy, consider discussing it with an employment relations professional and a health professional. This will support in devising a relevant and practical stress leave policy for everyone. Strategies for employers to reduce workplace stress There are some ways that employers can mitigate or reduce workplace stress: Balancing job demands to employee skills and capacities. Setting realistic pace and timelines. Having clear and consistent policies on behaviour and work standards. Having regular meetings with the team. Having regular meetings with the employee in a 1:1 setting. Encouraging employees to take leave as needed. Encouraging a positive work culture. Having flexible work arrangements. Regularly conducting surveys to understand team morale. Regularly conducting risk assessments and health and safety surveys. Offering training to employees for hard and soft skills. Build healthy workplaces with Peninsula Workplace stress can have a huge impact on mental well-being. It’s not just mental health, studies have found that ongoing stress can lead to physical conditions such as heart disease or headaches. Employers have a legal responsibility to mitigate risks to mental health, but they also have a moral responsibility to their employees on a personal level. Managing business’ needs as well as your employees’ welfare needs can be a difficult balance. Peninsula offers support and guidance to small businesses in New Zealand looking to implement stress leave and improve their workplace culture. Our resources include tools, training, software, policies, and documents that can help draft a stress leave policy, boost your company’s productivity, and create effective systems of work. Call our expert team for free initial advice.

Blog

What is an Employee Assistance Program (EAP)?

An Employee Assistance Program – more broadly known as EAP – is offered by employers to help employees, and often their immediate family members, maintain or improve their mental health and wellbeing. An EAP program is designed to help individuals address a range of personal and work-related issues. It offers a safe, non-judgemental, and confidential counselling service focused on providing mental health and wellbeing support from qualified counsellors. One of your employees may be struggling with a relationship breakdown, financial stress, family violence, depression and anxiety, loss of a loved one, gambling, alcohol or substance addiction. You may be unaware an employee is silently dealing with one of these life challenges until it impacts their work performance or attendance. What are the business benefits of EAP services? As a small to medium sized business owner or manager you have first-hand experience of the challenge of attracting and retaining high performing employees. The benefit of an employee assistance program is its accessibility. The service provides employees with coping strategies and resources. This support allows them to better manage personal and work-related stress they find overwhelming. Helping to maintain productivity, ultimately benefiting your business. By supporting employee wellbeing and job satisfaction through an EAP, you can improve staff retention and reduce the need for frequent hiring and training. Healthy and happy employees are more engaged in both your business and their role, reducing absenteeism and increasing overall workplace morale. Employees can access help knowing their concerns will be handled discreetly and professionally. They are able to be open and honest about their challenges without the fear of judgment or repercussions in the workplace. An EAP typically includes telephone counselling, face-to-face sessions, and online resources. Some employees may be referred to specialised or long-term support if needed. The cost of mental health to business It's often thought mental health challenges affect employees in large corporations in high-pressure, high-stress roles working long hours, or are in specific industries such as healthcare or the legal profession. In reality, SMBs are often more vulnerable to the financial and operational impact of mental health issues. Absenteeism, reduced productivity, and increased workplace health and safety compensation claims as well as high staff turnover is costly for small businesses. As a small to medium sized business owner in New Zealand, the impact of poor mental health is substantial as you have fewer staff to cover for absent colleagues. This reduces productivity, increases workloads, and creates a higher level of stress and fatigue for remaining employees. As a consequence, this could lead to further instances of mental health challenges, stress leave and high employee turnover. Psychosocial hazards and EAP For some time, the focus of health and safety at work has been reducing hazards that could potentially cause a physical injury. In more recent years this has expanded to include psychosocial hazards, which can impact an employee’s mental health and wellbeing. Psychosocial hazards can include: Job demands: An excessive workload, unrealistic expectations leading to project failure, or tight deadlines requiring long work hours leading to fatigue. Employee support: A lack of management or supervisor support, poor co-worker relationships, or limited access to essential resources. Conflict: Workplace violence, verbal or physical intimidation, bullying, or sexual harassment. Role clarity: Unclear job expectations, responsibilities, or performance standards. Lack of recognition: Minimal or no recognition for achievements or contributions. Work isolation: A lack of social interaction or support of remote or isolated employees. An EAP and management of psychosocial hazards are connected. An EAP can play a key role in reducing the effects of psychosocial hazards by providing early intervention services for employees facing workplace stress, bullying, harassment, sexual harassment or interpersonal challenges. Effectively managing psychosocial hazards requires a proactive approach, including identifying and minimising hazards in the workplace. Absenteeism and presenteeism Mental health issues are a leading cause of unscheduled absenteeism. However, presenteeism, where employees attend work but are unproductive, can be an even greater problem. An employee struggling with their mental health may be physically present but functionally absent. Their ability to concentrate and perform tasks effectively is reduced, which could result in safety risks to other employees. This lack of focus can create a work backlog, result in missed deadlines, and a decline in output. The connection between poor mental health, productivity, and absenteeism can be difficult to identify at first and even harder to manage. The stress and anxiety associated with mental health issues can then manifest in physical symptoms, leading to increased sick days and further absenteeism. An EAP program can help employees address challenges before they escalate and impact their personal and professional lives. Providing Employee Assistance Program services should not be considered a perk, but rather an essential part of your business. You’re investing in the ongoing health and wellbeing of your employees. It not only improves morale, productivity, and reduces absenteeism, an EAP can attract and retain top talent by building your reputation as an employer of choice that places the welfare of your employees first. To find out more on how offering EAP services to your team can help them better manage difficult situations, contact the team at Peninsula to learn about our 24/7 counselling helpline and other EAP services.