By Hannah Haworth, Head of Strategic Positioning & Enablement at Seventh State
Artificial intelligence has moved from experimentation to everyday business reality, but many SMEs are still struggling to unlock its full potential. While AI has often been promoted as a way to automate tasks and improve productivity, some experts believe businesses are asking the wrong questions altogether.
Hannah Haworth, Head of Strategic Positioning & Enablement at Seventh State, explains why AI should be used to enhance people’s thinking rather than replace it, why culture matters more than technology, and how SMEs can take a more deliberate approach to adopting AI.
AI has been one of the biggest business talking points in recent years. Why do you think so many SMEs still aren’t seeing the benefits they expected?
A lot of it comes down to how they’ve framed AI in the first place. Most SMEs see it as a productivity tool, something to do the same things faster, or to replace a task, a role, thinking. But if you optimise for replacement, you tend to dilute the very thing that gives you the edge. AI is only loaded with what’s already out there. So the moment you use it to replace someone’s thinking, you’re trading their experience and perspective for the average of everything that’s already been said. The businesses getting real value are using it the other way round, to enhance an individual’s thinking, not stand in for it. Get AI to challenge your people rather than answer for them, and it unlocks the perspective they already have. It gives them a way to look inward and converse with themselves.
The second thing is that too many businesses layer AI straight onto processes they’ve never questioned. They keep processes in place simply because that’s the status quo. Any technology shift like this is the best prompt you’ll get for a proper review, and sometimes AI doesn’t just speed up the old process, it lets you rethink it entirely. That has to come first. Look hard at what you’re actually doing before you layer in a new tool, whether that’s AI or anything else.
There’s no cookie-cutter answer. Where AI helps is a product of the specific people you have, their experience, their talent, their mindset, and the environment your leaders create around them. It’s the people, the mindset, the use cases, the culture. All of it is different from one business to the next. So the answer that works for one won’t be true for another, and copying someone else’s playbook is often exactly why the benefits don’t show up in the way we may expect.
Do you think some businesses have rushed into AI simply because they felt they had to?
Some did, but I don’t think that was the wrong instinct. For a while AI was the shiny new thing everyone was talking about, and jumping in to see what it could do was exactly the right move. That’s the experimentation phase. You have to play with something before you can understand it.
The issue isn’t the ones who rushed in. It’s the ones who never shifted gear afterwards. They treated AI as another tool to bolt on, tick the box, job done, without realising there’s a whole other phase waiting. Now that businesses have had time to see what’s possible, the move is to stop and think deliberately about how AI actually belongs in their business, rather than just slapping it on the side.
AI has the potential to be a revolutionary change, not just to your internal processes, but to where you place value in the market and what you deliver as a business. You can treat that as the opportunity it is, or ignore it and let it become the threat it could be. Either way, it’s not something you rush. The experimentation phase is over. The businesses that get ahead now are the ones that realise there was ever a second phase at all.
What’s the biggest mistake you see SMEs making when they start using AI?
Treating it as a tooling problem when it’s really a skills and mindset problem. Businesses focus on which tool to buy and how to prompt it, when the actual question is: how do we, as a business, use this well? That needs education, but not the “here’s how to write a prompt” kind. The kind that helps people understand where AI genuinely belongs in their work.
That’s bigger than an AI policy. It comes down to the culture and the environment you’ve built. If you run a rigid, process-driven business where nothing happens without three sign-offs, then anyone experimenting with something as sensitive as AI is going to be seen as too risky to bother. The behaviour you actually want never gets off the ground. You can write all the guidelines you like, but if the environment punishes curiosity, they won’t matter.
This is why I find a term like “shadow AI” so unhelpful. It takes something that should be positive – people being inquisitive, experimenting, finding what works – and makes it sound illicit. That framing drives it underground, when that’s the last thing you want. The answer is transparency: leaders saying clearly what’s OK and what isn’t, so people can experiment safely rather than in secret.
Leaders have to lead on this, by example, and by building an environment where people can use AI safely, correctly, but still creatively. Get that right and the onus shifts: people are genuinely responsible for how they use these tools. It’s not a leadership problem or a people problem. Done properly, those aren’t two sides of a different coin, they’re two sides of the same one.
Where do you think AI can make the biggest difference for a smaller business today?
For me it’s enhancement: AI amplifying your people’s thinking rather than replacing it. That benefit doesn’t scale with company size. A five-person business gets exactly the same value from it as a five-hundred-person one. That’s precisely what makes it such a leveller for smaller businesses.
The real constraint for a small team was never a lack of good thinking, it was time. If you wanted a sounding board before, you needed a senior person in the room. You’d have to schedule it, pull people off the operational work they were already stretched across, and in a small team there just aren’t the hours for that. The thinking got squeezed out. What AI changes is that you can now do the thinking and the challenging at the same time as the operational work, not instead of it. That speed is the leveller.
An example we’ve implemented at Seventh State is the use of a simple custom GPT to help individuals think through and articulate their ideas. Everyone has ideas, but not everyone can articulate why their idea is a good one in the context of where the business is trying to go. Someone might know instinctively that it’s worth doing, without being able to make the case for it. So we use AI for exactly that: here’s our mission, here’s what we’re trying to achieve, here’s my idea, help me work out how it serves those goals and how to put it to the team so we can make a decision on it quickly.
So now, we’re not only talking about AI levelling between small and large businesses. It can be the leveller within a team, too. A good idea from someone who isn’t the natural communicator no longer dies because they couldn’t make the pitch. Everyone gets to contribute at the same level, and for a small business, where every good idea counts, that can make a real difference.
Is AI something every SME should be investing in, or are some businesses better off waiting until they’re more prepared?
I don’t think it’s an all or nothing situation. AI spans so many different use cases that the honest answer changes depending on which part of the business you’re talking about, even within the same company. Some things you can just get on and do. Others need more deliberate thinking first.
Take the idea-articulation example. We’ve built a custom GPT at Seventh State that helps the team turn an idea into a proper business case, mapped to our mission and goals. There’s very little risk in something like that, and you get real value from it straight away. That’s the kind of thing any SME can implement right now, no need to wait for anything.
But when you start asking bigger questions like how do we use AI to review our processes, or to reassess where our value sits in the market, those need real groundwork first. You do the deliberate thinking, then you layer AI on top. Rushing those is exactly where businesses can come unstuck.
But I wouldn’t say this is “waiting”. Nobody should be waiting to engage, the low-risk wins are there for everyone today. And on the bigger moves, what you’re actually doing is preparing deliberately.. The real question isn’t “should we invest in AI.” It’s what can we use safely right now, and how do we use this moment to take a proper look at the business, inside and out, and evolve so we stay relevant. Nothing in that is passive.
How can business owners tell the difference between an AI tool that’s genuinely useful and one that’s just clever marketing?
I’ve been in marketing for over fifteen years, and the test I’d give any business owner isn’t even specific to AI, it’s product marketing 101. Can you tell me what problem this solves for me? What will it actually do for my business? Because I don’t care what the features are. I care about the benefit. The “how” is always secondary.
That’s the lens that cuts through it. “AI-powered” is part of the “how”, it’s a feature dressed up as a benefit. On its own it tells you nothing about whether the tool is of any use to you. Plenty of genuinely useful tools happen to use AI and barely mention it, because the value speaks first.
So here’s a practical thing you can do: strip the word “AI” out of the pitch and see what’s left. If there’s still a clear, specific benefit standing, something you can point to and say “yes, that solves a real problem I have,” it’s probably worth a look.
If an SME wanted to get more value from AI over the next 12 months, what practical advice would you give them?
Start with the low-risk, high-value wins. Every business has them, though they’ll be different for each one, the things where there’s very little downside to just getting on and using AI, and real value in doing so. Start there, because that’s the part where there’s no reason to wait. Think about what custom GPTs might work for your organisation. Get your people conversing with AI to work through what they actually think about something, using it to challenge and enhance their thinking rather than hand them an answer.
Then shift how you’re thinking about it. We’re not in the experimentation phase any more, so the job now is to be deliberate. And the practical side of being deliberate is doing the groundwork: take a hard look at your processes before you layer anything on top of them, and then take on the bigger strategic questions: how AI changes your processes, and where your value actually sits in the market. Those are the moves that take real thought, and they’re worth the time.
Running underneath all of that, the whole way through, is the culture piece. You have to be building the education and the environment that lets your people use AI safely and confidently. That’s not a step you finish, it’s the condition that makes everything else possible.
Looking ahead, what do you think successful SMEs will be doing differently with AI in two or three years’ time?
The successful ones will have stopped treating AI as a thing they adopted and started treating it as a prompt to reinvent. That runs at two levels. At the business level, they’ll have used it to genuinely reevaluate what they bring to the market and how they stay relevant, rather than bolting it on and carrying on as before. At the individual level, they’ll have used it to bring out the potential in their people, enhancing how their team thinks rather than replacing it. It’s the same instinct at two scales: reinventing what the business offers, and reinventing what each person brings to it.
Those businesses will pull away from the ones that just used AI to do the old things faster or cut a few costs. In two or three years, I don’t think the gap between them will be a technology gap. It’ll be the result of who used this moment to genuinely rethink, and who didn’t.
