How much AI do SMEs really need?

How much artificial intelligence (AI) do SMEs actually need? Should companies be getting into AI right now? We’ve asked someone who knows: Bastian Diedrich, a young man from Bremen with a lot of vision. Some might say that’s easy for him – given that his office is in the Weser Tower, Bremen’s tallest office building, with panoramic views across the whole of the city.

When it comes to new technologies, the 33-year-old is always one of the earliest adopters. As Head of Business Development at digital agency hmmh, it is his job to get employees connected, give them access to the latest technologies and always stay at the cutting edge of developments. This includes knowing his stuff about artificial intelligence (AI). “What an awesome job,” he says with a broad grin.

Digital expertise from Bremen

With over 300 employees, hmmh is one of the largest e-commerce agencies in Germany – specialising in designing, building and operating online stores and marketplaces, newsletter systems, and even POS (point of sale) and printed material. All completely seamlessly. Tchibo, Bonprix, Schaeffler and many other famous names rely on digital retail services from Bremen. “But the majority of our customers are small and medium-sized companies from northern Germany,” says Bastian Diedrich.

Some of these projects do use artificial intelligence. This includes chatbots in apps that recommend outfits to customers, and systems that track users as they navigate through a website and then present them with individualised offers based on their preferences.

Is there too much hype around AI?

Although AI technology is being used very successfully in those projects, Diedrich warns against seeing it as the magic bullet that the media are currently making it out to be. “AI is effective, no doubt, but it is being overhyped right now,” says the head of Business Development. “Every user needs to ask himself: ‘What is my actual problem? What is really behind it? Can I increase the benefit to myself and my customers through AI?’ And sometimes the answer might be: ‘No, it’s not worth it at the moment.”

Strong words from an agency, you might think. But this sort of honesty is very important to hmmh. “We do rely on AI where it really makes sense, and is economical. But we don’t engage in hype, we deliver solid performance,” says Diedrich firmly.

Data, data, data

One place that delivers solid results at hmmh is the MAD unit. The name stands for Mobile Apps & Devices. Within the agency, a unit is a department that deals with all aspects of a customer’s requirements relating to a specific issue. MAD is located on the 15th floor of Bremen’s Weser Tower, one of the top floors of the eight occupied by hmmh in the impressive building on the edge of Bremen’s Überseestadt district. MAD develops concepts and technologies. Here, programmers work side by side with creatives on apps, augmented and virtual reality, and above all on devices for the Internet of Things. They also process machine data for new applications.

This data is crucial when it comes to using AI. “There has to be an ecosystem around AI, otherwise the project won’t get anywhere,” says Diedrich up on the 15th floor. “The first questions that companies moving towards AI need to ask themselves are: ‘What data do I have? Am I collecting machine data in the production department or financial data in controlling? Can marketing provide some figures? How can I gather more data within the company and process it in a way that makes it compatible with AI applications?’”

Data can take all sorts of forms, such as photos, audio recordings, videos, sensor readings, or tables of user behaviour from the website. “Many companies do not have sufficient base data, and if they do, it is not structured,” Diedrich explains. That means the AI will not be able to make use of it.

To structure and catalogue – that’s half the battle

To find out why properly categorised and processed data is of such importance, we need to move from the 15th to the 9th floor. Instead of small, team-based offices this has an open-plan area which covers almost the entire floor, with individual workplaces crammed tightly together. “When you’re using an AI, 60 to 70 per cent of the work is data processing. And that is one of the things we are doing here,” says Diedrich as he looks round.

Any AI is only as good as the data it runs on. At the start of every project, the existing data must be prepared, processed and adapted. Despite all the automation, that work can only be done manually. “To train an AI to recognise images we must first of all define what those images show in the training data,” Diedrich explains. This work is a necessary initial investment.

For weeks, content specialists sit in front of screens, attaching tens of thousands of tags to thousands of data items, and sorting masses of data into a centralised format. “The final form that the data will take is decided by our AI consultants on an individual basis for each customer,” Diedrich explains.

“Once the data has been prepared, the fun begins,” he adds. Now the AI can be trained before it goes on to work its magic.

AI in SMEs – should you jump in or hold back?

Once again, the question is whether it’s worth all that effort for small and medium-sized businesses? Should companies be looking at AI right now or leaving it well alone? Diedrich is convinced that to do nothing would also be the wrong approach. AI can be used effectively by SMEs if the problem to be solved is suitable. But there is no sense in employing AI for its own sake.

To get an idea of the possible applications, companies first need to do their research, advises the expert. Service providers like hmmh offer events where firms can get to grips with the technology, ask questions and receive answers.

Networking and learning together

This is why the agency is also a founder member of Bremen.AI, Bremen’s AI network. “The technology is developing at a frantic pace, which makes it a real challenge to keep on top of things, so the network is a great help. Bremen is an outstanding AI hub with huge potential, and it is attractive to both companies and qualified staff,” says Diedrich.

In addition to giving AI specialists a chance to share information, the Bremen.AI network also organises events and seminars that provide an overview of the topic for interested companies.

Within the network, Diedrich is in charge of the AI Ethics work group. He wants to get the message across that artificial intelligence does not pose a threat to people, but instead makes life easier in many ways. “Many people have abilities that they have not properly developed yet. AI gives us more freedom to go our own ways,” the digital retail specialist says.

And he should know – he’s certainly got the necessary vision, up here in the Weser Tower, above the rooftops of Bremen.