uman resource functions in small and midsize businesses (SMBs) are often on the outside looking in when it comes to using artificial intelligence to improve operations. That’s because they typically don’t have the resources required to build the internal infrastructure or hire the AI experts needed to make the technology work.
But there’s a new option that allows SMBs to begin implementing tools such as chatbots with smaller upfront financial investment: Artificial Intelligence-as-a-Service (AIaaS) platforms. These third-party vendor solutions provide out-of-the-box AI capabilities to organizations in ways similar to Software-as-a-Service (SaaS) products now common in the HR technology industry.
Growing Gap Between AI Have’s and Have Not’s
Recent research shows the gap in AI adoption between large and small companies continues to grow. A 2022 global study from IBM found that larger organizations now are twice as likely as smaller organizations to have deployed AI, compared with only 69 percent in 2021. Among the top factors hindering successful AI adoption are limited internal AI expertise, a too-high price tag, and lack of tools and platforms to develop AI models.
AIaaS platforms enable smaller businesses to begin using AI by providing ready-made platforms for developing and testing tools including chatbots that can answer frequently asked questions from job candidates and employees, or create application programming interfaces (APIs) that improve integrations between disparate HR systems. Using these pre-trained AI tools helps SMBs avoid costs of investing in specialized hardware such as GPU-based processers and other infrastructure needed to create and use on-premise AI.
In a time when there’s a shortage of AI programming experts—who typically can demand hefty salaries—AIaaS platforms also enable SMBs to avoid those recruiting and compensation issues because most require minimal or no coding skills for successful use.
HR technology analysts say AIaaS platforms can be a good fit for HR functions in smaller businesses still figuring out how they want to use AI in their operations.
“AIaaS can be a good option for smaller or medium-sized businesses that don’t have a big data science team or advanced infrastructure,” said Alexander Wurm, a senior analyst specializing in enterprise software for Boston-based Nucleus Research. “These pre-trained AI models have taken off lately, whether for creating chatbots used on websites, for voice recognition purposes or for data classification. The platforms allow SMBs to see value right away from experimenting with AI with a low upfront investment.”
Research shows more SMBs will likely invest in these types of platforms in the future. A study from Analysys Mason, a technology research and consulting firm in London, found that SMBs plan to increase their tech spending by 6 percent this year over 2022 levels, with some of that increase targeted to as-a-service technologies. Spending on Platform as-a-Service (PaaS) solutions, for example, is expected to grow by 18 percent this year over prior-year numbers, the study found.
“SMBs are demanding more flexibility without committing to expensive IT resources,” wrote authors of the Analysys Mason study. “Early adopters are increasing their use of advanced analytics tools such as business intelligence and AI-powered applications.”
