More than half of South African small businesses are using artificial intelligence (AI) tools daily or weekly, but many are still struggling to work out where the technology fits into their operations.
Xero’s 2026 State of South African Small Business report found that 52% of small businesses are using AI tools daily or weekly, while 56% want more support understanding how AI applies to their specific operations. A further 34% say they feel overwhelmed by the amount of information about AI.
The findings suggest that the next stage of AI adoption may be less about convincing businesses to use the technology and more about helping them identify where it can solve a real business problem.
Kenne Loubser, chief marketing officer at HyperDev AI, says businesses should start with the problem rather than the technology.
“Most small business owners don’t need another explanation of what AI can theoretically do. They need to solve one specific problem this week. That might be a reporting tool, a client onboarding form or a dashboard that currently lives across three different spreadsheets. The starting point should be the problem, not the technology.”
Xero’s research found that 85% of small businesses are prioritising digital adoption, using automation and AI to speed up manual processes and gain better visibility of their business performance.
That practical approach is becoming more relevant as AI moves further into software development. Gartner predicts that 40% of enterprise applications will include task-specific AI agents by the end of 2026, up from less than 5% in 2025.
It also predicts that by 2027, more than 65% of engineering teams using AI-assisted coding will treat traditional development environments as optional rather than essential.
For smaller businesses, this does not mean every founder needs to become a software developer. It means the distance between identifying a problem and testing a potential solution is becoming shorter, without requiring a large development budget or extensive technical expertise upfront.
Start with practical problems
Loubser recommends that business owners begin with something low-risk and high-friction.
An internal reporting tool, client onboarding form or dashboard spread across several spreadsheets can provide a useful starting point because the benefit is relatively easy to identify and the consequences of getting it wrong are limited.
He also recommends building something the team can see. A working first version, even if rough, can demonstrate what an AI-enabled tool can actually do and make its potential value more tangible than a presentation about AI.
The impact should then be measured in terms of time rather than opinion.
Businesses can track how long a task takes before and after introducing a tool, focusing on whether it saves time, improves an experience or frees people up for higher-value work.
“None of this requires a big AI initiative,” says Loubser. “It requires picking one task that takes longer than it should and being consistent about fixing it.”
The approach does not remove the need for human judgement. Deciding what to build, how it should work and whether it is ready for customers remains a human responsibility.
What changes is how early a non-technical founder can explore an idea before committing to a larger development project.
“The businesses that benefit most from AI won’t necessarily be the ones running the biggest AI initiative,” says Loubser. “They’ll be the ones that get comfortable solving small, practical problems, measure whether those solutions actually make a difference, and then build from there.”
