How AI can transform your back office operations

Love it or hate it, there's no denying artificial intelligence is having a profound impact on your small business clients. 

A recent U.S. Chamber of Commerce report found that almost 60% of small businesses are using AI for business operations — twice the adoption rate we saw in 2023. Meanwhile, a Thryve small business study found that two-thirds (69%) of small business owners leverage AI to automate back-office and customer management processes and three in four respondents (73%) agreed that AI would effectively "offload repetitive tasks."

Sounds great, right? Well, a recent Goldman Sachs report found that only one in eight (12%) business owners are fully integrating AI into core operations. What's more, nearly half cite "lack of technical expertise" and difficulty "choosing the right AI tools" as barriers to integrating AI into their back-office business processes. That's where you can provide significant value in three fundamental areas: 

1. Cash flow management: New tools monitor cash flow patterns and send finance teams proactive alerts. If a business's cash runway drops below 12 months, clients get immediate notification when they can actually do something about it.

2. AP/AR automation: Through integrations like Bill.com, clients tell us AI-powered automation eliminates over 90% of back-office headaches. Invoice processing that took hours now takes minutes.

3. Tax preparation: Tools can estimate quarterly taxes automatically based on current financial data, giving continuous visibility into tax obligations. When cash flow is optimized, AP/AR runs smoothly, and taxes are under control. This gives business owners peace of mind and the mental bandwidth to focus on growth. 

When used correctly, AI transforms back-office professionals from data processors to strategic advisors who can now provide financial planning expertise by analyzing trends, forecasting scenarios and guiding expansion decisions. These folks can also be freed up to provide advisory work by analyzing industry benchmarks, optimizing pricing, planning tax efficiency and making process improvement recommendations by evaluating tools and integrations and optimizing systems for scale. 

With AI handling routine tasks, back-office professionals can also be freed up to enhance client relationships by providing personalized support and responsive service by staying current on regulations and deepening expertise. Bottom line: AI frees up humans to do what they do best: provide judgment, empathy and creative problem-solving.

Introducing AI to your team

Change is always unsettling for workers. We've found several good ways to introduce AI to your back-office team so they consider it an ally rather than a threat.

• Lead with empowerment: Frame AI as a tool that frees up team members from tedious tasks so they can focus on strategic, relationship-building work.
• Provide training: Education transforms fear into confidence. Show how the technology works and give team members time to get comfortable with it.
• Be transparent: Share case studies that show how AI enables back-office workers to spend far less time on data entry and far more time on strategic advisory.
• Emphasize AI's limitations: These include understanding relationships, exercising judgment, providing empathy, navigating complex edge cases and thinking creatively — areas where humans excel.
• Share success stories: As mentioned earlier, research shows that four out of five businesses using AI increased their workforce rather than reduced it. To me, that proves AI is a force multiplier, not a job killer.

At its core, AI enhances decision-making through:

• Pattern recognition: AI detects subtle patterns across months of data, like seasonal revenue dips, giving advance notice to adjust plans proactively.
• Trends and alerts: AI can identify financial trends and provide proactive alerts.
• Benchmarking: It can compare metrics against industry standards. For instance: Is your profit margin healthy? Are expenses in line with peers?
• Real-time visibility: Traditional month-end closes mean decisions based on 30-day-old data. AI provides current financial information reflecting business reality.
• Democratizing expertise: AI explains complex metrics in plain language, making financial intelligence accessible to entrepreneurs without having armies of MBAs on staff.

The combination of the factors above creates "informed intuition." Business owners still rely on experience and instinct, but they're now supported by comprehensive, real-time, contextual data.

Real-world example

Fishbat, a digital marketing agency we work with, now uses AI to automate reporting, data entry, project updates and performance summaries. This frees up its staff to focus on high-value client work instead of administrative tasks.

Beyond automation, Fishbat leverages AI to analyze workload distribution, project timelines, profitability metrics and resource allocation. "We're not just reacting when something goes wrong anymore," explained Fishbat CEO Clay Darrohn. "AI gives us a clearer picture of what's working, what's slowing us down, and where we should allocate time and people."

Perhaps most valuable, AI has helped Fishbat systematize its operations from SOPs and onboarding to quality control. The technology documents processes, identifies gaps and standardizes workflows, making the business more scalable and less dependent on any single team member.

10 steps to selecting the right AI tools for your client's back office

1. Start with pain points: Identify your biggest operational challenges, not features you think your clients need.

2. Evaluate integration: Does it work with QuickBooks, Xero, payment systems, payroll? Disconnected systems create more work.

3. Look for customization: Can you customize dashboards and reports? Will it scale as your client grows?

4. Prioritize user experience: Is it intuitive? Mobile-accessible? Presented in language you understand?

5. Evaluate human support: What level of support comes with the technology? Dedicated account management or just technical support?

6. Consider the total cost: Look beyond sticker price to implementation, training and long-term value.

7. Check track record: How long has the solution provider been in business? Industry specialization? Client testimonials?

8. Test first: Request demos or trials with real-world scenarios.

9. Think ecosystem: Often multiple integrated tools work better than one monolithic solution.

10. Partner with experts: Unless you have in-house expertise, work with a provider who handles technical complexity.

The right tools should provide efficiency, insights, and free your team for strategic work. If not, keep looking.

Measuring ROI

Operational costs: Industry research shows outsourcing back-office tasks with AI integration reduces costs by approximately 27%. 

Time savings: Research shows entrepreneurs spend 36% of their work week (15 hours) on administrative tasks. We're seeing clients reclaim 10 to 12 hours per week — essentially an extra day and a half thanks to AI's impact on the back office.

When it comes to AI, start small, but start now. You don't need to overhaul your client's entire business. Start with a single high-impact area, prove value, then expand. The question isn't whether AI will transform your client's back office, it's whether they'll proactively embrace that transformation or reactively scramble to catch up.