Sharon Florentine on Why Most SMBs Deploy AI Without Budgets or Governance

Dave Sobel (0:00)

Dave Sobel here, reporting from the floor of ChannelCon, joined today by Sharon Florentine. She is the manager and research analyst at GTIA. Now, Sharon spent 25 years as a technology journalist, editorial director at ChannelEDE and MSSP Alert, and before that, cio.com and CRN, and you joined GTIA back in March. She's been presenting new AI research that's coming out even just next week. I want to tell the audience, I haven't even seen this yet. We're all learning it in real time together. Sharon's going to walk it through. Actually, in full disclosure, I got a GTIA number wrong last week and had to issue a correction.

Sharon's going to walk me through this. Sharon, welcome to The Business of Tech.

Sharon Florentine (0:40)

Hey, thanks. Great to be here.

Dave Sobel (0:41)

I'm excited to hear. Tell me about what data you're presenting.

Sharon Florentine (0:46)

This study is called End User AI Adoption, how ITSP customers are really using AI. This is, like I said, an end user study.

What we were trying to figure out is how end customers of ITSP's are integrating AI, what they're doing with it, where it is in their business, and then what the opportunities are for ITSP's, how they can go in and help their customers either do better, what they're already doing, or identify new places where they would be able to assist them with integrating AI in some way.

Dave Sobel (1:28)

Well, what do we find?

Sharon Florentine (1:30)

How's it going within customers? Like 98 percent of businesses in general are using AI. Like 97, 98 percent, everybody's using it. What we found is that 20, 25 percent are doing so strategically, and that means that they have governance around it, they've got it assigned under a leadership role in the organization.

There's policies, procedures for how the companies can use it, and the individuals in the companies can use it. So there is a huge opportunity there in that other 75 percent for an ITSP to come in and help these end users figure out how to get into that strategic or tactical implementation of AI.

We also found that only about a quarter have any kind of dedicated AI budget. So the majority are just kind of winging it. And where is the money coming from? Are they pulling it from other IT priorities? Is it coming out of other budgets? Are they finding $20 on the street? And using that, we're not sure.

Dave Sobel (2:50)

So let's baseline the audience.

Sharon Florentine (2:52)

Yes.

Dave Sobel (2:52)

So you surveyed how many people and what do they look like?

Sharon Florentine (2:56)

Got you. Tell me a little bit about the audience.

Dave Sobel (2:57)

Okay.

Sharon Florentine (2:58)

We surveyed 520 small to mid-sized businesses. 11 different verticals are represented. There's some manufacturing, there's some healthcare, there's some finance, some MSPs, some MSSPs, the whole gamut.

Dave Sobel (3:15)

So the audience could recognize it like, hey, this is my customer base. These are the kinds of people. Yes. What surprised you? I bet there was a particular data point that jumped out and was your favorite.

Sharon Florentine (3:23)

Yes. So what surprised us the most was the budget versus the adoption. So wow, almost everyone is using AI, integrating it in some way.

The fact that they don't have a budget for it was, that's really, really surprising and a little bit confusing. Because if you're going to be using this, if you're already integrating it into your business, how are you paying for it? Why aren't you paying for it? Why are you not planning to pay for it? And what happens in the future if you need to pay for it and you don't have the budget allocated?

Dave Sobel (4:12)

So that's the open question for the next round is this, hey, you've identified this piece. So by the way, listeners, you should ask your customers, this is a great leading question here. So give me a little bit of a sense like, when you have the opportunity to work on research like this, how's the methodology work? Is it start with the same, is the only set of questions? Do you get to follow in multiple rounds? Like explain for people how this works.

Sharon Florentine (4:35)

When we're putting together a piece of research, we start with a big broad question that we're trying to answer. And then we identify who the audience should be that would benefit from answering that question. In this case, it's the SMBs that we surveyed and then ITSPs.

And we put together a set of questions that allow us to figure out what they're thinking about certain topics.