Artificial Intelligence in Small and Medium Enterprises – An Empirical Analysis of Critical Factors

The purpose of this study was to investigate the critical factors that determine the artificial intelligence (AI) adoption decision among the small and medium enterprises (SMEs) in UK. The study was driven by the increasing adoption of AI in the business environment, the significant contribution of SMEs in the economy, and their inherent challenges in technology adoption. background of the study was developed on the Technology-Organization-Environment (TOE) framework. An empirical study was conducted, using primary data collected from SMEs representative sample. A sample of 413 respondents was used. The data was analyzed empirically using structural equation modelling technique. The findings revealed that critical factors that significantly influenced AI adoption decisions in SMEs were regulations, perceived relative advantage, management support, technology infrastructure, and resources. However, complexity was not a significant critical factor. The research recommended that SMEs management should consider several aspects to improve AI adoption decision in their firms. These include investing in technological infrastructure, seeking relevant regulatory support and compliance, evaluating the benefits and advantages of proposed AI technologies, and mobilize relevant resources for AI investments.