The implications of digital technologies on SME’s

This research paper aims to analyse the impact of artificial intelligence in driving innovation in retail businesses of UK, with a study on Nisa retailers (SME). It evaluates the importance of innovation in retail organisations of UK, factors of digital technology that tend to drive innovation in the business, and the need-based use of artificial intelligence in driving innovation in Nisa retailers. The paper also recommends effective measures of driving innovation by Nisa retailers through artificial intelligence.

Research Project

Table of Contents
INTRODUCTION...........................................................................................................................1
LO1..................................................................................................................................................1
P1 Research proposal .................................................................................................................1
P2 Examining suitable research methods and approaches to primary and secondary
research(LR)................................................................................................................................2
Importance of innovation in Retail Organisation of UK.............................................................2
Factors of digital technology that tends to drives innovation in the business.............................3
Need base use of artificial intelligence in driving innovation in Nisa retailers..........................4
Measures to drive innovation by Nisa retailers through artificial intelligence...........................4
LO2..................................................................................................................................................5
P3 Conducting primary and secondary research.........................................................................5
P4 Applying appropriate analytical tools for analysing data......................................................7
LO3................................................................................................................................................13
P5 Communicating research outcomes in an appropriate manner for the intended audience...13
LO4................................................................................................................................................13
P6 Reflect on the effectiveness of research methods................................................................13
P7 Alternative research methodologies.....................................................................................13
CONCLUSION..............................................................................................................................14

Title- “The implications of digital technologies on SME’s”
INTRODUCTION
Digital Technology has provided game-changing transformation and innovation to the
market. It has disrupted existing industries and generated new ones. With the help of it, SME can
connect with customers and increase their productivity (Hammersley, 2017). In this research,
importance of artificial intelligence, evaluation of factors and its proper usage are illustrated.
LO1
P1 Research proposal
Aims and Objectives
Aim
To analyse the impact of artificial intelligence in driving innovation in retail businesses of UK-
A study on Nisa retailers (SME).
Objective
 To assess the importance of innovation in retail organisations of UK.
 To evaluate the factors of digital technology which tends to drives innovation in the
business.
 To determine the use of artificial intelligence in driving innovation in Nisa retailers. To recommend effective measures of driving innovation by Nisa retailers through
artificial intelligence.
Research questions
 Why innovation is important for the retail organisations of UK?
 What are the factors of digital technologies that drives innovation into the business? How artificial intelligence as an effective digital technology can be used to drive
innovation in Nisa retailers?
Background/ Overview of the study
In recent years, digital technology has become indispensable for operating
management areas of SME. It can easily affect dynamics and contribute innovation capabilities
within Small and Medium sized enterprise. Digital Technology must work on different models
and methods where development and growth no longer rely on individual reasons (Aveling,
Gillespie and Cornish, 2015). There is fast increase in technological improvement that reveals its
importance of informatics and innovation. It is a crucial driver of economic growth and
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development of SME. It results in new services and products with improved quality and reduced
costs of production. Processes and production are very close to technological innovation and in
today's multifaceted world SME focuses more on using technology to increase market
differentiation and client value. Artificial Intelligence is one of the most discussed technologies
used by SME (Kim and et.al., 2018). AI technologies present challenges and opportunities for
SMEs. AI can be considered as fourth industrial revolution because it is responsible for changing
people's lives and with machines and has risen up digital age. This report would illustrate the
importance, factors and use of AI in Nisa. It is getting cheaper and is not meant for defining new
commercialised and compelling markets that makes it accessible to small and medium sized
businesses.
Rationale/ Significance
Artificial Intelligence was selected for the research project in order to find out the main
reason associated with the innovation and growth of SME. More detailed information needs to
searched out with the impact of digital technology on SME. From Professional point of view,
this study is carried to out to know the importance of digital technology on SME which creates
and improve productivity of processes or workforce by accelerating workflow efficiency which
leads to profit margins. This also reduces errors and shifts work from paper-based processes.
Going digital permits people to increase efficiency in several ways while curbing operational
costs and many moulding many other financial structure. Artificial intelligence also adds value to
the businesses and thus business volumes is increases. This report helps businesses and
customers going digital in professional way (Anwar and runi Kusumawarni, 2018). It generates
engaging various customers and approaching them in innovative ways. Therefore, in professional
context digital technology helps in cost savings, operational efficiency and carries challenges
like new competitors that captures customers through artificial intelligence and escalating cost of
operations.
P2 Examining suitable research methods and approaches to primary and secondary research(LR)
Importance of innovation in Retail Organisation of UK
Innovation is important and outstanding factor that contributes in the economy of UK.
According to Jenssen and et.al., (2016) all changes have taken place in retail sector and are
allowed to operate systematically. It has been lead to increase in development of technologies
that lead to productivity of logistics and selling processes. Internet and Artificial Intelligence are
2

widely used in retail sector. This reduces costs as well as improves the level of consumer service.
Small business can nurture and easily develop customer base where marketplace create a
community. There is an intimate relationship with tablets and mobile phones that outweigh any
type of interaction customers have and with SME. Customers that experience streamline and
branded shopping from any retailer's app are also demanding same type of experience when they
enter retailer's physical store (Khan, 2014). Evolving trends and dynamics are shaping modern
retail today and changing its future. Innovation can provide five major categories of retail
shopper need i.e. shop ability, convenience, choice of assortment and price value. Shoppers are
concentrated on the value for money. There is need to innovate to meet customer expectations,
competitive forces and know the changing roles of retail industry.
As per the view of Khan, S.N., 2014 supercharging advancements are changing the firm's
ability to innovate by developing their own brand products with squeezed prices. Retailers have
capacity to listen their loyal customers and enhance customer analytical power and customer
insight. They are capable of producing responsive products that are tailored to meet the demands
and desires.
Factors of digital technology that tends to drives innovation in the business.
According to Stage and Manning, (2015), it is stated that various innovation capabilities
that retailers find to compete and thrive in the market. Digital technology i.e. artificial
intelligence has brought changes in areas of product innovation, service innovation, channel
innovation, business model innovation. Digital capabilities and innovation are big differentiators
in this field. In cost-pressured and competitive market experience in one field could help retailers
to differentiate and allow them to convert to become a more than a platform. Innovation hubs is
often characterised by addressing the prior need of it. It is not always punching and high-tech
factor that is impactful but sometimes responsive in fulfilling consumer behaviour and
purchasing patterns that is not sufficient when formulated. Infrastructure, policy and workforce
all need to be reconsidered and are tuned to ensure enterprises' benefits. Scale of SME also
increases as the development velocity increases. Differences occurred leaves great impact on the
objectives of Nisa that influence its presence in market with continuous growth.
According to the Sekaran and Bougie, (2016), it has been pointed out that there is
increment in the digital transformation and assurance of consistent service delivery that depends
on real time information ans completely supports comprehensive its visibility and capability of
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producing insights of operations and procedures. Thus, a type of business assurance is there
through in a technological way. Another important factor that can be considered is that built-in
value of information with active technologies can be gathered and examined in actual times if all
systems run smoothly. Therefore, various areas are being innovated due to technological factor
and optimised to fulfil potential and digital goals of Nisa.
Need base use of artificial intelligence in driving innovation in Nisa retailers.
Many Artificial Intelligence specialists support that opportunities are endless in retal
sector and it is being already used in by SME. It has huge increase from $643.7 million in 2016
to $36.8 billion till 2025. It provides many job opportunities to alternative industries. This would
significantly minimize costs of labor and would make shopping procedure more efficient and
effective. As per the view of Cleary, M., Horsfall and Hayter, (2014) integration of AI in Nisa
would rather be able to take big data sets and use them for their advantage. It will create more
targeted ads that would be varied from store to store. AI algorithms such as neural networks
produce a model that provide answers like real human being and these are given on the basis of
whatever AI obtain data from the dataset. This is actual sales data that is grabbed and is
connected to linked customer data. Artificial Intelligence (AI) also help in guidance of
customers' preferences and get to know their behaviour in Nisa. It helps in knowing what they
actually need and what they don't need. Large benefits are drawn when AI is capable of
producing such information. Another main use of AI is improving customer's experience because
all demands of customers are fulfilled at exact and better prices. A relationship is built with
customers that lay down AI greatly in the store. Another important thing that can be considered
is increase in job opportunities by expanding job market. This would result in rapid growth of
productivity in retail sectors like Nisa.
Measures to drive innovation by Nisa retailers through artificial intelligence.
Artificial Intelligence helps in retail sector which is one of the largest industries of the
world. It has brought revolution in the market. AI can help in maintaining customer expectations
by implementing it systematically. Major role of AI is to transform Nisa through numerous
techniques which are being used. Under AI, cognitive computing is a part that can impact the
future of business. According to Le Tran and et.al., (2017), AI can help to drive sales and get
repetition of customers through personalized consumer experiences by integrating digital
technologies it is one the most innovative way to reach shoppers from all around the world. AI is
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also used to maintain customer relationship through CRM software. CRM focuses on customers-
strategies and experiences. Valuable information on consumers are provided through meaningful
data. Their queries are handled by CRM systems which help to reduce escalation and meets
customer satisfaction. It also helps in meeting potential and current consumers of Nisa.
Artificial Intelligence is highly used in Nisa in to improve quality, speed, efficiency and
lowering of costs. It gathers information, perform skilled labour and predict consumer behaviour
and thus production is increased by offering relevant data. As per the view of Bristow and
Sauders, (2015), AI technologies also help in logistics, supply chain and inventory management.
Through optimum algorithms supply and demands are kept on proper level by reducing stock
depletions and increasing stock levels. Thus, it also helps in providing supply chain visibility,
clearance and insight into it. This can be attained by collecting data from external sources like
social media etc. AI also play role in completion of last mile delivery through drones. It uses
autonomous vehicles and small AI machines for this purpose.
LO2
P3 Conducting primary and secondary research
Research Methodology
Research Approach:
Research approach is mainly data gathering of data which further analysed and
interpreted. It is of two types, inductive and deductive. In this research inductive is used because
the scope of research is wide and broad. Its dimensions can be increased in further ways.
Research Design
Research design can be referred as the quality of data collection and its analysis which
can be done in various ways. Every form of research design has its own needs and purpose.
There are three types of research design: descriptive, explanatory and exploratory (O’Gorman,
Lochrie and Watson, 2014). Descriptive method is used here because research is done in a deep
and clear manner.
Data collection
Data collection is a process of gathering data from all related sources so that problems
could be sorted appropriately. There are two types of data collection method: primary ans
secondary method. This research has used primary method because it ensures high level of
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understanding and quality of data collection. Interviews, surveys and focus groups are embedded
in primary data collection.
Sampling
Sampling can be described as specific way to collect data from targeted population which
is further involved in the research work. Due to interest of large population that work directly,
statistical sample of 10 employees would be taken (Flick, 2015). This would be purposive in
nature. It would result in accurate findings and speed up the work.
Research philosophy
Research philosophy is associated with the source, nature and development of work. It
should be profound and data collected should be properly analysed and used. There two types of
research philosophy: Interpretivism and Positivism. In Research work mainly Interpretivism is
used because it is subjective and deals with philosophical position of idealism. It groups diverse
and verified approaches.
Ethical considerations
Ethical consideration is essential part of research methodology. Participants'
confidentiality, consent should be protected. They should not be harmed in any ways. Their
dignity should be properly maintained. Aims and objectives of research work should be kept in
mind and must not be avoided (Marczyk, DeMatteo and Festinger, 2017). All these factors
should be followed while following research work.
Research Limitation
Research limitation is mainly based on cost and time. With the help of activity based
budgeting there will be costing for each activity. Work should be performed within time frame. It
should not go over budget. Therefore, time and costs are two restraints of research work.
Analytical Approach
Examining of data is done through various methods: qualitative and quantitative method.
This research work uses qualitative method because it is thematic and theoretical. It recognizes
common patterns and critically analyse them to attain research aims and objectives.
Reliability & Validity
Reliability of data is done to see whether tools used are effective or not and validity is
concerned with the outcomes of the research work. It assures the time scale, methodology and
requirements of the research work (Aveling, Gillespie and Cornish, 2015.). These two things
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have to be addressed in methodology. It concentrates on the believability and credibility of the
research. It ensures whether the findings are genuine or not. Therefore, if data are reliable then
they have to be valid.
P4 Applying appropriate analytical tools for analysing data
Theme 1- A large number of respondents are working since more than 2 years.
Since when you are working with Nisa Retailers? Frequency Percentage
6 months 2 20
1 year 3 30
1-2 years 1 10
More than 2 years 4 40
Interpretation-
From above graph it can be interpreted that out of 10 4 respondents are working with
Nisa from last two years and others are newly appointed. They are not so much experienced. 3
are one year experienced and single employee is experienced above one year.
Theme 2- Most of the respondents are aware of the benefits of innovation.
Are you aware of the benefits of innovation in retail industry? Frequency Percentage
Yes 6 60
No 4 40
7

Interpretation-
It can be interpreted that 6 employees are aware of the advantages of digital technology
in retail sector while 4 are of traditional mindset. They believe in face-to-face communication.
They do not know much about benefits and usage of technological system in this industry.
Theme 3- Majority of the participants have reported an improved logistics and delivery services
as a vital benefit of innovation.
In accordance to you, what are some major benefits of
innovation? Frequency
Percentag
e
Personalised products 3 30
Effective payment system 3 30
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Improved logistics and delivery services 4 40
Interpretation-
Above graph interprets that majority of employees believe in improvisation of logistics
department and delivery services. On the other hand, equal number of respondents believe that
innovation help in increase effectiveness of payment services and personalized products. Nisa
has improved its services through various apps and electronic devices.
Theme 4- Both AI and IOT are 2 favorable measures of digital technology by most of the
participants.
What are the adopted measures of digital technology by Nisa
retailers?
Frequenc
y
Percentag
e
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Social media 2 20
Artificial intelligence (AI) 3 30
Cloud computing 2 20
Internet of things (IOT) 3 30
None of these 0 0
Interpretation-
Above chart interprets that equal number of employees working in Nisa are in favor of
Artificial Intelligence and using Internet as medium of generating customers and expanding
business. On the other hand, only 2 people are in favor of social media sites and cloud
computing. Artificial intelligence is widely used by retail sector in many areas like marketing,
customer’s experiences, considering their preferences etc.
Theme 5- Almost all the workers of Nisa retailer possess a neutral view towards the beneficial
contribution of AI in bringing innovation.
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Artificial intelligence is extremely helpful in bringing innovative services
for the customers of Nisa retailers. Frequency
Strongly agreed 2
Agreed 3
Neutral 4
Disagreed 1
Strongly disagreed 0
Interpretation-
From the above graph it can be interpreted that out of majority of employees feel neutral
about AI as innovative part of today's era for customers' in Nisa. They think that AI is neither
helpful nor unreliable for customers. But 2 employees strongly believe in its services in Nisa.
Theme 6- A large number of participants depicted a satisfied perception towards the digital
implication of Nisa retailers.
Are you satisfied with the digital implications of Nisa retailers? Frequency
Highly satisfied 2
Satisfied 4
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Neutral 3
Dissatisfied 1
Highly dissatisfied 0
Interpretation-
From above graph it can be interpreted that out of 10 it can be interpreted that 4
employees are very much satisfied with digital implications in Nisa retailer. On the other hand, 2
are highly satisfied as they belong to production department and AI has helped a lot to this
department. While others do not feel the same. They think that it leaks private information easily.
Theme 7- Quick delivery of products and services have been stated as a major assistance of AI
by most of the respondents.
For what purpose, Artificial Intelligence (AI) as a vital tool of innovation
can be used by Nisa retailers? Frequency
Product innovation 2
Inventive customer service 3
Quick delivery of products and services 4
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Improving the quality of goods 1
Interpretation-
From the above graph it can be interpreted that out of 10 4 employees of Nisa believe AI
in helping in Quick delivery of services and products while others 3 believe in bringing good
customer service.
LO3
P5 Communicating research outcomes in an appropriate manner for the intended audience
Covered in PPT
LO4
P6 Reflect on the effectiveness of research methods
I have learned from this study that the research methods i. e. Inductive and descriptive for
the impact of artificial intelligence on retail sector like Nisa is now widely used in various areas
like marketing, generating loyal customer base, enhancing sales, management of payment
services.
P7 Alternative research methodologies
Artificial Intelligence is now a part of ever human being's life so in future it can organize
big data into various structures and patterns. According to this research working with AI can
outperform individuals by 2060 and companies have acquired around 34 AI start-ups to build AI
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smarter. I have learned that research methodologies have helped me to identify future of AI in
every perspective such as creating job opportunities, creating customer base.
CONCLUSION
It has been concluded that digital technology has been playing vital role in retail sector in
which Artificial intelligence is an essential part. Its innovation and implementation in industries
has changed the life anf functioning of each and every department of Nisa. Many employees are
aware of its benefits while some are of traditional minds and follow earlier trends. Thus, in future
would market by reinforcing leads and allowing data analytic to work in more innovative way.
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