MAINSTREET CHAMPIONS PT. 4
On July 8th, 2010, the basketball world stood at a standstill as LeBron James prepared to make a decision that would reshape his career and the National Basketball Association (NBA) itself. Aptly named "The Decision," the televised event was more than just an announcement; it was a turning point in the history of the NBA that ushered in a new era of player empowerment. James famously declared he would "take his talents to South Beach," joining the Miami Heat. Behind the spectacle, however, was a careful evaluation process. His goal was clear: win a championship. The hard part was to make the right choice to achieve that goal. James had to establish clear criteria—like team culture, coaching, roster strength, and his family wellbeing—to prioritize among multiple suitors. This assessment culminated in his decision to join the Miami Heat where he won 2 championships and went to four NBA finals.
Similarly, for small businesses considering AI implementation, setting clear goals is only part of the challenge. In last week’s blog post, we introduced the ACT framework (Actionable pain point, Clear success definition, Time-bound execution) to guide goal setting. However, often the toughest step isn’t just defining the goal, it's prioritizing the many opportunities available. Small businesses typically face numerous areas where AI could potentially deliver value. The constant influx of new AI tools, promising to enhance productivity or profitability, can be overwhelming. Without a clear way to prioritize these opportunities, businesses risk spreading resources thin or investing in solutions that won't drive meaningful returns. Just like LeBron carefully assessed team culture, roster strength, and other criteria, small businesses need a structured approach to evaluate and prioritize AI initiatives that will drive maximum return on investment (ROI).
To maximize ROI, small businesses must prioritize AI initiatives by carefully evaluating both the potential impact on their organization and the effort required for implementation. Below, I introduce the 4S-3R framework—a simple yet practical approach for prioritizing AI opportunities. This framework guides businesses to evaluate each opportunity based on its impact on revenue growth, cost reduction, and customer retention, as well as implementation effort, considering factors such as solution availability, required skills, speed of implementation, and system dependencies.
The "4S-3R" Framework for AI Prioritization
Before assessing priorities, small business owners should first define their company’s strategic objectives and identify the key challenges preventing their achievement. These challenges often reveal the most valuable opportunities for AI implementation. When deciding which opportunities to pursue, businesses should evaluate them based on two key dimensions: impact and effort.
Evaluate Impact (3R)
More so now than ever before, businesses are under pressure to do more and earn more with less. Therefore, every opportunity should be evaluated based on its impact to the bottom line. Small businesses should ask themselves these simple questions to determine if an AI opportunity is high impact:
Revenue: will this clearly boost sales or attract new customers?
Reduction: will this significantly reduce costs or free up valuable time?
Retention: Will this enhance customer satisfaction, loyalty, or repeat business?
Evaluate Effort (4S)
Businesses should prioritize low effort high impact opportunities to maximize ROI. So, every opportunity should be evaluated on how straightforward or challenging it is to implement. Businesses can do this by asking themselves these four questions:
Solution: Is an AI solution readily available?
Skills: Do you or your team have (or can quickly learn) the necessary skills to implement this opportunity?
Speed: Can you realistically implement and see results within weeks?
Systems: Will the solution integrate smoothly into your current system, tools and processes?
Build Your AI Prioritization Matrix
To utilize this framework effectively, businesses should score each AI opportunity by evaluating impact and effort through a simple Yes/No scoring system. For impact, assess each opportunity by answering Yes or No to the 3R criteria—Does it increase revenue? Does it reduce costs or time? Does it improve customer retention? Count the number of Yes responses: 3 Yes = High Impact (priority initiative), 2 Yes = Moderate Impact (consider after high-priority tasks), 0–1 Yes = Low Impact (low priority, reconsider later). Similarly, assess effort using the 4S criteria—Is there an off-the-shelf solution? Does your team have the necessary skills? Can it be implemented quickly? Will it integrate easily with existing systems? Count the Yes answers: 4 Yes = Low Effort (easy implementation), 2–3 Yes = Medium Effort (requires planning), 0–1 Yes = High Effort (complex, reconsider carefully).
Once each opportunity is scored, plot them on a 2x2 prioritization matrix to determine the best course of action. High Impact + Low Effort opportunities are "Quick Wins" and should be implemented immediately. High Impact + High Effort initiatives fall under "Strategic Projects”, which are valuable but require more planning and resources. Low Impact + Low Effort tasks are "Low-Hanging Fruit," which can be tackled later if resources allow. Low Impact + High Effort opportunities should be discarded, as they offer little return for the investment. This structured approach ensures small businesses focus on AI initiatives that drive real results without overextending resources.
Accounting Firm Case Study
Recently, I have been working with a few clients to guide them along their AI implementation journey. One of my clients, a small accounting firm that assists other businesses with financial reporting, tax compliance, and bookkeeping came to us with a desire to significantly enhance operational efficiency by accelerating client onboarding and financial reporting processes. When the firm came to us, they were facing three major obstacles preventing them from achieving this strategic priority. First, were extensive manual data transfers across disconnected systems leading to delays. Second, there were frequent data entry errors causing inaccuracies and rework; and lastly, a lack of integration among existing systems resulting in fragmented workflows and poor visibility across client management, accounting, and reporting processes. These challenges all present fantastic opportunities for AI implementation. However, our client wanted to know how to prioritize these opportunities and where to start.
So, we evaluated each opportunity using the 4S-3R framework and created a prioritization matrix for this client as shown below.
Table 1 shows our score for each opportunity across the impact and effort dimensions criteria
Figure 3 shows the prioritization matrix we built for this client
Based on this assessment, we determined that implementing AI to automate the manual data transfer that’s leading to excessive delays in client delivery was the quick win for this client.
The "4S-3R" Framework provides small business owners with a clear, effective roadmap to prioritize AI opportunities that deliver maximum return with minimal complexity. In the following weeks, we will discuss how to create a road map for implementation and how to select the right tools once you have prioritized the opportunities to focus on.
THIS WEEK ON MAINSTREET
📰Mainstreet Minute:
Daily Harvest, a meal delivery service founded in 2015, has been in the news this week for its innovative use of artificial intelligence (AI) to enhance operations. Despite having fewer than 200 employees, the company employs AI to personalize product recommendations and improve customer service through AI-driven chatbots. These advancements have enabled Daily Harvest to scale its services effectively without increasing operational costs.
📌Quick Win Tip:
ChatPDF, is the fastest way to navigate manuals, legal contracts, reports and other documents in minutes. You can upload any documents in any language and chat with your document as you will with chatGPT to get any questions answered. You can summarize, chat and analyze your documents easily. Get a quick win this week and save yourself some time by analyzing your next documents using ChatPDF.