A Race to the Top in the Era of Artificial Intelligence - A Qualitative Study examining challenges & opportunities for small and medium sized Swedish companies in AI adoption

Background & Purpose: This study focuses on challenges to AI adoption in small- and medium sized enterprises (SMEs) in Sweden, as well as solutions to these challenges. The background, and the reason for studying the topic, lies in Sweden’s stated vision of becoming one of the world leaders in adopting the powers of Artificial Intelligence (AI). Despite this vision, the research regarding AI adoption in Swedish companies, especially in Swedish SMEs, is very sparse. The purpose of this study is to identify challenges experienced by Swedish SMEs in adopting AI and, by interviewing companies and individuals with experience in AI implementation, identifying recommendations on how to solve or mitigate these challenges. These recommendations are, in the last stages of the thesis, adapted to fit to the context of the Swedish SMEs, i.e. to the Swedish business culture and to companies with fairly limited resources. Methodology: This is a qualitative study in which 10 interviews are held. Three interviews are held with Swedish AI aspirants, i.e. Swedish SMEs that have a wish to implement AI. The remaining six interviews are held with Swedish and American companies and individuals that have knowledge and experience of working with AI. These interviewees are referred to as experts. The interview findings are analyzed by a thematic analysis based on categories and themes found in the literature and, in some cases, that emerged during the interviews. The thematic analysis results in seven challenges and seven recommendations regarding AI adoption. Findings & Conclusions: Seven challenges and seven recommendations are found. The challenges include immaturity of the AI-technology, compatibility with the company, evaluating, developing and implementing the technology, lack of resources, lack of knowledge, establishing a culture of innovation and the effects that the external environment has. The recommendations include learning about fields related to AI, using external forces, embracing being a smaller company, promoting change, motivating and inspiring with soft factors, developing a culture of innovation and understanding the specific company context. Simply put, Swedish SMEs need to thoroughly assess their current capabilities and start learning about fields related to AI as a first step. Once this is done, they need to evaluate whether to use external forces (such as off-she-shelf AI solutions and/or consultants) and, if so, to which extent. They should also take advantage of being a smaller company in the sense that their AI-solutions can be much simpler than for larger companies. Lastly, they should learn about what country specific factors that might make the implementation of AI easier or more difficult. Such factors include Swedes being innovation friendly, the existence of free learning opportunities and the in Sweden common flat organizational structure