AI is moving fast. SME training is stuck in the slow lane

There’s no shortage of ambition among small businesses when it comes to digital skills. SME owners I speak to know that AI and data capability will underpin their future competitiveness.

And AI adoption is rising quickly. A recent study by the Resolution Foundation found that nearly half of businesses are now using AI in some form.

Yet while AI adoption is growing, the use of it in businesses remains relatively shallow. The same study found that only one in 20 businesses say they are using AI extensively.

The challenge now is how businesses unlock the technology’s true potential, one that’s solved by SMEs addressing foundational skills gaps in their businesses.

Of course, SMEs can’t address these skills gaps alone. Trade associations, local authority networks, and external training providers each have an important role to play in helping them to level-up their AI capability.

But if we think of the SME AI capability gap as a round-shaped hole, this support network – with the best intentions – is often offering a square peg to fill it. Much of the support available isn’t designed with the day-to-day reality of the SME in mind. So, what’s holding SMEs back and what could optimal support look like?

The expectation and opportunity gap

In an SME, one person might handle customer data, manage suppliers, oversee compliance and run social media – often all in the same week. Naturally, it’s difficult for most funded training to be built specifically around the many hats SME employees may be wearing.

Apprenticeships, skills bootcamps and most regional funding routes are designed around a single, defined specialism – a data analyst, a cyber apprentice, or even a dedicated AI role. These routes are great at producing people who can walk into a specialist role. But SMEs need generalists, and these routes aren’t built to add a capability onto a role that already covers five other hats.

SMEs cannot always afford to open up dedicated digital or AI roles, and when they do bring people in, they need someone who can contribute across the business from day one. When those expectations are not met on either side, the development stalls.

Calls for more funding tend to be the go-to solution for addressing skills gaps. But layering new schemes and funding streams on top of the routes available risks building in added complexity. SMEs aren’t short of options, but they are short of time, management resource, and confidence that the next programme will fit their business.

The mismatch is more likely to be solved by how training and support is delivered around them.

Building the pathway

In practice, that means a blend of support rather than a single course. At Kaplan, this is the model we have built through Education 4.0: combining expert-led tuition, AI-enabled learning support and flexible digital content that adapts around the learner and their working pattern. And crucially, it means the learning is contextualised to the size and sector of the business, not built around enterprise-scale case studies that bear no resemblance to how an SME actually operates.

But delivering the right model is only part of the challenge. Devolved funding currently skews toward FE and HE institutions, which can mean SMEs are directed toward providers whose traditional delivery models – full-day release, fixed timetables, classroom-based programmes – do not flex around how small businesses operate.

Independent providers working at national scale can bring something different here. Support teams can guide both apprentices and SME leaders on integrating training and getting a return from it, while a wider employer network offers credible use cases and implementation advice from businesses that have already balanced growth with skills investment.

This isn’t about the quality of local provision. It’s about SMEs being able to reach the delivery model that fits them.

Many of the SMEs I speak to have already been through training that didn’t fit their business, and it’s left them wary of the next offer. Flexibility has to be demonstrated before it’s believed.

Government ambition on skills is real, and it’s matched inside small businesses. What’s missing is a system that lets SMEs act on it. That means training that builds real-world capability and makes a measurable impact, delivered in a way that fits around the business rather than pulling people out of it.

Providers who can combine strong content with genuine support for managers and mentoring will be the ones that help SMEs make AI adoption genuinely stick. That is the partnership SMEs need, and it is the one the skills system should be making easier to access.