Your 5-minute guide to AI that actually helps small business owners

Every week I dig through the noise to find AI updates and news to keep you updated. This week, we're going to tackle something that may not be quite as exciting as the latest AI tool—but could be much more important for your business: creating some ground rules for how your employees use AI.

If your employees are already using ChatGPT, Gemini, Claude, Copilot, or AI built into the software you already use, you may have an AI policy whether you've written one or not.

The question is whether your employees know what that policy is.

I’m not suggesting you have a 30-page document written by your attorney. Realistically, no one will take the time to read it anyway. For most small businesses, a simple policy that answers three questions should suffice:

Here's a simple place to start.

Let your team know they are allowed and encouraged to use approved AI tools for everyday tasks that don't involve sensitive information:

These are relatively low-risk uses because the information being entered isn't confidential, and the employee can review the result themselves.

Small business employees (and owners) commonly use AI for writing support, research, summarizing documents, and translating content. This is a great use for increasing productivity, which adds to your company’s profitability and ROI.

Some AI uses aren't necessarily prohibited—but employees shouldn't make the decision on their own. Your policy should tell employees which AI tools are approved and what types of information can be used with them.

For example:

You want them to understand that the tool isn't necessarily a problem. The data or the task may be the concerning element.

Your policy should also identify who approves tools and keeps a simple inventory of the AI tools the business uses, including AI features already built into existing software.

Keep in mind, you don't necessarily need to approve every AI tool employees might encounter. You could start with something as simple as:

“Use company-approved AI tools for company work. If you're not sure whether a tool or use is approved, get approval from {person at your company} before you use it.”

The most important thing to convey is what information should never be entered into a public or unapproved AI tool without specific authorization.

That includes:

Your policy should prohibit employees from entering customer, employee, financial, contract, security, and other confidential information into AI tools that aren't approved for that category of data.

This is one area where being very clear is better than assuming your employees know the rules.

AI doesn't get the final say.

If AI drafts an email, a proposal, a customer response, a report, or anything else that will leave the company, a human should read it before it goes out.

Not skim it. Read it. Check it. Own it.

AI can make mistakes. It can invent facts, misinterpret information, or leave out something important. Your business’s AI policy should require human review, editing, fact-checking, and approval before AI-generated content is distributed.

And if you're using AI for something more consequential—like hiring, financial decisions, customer-facing interactions, pricing, or anything that can actually take an action on your behalf—the level of human oversight should increase.

For AI agents that can communicate with customers, publish content, change prices, make purchases, or operate connected systems, a specific person in your company should have stop authority to intervene when necessary.

This principle is worth remembering: The more power you give AI, the more human oversight you need.

I realize that a blanket ban on AI may sound like the safest approach. However, it's likely your employees are already using AI. Plus, AI is increasingly built into the software they use every day. So, instead of saying:

"Employees are not allowed to use AI."

Give them a clear path for using it responsibly.

If you're a small business owner and you don't have an AI policy yet, don't spend the next six months creating one.

Start with one page.

Name one person as your AI Lead who can answer questions, approve new tools, and keep track of what's being used.

Then establish your basic rules:

That's enough to give your team a starting point. And you can update the policy as your business and AI changes.

I've created a one-page sample AI policy for small businesses that you can download and customize for your own team.

This is a starting point, not legal advice. If your business handles regulated information or operates under specific industry or contractual requirements, have your policy reviewed appropriately.

Yours in success,
Kathleen

P.S. Forward this to one business-owner friend who’s still “figuring out AI.” You’ll look like the smart one. 😊