'A virtual assistant': How Capital Region businesses are using AI

Phillips Hardware owner Jon Phillips holds plans for his proposed new ice cream, pizza shop and mini-golf course on May 6 at his hardware store on Route 158 in Altamont. Phillips used artificial intelligence to put together these AI-generated renderings to present to the Guilderland Planning Board.

An AI-enabled camera is seen on a Capital District Transportation Authority bus. The CDTA uses these cameras to scan bus shelters and detect any maintenance issues that need to be addressed.

Owner Kerry Fagan hangs up an Italian-made jacket in Mark Thomas Men’s Apparel in September 2025 in Colonie. Fagan uses the free version of ChatGPT multiple times per day at his shops for a variety of tasks, including website improvement recommendations, social media posts and mortgage finance scenarios.

An AI-enabled camera on a CDTA bus identifies possible maintenance needs at one of its bus shelters.

The owner of River Bend Christmas Tree Farm, Jim Carpenter, purchased a specialized piece of equipment last year to assist with spreading fertilizer more efficiently among the rows of trees growing at his Lake Luzerne farm. The problem: he didn’t know how to use it.

“I struggled and struggled and struggled to find anyone to help me use it,” Carpenter said after talking to around 50 people. “Finally one day, I sat there and said, 'Why don’t I just ask AI?'”

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Using artificial intelligence, or AI, he was able to learn about the history of the equipment and the certain parts he needed in order to operate it — all within minutes, Carpenter said. The tool also told him where to get the parts, how to install them and how to operate the equipment.

“It’s like having an assistant with you,” Carpenter said. “It really takes a small family business, like we have, and then lets you leverage a lot of knowledge out there to help you move through stuff. It just speeds everything up.”

As AI technology continues to rapidly advance, business owners — much like consumers — are increasingly finding new ways to use it. But local business owners have described trying to navigate that exploration while also striking a balance between automation of tasks and human oversight. Surveys show that many customers they serve also have complicated feelings about the use of the technology, whether that be as a result of mass layoff fears, environmental concerns or general distrust of the technology. Those sentiments have prompted some businesses to place guardrails on its use — or to ban it altogether.

From 'a matter of curiosity' to 'an efficiency tool’

According to Forbes, the emergence of OpenAI’s ChatGPT in November 2022 led to AI’s widespread use. Posts about the chatbot quickly went viral on social media after users shared examples of what it could do.

In a report released in April, the Siena Research Institute found that AI chatbots are now used by about two-thirds of New Yorkers, with nearly half noting they’ve increased usage since last year. Among small businesses, almost 60% now use AI, more than double the reported usage in 2023, according to a report released by the U.S. Chamber of Commerce last August.

“It was a matter of curiosity at the beginning,” said Necip Doganaksoy, professor and director of the Siena University’s Master of Science in Business Analytics program. “The big companies with vast resources in AI are the ones that are leading this. The particular businesses that we are keeping an eye on are local, regional businesses that lack those resources.”

Doganaksoy said he’s noticed AI tools becoming more accessible and less expensive, which is beginning to change the AI landscape for smaller businesses such as Carpenter’s.

“In the small company, midsize company environment, I don’t have a clear picture of how it’s going to play out, but what I can clearly see is that in places where it is used, AI is clearly a productive multiplier,” Doganaksoy said. “One person can multiply the amount of work that they can do. It can be fivefold or tenfold. It doesn’t necessarily mean hiring fewer of those people.”

For instance, the Capital District Transportation Authority’s chief operating officer, Christopher Desany, has brought his background as a software architect to oversee day-to-day transit operations and budgeting. He has been utilizing AI for years. He’s constantly exploring the use of new technologies to make CDTA operations more efficient, including the use of AI-enabled cameras, which were installed earlier this year on some of its buses to help identify shelter maintenance needs. Those needs are reported to CDTA in real time.

Before the cameras, CDTA staff would drive around to each of its over 300 bus shelters to check for maintenance needs. Now, the cameras assist in identifying maintenance needs — alerting CDTA to everything from broken glass and graffiti to trash — without staff having to go there in person first.

“The theory is we have lots of rolling assets, buses, why not use those buses to do the heavy lifting for us?” Desany said. “Anytime we can apply smarts to something inherently brute-force, we’ll try to do it.”

The CDTA is exploring the use of AI in other ways, including planning bus routes and identifying traveler patterns, Desany said.

“CDTA has been using lots and lots of technology long before AI became the hot topic,” he added, noting conversations surrounding AI at CDTA started in April 2024. “Our system is more efficient than it’s been in a long time.”

For smaller Capital Region business owners, including Mark Thomas Men’s Apparel owner Kerry Fagan, using the free versions of AI services has been “transformational.” Fagan uses the free version of ChatGPT multiple times per day at his Colonie and Saratoga Springs shops for a variety of tasks, including website improvement recommendations, social media posts and mortgage finance scenarios.

“With any decision I’m thinking about making, it’s so good to throw it in there and see what comes out. I’m amazed at how granular it gets,” Fagan said, noting he started using ChatGPT around the end of last year. “It’s such an efficiency tool. Like every small business, I’m wearing a lot of different hats. I don’t have an HR or IT department. This is kind of a free virtual assistant I can bounce ideas off 24 hours a day.”

While experts, including Doganaksoy, think AI will make workers more efficient without necessarily slashing some jobs, others think it will eliminate some jobs while creating new ones, according to the Associated Press.

“It’s a learning game. It’s changing so rapidly,” said Rashmi H. Assudani, dean of the School of Business at Siena University. “There’s also an effectiveness factor there for small companies to be able to leverage upon these tools. Think about the manpower they can hire or not hire. How should they then compete? These tools equip them with these efficiencies, if used appropriately.”

Embracing AI through uncertainty

In late December, Kartik B. Athreya, the director of research and head of the Research and Statistics Group of the Federal Reserve Bank of New York, told attendees of the Capital Region Chamber’s annual economic outlook breakfast that “uncertainty” has been “an important driver” in the economy, citing factors including the development of AI.

That’s around when Guilderland-based entrepreneur Jon Phillips started using AI, first to turn images of his family members into characters that would be in “The Muppets,” then to incorporate it into his business practices.

“As much as people say AI is going to replace jobs, I say, 'How can I take AI to improve things and fit our culture?'” Phillips said, noting the technology isn’t replacing his employees. “It’s kind of limitless. The information was in the library before, then after that, it was on our Google search. I think it’s just becoming more prevalent of all the resources that it’s compiling. It’s going to pull multiple suggestions and directions, but you still have to decide what you want to do. You still have to be decisive.”

Phillips is “embracing AI with a human component” and has used it to help direct customers to the products they’re looking for at his hardware store, Phillips Hardware. He also utilizes it for price analysis at his Phillips Mini Mart and Mobil gas station.

“I’m trying to find all the ways (to use) AI, whether it’s looking at pricing or budgeting, so I can put more time into human connection,” Phillips said. “If I can use it to provide better service, why wouldn’t I? I’m finding out my customers really like the extra thoroughness in sales. I think they really appreciate that extra service end of me saying, 'Here’s a suggestion, but I’m even going to take a couple minutes to see if I have any other suggestions.'”

Phillips also used AI to create building renderings of his proposed mini-golf course, pizza and ice cream shop to present to the Guilderland Planning Board.

While local business owners, including Phillips, have embraced the use of AI, others — such as Chris Sule — are either opposed to using it or have set up some internal rules around its use.

Sule, the co-owner of Stella’s Pasta Bar & Bistro, Seven Points Brewery and Van Dyck Music Club, said he’ll never incorporate AI into his business operations.

“I’m against these technologies for a variety of reasons, but the main point comes down to this: AI disregards the humanity of connection and community,” Sule wrote in a statement in November. “I firmly believe the act of creating something, anything, is a key component to what it is to be human. In my humble opinion, generating does not equal creating.”

The Hideaway at Saratoga Lake said it will never use AI photos to represent the food it serves, stating in a Facebook post in February that “it risks setting an expectation that doesn’t match what hits the table.” The restaurant added that it thinks AI could be a helpful tool for its marketing ideas and condensing copy.

According to a survey by global research and advisory firm Gartner, half of U.S. consumers said they prefer to support businesses that do not use AI.

But Carpenter worries that if he doesn’t embrace AI, it could lead to him losing his generational farm. It’s a sentiment other longtime business owners in the Capital Region share, including Fagan and Phillips.

“A Christmas tree farm doesn’t seem like something that would use AI, but we’re losing more and more people out there that know about equipment and farming,” Carpenter said. “It’s really hard to find experts and specialists out there, so anytime that I can use technology to help me be a better farmer, I need to do that.

“I think the thing that we’re always looking at is how can we use the tools that are available to make our business grow and thrive, and you can’t be afraid of whatever those things are if you want your business to be successful,” Carpenter added. “If you fall too far behind, you just can’t survive.”