The Firms Most at Risk From AI Are Not the Smallest Ones

Everyone assumes the small firms are the most exposed. Fewer resources. Thinner margins. Less room for error.

I think the opposite is true.

I have spent the last 30 years working with local governments across Canada, and one pattern showed up again and again. The most innovative municipalities were rarely the large urban centres with the deepest budgets. They were often the small, rural, and northern ones.

Because they had to be.

They didn't have the bench strength to fall back on. No spare budget to absorb slow decisions. When something needed to change, one or two people made the call and the organization moved.

The larger governments had more staff capacity, more money, and more space and time to experiment.

What they often lacked was urgency.

Committees. Process. Layers of approval. A dozen stakeholders who all needed to weigh in before anything moved.

I see the same pattern emerging in AEC firms as AI reshapes our industry.

Small firms move quickly because there is nobody to ask permission from. A principal decides, the team adapts, and the market rewards them within months.

The largest firms have scale, capital, and increasingly the ability to invest heavily in AI.

It is the mid-sized, multi-generational, employee-owned firm sitting in the middle that concerns me most.

Enough structure to slow every decision.

Not enough scale to absorb being slow.

The very governance habits that served these firms well for decades can become liabilities when technology is moving this quickly.

Size was never the protection people assumed it was.

Necessity is the real variable, and it does not correlate with headcount the way many boards think it does.

Where does your firm actually sit on that spectrum?

And more importantly, does your board know it?