The 4 phases of using AI

One question per phase. Answer honestly.

Last night, while I was asleep, my system went looking for local businesses with bad websites. It built each one a mockup of a better site and wrote the owner a personal email. Then it queued everything up and waited for me.

I didn't write a prompt or touch a keyboard. This morning I drank my coffee and clicked approve on the ones I liked.

That's phase 4.

Most business owners I talk to are in phase 1. Some haven't started. And almost none of them know there are phases at all. They think "using AI" is one thing: either they're doing it or they're not.

So they try ChatGPT for a few weeks. It writes a decent email and answers a question. Nothing else changes. The phone still rings the same. The follow-ups still slip. They decide AI is overhyped and go back to doing it the old way.

AI wasn't the problem. They were standing on the first rung wondering why the view didn't change.

Four rungs. The guy who built Claude Code, Boris Cherny, laid it out for engineers. Here's the version for people who run businesses.

Before we start: phase zero.

The chat window. You open ChatGPT, ask it something, copy the answer, paste it somewhere real.

That's where most of the world lives. Gallup found roughly half of US workers don't use AI at work at all, and only about 28% use it weekly or more.

Here's the test. Are you copying things between ChatGPT and your business so it has something to work with, then moving its answers into your email, docs, CRM, or wherever the work belongs?

If yes, you're in phase zero. The copy-paste dance is the bottleneck.

It feels productive. You got a draft in ten seconds. But count the steps around it: you found the customer's info, explained the situation, copied the answer, fixed the formatting, and pasted it into the right place.

The AI did one step. You did five.

Phase 1. AI as your assistant.

One of you. One AI. It works next to you, in your real stuff.

The difference from phase zero is hands. The AI reads your actual files and opens your calendar. It pulls from your inbox. When it writes a proposal, it puts it straight into the folder where proposals live.

You still watch everything it does in phase 1. That's fine. It's new.

What it looks like in a service business: a customer emails asking for a quote on a water heater swap. Instead of opening ChatGPT and retyping the job, you tell your AI "draft a quote for the Johnson email." It reads the email, pulls your price sheet, looks at the last three quotes you sent for the same job, and writes the draft in your quoting tool. You check it and tweak one line before sending.

Same result as phase zero. A third of the effort. And nothing got lost between windows.

What traps you here: your attention. In phase 1, you're reading every line it writes, so you can never look away. It's faster than doing it yourself, but you're still the one doing it.

How to climb: connect one tool. Just one. Your email, your calendar, the folder where your documents live, or your quoting tool. The day your AI can see your business without you pasting it in is the day you leave phase zero for good.

The question: Can your AI see your business without you pasting it in?

Phase 2. AI as a team.

Now you stop doing the work and start running it. Five or ten things going at once, with you looking at finished work instead of every step.

Opening more tabs won't get you to phase 2. It takes two things.

First, something other than you has to check the work. Some checks are simple, like the right phone number and logo colors. Others take judgment: is this email too pushy? Does this look like a real business or a template? Both kinds can be automated in phase 2. If you're the only one checking quality, you're the traffic jam.

Second, permissions. Treat AI like a new hire on day one who's very fast and a little bit drunk. If it can break something, eventually it will. Safe stuff goes through on its own. Risky stuff stops and asks. In my business there's one rule that never bends: nothing reaches a customer until I click approve.

What it looks like in a service business: Monday morning. One AI is writing replies to the weekend's reviews. Another is pulling last month's jobs into a summary for your bookkeeper. A third is drafting three social posts from the job photos your techs sent. A fourth is checking your website for a broken contact form. You're reviewing what comes back. A checklist already caught the post with the wrong phone number before it reached you.

What traps you here: steering. You're correcting five things at once and your head is spinning.

How to climb: write your checklist down. Every time you fix the same mistake twice, that fix becomes a rule the AI checks for itself. Your corrections turn into its standards.

The question: If you stepped away for an hour, would anything still be getting done?

Phase 3. AI works the night shift.

In phase 3, the AI starts work you used to start. Follow-ups go out without you remembering, reports show up on their own, and the research is done before you ask for it.

Everyone hits the same objection here: "It's faster if I just do it myself."

Usually true. Doesn't matter, though. The first two weeks with any new employee are slower than doing it yourself. You hire anyway because it compounds.

Three moves get you here:

1. Write the process down once. Do the task with AI one time, get a result you actually like, then have it turn that into a repeatable set of instructions. Now it does it the same way every time.

2. Put it on a schedule, and make it report. An employee who does the work but never tells you what happened isn't one you can trust. Pick one place you actually check, your phone or a dashboard, and make everything report there.

3. Split the slow parts. When one step drags, break it into pieces that run at the same time.

What it looks like in a service business: every estimate that hasn't been signed in three days gets a friendly nudge written for that customer's job and price. Every finished job gets a review request the next morning. Every Friday at 4pm your phone gets a short text: jobs closed, estimates out, reviews in, leads that went cold.

Nobody had to start any of that this week. It started itself.

Phase 3 is where AI starts paying for itself. It never forgets, and forgetting is where most small businesses lose money.

What traps you here: trust. In phase 3, work also piles up if you can't make decisions about what the AI hands you.

How to climb: pick the one task you do every week that you hate. Do it with AI once and save the instructions. Then put it on a schedule. Start with one.

The question: Does anything in your business happen on a schedule without you starting it?

Phase 4. The business runs, you steer.

In phase 4, AI checks on other AI. It flags problems and suggests improvements to its own system, then waits for your sign-off.

You set the direction and look when something breaks. Managing individual tasks stops being your job.

That's my morning coffee from the top of this email. I didn't tell the system to go prospecting last night. It knows that's its job, what a good lead looks like, and which ones to skip. And there's a separate system with one job: check that the first one ran and tell me if it didn't.

One warning. There's a story making the rounds of a business that woke up to a $3,000 AI bill. One task got stuck in a loop overnight and kept going.

Nothing was broken. Nothing stopped it either.

So two guardrails. Use the cheapest AI that can do the job. You don't need the top model to rename files. And give every automated task a limit: it gets so many tries, then it stops and tells you.

Without those two guardrails, autonomy is a leak.

The question: When something goes wrong at 2am, who finds out first, you or your system?

The one rule that decides what to hand over.

Automate work where 80% is good enough: finding prospects, first drafts, research, reports, reminders.

Where 80% would be a disaster, never automate all the way through. That includes the price you quote and the promises you make. Anything a customer sees needs your review first.

In phase 4, you still show up wherever your judgment matters.

So where are you?

Don't try to jump to phase 4. You'll build something fragile and quit.

Find the one thing trapping you where you are and fix it. If you're still copy-pasting, that's your whole to-do list this week.

Odds are most of your competitors are still in phase zero. Climb one rung this month and you're ahead of them.

Hit reply and tell me your phase. One word is fine. I'll write back with the next move for your business.

Or come sit with me. This Wednesday at 10am, I'm running my AI class at The Mission Coffee on Newberry Road in Gainesville. Bring your laptop and we'll move you up one rung while you're there.

Larry Fischer is the founder of Internet Media Now. He helps service businesses build the systems that turn leads into customers. Learn more at InternetMediaNow.com.