I want small models to win and I am constantly experimenting with them. I have never tried fine-tuning and do not have that kind of budget. My approach is to remove some of the burden from models and bring into the agent.
Tool calling is an example - in some tasks RAG works really well, including coding agents where code, git log, Epics/Tasks, dependencies sources, etc. are all available in very structured manner. You can save many extra tool calls if you can run separate prompts and retrieve the source data needed for the actual work - rather its prompt.
And I really want to focus on search - this is the key technology if we want to use RAG instead of fine-tuning. If we can present really contextual sources in the prompts using a hybrid search approach - you can see how easily we get better results - either decisions or summaries from even small models.