Presented by Dell Technologies
Shadow AI: A Growing Challenge for Businesses
The rise of Shadow AI presents significant challenges for organizations of all sizes due to the unsanctioned use of generative AI outside IT's oversight.
According to a Salesforce survey of 14,000 workers, 28% of employees use generative AI at work, with over 50% doing so without their employer's approval. This trend is likely to increase as more workers recognize the productivity boosts from AI-generated content.
The Opportunity for IT Leaders
The prevalence of Shadow AI also offers IT leaders a unique opportunity to enhance their governance strategies. Balancing support for business initiatives with risk management is a constant challenge for CIOs.
As IT governance requirements evolve to address changing business needs and risk profiles, it is crucial to align strategic objectives with effective risk management during this fast-paced digital transformation.
Why Governing Generative AI Matters
Addressing Shadow AI is more challenging than dealing with Shadow IT, where employees consciously subscribed to unauthorized services. Shadow AI's risks are compounded by its accessibility; employees can utilize generative AI tools without financial barriers.
The misuse of these AI services can lead to critical governance challenges. For example, employees might inadvertently input sensitive corporate intellectual property or personally identifiable information into public generative AI systems, jeopardizing data security.
Employees querying these services for strategic information risk disclosing proprietary insights. Likewise, incorporating confidential information can expose organizations to legal liabilities and copyright issues.
Despite acknowledging the risks, many organizations lack comprehensive policies to govern generative AI. A KPMG survey revealed that 69% of companies are still in the early stages of evaluating generative AI risks and developing mitigation strategies.
Completely banning generative AI could encourage covert use, increasing risks like data breaches, compliance issues, and reputational damage. With 44% of IT decision-makers in preliminary phases of their generative AI journeys, IT departments must collaborate with the broader business to establish a unified approach.
Collaborative Governance Strategy
IT leaders should partner with legal, compliance, and risk management teams to create a centralized generative AI strategy. This involves defining acceptable use policies, communicating them clearly to employees, and implementing training programs that promote responsible usage.
Establishing an AI Governance Framework
Organizations should create protocols designed to protect sensitive data while aligning with existing IT governance strategies. Consider these key steps:
1. Institute AI Governance Policies: Develop clear guidelines for AI use, outline approved systems, and communicate the repercussions of utilizing unauthorized applications.
2. Provide Approved Tools: Equip employees with sanctioned AI applications to minimize the temptation to use unapproved tools.
3. Formalize Training: Educate staff on the ethical use of approved generative AI services and the risks of sharing sensitive content with unauthorized systems.
4. Audit and Monitor Usage: Implement regular audits and compliance checks, utilizing software to identify unauthorized AI activity.
5. Encourage Transparency and Reporting: Foster an environment where employees can report the use of unapproved AI tools without fear, enabling swift responses to incidents.
6. Communicate Frequently: As generative AI tools advance, keep your policies current and communicate updates consistently to employees.
Your Generative AI Insurance Policy
Effective governance functions like an insurance policy—better to have it in place than to face the consequences of neglect. Generative AI differs from traditional AI in its ease of adoption, which can lead to management challenges.
To ensure responsible use, companies must prioritize data management, identifying sensitive information that should remain within secure generative AI systems.
Generative AI symbolizes a new phase in the evolving AI landscape, and trusted partners can help navigate its complexities. Dell is leading the way by developing business cases that empower customers to explore generative AI options securely from their data centers, using open-source LLMs to maintain control over system deployment.
Ultimately, integrating AI with your data infrastructure may be your most effective governance strategy.
For more information, visit dell.com/ai.
Clint Boulton, Senior Advisor, Portfolio Marketing, APEX at Dell Technologies.
1. The Promises and Pitfalls of AI at Work, Salesforce, October 2023
2. Generative AI: From Buzz to Business Value, KPMG, June 2023
3. Generative AI Pulse Survey, Dell Technologies, Sept. 2023
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