How ‘Shadow AI’ Is Harming Businesses

Gross negligence

More and more employees are using artificial intelligence (AI) for their outputs, but are ignoring proper cybersecurity protocols. 

Roughly seven out of 10 employees in the United Kingdom have admitted to using “Shadow AI,” or unapproved or unsanctioned external AI tools, without the company’s knowledge or IT department guidance. 

They use AI in internal and external communications, business presentations, and finance-related activities, according to the Microsoft study. While it has saved around 12 billion hours (equivalent to $274 billion), just a third of employees were concerned about the privacy of the company or customer data entered into the AI tools. 

This is a concerning trend that could result in data breaches, significant financial losses, and even reputational damage.

Trial stage

This disturbing phenomenon comes as demand for AI consultancy has been waning. Government contracts have been cut. Some private companies have pulled out of consultancy agreements, believing that AI could do the job and result in cost savings. Industry insiders say consultancy services have dropped by as much as 40% this year.

Believing you could do things on your own could be the biggest mistake a business can make, especially at this point in the tech revolution. While AI can accomplish menial and routine tasks very well and some applications are advancing by the minute, AI is still experimental. Every so often, we hear about an AI engine glitching, churning out fake information, and harmful outputs.

Critically, we have yet to figure out a workflow that allows humans and AI to coexist. Some staff have become so overdependent on AI that their communication skills, critical thinking, and even empathy have taken a hit. Others have entrusted a chunk of their work to AI, leading to embarrassing mistakes

Some companies have laid off thousands of employees, claiming that one AI engine could do their work better. Months later, they discovered that the engine had adversely affected service quality and decided to hire humans back

Respect expertise

These incidents clearly demonstrate the need for businesses to receive guidance on AI. While Silicon Valley is the AI innovator, consultants are the AI integrators who help corporations translate technical AI technology into high-value business solutions. 

There are thousands of AI tools on the market today, but not all are suitable for corporate use. Consultancies help businesses choose the right engine for their needs, be it in customer service, communications, finance, or human resources.

These third-party firms are continuously experimenting with these new-age technologies, ensuring they are easy to use, secure, and will help corporations unlock more value. And as AI improves every day, businesses that have built strategic partnerships with these consultancies will be the first to capitalize on the tech’s great potential.

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