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MLOps
Shadow AI
Definition
Shadow AI refers to employees using unauthorized AI tools (like ChatGPT) for work tasks without IT approval, creating security, compliance, and data governance risks for organizations.
Why It Matters
Employees adopt AI tools faster than IT policies can keep up. An estimated 50%+ of workers use AI tools without explicit approval. This creates real risks: sensitive data uploaded to external services, compliance violations, inaccurate outputs affecting decisions, and lack of audit trails.
Common Shadow AI Scenarios
- Pasting proprietary code into ChatGPT
- Using AI to draft sensitive communications
- Uploading financial data to AI tools
- Generating content without disclosure
- Making decisions based on unverified AI outputs
Risks
Security: Confidential data exposed to third parties Compliance: GDPR, HIPAA, SOC 2 violations Quality: Unvetted AI outputs in business processes Legal: IP concerns, liability for AI errors Governance: No visibility into AI usage patterns
Managing Shadow AI
- Acknowledge Reality: Employees will use AI regardless
- Provide Alternatives: Approved enterprise AI tools
- Set Clear Policies: What’s allowed, what’s not
- Enable Safely: Guardrails over prohibition
- Monitor: Track usage and data flows
- Educate: Train on responsible AI use