Shadow AI

Employees using AI tools that the organisation has not approved or does not know about, often by pasting company data into public chatbots.

Definition

Shadow AI is the AI version of shadow IT. It usually starts with good intentions: people find a tool that saves time and use it before the company has a policy or an approved alternative. The risks are data leaving the company, unvetted outputs in customer work, and compliance gaps.

Banning AI rarely works; usage moves to personal devices. Organisations that reduce shadow AI usually combine a clear policy, an approved tool that is genuinely good, training in AI literacy and visibility of what is being used.

Sources

  1. IBM, What is shadow AI?