The Rise of Shadow GenAI and the Risk of Technical Debt

I have written previously about technical debt and GenAI choices and when you add on Shadow GenAI the situation becomes even more complex. The accessibility of Generative AI (GenAI) tools means that everyone can innovate like never before. However, this surge in un-monitored GenAI usage, often referred to as “Shadow AI”, combined with GenAI only now starting to come down from the ‘Peak of Inflated Expectations’ can lead to significant challenges, including the accumulation of technical debt within organisations.

What is it?

Shadow AI refers to the deployment and use of AI tools, technologies, or models within a company without formal approval or oversight. These AI applications often include unsanctioned generative AI tools and large language models that employees use to perform tasks.

Technical Debt is a concept from software development that describes the future costs incurred when quick, short-term solutions are implemented instead of more effective, long-term approaches. In the context of GenAI, technical debt accumulates when AI systems are developed or deployed hastily without proper oversight, leading to issues that require future remediation (given where we are in the hype-cycle we need to be careful that we select GenAI technologies that will survive any shake-out in the “Trough of Disillusionment”.

Understanding these concepts is crucial because unmonitored GenAI usage can introduce security vulnerabilities, compliance risks, and inefficiencies that may hinder an organisation’s long-term success.

What does it mean from a business perspective?

Increased Security and Privacy Risks: Unapproved GenAI tools can bypass standard security protocols, making the organisation vulnerable to data breaches and cyber attacks.
Compliance Challenges: The use of unsanctioned GenAI may lead to violations of industry regulations and standards, potentially resulting in legal penalties and reputational impacts.
Operational Inefficiencies: Shadow AI can create redundant processes and systems, leading to confusion and decreased productivity among teams. (Equally, just dropping an approved tool onto employees desktops without even basic prompt design training will lead to frustration and lost opportunities.)
Accumulation of Technical Debt: Rapid deployment of AI without proper oversight can result in poorly integrated systems that require significant future resources to fix.
Strategic Misalignment: Uncoordinated AI initiatives may diverge from the organisation’s goals, leading to wasted resources and missed opportunities.

What do I do with it?

Select Appropriate Partners and Tools: Employees will use GenAI tools to help them in their jobs whether you approve them or not, especially given today’s pressures. Support employees by selecting appropriate partners (e.g. Microsoft, Google, OpenAI, Anthropic, Cohere) and tools, a secure environment to work in and provide the training to make the best use of them.
Establish Clear AI Governance: Develop and enforce policies that regulate the use of AI tools within the organisation to ensure alignment with security and compliance standards supported by training and monitoring.
Promote Cross-Functional Collaboration: Encourage communication between IT, security teams, and other departments to ensure AI initiatives are cohesive and strategically aligned.
Invest in Training and Awareness: Educate employees about the risks associated with Shadow AI and the importance of adhering to approved tools and protocols.
Implement Monitoring Tools: Utilise software solutions to detect and manage unauthorised AI applications within the organisation’s network.
Regularly Assess and Address Technical Debt: Conduct periodic reviews of AI systems to identify and remediate technical debt, ensuring long-term system health and efficiency.

By proactively managing Shadow AI and technical debt, organisations can harness the benefits of generative AI tools while mitigating potential risks.

What is it?

What does it mean from a business perspective?

What do I do with it?

Further Reading