Dive Brief:
- With businesses under pressure to automate operations, more than half of department-level AI initiatives lack formal approval or oversight, according to EY’s Technology Pulse Poll published Thursday. The report surveyed 500 business leaders in tech across the U.S.
- Demand for rapid tech deployment is driving this trend, with 85% of technology leaders prioritizing time-to-market over AI governance, according to the report.
- “Without strong governance in place, companies risk hitting a plateau where large-scale transformational growth and innovation across the enterprise become increasingly difficult,” James Brundage, EY Global and Americas Technology Sector Leader, said in the report. “That’s the velocity paradox leaders are navigating today, balancing urgency with accountability.”
Dive Insight:
Shadow AI is embedded in day-to-day operations as business leaders pursue faster deployment of the technology — but the breakneck pace of adoption is creating a downstream consequences.
More than 78% of leaders said adoption is surpassing their organization’s ability to manage the associated risks, with governance and oversight falling by the wayside in favor of rapid rollouts.
This disconnect is already giving rise to security incidents. The report found 45% of leaders confirmed or suspected sensitive data leaks tied to employees’ unauthorized use of third-party AI tools in the past year, while 39% cited intellectual property exposure concerns.
The findings echo wider industry unease over mounting cyber risk as a result of AI uptake.
More than 80% of workers use unapproved AI tools at work, according to UpGuard data. Roughly one-quarter of employees said they consider AI tools as their most trusted source of information.
Incidents involving sensitive data sent to AI applications have doubled year over year, according to research from cloud security firm Netskope published in January.
Against that backdrop, EY’s data suggests technology leaders are aware of the tension but remain unwilling to sacrifice speed, with 95% of executives expecting investment in AI to increase in the next year.
For CIOs, the risk calculus is shifting. Moving too slowly can stall innovation. Moving too quickly can expose sensitive data, intellectual property and customer trust. The challenge is scaling AI and governance in parallel.
Security awareness training alone is not enough to safeguard against threats, according to UpGuard, with new approaches needed to keep up with the pace of change. Clearer governance processes, stronger provisioning controls and continuous visibility into AI usage patterns are also critical to curbing risk, Netskope said.
Companies that prioritize security controls can expect more sustainable growth, said Ken Englund, EY Americas technology sector growth leader.
“Investment momentum remains strong, particularly in cybersecurity, infrastructure and AI-specific talent,” he said in the report. “Organizations that standardize approved tools, strengthen monitoring and security controls and invest in workforce enablement will be better positioned to scale safely and achieve their AI ambitions with manageable risk.”
