What Are the Risks of Artificial Intelligence at Work

Understanding the Risks of Using AI in the Workplace

The rapid rise of artificial intelligence (AI) has made it nearly impossible to ignore.  AI tools and apps have been integrated into many operations within businesses and organizations across industries.  The reason so many businesses have adopted AI technology is because it can help streamline business operations for higher efficiency and improve customer service. Efficient use of AI technology can also save businesses and organizations time and money.

There are some inherent risks with incorporating AI technology into business operations.  The widespread adoption of AI technology is unprecedented as more tools are becoming available and put to use each day.  Many businesses are taking an ad hoc approach to incorporating the technology into their operations because the technology is so new and appearing so quickly.  Businesses are eager to leverage the capabilities of AI to boost their productivity without properly assessing the impact and risks of the technology.

The use of AI technology is still in its early stages.  It is important for businesses and organizations to take a more calculated approach to incorporating AI technology and consider the legal, ethical, safety, and fairness ramifications.  In this guide, we will help you understand the risks of incorporating AI technology in your workplace as well as the best ways to leverage AI tools and apps.

The Risks of AI Technology

The benefits of AI technology are obvious as businesses and organizations can use these tools to greatly increase productivity.  There is a sort of honeymoon phase happening as businesses continue to discover new ways to use it with little consideration of the risks and no clear process for incorporating the new technology.  While there are risks concerning cybersecurity, ethics, and shortcomings with the technology that are known, there are also potential risks that we do not fully understand yet.

We advise that all businesses and organizations use caution and understand the risks when incorporating AI technology.  The following are the main risks of AI technology that you should be aware of:


Becoming over reliant on a tool that can automate operations to make them faster and more efficient is easy.  Businesses must keep in mind that the relationship between the company behind the AI tool and the consumer is one way.  A producer of AI technology can change the capability and price of the tool and limit the free version at any time.  Businesses should consider the extent to which they use AI tools and have a plan in place to allow them to continue operations should they lose access to one of the tools.

2.Bias and Discrimination

Much of the information provided by AI tools is not entirely made up by the technology.  These tools are trained with existing pools of data that may reflect the biases and prejudices of those who created the original data.  This could create problems when the technology is used to approve job applicants, benefits, and loans.

3.AI Hallucinations

While a lot of the information presented by AI technology is drawn from the pool of data the technology is trained on, it can also make up information to answer a request from the user.  These incidents are known as AI hallucinations.  A real-life example of this happened recently when a lawyer used AI to find previous cases to use as precedents and the cases it generated did not exist.

Many AI tools come with disclaimers warning about the possibility of AI hallucinations.  It may be difficult to spot when this happens as users would have to continue asking the AI model for more refined answers or do the research themselves to fact check.  Both options take time that users are trying to save by using AI in the first place.  It is very important to be aware of the possibility of AI hallucinations to avoid spreading false or misleading information.

4.Data Security

Data security issues such as breaches, privacy, and cybersecurity risks are among the biggest issues concerning the use of AI technology.  There is an inherent risk when users enter any type of sensitive information into a third-party AI tool.  AI tools interact with and hold a significant amount of sensitive information and their rights or consent to use this information are not always clear.  Sharing sensitive information with AI tools may overstep legal boundaries in certain situations and it increases the risk of the data being exposed if there is a breach of the tool.

AI tools are also vulnerable to cyberattacks as attackers can corrupt the algorithms and take control of the AI system.  This can lead to severe consequences for businesses and organizations that use these tools.  It is important to understand the data and security risks of the specific AI tools used and take steps to safeguard against breaches and cyberattacks such as training employees on best practices.  Businesses can also work with our professionals at PSM to help strengthen cybersecurity measures regarding AI technology.

5.Risks to Intellectual Property and Copyrights

There is a risk that something created using AI could violate copyright laws or intellectual property rights because AI tools largely draw from existing data.  These violations could result in costly legal action for businesses and organizations.  It is important to be aware of this risk and use AI tools in a way to avoid these types of violations.

6.Legal and Regulatory Risks

Businesses and organizations that use AI tools to make decisions are still liable for these decisions and any consequences they may bring.  It may be best to avoid using AI tools for decisions that can have legal ramifications or violate regulations.  An experienced employee can provide better analysis and make better judgements for decisions that could have legal or regulatory ramifications.  Businesses should also avoid using AI tools that do not comply with federal, state, or local guidelines because they could be held responsible for damages caused by these tools.

7.Risks to Reputation

Businesses and organizations can damage their reputations if they are affected by some of the risks mentioned above, including data breaches, cyberattacks, spreading misleading or false information, violating intellectual property rights and copyright laws, and violating laws or regulations.  Dealing with the effects of these issues may involve legal action and negative publicity that can cause businesses to lose customers and revenue.  This is why having a sound policy in place for the integration and use of AI technology is crucial.


Communicating effectively with the target audience, customers, or clients is vital for building trust in a brand.  People are more loyal to a brand they can identify with, a brand that understands their needs and pain points.  In other words, people are more likely to connect to a brand when their customer communications are more human.

One of the problems when using AI tools to generate content is that the content itself can become dehumanized.  AI content may sound unnatural or lack character and people who consume your content will realize something is missing.  The feeling of human connection is strong, even when it comes to content on a website or marketing materials.  AI generated content may lack this basic connection which can cause the audience to feel disconnected to the brand.

Those in charge of creating AI content should still review and edit it so that it sounds natural and is in line with the tone of voice and vocabulary used throughout the branding of the business.

Integrating and Using AI in the Workplace

Despite the risks, the use of AI technology will continue to grow and become an integral part of the operations of businesses and organizations across industries.  Effective use of AI can greatly increase efficiency and productivity leading to reduced costs and increased revenue.  For AI technology to be used successfully, there must be a process in place for integrating AI technology as well as a clear understanding of how it will be used.

The following should be included in workplace policies regarding the use of AI:

  • Purpose of the policy: The policy should state its purpose when it comes to the use of AI tools. It should also describe how it should be implemented and who is in charge of implementing and enforcing the policy.
  • Data collection and use: The policy should clarify what type of data will be collected by the AI tools and how it will be collected and used. Establish when approval may be needed to collect and use certain data.
  • Fairness and non-discrimination: You must ensure fairness and non-discrimination in your use of AI technology and form a plan to identify and address potential biases.
  • Transparency and accountability: It is important to inform employees of exactly how AI technology will be used and whether or not they will be held accountable for the content or decisions produced by the AI tools.
  • Intellectual property: Clarify who owns the intellectual property created by the AI tools and how employees are compensated for their contributions to the intellectual property using AI.
  • Privacy and security: The policy must specify how the AI tools will be used in compliance with privacy and security laws as well as how sensitive data will be protected.
  • Training and education: The policy must include the details for training employees to use the AI systems as well as how to ensure that employees fully understand the risks and benefits of using AI.
  • Monitoring and auditing: Establish a process for monitoring and auditing the use of AI systems to ensure that employees are using the technology in accordance with the AI policy.

Microsoft AI Solutions from PSM

There is no denying the rapid growth and implementation of AI technology and there are no signs of it slowing down.  The use of AI technology is expected to increase significantly and businesses and organizations that use it must understand the risks as well as the benefits.  By carefully considering how you will use AI technology and implementing a workplace policy on its use, you can reap the benefits of AI technology and protect your business or organization from the risks mentioned above.

Implementing new AI technology requires businesses to put a plan in place on what technologies to introduce and how to use them.  Using a bunch of AI tools ad hoc with no real plan can lead to some of the risks described above.  At PSM, we can help you implement Microsoft Copilot and other new Microsoft AI tools based on your industry and business needs. We can also ensure that the AI technology you incorporate into your IT infrastructure is protected by taking the necessary cybersecurity measures.

For more about how we can help your business implement AI technology, give us a call at (312) 940-7830.


(Managed Services, Cloud Services, Consulting, Cybersecurity, Talent)

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