The Rise of Shadow AI in the workplace
Generative AI (GenAI) has been the buzzword of the year. From writing emails to generating code, it seems like everyone is using it. But according to a new report released this week, the honeymoon phase might be ending for Australian businesses.
A new study by intelligent automation company ABBYY, titled State of Intelligent Automation: GenAI Confessions, peels back the curtain on how Australian leaders are actually coping with the AI revolution. The verdict? While optimism is high, the road to implementation is bumpier than expected.
While tools like ChatGPT feel magical to the casual user, integrating them into a business isn’t simple. The report found that Australian business leaders are facing significant “teething problems.”
The top challenges include:
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Training staff: 33% of leaders struggle to get their teams up to speed.
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Integration: 26% are finding it hard to plug GenAI into existing systems.
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Trust issues: 16% cite “hallucinations”—where the AI confidently provides incorrect information—as a major headache.
One of the most interesting findings in the report is the phenomenon of “Shadow AI.” This happens when employees use AI tools (like their personal ChatGPT or Perplexity accounts) without IT permission or oversight.
Over 20% of respondents are seeing this in their workplace. In fact, 40% of Australian business leaders admitted they only invested in GenAI because their employees were already using it on the sly. This “if you can’t beat ’em, join ’em” mentality is actually driving investment more in Australia than in the UK or France.
So, how are businesses fixing the glitches and hallucinations?
Over 90% of businesses saw improvements when they stopped relying on GenAI alone and paired it with other “purpose-built” AI tools (like Document AI). By combining creative AI with factual, specialized AI, businesses saw:
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Better consistency (45%)
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Improved cost efficiency (43%)
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Higher trust in the results (40%)
For example, a global fast-food chain used this hybrid approach to extract data from thousands of lease agreements, improving accuracy by 82%.
Despite the challenges, staff are generally happy. 85% of leaders say the results are positive. Half of the staff say AI reduces their workload, and 43% admit they use it to “make them look smarter and more professional.”
However, Australian workers have one specific request for their AI assistants: Honesty. 19% of Aussie workers wish GenAI would simply admit when it doesn’t know the answer, rather than making one up. Interestingly, Australians care more about this than their counterparts in the UK or Germany.
Want to dive deeper into the data? You can access the full report here: State of Intelligent Automation: GenAI Confessions
