What is shadow AI and how common is it in enterprises?

Shadow AI refers to AI tools and services that exist outside an organization's visibility, approval, and governance. It is widespread: a 2025 Gartner survey found 69% of organizations suspect or have evidence that employees use prohibited public GenAI tools, and across the enterprise deployments Olakai has analyzed, roughly 60% of AI usage happens outside IT-sanctioned channels.

Definition of Shadow AI

Shadow AI represents AI tools and services operating beyond enterprise governance and visibility. These systems lack approval from IT, security, or compliance teams, sit outside standard technology inventories, and bypass official data protection policies and monitoring.

Source: Shadow AI: The Hidden Risk in Your Enterprise

Prevalence in the Enterprise

Enterprise data reveals broad adoption of unauthorized tools. A 2025 Gartner survey showed that 69% of organizations suspect or possess evidence of staff using prohibited public GenAI applications. Similarly, Microsoft research revealed 71% of UK workers admit to using unapproved AI solutions on the job, with 51% doing so at least weekly.

Source: Shadow AI: The Hidden Risk in Your Enterprise

Employee Adoption Rates

Research from BlackFog indicates that 86% of employees use AI tools weekly for their job responsibilities, with 49% utilizing solutions that have not been sanctioned by their employer.

Source: Shadow AI: The Enterprise Risk Hiding in Plain Sight

Share of Unsanctioned Enterprise Usage

Across analyzed enterprise environments, approximately 60% of AI activity occurs outside IT-approved pathways, spanning browser tabs, unapproved summarizers, and ungoverned coding assistants.

Source: What Your Employees Are Actually Using: The Shadow AI Opportunity

Also asked as

What does shadow AI mean?
How widespread is unauthorized AI tool usage in companies?
What percentage of employees use unapproved AI tools at work?