Balancing AI Regulation With InnovationBalancing AI Regulation With Innovation

Being AI-forward means doubling down on strategy

Agur Jõgi, CTO, Pipedrive

October 23, 2024

3 Min Read
Piles of legal books on a bookshelf
Getty images

Balancing regulation with innovation is a critical challenge for businesses in the rapidly evolving landscape of artificial intelligence. As AI advances at an unprecedented rate, governments worldwide are working to establish regulations that keep pace. The European Union's AI Act is already in force and discussions around a U.K. AI Bill are gaining momentum. This marks a shift from a time when AI innovation faced fewer constraints. As AI becomes more integrated into daily life, the need for robust regulation across the world has become increasingly clear.

Shift From Unchecked Innovation to Responsible AI Development

Innovation in AI brings varying levels of risk. While an AI suggesting recipes poses minimal risk, critical areas like medication require human oversight. This highlights why businesses need to understand AI's role before adopting it. Pipedrive’s State of AI in Business Report found that nearly half (48%) of businesses see a lack of knowledge as a major barrier to AI adoption. Recognizing these risks helps in making informed decisions. As companies adopt these technologies, understanding regulations ensures responsible use, building trust and ensuring AI is ethical and respects individual rights.

Importance of Transparency in AI Operations

Related:AI Divide Risks Poverty Over Promise

It's important to be open and clear about how AI works because many people still don’t fully trust it—only 62% feel confident that their organization will use AI responsibly, according to Workday. To build trust, companies need to explain the purpose of their AI, how they handle data and how much decision-making power the AI has. This is especially crucial when AI is used in high-risk areas that could affect safety, rights, or access to essential services. Clear guidelines, oversight and policies help make sure AI is used fairly and transparently.

 Different types of AI vary in how complex they are, which makes transparency even more important. For example, decision trees are simple and fully controlled by humans, making them easy to manage. On the other hand, tools like ChatGPT depend on human data but can still make mistakes. The most complex are self-learning models that make their own decisions and need close monitoring to ensure they’re used responsibly and ethically. Being clear about how these different AI models work helps build trust and ensures they’re used safely.

Balancing Innovation With Responsibility

AI offers significant opportunities for innovation, improving efficiency and enhancing employee well-being. For example, colleagues who leverage automation often report greater job satisfaction and a better work-life balance, according to Pipedrive data. However, as businesses embrace these advancements, they must also act responsibly. Public trust hinges on transparency and honesty, especially in dealings with third parties that manage data. 

Related:AI's Dark Side: The Grim Reality of AI Risks

Urgency of Developing an AI Strategy

The days of diving headfirst into AI without considering the ethical, legal and regulatory implications are over. AI and regulatory oversight are both here to stay and its complex nature demands careful consideration of its creation and deployment. Companies that fail to address these issues risk facing serious consequences as regulators become more active.

Leading Through Compliance and Innovation

Global regulations aim to prevent AI from perpetuating biases, creating cybersecurity threats, or misusing data. To stay competitive, businesses must ensure their innovation is backed by strong security, legal, HR and data protection measures. These are essential to avoid regulatory penalties. Companies that balance regulation with innovation will set the industry standard, building trust and leading the evolving AI landscape, showcasing what is possible to improve users’ lives and drive value.

About the Author

Agur Jõgi

CTO, Pipedrive, Pipedrive

Agur Jõgi is the chief technology officer at Pipedrive.

Sign Up for the Newsletter
The most up-to-date AI news and insights delivered right to your inbox!

You May Also Like