Reference
AI Glossary for UK Business Leaders
Plain-English definitions of the AI terms a board, SLT or council cabinet needs to share a vocabulary on. No jargon for jargon's sake.
- AI Readiness
- The state of having the data, team culture and governance in place to adopt AI without disrupting daily operations. A checklist diagnosis comes before any tool buying decision.
- API (Application Programming Interface)
- A set of rules that lets two pieces of software talk to each other. AI tools rely on APIs to read from, and write back to, your existing systems (CRM, accounting, helpdesk).
- GDPR Article 22
- The clause in UK and EU data protection law that gives individuals the right not to be subject to a decision made solely by automated processing where it has a legal or similarly significant effect — for example, hiring, credit, benefits or insurance.
- Hallucination
- When a generative AI model produces output that sounds plausible but is factually wrong or invented. The risk is highest when AI output is used unchecked in customer communication, advice or decision-making.
- Prompt Injection
- An attack where hidden text in an input (an email, a webpage, a document) tells the AI to ignore its rules and do something the user did not ask for — leak data, change the answer, run an action. A core risk for any AI agent that reads untrusted content.
- Shadow AI
- Staff using AI tools (free ChatGPT, browser plugins, personal Copilot accounts) for work without the organisation knowing. Creates data leakage, IP and compliance risk that does not show up in any system audit.
- Total Cost of Ownership (TCO)
- The full cost of an AI initiative across its life — licences, integration, training, change management, support and exit. Usually three to five times the headline software cost.
- Return on Investment (ROI)
- The financial return an AI investment generates relative to its TCO, expressed as a percentage or payback period. A board-grade business case quantifies time saved, errors avoided and revenue uplift in pounds.
- Pilot
- A small, contained trial of an AI use case with defined inputs, success metrics and a stop date. Designed to prove or disprove value before any wider rollout.
- Data Protection Impact Assessment (DPIA)
- A structured review required under UK GDPR when processing is likely to be high-risk to people's rights. Most AI deployments that touch personal data trigger a DPIA before go-live.
- EU AI Act
- European legislation that classifies AI systems by risk and sets compliance obligations on providers and deployers. Key provisions for general-purpose AI take effect in August 2026 and reach UK organisations who sell into, or process data from, the EU.
- Fractional AI Director
- A senior AI leader engaged on a part-time basis — typically one to four days per month — to give an organisation board-level AI direction without the cost of a full-time executive hire.
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