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Nearly 9 out of 10 AI tools inside enterprises are invisible to IT. Thats the finding of a LayerX study that should send shivers down the spine of any executive: AI is shaping decisions, summarizing meetings, and analyzing data without the knowledgeor controlof the very teams meant to secure it. What sounds like a technical oversight has become a board-level crisis, worsened by new global regulations. Last month, the EUs AI Act entered its next enforcement stage, forcing enterprises to document how general-purpose AI tools process data and threatening penalties of up to 35 million or 7% of global turnover. Yet weeks later, many organizations remain unprepared, struggling even to inventory which AI features are active in their environments. As regulators demand transparency, most enterprises cant meet the basic threshold of visibility. That gap is where the real danger lies. AI isnt only the domain of headline-grabbing tools like ChatGPT; its embedded in the everyday software stack. Zoom can transcribe and summarize meetings, Salesforce can auto-generate reports, Slack can analyze conversations. These features arrive through silent updates, slipping under ITs radar while handling sensitive data. The shadow AI crisis Call it AI sprawl. Platforms ship smart features by default, leaving enterprises with dozenssometimes hundredsof parallel AI apps. IT teams often monitor only a fraction. A report from security platform Zluri found that four out of five AI tools inside enterprises are unmanaged, leaving leaders unsure what data they touch, whether they comply with retention rules, or if theyve been activated at all. The danger lies in how AI arrives. It doesnt show up as new software IT can review. It slips in through automatic updates inside trusted apps. One day Slack is just a messaging platform; the next, its summarizing conversations and suggesting actions by default. Salesforce, Zoom, and Microsoft 365 are all adding similar capabilities, with little fanfare and no guarantee that compliance teams are aware. Gal Nakash, cofounder and chief product officer at the SaaS security company Reco, warns that the real danger isnt in sanctioned AI tools but in the hidden ones that slip into everyday workflows. He notes that vendors regularly roll out new features inside apps like Microsoft 365, Salesforce, and Slack, often without fanfare or IT oversight. “The real challenge isnt governing AI you know about,” he says. “Its discovering and securing the AI you dont even realize is there. That discovery gap is what turns AI from productivity booster to liability. When features activate silently, they bypass procurement and security reviews. Sensitive data can be processed without oversight. If you cant see where AI lives in your stack, you cant govern its behavior or its output, Nakash says. Why traditional governance is failing Enterprise security tools werent built for this. They track software inventories and run quarterly reviews, but embedded AI arrives silently, as toggles and background features inside already-approved apps. The risk isnt new software; its new capability. Search that combs entire databases. Copilots that draft messages or summarize private docs by default. New Reco data underscores the scale: 91% of AI tools inside enterprises operate without IT oversight, and 8.5% of employee prompts involve sensitive business data. That includes personal identifiers, customer details, even financials, all of which are processed by features security teams may not know are in fact turned on. “Traditional security tools operate on static inventories and periodic assessments,” Nakash notes. “They were built for the pre-AI era where changes happened slowly and visibly.” In other words, the very tools companies trust to protect them are ill-equipped for a world where SaaS vendors can transform the capabilities of an approved app overnight. By the time traditional reviews catch up, sensitive data may already have been exposed. Governance-first AI Some companies are responding by embedding AI inside governance controls from the outset. LeapXperts communications intelligence solution, Maxen, is one such example. Instead of layering an LLM onto consumer chat apps, Maxen functions within enterprise guardrails. That means access is enforced at the user level, outputs are explainable and retained, and data stays within compliance perimeters. Dima Gutzeit, CEO of LeapXpert, argues that many AI assistants are rushed into products as afterthoughts, prioritizing ease of use over accountability. Gutzeit says his company took the opposite approach, building AI into its compliance framework from the very start, with controls for access, explainability, and retention. We view AI as an integral part of the communications governance fabric, not an add-on, he adds. For highly regulated industries like finance or healthcare, the stakes are high. A vague queryWhats the status of our largest deal?could cause an unsanctioned assistant to surface material nonpublic information to someone without clearance. Gutzeit says Maxens controls prevent that. This governance-first model complements discovery tools. Enterprises still need visibility across SaaS platforms to spot hidden toggles and plug-ins. But assistants designed to respect audit and retention rules reduce the chance of sensitive data spilling into the wrong hands. A transparency filled future? The EUs enforcement cadence makes the risk unavoidable. The AI Act now requires transparency, documentation, and risk assessments for general-purpose AI, with even tougher obligations for models deemed systemic risks. And regulators have also introduced a voluntary code of practice, according to The Wall Street Journal, offering a preview of stricter enforcement ahead. LeapXpert’s Gutzeit believes this will trigger a fundamental shift in how enterprises adopt AI. Silent AI features will no longer be tolerated,” he says. “Enterprises will require vendors to disclose how AI is being used, what data it draws on, and how outputs are retaine. Compliance-first strategies will replace AI-first adoption. For executives, the message is clear: Waiting for perfect standards or a finalized audit checklist is not a strategy, and discovery must instead be continuous. And controls have to be built in from the start, not patched on after rollout. The enterprises that will succeed with AI are those that treat governance as a competitive advantage, not a compliance burden, says Reco’s Nakash. When you build visibility and control into your AI strategy from day one, you’re not just managing risk; you’re creating the foundation for sustainable innovation at scale.” The future depends on making AI transparent. If you cant see where its running or what its touching, you cant safeguard customers, comply with the law, or trust the insights it generates. The good news is that a path forward is emerging: real-time discovery across SaaS platforms combined with governance-first assistants that keep data contained. Thats how enterprises can embrace AI without losing control.
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E-Commerce
Fast-food and casual-dining chains are battling out over whose menu has the best value. IHOP hopes that the pancake houses $6 breakfast deal stacks up with the restaurant sectors best bargains. McDonalds, Burger King, and Olive Garden have all recently unveiled discounted menu offerings as low- and middle-class consumers have been more loudly signaling that they are feeling pinched by inflation and anxiety about a weakening jobs market. IHOPs new nationwide, everyday $6 value offering ($7 in some pricier markets) features four breakfast meals, ranging from a ham-and-cheese omelet thats paired with buttermilk pancakes to scrambled eggs with cheese and hickory-smoked bacon and served with hash browns. Theres a clear message that guests want and need more value right now, says IHOP president Lawrence Kim during an interview with Fast Company. The Everyday Value Menu kicks off Monday with a national advertising campaign that will run on linear TV and streaming platforms, in public spaces, and on social channels including TikTok and Instagram. IHOPs new promotion flipped the marketing messaging from the chains prior all-day breakfast special, which was known as House Faves. The breakfast purveyor wanted to more clearly communicate the promo to diners with the word value. Both promotions were available from 7 a.m. to 10 p.m., but Faves excluded weekends. IHOPs Everyday offer will instead run every day, adding the chains two busiest traffic days. We wanted to make the value menu simple to understand, Kim says. The bigger value bet comes as IHOP has reported softer sales for more than a year. The chains parent company, Dine Brands, reported declines for IHOPs domestic system-wide comparable same-restaurant sales in fiscal 2024 and the first two quarters of fiscal 2025. IHOP has projected that for the current fiscal year, that metric will range between a decline of 1% to a growth of 1%. During an earnings presentation to Wall Street analysts in August, Dine Brands CEO John Peyton said IHOP is seeing steady improvement in traffic and comp sales due to the expanded bet on a value menu, campaigns including an ad spot from this spring that featured NASCAR Hall of Famer Dale Earnhardt Jr., and a recent decision to bring social creative and content teams in-house to generate more engagement with Gen Z consumers. Peyton said the recent pivot on the social strategy led IHOP to see a 400% increase in engagement, growing followers by 30% across TikTok and Meta on a quarter-to-quarter basis. All of these efforts, he promised, are keeping the brand relevant and well positioned for continued progress in the second half of the year. [Photo: IHOP] $6 vs. $16: The Price Gap IHOP Is Betting On While Kim didnt share the average amount spent by an IHOP guest, the $6 offering is a considerable discount from standard menu items. In New York City, for example, four pumpkin spice pancakes are $10, while combo meals that feature French toast, pancakes, eggs, and other breakfast staples are $16 and higher. Kim says the promotional offers were tested in several markets before launching nationally, as IHOP wanted to see a lift in traffic, overall sales, and restaurant profits. We proved success across all three of those metrics, he adds. Kim says IHOPs decision to get more assertive on the value meal promotion was in part validated by his own ongoing listening tour, in which he visits restaurants in states including Ohio and New York and meets with servers, cooks, general managers, and customers. As he spent time with diners, Kim says that they would consistently tell him that they love IHOPs food and are pleased with the chains service. But consumers also shared that they were craving deals. IHOPs ad spot was developed with ad agency Deutsch, which has also produced creative work for Taco Bell, Walmart, Nintendo, and Dr Pepper. Ryan Lehr, co-chief creative officer at Deutsch, says that the concept was focused on the different meanings of value. Theres value in being able to have a breakfast for $6, but theres also the value of being able to reconnect with your family and friends, Lehr says. The campaign was directed by Drew Kirsch, a filmmaker whose vibrant and colorful style has been seen in music videos starring Taylor Swift, Shakira, and Machine Gun Kelly. The visual portrays a whimsical dreamworld that features each of the four combos, with a backdrop depicting syrup streams, French toast mountains, and pancake umbrellas on a beach. We didnt just want to talk about $6, says Kim, though that theme is consistently hit upon in the video, too. We wanted to make sure that it brings the IHOP memories and bonds to life in a very unique way.”
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E-Commerce
The Innovation by Design Awards celebrate the people and companies behind some of the worlds best and most thought-provoking design work. This year, Fast Company is recognizing nearly 300 projects that are shaping the world we live in for the better. Every year, Fast Company’s editorial staff spends months poring over applications, vetting projects, and ultimately telling the stories of the best designs from the bunch. Here is a behind-the-scenes peek into how we make it happen. METHODOLOGY Nearly 2,000 applications were submitted to the 2025 Innovation by Design Awards. A team of staff editors and writers, alongside trusted freelancers and external expert judges, assessed each application based on our criteria, which include: Functional: What problem does the design solve? Logical: Does the design make sense? Does it work? Impactful: Does a design make a difference in its users lives? Beauty: Is it thoughtfully designed? In a world of countless new products and serviceswhere it takes little more than an AI prompt to create something newwe believe there is only more value to the practice of design and applying a critical lens to this work, says Mark Wilson, Fast Companys global design editor. Our team of journalists judge each project on both its own merits and its greater cultural context. Through this process, we aim to surface the most relevant projectsthose that matter the most today and into the future. Each winner is chosen after multiple rounds of judging and conversations about a designs role in the current cultural moment. This months-long process ensures that every project chosen to receive an Innovation by Design honor is representative of the best work in its field.
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E-Commerce
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