"80% of AI Use Happens Off the Grid": How Lanai Software Reveals the Hidden World of Enterprise AI

Summary

Podcast Summary: "80% of AI Use Happens Off the Grid": How Lanai Software Reveals the Hidden World of Enterprise AI

Podcast Information:

• Title: Lead With AI
• Host: Dr. Tamara Nall
• Guest: Lexi Reese, CEO and Co-Founder of Lanai Software
• Episode Release Date: June 3, 2025

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Introduction

In this episode of Lead With AI, Dr. Tamara Nall engages in a deep conversation with Lexi Reese, the CEO and Co-Founder of Lanai Software. The discussion centers around the hidden utilization of AI within enterprises and how Lanai Software provides crucial visibility and governance to manage this covert AI usage effectively.

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Guest Introduction

Lexi Reese introduces herself as a seasoned professional with extensive experience in building essential infrastructures that amplify human potential. Having previously contributed to Google’s real-time machine learning ads engine and scaling Gusto’s payroll and health insurance services, Lexi highlights her passion for creating systems that support significant technological shifts, especially in the realm of AI.

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Lanai Software Overview

Lexi explains that Lanai Software is the first platform designed to offer CIOs and CISOs real-time, prompt-level visibility into how AI is being utilized across their organizations. The platform focuses on AI observability and security, ensuring that AI interactions are transparent, safe, and aligned with business objectives.

Lexi Reese [03:18]: "Lanai is an observability and security platform that helps people see the interactions between humans and AI when they're happening, why they're happening, and how risky those are."

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Key Insights and Discussions

1. The Hidden Extent of AI Usage

A significant revelation shared by Lexi is that 80% of AI use occurs "off the grid", meaning it happens without the organization's knowledge or oversight. This lack of visibility can lead to unintended risks and compliance issues.

Lexi Reese [04:09]: "80% of AI use happens off the grid. It cannot manage what it can't see."

2. The Critical Need for AI Governance

Lexi emphasizes the paradox where companies rapidly adopt AI technologies without establishing the necessary infrastructure to monitor and manage their AI usage. This gap can result in both security vulnerabilities and unintentional misuse of AI tools.

Lexi Reese [04:27]: "We're in this AI era and companies don't need more AI tools. They need intelligence about their AI."

3. Real-World Case Study: Insurance Company Incident

A pivotal moment for Lanai occurred when Lexi learned about an insurance company's misuse of AI tools. A sales leader reported increased upsell rates thanks to AI, but upon investigation, it was discovered that employees were unlawfully using customer data to discriminate based on zip codes—a proxy for race.

Lexi Reese [05:04]: "Sales team was uploading customer data into an AI tool that had been quietly added to their existing customer relationship system... using zip code to decide who or who not to sell to is illegal."

This incident underscored the necessity for platforms like Lanai that provide comprehensive oversight of AI interactions.

4. Inside Lanai: How It Works

Lanai functions by detecting AI interactions across the enterprise, classifying use cases, and labeling associated risks—all in real time. The platform ensures this without disrupting workflows or infringing on employee privacy by focusing on pattern detection rather than content monitoring.

Lexi Reese [06:54]: "We detect AI interactions, classify them to identify the use case, and label the risks using AI itself."

An example highlighted is Lanai's rapid detection of a Chinese AI tool, DeepSoft, which many organizations only discovered two weeks after its usage began—Lanai identified it within minutes.

5. Transforming Organizational Response to AI

Lexi shares an anecdote about a healthcare executive initially alarmed by clinicians using multiple AI tools. Lanai's insights shifted his perspective from shutting down AI usage to scaling its positive applications, such as improving patient care times and reducing documentation burdens.

Lexi Reese [09:34]: "His perspective shifted from shut this down to scale. This is the power of visibility, transforming apparent chaos into strategic opportunity."

6. Ethical Considerations and Human-Centric Approach

Lanai prioritizes balancing AI visibility with employee privacy. The platform aggregates and anonymizes data to prevent individual surveillance, adhering to the mantra "don't be creepy" as advised by one of their advisors.

Lexi Reese [15:56]: "Our ethical line is very clearly balancing visibility with privacy... We're focusing on pattern detection, not content monitoring."

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Future Vision: AI Integrated Workforce by 2030

Lexi envisions a future where AI is seamlessly integrated into daily workflows, becoming as ubiquitous as digital tools are today. AI and human workforces will operate in harmony, with Lanai facilitating this integration by providing the necessary visibility and governance.

Lexi Reese [17:28]: "Every organization will effectively have dual workforces, your human workforce and your AI workforce."

She believes that organizations with the best visibility into their AI operations will thrive, leveraging AI to drive intentional and value-driven outcomes.

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Practical Takeaways for Listeners

Lexi Reese offers actionable advice for leaders looking to understand their organization's AI usage:

1. Conduct an Anonymous Survey: Create a five-question survey to identify which AI tools employees are using and for what tasks. Ensure anonymity to encourage honesty.

   Lexi Reese [20:16]: "Create a five question anonymous survey asking your teams which AI tools they're actually using day to day and for what tasks."

2. Understand Hidden AI Utilization: Recognize that teams might be using significantly more AI tools than anticipated, uncovering both hidden risks and opportunities for innovation.

3. Prepare for Lanai Integration: For organizations ready to scale AI innovation securely, joining Lanai’s waiting list is recommended.

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Rapid Fire Segment

In a fun and insightful rapid-fire round, Lexi shares her thoughts on various topics:

• Most Overrated Tech Trend: Agents
• Most Underrated Tech Trend: AI Breakthroughs
• AI Native Detection: [Lexi did not specify; likely a category designation]
• One Book Everyone Should Read: The Atlas of AI by Kate Crawford
• Boldest AI Prediction: Without proper visibility and guardrails, AI will automate more jobs than it creates.

Lexi Reese [25:33]: "The Atlas of AI by Kate Crawford."

Lexi Reese [25:38]: "Unless we equip leaders with visibility and guardrails like Lanai provides, AI will automate more jobs than it will create."

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Conclusion and Contact Information

Dr. Tamara Nall wraps up the episode by encouraging listeners to connect with Lanai Software for further engagement. Lexi Reese provides various contact avenues:

• Website: withlanai.com
• LinkedIn: Follow Lanai and Lexi Reese personally
• Learning Journeys: Available on Lanai’s website to help leaders navigate AI integration effectively

Lexi Reese [26:23]: "Thanks with lanai.com is our website and you can sign up there to say you're interested and we'll get back to you."

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Final Thoughts

This episode of Lead With AI offers valuable insights into the often-overlooked aspects of enterprise AI usage. Lexi Reese’s expertise highlights the critical need for visibility and governance in AI adoption, ensuring that organizations can harness AI's full potential while mitigating risks. Listeners gain a comprehensive understanding of how platforms like Lanai Software are essential in shaping a future where AI integration is both innovative and responsible.

Transcript

[Lexi Reese]

What if you could see and secure every AI interaction in your company down to the prompt? In this episode of lead with AI, I sit down with Lexi Reese, powerhouse CEO and co founder of Lanai Software. Lanai is the first platform that gives CIOs and CISOs a real time prompt level view of how AI is is being used across the business. From stopping data leaks to boosting revenue by up to 35%, lanai is AI with accountability. If you care about AI governance, enterprise security or next level productivity, this conversation will blow your mind. Let's talk about what it really means to lead with AI. Let's get into it.

[Dr. Tamara Nall]

Welcome to Lead with AI. I'm Dr. Tamara Nall. In each episode, we will take you behind the scenes with visionary leaders shaping the future of AI across public and private sectors. Join us as we explore groundbreaking projects and innovations that are transforming industries and making a real impact on people's lives. Let's dive in.

[Dr. T]

Hi everyone, how are you? My name is Dr. T. I am your host with the Lead with AI podcast. And today I am so excited to be here having a conversation with Lexi Reese from Lanai. How are you Lexi?

[Lexi Reese]

I'm doing great, Dr. T. Thrilled to be here.

[Dr. T]

Amazing. And we're happy to have you. And this discussion is especially important for all you B2B guests and listeners that we have out there. So let's get started. So Lexi, just tell us a little bit about you. Who are you at your core? What was the great vision that you had when you started the company?

[Lexi Reese]

Yeah, so I'm Lexi Reese. I'm the co founder and CEO of Lanai and I've spent my career building what I call quiet infrastructure. It's essential systems that shape how people live and how they work, but that most never think about. At Google, I helped build their real time ML ads engine before ML was cool. At Gusto, I scaled a payroll and health insurance company for millions of employees. And what's always fascinated me is how the right infrastructure amplifies human potential. So right now we're in the most profound shift at work of anything we've seen in our lifetime, since maybe the dawn of the Internet. But we are missing infrastructure for it. And I saw this paradox, this paradox where companies were racing to adopt AI but had zero visibility into how it's actually being used. And so Lanai is an observability and security platform that helps people see the interactions between humans and AI when they're happening, why they're happening, and how risky those are.

[Dr. T]

Wow, that's amazing. That's absolutely amazing. And your background, I mean, it's just so prime for this and seeing that gap in that need. Because you are right. I mean, I actually heard someone discussing one time that his employees were using all kinds of GPTs, et cetera, different LLMs for all kinds of things. And they actually had a group that was going into the cloud. So I'm going to refer them to you. So you can definitely help them out because I'm hearing it was, was pretty scary. So this, this product is definitely filling up a gap. So talk to us about that holy smokes moment. What was the jaw dropping moment when you can tell us about a case when, when someone first experiences Lanai and realize that, wow, this changes everything for the company.

[Lexi Reese]

Yeah. So I mean, first of all, 80% of AI use happens off the grid. It cannot manage what it can't see. And most actually from bad actors. It's from smart employees doing the wrong thing with the right intent.

[Dr. T]

Got it.

[Lexi Reese]

So I feel like we're in this BAM era and you've heard a lot about these blind AI mandates where CEOs will say, go use more AI, but companies don't need more AI tools. They need intelligence about their AI. A holy smokes moment. Dr. T was when I learned in an insurance company, a sales leader was saying how much AI was helping her with upsell rates. So they were using AI and their sales team was able to sell a lot more.

[Dr. T]

Got it.

[Lexi Reese]

Great. She told this anecdote at an AI council meeting. And most Fortune 500 companies have AI councils and they meet to talk about the anecdotes because they don't have a lot of data of how people are using AI and what's good and what's bad. So sales leader comes in and says, this is great. More upsell data compliance. Leadership says, wait, tell us about how they're doing that and what was happening. Right idea, wrong execution. Sales team was uploading customer data into an AI tool that had been quietly added to their existing customer relationship system. So it was not a net new tool, it was a net new function within an existing tool.

[Dr. T]

Got it.

[Lexi Reese]

And the they were uploading customer information that had zip code. Zip code in the insurance industry is a proxy for race and using it to decide who or who not to sell to is illegal.

[Dr. T]

Yes.

[Lexi Reese]

So that was a holy smokes moment where I felt like we could create and we have created a product that gives visibility and the name Lanai comes into lean into AI, but do it safely in a way that empowers Both your employees and your customers.

[Dr. T]

Wow. No, that's amazing. I mean, y' all save them from a lot of heartache, potentially liability. Wow, that's amazing. That's amazing. And then if we think about like opening up the hood and looking inside the brain, what will we actually find if we were to open up that hood?

[Lexi Reese]

So inside Lanai, you'd find a sixth sense about your organization's AI interactions, connections between teams and tools and outcomes that were previously invisible to you. So under the hood, we detect AI interactions across the enterprise, we classify them to identify the use case and we label the risks and we use AI to do all of this. So for the, for the real sort of, aha. For some companies, you know, there was a Chinese AI company competitive to OpenAI called DeepSoft. Most of the world found out about it two weeks after we were able to detect that customers employees were using Deep seq. Wow. So we see things that take many weeks in minutes and we make that intelligence actionable through real time dashboards. And the challenge that we're, that we face and that we're happy with how we've solved so far is doing this without disrupting workflows or compromising employee privacy. And so that's really important because I think there is a lot of surveillance tools that are trying to surveil actual human employees, whereas we're focusing on pattern detection, not content monitoring. And so understanding the purpose and the impact of AI interactions without reading you Dr. T's individual prompts.

[Dr. T]

That's amazing. Now how does it work? Because there are different types of leaders. I can imagine that you do this analysis, you conduct the assessment, you're talking to the leaders within an organization and, and you have different types of people. You can have the person that can read it and like blow up. And then you'd have the person that can have a more kind, thoughtful response. But you started the conversation by saying that like most of these employees are good, well intentioned people, just with maybe lack of information. How do you have a discussion with a leader about whoop this is going on and how do you change the use of these tools in a way that is compliant and it is safe without particularly somebody like blowing up at a team or a person or et cetera? How does that work?

[Lexi Reese]

Yeah, I think, look, there's a good story of one health care executive literally stands up when he sees his clinicians using 18 different AI tools, which is 15 more than was approved. And that's alarming. But that alarm was transformed to curiosity when we showed how these tools were improving patient care times and reducing documentation burdens. His perspective shifted from shut this down to scale. This, this is the power of visibility, transforming apparent chaos into strategic opportunity. And the jaw drop isn't discovering shadow AI, it's seeing patterns you didn't know before. So, you know, just like with your kids, you say, don't get furious, get curious.

[Dr. T]

Right, Right.

[Lexi Reese]

This is all the, the speed at which human beings and enterprises are experimenting with and, and utilizing AI is going so much faster than any one person or existing team can keep up with.

[Dr. T]

Right.

[Lexi Reese]

What we talk to our customers about is it's a new AI era. And AI era requires new infrastructure. That's what we're providing, a map. Where are their. Where is there traffic? Where are there accidents? Where are there clearer routes? And I think most people understand that.

[Dr. T]

Yeah, no, that's good, that's good. Now you gave us some wonderful examples. Talk to us about the scene where, you know, you're getting the results for your customers, but you sat back after you, you know, saw some assessment, have a conversation, helped a company, and you got chills because you're like, let me pat myself on the back a little bit. Like, I am leading an organization that is AI powered, that is literally making a huge difference and a huge impact. Like, talk to us a little bit about that. That moment where you're like, gosh, like, is this really happening? Like, I co founded this and this is amazing. I'm changing the world. Is it a victory dance? Is it a song? Is it a special bottle of wine? Like, I love this.

[Lexi Reese]

We actually have a bell that, we have a bell in our office that says together we so rock.

[Dr. T]

Oh.

[Lexi Reese]

We believe values become norms and norms become expectations. And as one example, we have an orange chair in every room that is a customer. And it's to remind us that we're only here by grace of our customers. And when we get a win for our customers, which is defined by they have some win.

[Dr. T]

Yes.

[Lexi Reese]

Then ring the bell. So that's what it is. And it's pretty fun. You know, these are small things that ripple. So a financial institution had mandated AI use but couldn't measure impact. And they use lanai. And they see a small team that's creating personalized client research briefings in minutes instead of days. And when they, when they scaled that approach, company wide client satisfaction climbed by something like 30%. And they were able to unlock a serious multimillion dollar figure in new revenue because relationship managers spent more time with CL and they were able to begin the conversation knowing more deeply what the issues and concerns were of clients. Which is. I like that example because I think we say the buzzwords of, well, AI can augment human capabilities, but really, I think most people are worried AI is going to come for your job. I think AI will change all of our jobs fundamentally and AI will take away jobs definitively. I will put no lip service on that. But I think when you democratize access to AI tools and let your employees experiment with guardrails, they know what will help them do their job better, and they do the job to help the people that they're serving.

[Dr. T]

Right.

[Lexi Reese]

So, you know, in the same way you can probably do this podcast better, I can run this company better as a result of AI, it's finding those stories that actually demonstrates visibility leads to the ability to manage to outcomes that really drive real value.

[Dr. T]

Right, right. No, I love that. And the key there that you said, I mean, there are a lot of nuggets you dropped, but I love guardrails. You know, it's giving your employees the independence and the freedom to explore, but within some confinement, so. So that we won't have these oopsies, you know, sometimes.

[Lexi Reese]

Exactly. Yeah. The magic isn't the AI tool. It's finding the needle in a haystack use and scaling it rapidly with thousands of employees. And we know this, everybody who's managed a big team know there's always champions that are just able to do the thing so well. And you say, oh, I want to bottle Dr. T and make everybody be more like Dr. T effectively. Lanaya is helping identify those champion use cases so that you can spread that magic to everyone.

[Dr. T]

That's amazing. That's amazing. Now, Lana is definitely a powerful, powerful tool. So what ethical lines are you constantly watching and how are you making sure that you protect the human in all of this?

[Lexi Reese]

Yeah, Our ethical line is very clearly balancing visibility with privacy. We want organizations to understand their AI ecosystem without creating employee surveillance. And that's why we focus on patterns and not people. We show trends, we show opportunities through aggregation and anonymization. We're not monitoring individual performance or creating AI productivity scores for each human being. We also believe in transparency. So one of our advisors is the chief security officer of Reddit and he just immediately when we started talking about this, had the mantra that don't be creepy. And I know that sounds weird, like it's so basic, obviously you're not going to be creepy, but a lot of technology in the zip code of where we play, which is both observability and security. Many other companies are definitively policing employees, whereas we're trying to effectively scale innovation and good workflows that drive safe adoption.

[Dr. T]

I love that. I love that. And creepy is one of those words that catches your, you know, your attention. So it's fine because you don't want to be creepy. So let's Fast forward to 2030. What does a future power by Lanai feel like to the everyday person?

[Lexi Reese]

Well, again, Lanai exists to empower humans to do extraordinary things with AI. So I think overall, AI will fade into the background of our lives, not because it's less important, but because it's ubiquitous. Just like, you know, once upon a time, there were digital companies and there were brick and mortar companies there, and now everyone's a digital company. The value will shift from AI itself to AI intelligence. So every organization will effectively have dual workforces, your human workforce and your AI workforce. And this is not so distant. I mean, this is happening for power users. And you may feel this. You have an editor on your team and you have a production assistant on your team. If you're using AI in real ways, you start seeing how you are working in harmony, because systems like Lanai will have eliminated the friction and the risk. The everyday person won't think about using AI, they'll just accomplish more. And their effort is going to be applied to places that are different than where they have to spend time today as a result of AI taking over some of those more routine, potentially draining workflows that you have to take care of right now.

[Dr. T]

Right, Right. Yep. No, that's amazing. And we have had guests where they are seeing and they help people set up these AI human teams. Like, there are a collaborative team where half of them might be AI agents and half of them might be humans. And so, like you said, we're pretty much already there. So.

[Lexi Reese]

Yeah. And I think that the companies that thrive won't be those with the most AI, they'll be those with the best visibility into how this dual workforce creates value. And that's. That's the future that I get excited about, is the best version of AI is where humans and machines are working together with intention.

[Dr. T]

With intention, Right. Yep.

[Lexi Reese]

And right now, we're flying blind. And that is not just inefficient, that is super reckless.

[Dr. T]

Yeah. So we obviously have listeners out there that are like, oh, my goodness, I just tasked my team or, you know, several of my teams to go out there and use AI, become more efficient without guardrails. Talk to us about one thing that our listeners who are in these roles can try build or explore this week with Lanai to fill this AI magic and to see a difference.

[Lexi Reese]

So first of all, we have a waiting list for Lanai. So if you have a large workforce and you're trying to navigate the complexity that comes with trying to scale AI innovation, we definitely want to talk to you. But you wouldn't be able to use it right away as we're early in going to market and right now cannot accommodate all the demand. But here's a simple exercise that will give you a taste of what Lanai can reveal without having us, which is create a five question anonymous survey asking your teams which AI tools they're actually using day to day and for what tasks. Okay. Which AI are they using day to day and for what tasks? And you have to make it anonymous because people are not going to want to have some sort of negative consequence for being honest. And the results will surprise you. Most leaders discover their teams are using 3-5x more AI tools than they realized, often for use cases they never imagined. So one engineering leader found her team using Claude to debug code that was not something she thought was happening. They had an AI specific tool, but that actually drove a ton of productivity gains. So that will give you some idea that quick visibility exercise will give you an idea of like wow, there are hidden risks, sure, but there's also breakthrough innovation. And when you're ready, we will be right there to help you. But that's the type of always on revelation that we can provide.

[Dr. T]

I love that I'm actually going to do that this week. What is today? Yes, I'm doing that this week because I feel like I know the tools that they're using because we talk about it every Monday and et cetera. But you're right, there are so many other tools that they could be using that we don't even know about. So that is amazing. Thank you for that. And then we'll wait to get off the wait list from there.

[Lexi Reese]

Okay. Dr. T, your grandfather did.

[Dr. T]

Oh, thank you. Woo hoo. I appreciate that. So one important question that we always have on lead with AI is what we call from one genius to another. And that's where our previous guest has a question for you, Lexi. So your question is what is one area in your life or in the world where you don't want to see AI introduced? And why not?

[Lexi Reese]

Yeah, I don't want AI writing my kids schoolwork.

[Dr. T]

Okay.

[Lexi Reese]

Yeah, because the difficult cognitive stretching that happens when my 15 year old struggles through an analytical essay as she was doing last night, or when my 12 year old puzzles over how to express an original idea. That's, that's where the actual learning lives. Right? And it's precisely what AI circumvents with its frictionless, effortless eloquence. You know, make me sound like insert name. And that teaches them nothing but dependence on, on digital crutches. And you know what's fascinating is that that does connect with what we do at Lanai. We want to help organizations identify where AI creates genuine value versus undermining the core elements of human capabilities. You know, people say, are you a tech optimist or a tech pessimist? And it's just such a wrong framing of the question. I'm pragmatic that the goal isn't one or the other. It's both working together to improve society and community. And that starts with, you know, making sure that our kids really learn how to think critically about big problems. Because we need them thinking about big problems.

[Dr. T]

We do, we do. And I have a number of colleagues that are professors at universities and they always say they can tell when someone has used, you know, chat, GPT or whatever for it and they just don't know how to get around it. But it is so critical that we do have people kind of thinking creatively and, and, and, and think critically. So I love that. I love that answer. Thank you for that.

[Lexi Reese]

You're welcome.

[Dr. T]

Awesome. So now we have our bonus rapid fire. We have four questions that I'm going to ramble off. You give an answer so our listeners can see what you think. Most Overrated Tech Trend Agents Agents Most.

[Lexi Reese]

Under Hyped AI Breakthrough AI Native Detection.

[Dr. T]

Okay, one book everyone should read.

[Lexi Reese]

The Atlas of AI by Kate Crawford.

[Dr. T]

Okay, I'm going to write that one down. The boldest AI prediction.

[Lexi Reese]

You believe that unless we equip leaders with visibility and guardrails like Lanai provides, AI will automate more jobs than it will create.

[Dr. T]

Wow. Wow. Love that. Absolutely love that. So Lexi, I have totally enjoyed this conversation. Thank you for all of your look go nuggets and telling us about Lanai. I know you have a wait list. We know, and so that makes people want it even more. But how can we get in contact with you and the company? What are all the different channels?

[Lexi Reese]

Thanks with lanai.com is our website and you can sign up there to say you're interested and we'll get back to you. If for whatever reason we don't, please follow us on LinkedIn lanai and on me personally Lexi Reese. I post a lot of content and we have learning journeys for leaders that help you get oriented into AI in the world, in the enterprise. And you can. I really encourage people to assign reading to their teams.

[Dr. T]

Okay.

[Lexi Reese]

And spend 15 minutes or 30 minutes at your next team meeting saying what, what did you, what do you feel or what are you thinking or what will you do differently as a result of having read or read or watched these things together?

[Dr. T]

Got it. And these learning journeys, are, are these on LinkedIn?

[Lexi Reese]

These are on our website.

[Dr. T]

On your website. Okay.

[Lexi Reese]

Yeah.

[Dr. T]

Yep. Everyone, that's W I T H L A N A I dot com. So we're going to go there and have some, some, some conversations, some good, great conversations with our team members. Lexi, thank you so much. I so enjoyed this conversation and our listeners have learned a lot today. And just kudos for all of the great things that you're doing for corporations.

[Lexi Reese]

Thank you so much, Dr. T. And kudos to you. Keep up the awesome work.

[Dr. T]

Thank you. Thanks so much. All right, till next time, everyone. Bye. Bye.

[Lexi Reese]

All right, see ya.

[Dr. Tamara Nall]

Thanks for tuning in to lead with AI. I'll see you next time as we continue exploring the cutting edge innovations shaping AI across the public and private sectors. Until then, keep leading with AI.