exception
What It Means
An exception is when something goes wrong or happens unexpectedly during a business process or system operation, forcing it off its normal path. Think of it as the digital equivalent of a roadblock that requires special handling - the system encounters something it wasn't designed to handle automatically and needs human intervention or alternative processing.
Why Chief AI Officers Care
Exceptions in AI systems can cascade into major business disruptions, from customer-facing chatbots giving nonsensical responses to automated decision systems freezing up entirely. CAIOs must build robust exception handling into AI workflows because unmanaged exceptions can damage customer trust, violate compliance requirements, and create operational chaos that's expensive to resolve.
Real-World Example
A loan approval AI system encounters an application from someone with a credit score that falls outside its training data range (like a score of 1 instead of the typical 300-850 range due to a data entry error). The system generates an exception because it doesn't know how to process this unexpected input, requiring manual review and potentially delaying the customer's application.
Common Confusion
People often confuse exceptions with simple errors or bugs, but exceptions are specifically about unexpected conditions that interrupt normal processing flow, not broken code. Unlike errors that indicate something is wrong with the system itself, exceptions indicate the system is working correctly but encountered something unusual it needs help handling.
Industry-Specific Applications
See how this term applies to healthcare, finance, manufacturing, government, tech, and insurance.
Healthcare: In healthcare, exceptions occur when clinical workflows, patient data processing, or AI-driven decision support systems ...
Finance: In finance, exceptions occur when transactions, trades, or processes fail standard validation rules or automated process...
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Technical Definitions
NISTNational Institute of Standards and Technology
"An event that occurs during the performance of the process that causes a diversion from the normal flow of the process. Exceptions are generated by an unanticipated event within a process due to an undefined or unknown input, undefined or unexpected outcome, or unforeseen sequencing of a task or event."Source: IEEE_Guide_IPA
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