local
What It Means
A local explanation in AI refers to understanding why an AI system made one specific decision or prediction, rather than how the entire system works overall. It's like getting an explanation for why your loan application was denied, focusing just on that individual decision rather than understanding the bank's entire loan approval process.
Why Chief AI Officers Care
Local explanations are essential for regulatory compliance, especially when customers or regulators ask 'why did the AI make this specific decision about me.' They're critical for building customer trust, handling disputes, and meeting legal requirements like GDPR's right to explanation. Without local explanations, organizations can't adequately defend individual AI decisions or identify when the system makes problematic choices.
Real-World Example
A credit card company's AI system denies a customer's application and provides a local explanation stating 'Your application was declined primarily due to your debt-to-income ratio of 65% and two late payments in the past six months.' This explains that specific decision without revealing how the entire credit scoring algorithm works for all applications.
Common Confusion
People often confuse local explanations with global explanations - local explains individual decisions while global explains how the entire AI system behaves across all cases. Many also mistakenly think local explanations reveal proprietary algorithms when they actually just explain individual decision factors.
Industry-Specific Applications
See how this term applies to healthcare, finance, manufacturing, government, tech, and insurance.
Healthcare: In healthcare AI, local explanations help clinicians understand why an AI system made a specific diagnosis or treatment ...
Finance: In finance, local explanations are critical for regulatory compliance and customer transparency, particularly when AI mo...
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Includes:
- 6 industry-specific applications
- Relevant regulations by sector
- Real compliance scenarios
- Implementation guidance
Technical Definitions
NISTNational Institute of Standards and Technology
"A local explanation explains a subset of decisions or is a per-decision explanation."Source: NISTIR_8312_Full
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