proxy
What It Means
A proxy is a substitute measurement or indicator that represents something else that would be difficult, expensive, or impossible to measure directly. In AI systems, proxies are used when the actual outcome you want to optimize for can't be easily quantified or observed in real-time.
Why Chief AI Officers Care
Proxies are critical for AI model performance monitoring and business outcomes measurement, but they can create significant risks if they don't accurately represent what you're trying to achieve. Poor proxy selection can lead to AI systems that optimize for the wrong metrics, creating compliance issues and unintended business consequences that may not surface until much later.
Real-World Example
A hiring AI system uses resume screening scores as a proxy for job performance since actual performance takes months to evaluate. However, if the proxy doesn't truly correlate with success in the role, the system might consistently hire candidates who look good on paper but underperform, while missing excellent candidates with non-traditional backgrounds.
Common Confusion
People often confuse proxies with the actual goals themselves, treating the measurable substitute as if it were the real objective. This leads to optimizing for metrics that may not align with true business value or desired outcomes.
Industry-Specific Applications
See how this term applies to healthcare, finance, manufacturing, government, tech, and insurance.
Healthcare: In healthcare AI, proxies are commonly used when direct patient outcomes are difficult to measure immediately, such as u...
Finance: In finance, proxies are commonly used to estimate market risk, credit worthiness, or portfolio performance when direct m...
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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 variable that can stand in for another, usually not directly observable or measurable, variable."Source: SP1270
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