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Due to expected positive impacts on business, the application of artificial intelligence has been widely increased. The decision-making procedures of those models are often complex and not easily understandable to the company’s stakeholders, i.e. the people having to follow up on recommendations or try to understand automated decisions of a system. This opaqueness and black-box nature might hinder adoption, as users struggle to make sense and trust the predictions of AI models. Recent research on eXplainable Artificial Intelligence (XAI) focused mainly on explaining the models to AI experts with the purpose of debugging and improving the performance of the models. In this article, we explore how such systems could be made explainable to the stakeholders. For doing so, we propose a new convolutional neural network (CNN)-based explainable predictive model for product backorder prediction in inventory management. Backorders are orders that customers place for products that are currently not in stock. The company now takes the risk to produce or acquire the backordered products while in the meantime, customers can cancel their orders if that takes too long, leaving the company with unsold items in their inventory. Hence, for their strategic inventory management, companies need to make decisions based on assumptions. Our argument is that these tasks can be improved by offering explanations for AI recommendations. Hence, our research investigates how such explanations could be provided, employing Shapley additive explanations to explain the overall models’ priority in decision-making. Besides that, we introduce locally interpretable surrogate models that can explain any individual prediction of a model. The experimental results demonstrate effectiveness in predicting backorders in terms of standard evaluation metrics and outperform known related works with AUC 0.9489. Our approach demonstrates how current limitations of predictive technologies can be addressed in the business domain.
While the recent discussion on Art. 25 GDPR often considers the approach of data protection by design as an innovative idea, the notion of making data protection law more effective through requiring the data controller to implement the legal norms into the processing design is almost as old as the data protection debate. However, there is another, more recent shift in establishing the data protection by design approach through law, which is not yet understood to its fullest extent in the debate. Art. 25 GDPR requires the controller to not only implement the legal norms into the processing design but to do so in an effective manner. By explicitly declaring the effectiveness of the protection measures to be the legally required result, the legislator inevitably raises the question of which methods can be used to test and assure such efficacy. In our opinion, extending the legal compatibility assessment to the real effects of the required measures opens this approach to interdisciplinary methodologies. In this paper, we first summarise the current state of research on the methodology established in Art. 25 sect. 1 GDPR, and pinpoint some of the challenges of incorporating interdisciplinary research methodologies. On this premise, we present an empirical research methodology and first findings which offer one approach to answering the question on how to specify processing purposes effectively. Lastly, we discuss the implications of these findings for the legal interpretation of Art. 25 GDPR and related provisions, especially with respect to a more effective implementation of transparency and consent, and provide an outlook on possible next research steps.
AI (artificial intelligence) systems are increasingly being used in all aspects of our lives, from mundane routines to sensitive decision-making and even creative tasks. Therefore, an appropriate level of trust is required so that users know when to rely on the system and when to override it. While research has looked extensively at fostering trust in human-AI interactions, the lack of standardized procedures for human-AI trust makes it difficult to interpret results and compare across studies. As a result, the fundamental understanding of trust between humans and AI remains fragmented. This workshop invites researchers to revisit existing approaches and work toward a standardized framework for studying AI trust to answer the open questions: (1) What does trust mean between humans and AI in different contexts? (2) How can we create and convey the calibrated level of trust in interactions with AI? And (3) How can we develop a standardized framework to address new challenges?