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Policy Fragmentation or Institutional Alignment? Institutional Governance of AI in Universities and Business Schools

This study analyzes AI policies across US higher education institutions and finds a significant misalignment where university-level guidelines prioritize risk mitigation while school-level policies focus on pedagogy, a gap that is particularly pronounced in business schools and hinders the integration of discipline-specific learning objectives.

Original authors: Lydia Manikonda, Dominique Outlaw

Published 2026-08-05
📖 4 min read☕ Coffee break read

Original authors: Lydia Manikonda, Dominique Outlaw

Original paper licensed under CC BY 4.0 (http://creativecommons.org/licenses/by/4.0/). This is an AI-generated explanation of the paper below. It is not written or endorsed by the authors. For technical accuracy, refer to the original paper. Read full disclaimer

Imagine the world of higher education as a massive, bustling city. For decades, this city has had to decide how to handle new tools: first came the calculator, then the spreadsheet, and now, the most powerful tool yet: Artificial Intelligence (AI). Think of AI as a super-smart, all-knowing assistant that can write essays, solve complex math problems, and analyze data in seconds. But just like a new superpower, it comes with a catch. Schools are trying to figure out the rules of the road: Should students be allowed to use this assistant? If so, how? And who gets to make the rules? This is the big question the paper tackles. It looks at how universities (the city government) and specific schools within them, like business schools (specialized neighborhoods), are writing their own rulebooks for AI. The goal is to see if everyone is singing from the same song sheet or if the city and the neighborhoods are arguing over the lyrics.

The authors, Lydia Manikonda and Dominique Outlaw, decided to play detective. They didn't just guess; they used a computer program (a kind of digital magnifying glass) to read and analyze 130 different AI policies from universities across 34 states in the US. They wanted to see if the big university rules matched the specific rules made by business schools. They treated the text of these policies like a puzzle, using math to measure how "happy" or "scared" the rules sounded (sentiment), how clear they were, and how similar the different rulebooks were to each other.

Here is what they found, and it's a bit like discovering that the city government and the local neighborhood watch are speaking two different languages.

First, they looked at the big picture: the university-wide policies. These turned out to be very cautious, like a parent telling a child, "Be careful with that new toy." The language was mostly neutral and gentle, using words like "may" or "can" instead of strict commands like "must" or "prohibited." The main focus of these big policies was on safety and risk. They were worried about data security (keeping secrets safe) and making sure no one was misusing the technology. They were essentially saying, "Don't break anything, and don't upload your private info to the internet."

Then, the authors zoomed in on the business schools. They found that only eight out of the 130 universities had a separate, specific policy just for their business school. But here is the twist: when they compared these eight business school policies to their parent university's rules, they didn't match up very well. It was like the city said, "Don't touch the wires," but the business school said, "Here is how to use the wires to build a cool robot."

The business school policies were much more focused on how to use AI for learning. They talked about specific tools, how to write assignments that use AI, and how to teach students to be good at using these tools. They were less worried about the "don'ts" and more worried about the "hows." The university policies were all about guarding the castle (risk management), while the business school policies were about teaching the knights how to fight (pedagogy and skills).

The paper suggests that this mismatch is a problem. If the university says, "Be careful," but the business school says, "Use this tool to get a job," students and teachers get confused. They don't know if they are supposed to be scared of AI or excited about it. The authors argue that we need to fix this gap. They propose a new way of thinking where the university sets the safety guardrails (like "don't upload secrets"), but the business schools are free to build the learning paths inside those guardrails.

The authors are careful not to say this is a solved problem. They suggest that right now, things are a bit messy and fragmented. They found that most universities are still in the "figuring it out" phase, using soft language because the technology is changing so fast. They recommend that schools should work together to make sure the big rules and the small rules talk to each other, so that students graduate ready for the real world, where AI is already a normal part of the job.

In short, the paper shows that while universities are trying to keep everyone safe from AI, business schools are trying to teach students how to use it. The challenge is to make sure these two goals don't trip over each other, but instead work together to create a future where students are both safe and skilled.

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