Five Steps to Governed AI

Chapter Four  /  Step One

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Decide


Agree what the AI should do before anything is built. In plain language. Signed by whoever owns the process.

Skip it and the AI builds to one person’s assumption. Fixing it costs more than doing it right for the first time.

Why it matters

Without a definition, the agent does what someone assumed the process was.

Two people each assume the other owns a step. An exception nobody wrote down never reaches the build. The agent then does exactly what it was told, which is not what the process is.

What good looks like

One page stating what triggers the process, which rules apply, which exceptions exist, and what a correct output looks like, specific enough that two people reading it would build the same thing. It is signed by whoever owns the process: operations, finance, compliance. The signature turns a set of assumptions into a decision someone has made.

It is not a requirements document, and nothing in it should name a system or a model.

It is

One page. Plain language. Signed. Written before anything is built.

It is not

A fifty-page PRD. A backlog. A diagram nobody signed.

Figure 4.1

What the agreement looks like

PROCESS SPECv1.0  ·  SIGNED
ProcessVendor invoice approval and payment
TriggerInvoice received and matched to a purchase order.
RulesInvoices under $5K auto-approve if the PO matches exactly. $5K to $10K need department manager sign-off. Above $10K needs VP Finance. Variance above 2% from the PO routes to the controller.
ExceptionsRecurring subscriptions with annual POs skip per-invoice matching. Emergency purchases approved by the COO bypass threshold routing.
CorrectPaid to the right vendor, at the right amount, with the right approval, within payment terms.
Sign-offM. Torres, VP Finance

Without it

FINANCE
TASK
DROPPED
PROCUREMENT

Both teams believed the other owned the threshold rule. Neither was wrong, because nobody had written it down.

In your firm

Your AI approved 340 vendor invoices last month. Nobody told it what “approved” means.

Finance set a $10K threshold for manager sign-off. Procurement set $5K. The AI was built on Finance’s rule, so for two months invoices between $5K and $10K went through unapproved.

Who assumed
Engineering assumed Finance owned the approval logic.
What was missed
Procurement’s $5K threshold was never written into the spec.
Who noticed
An external auditor, during the quarterly review.
What it cost
$287K needing retroactive sign-off, and an escalation to the board.

The AI did exactly what it was told. Nobody had agreed what to tell it.

Skip this step
The agent builds the wrong thing. Nobody agreed what “correct” means.