Executing this shift presents significant challenges for procurement leaders. AI spending is fragmented across internal and external stand-alone tools, embedded software capabilities, cloud services, consulting engagements and business-led purchases. Effective AI management requires collaboration across procurement, IT, legal, security, risk, data governance, HR and business leaders. Procurement’s role is to provide visibility, governance and commercial discipline across these stakeholders.

Organizations also face consumption growth that can outpace governance, limited pricing transparency, inconsistent data rights protections and AI investments made ahead of the organizational maturity needed to effectively manage them.

Gartner recommends that CPOs take several steps to improve visibility, governance and control as AI becomes an enterprise capability:

  • Create enterprise-wide visibility into AI capabilities, spend, suppliers and use cases
  • Treat AI as a category management domain rather than solely a technology category
  • Establish enterprise standards for AI acquisition, governance, data rights and risk management
  • Measure AI investments against business outcomes and workforce impact
  • Make deliberate decisions about which AI capabilities should be built, bought or managed through a blended approach