The cost of intelligence: How CIOs can manage AI demand at scale
Executive Take
CIOs who treat AI spend as a portfolio to be prioritized against outcomes—rather than a cost line to be trimmed—will capture more value from the same budget; those who don't will face runaway costs with unclear ROI.
Executive Summary
McKinsey argues that as enterprise AI usage grows, CIOs face rising and often unpredictable costs. The piece recommends CIOs actively manage AI demand across the organization, prioritizing which use cases get resources based on business outcomes rather than simply minimizing spend.
Why It Matters
Unmanaged AI demand can quickly erode budgets and dilute focus on high-value use cases, making demand governance a board-level cost and strategy issue for technology and finance leaders.
Bizquad Perspective
Expect AI demand management to become a standard CIO discipline within the next two years, similar to how cloud cost governance (FinOps) matured after early overspend cycles.