Healthy software companies typically don’t suddenly eliminate one-fifth of their workforce, but monday.com is doing just that as it bets on flatter teams, AI agents, and customer implementation expertise as the winning combination in the AI era.

Monday.com co-founder and co-CEO Eran Zinman today announced the “very difficult decision” to reduce the AI work platform company’s global workforce by about 20%, or 620 people.

The move has nothing to do with increasing margins or replacing humans with AI, he insisted in his post on LinkedIn; rather, it’s a calculated decision to trim down and hone the company’s focus as AI becomes integral to day-to-day workflows.

“This is not a distress signal; it is a deliberate reset, disclosed with its price attached,” said Sanchit Vir Gogia, chief analyst at Greyhound Research. “The industry has quietly swapped the meaning of productivity, and this filing is the clearest exhibit yet.”

A ‘significant opportunity’ in technology

In a SEC filing this week, monday.com said its restructuring plan reflects the “ongoing transformation of its product, marketing, and go-to-market strategy.” The move is intended to support a “leaner, more focused operating model” as the company continues to invest in its AI-driven strategy.

Zinman noted in his post that the company has shifted to “doing the work with AI and not just managing it,” and is focused on building environments where “people and AI agents [work] together in one workspace.”

In recent months, monday.com has evolved its products, strategy, and the way it serves its customers, and Zinman contended that “the organization we built for our previous chapter is not the organization that fits the new AI era.” Monday.com needs to “execute more decisively,” take on new challenges, and quickly respond to market changes, he said.

“We have never seen such a significant opportunity in software, driven by such exciting technology,” Zinman noted. He emphasized that the reduction is not to replace people with AI, nor to improve margins; the “vast majority” of savings will be reinvested into talent, products, and AI.

The restructuring will result in a “flatter organization” with fewer management layers and smaller, more autonomous teams, and monday.com also has a new go-to-market model, Zinman explained. Customers expect “deeper implementation support” as they deploy AI, and the company will work more closely with customers, increase its on-site presence, create new roles, and “adapt many existing ones.” In its SEC filing, the company said it expects to continue hiring in “key strategic areas” throughout 2026.

Workers will be expected to work better, “not harder,” Zinman noted. He pointed to several past examples where work could have been done in a few days, but instead took many months with “multiple meetings and endless friction.”

“This wasn’t people’s fault and everyone was frustrated by this,” he said. “Our new org changes ownership to allow people to make decisions and move fast.”

A spokesperson for monday.com declined to comment further on the staff reductions.

Monday.com’s key market advantages

Monday.com certainly isn’t struggling; the company expects 19% to 20% year-over-year growth in 2026.

“Companies in that position do not restructure because they must,” Greyhound’s Gogia noted. “They restructure because they have decided to become something else.”

Melody Brue, VP and principal analyst at Moor Insights & Strategy, pointed out that organizational redesign is important for real AI transformation, but while it can signal confidence to the market, it can still be “devastating” to humans.

While the company looks as though it’s trying to do right, that ultimately remains to be seen, she said. “There are often hidden internal bruises that can surface long after layoffs.”

Monday.com’s advantage is in its “structured substrate,” Gogia noted; its boards, permissions and typed workflows give agents something firmer to act on than just documents and chat history. The company highlights its natively built agents that can be configured by any team member, as well as connectors with Claude, Microsoft Copilot, and ChatGPT, and dedicated routes for external agents to authenticate and operate.

“For some time, the sharper enterprise question has been shifting from who has an agent to who owns the governed runtime in which an agent can safely act,” he said. “Structured work is a serious claim on that runtime.”

But parts of monday.com’s agent estate remain in staged release, and its product is ultimately “mid-transition,” Gogia pointed out; its agent builder carried a beta label as recently as March,. Also, the company’s pricing model changed in May to a hybrid model charging for seats as well as mandatory AI credits. And, while its AI-powered no-code builder monday vibe passed $1 million in annual recurring revenue within two and a half months, monday.com has not released subsequent outcomes, usage volumes, or attach rates.

Further, there’s an element of “gravity” with its competitors, he observed. Asana is reorganizing teams around agents, Atlassian is wiring agents into the developer estate, and others are simply bundling them into their offerings: Microsoft is doing so across the productivity stack, and ServiceNow across enterprise operations, each with identity and procurement built in.

“Their pull is strongest exactly where monday.com wants to grow, in the largest accounts, where control-plane depth and administrative reach decide the deal,” said Gogia.

Actions for the near-term

Going forward, buyers should focus on operating risk, not headline risk, Moor’s Brue noted. In practice, that’s continuity of service, roadmap consistency, and strength of enterprise support. Productivity should be valued as better outcomes per unit of organizational effort, not mere activity.

“It should be a measure of how much smoother, faster, and more effective the operating model becomes when AI is built into the work,” said Brue.

Gogia noted that strain surfaces first in customer service, and monday.com’s attention is being redistributed. The company’s annual report disclosed that its focus is now concentrated on the largest accounts, with support for medium-sized clients moved to an AI-first and human-supported model.

During the first month of the transition, buyers should track named account continuity and escalation times, he advised. By the first quarter, keep an eye on whether credit governance and admin controls mature on schedule, and if the roadmap beyond the AI estate keeps pace. By the half-year mark, determine whether promised implementation depth is producing outcomes or “simply more billable engagement.”

Support tiers should be enumerated in writing before renewal, and buyers should contract for “side exits,” Gogia emphasized, with overage pricing fixed in advance, the right to pause consumption, and portability for workflows and agent configuration “if the relationship sours.” Finance should also insist on monthly consumption reporting by capability. Further, integration efforts, partner dependency, and change management should be considered first-class costs of the agent era, “not as afterthoughts to a license.”

“A license was a known cost,” said Gogia. “A meter is a behavior, and behavior is harder to forecast than headcount.”

This article originally appeared on CIO.com.

AMD executives took to the stage at its Advancing AI 2026 event in San Francisco today to detail the company’s next generation of AI infrastructure solutions, from Instinct MI455X AI accelerator GPUs and 6th Gen EPYC “Venice” CPUs, to Pensando networking, ROCm.AI software and its Helios rack-scale platform that ties it all together.

AMD has been working towards rack-scale AI system solutions for years. Its ZT Systems acquisition last year added valuable engineering talent and intellectual property that is now finally bearing the real fruits. Its Helios AI platform is a major platform evolution for AMD, with shipments scheduled to begin in the second half of this year (which is here and now).

The announcements at Advancing AI show how the company has engineered its AI platform solutions for large reasoning models, sustained inference and agentic workflows. These workloads pressure memory capacity, data movement, networking and CPU orchestration. AMD’s approach is to keep as much data close to the compute engines as possible and move it more efficiently throughout the system, but there’s deeper nuance here that’s obvious versus AMD’s chief rival, NVIDIA.  

AMD’s MI455X targets the AI memory wall

The Instinct MI455X GPU is the compute engine that fuels the Helios rack, and the first GPU based on AMD’s new CDNA 5 architecture. Built with a modular mix of 2nm and 3nm chiplets, it carries 432GB of HBM4 and 23.3TB/s of peak memory bandwidth.

Compared to AMD’s current MI355X, the MI455X offers 1.5 times the memory capacity, up to 2.9 times the peak memory bandwidth and up to four times the peak matrix performance with MXFP4 and MXFP8 data types, which are lower-precision numerical formats designed to accelerate AI processing while reducing memory demands. With MXFP6 (6-bit floating point), performance is rated at up to twice that of MI355X.

AMD also shared some actual, measured internal results using production silicon. The company claims MI455X delivers 3.8 times higher FP8 decode performance, 3.5 times more measured FP4 compute performance and between 2.5 and 3.5 times more networking bandwidth than MI355X, depending on the transfer path tested. Those figures provide more context than just numerical specifications, though they remain AMD-provided comparisons that will need independent validation.

AMD

The architectural choices behind the numbers are important. Reasoning models and long context windows require sizeable KV caches for maintaining AI attention states, while mixture-of-experts models frequently move large amounts of data across accelerators. MI455X should let more model data, activation states and cache remain local. New dedicated IP in hardware can transfer data while the GPU continues processing, and expanded cache and multicast capabilities are designed to reduce redundant data movement to further improve efficiency.

The aforementioned lower-precision formats can also raise throughput and reduce memory use, but model developers still have to determine where they can be applied without unacceptable accuracy loss.

AMD’s Helios rack takes aim at Vera Rubin

Dave Altavilla

Helios is AMD’s primary rack-scale competitor to NVIDIA’s Vera Rubin platform. Each liquid-cooled rack combines 72 MI455X GPUs, 18 single-socket Venice host CPUs and Pensando networking technologies.

In its most complete, premium configuration, AMD rates Helios for 2.9 exaflops of low-precision AI compute, with 31TB of aggregate HBM4 capacity, 1.7PB/s of memory bandwidth, 260TB/s of bidirectional scale-up bandwidth and 43TB/s of scale-out bandwidth.

These are formidable figures, but they are technical specifications rather than actual application benchmarks. The more consequential development is AMD’s move from collections of eight-GPU servers to a 72-GPU shared-memory domain. Models too large for one node can operate across the rack without treating every exchange as a scale-out networking transaction, which benefits large-model inference as well as training.

AMD uses UALink over Ethernet, or UALoE, for an open standard scale-up fabric. Each MI455X provides 3.6TB/s of bidirectional scale-up bandwidth, while the complete rack delivers all-to-all connectivity through a single switch layer. AMD also claims six times more scale-out bandwidth per GPU than MI355X when MI455X is configured with three Pensando Vulcano 800 AI NICs.

While open standards give cloud providers more control over suppliers and system design, AMD and its partners now have to prove those components can deliver the predictable performance, reliability and deployment experience customers expect from a tightly controlled, more vertically integrated platform.

Finally, AMD designed Helios with automatic rerouting around failed links, virtual rack partitions, tray-level serviceability and rack-wide power, cooling and health monitoring. Major hyperscalers and potentially large-scale enterprise customers will likely key in on these capabilities, which can affect the availability, total cost and consistency of the AI services they consume.

Kind of like cowbell, AMD Venice gives agentic AI more CPU

AMD

AMD’s agentic CPU messaging regarding its upcoming Venice-based EPYC processors is mostly marketing speak, but the underlying requirement is very real. An AI agent can invoke retrieval, databases, security checks, code execution and other tools before a GPU generates a response. Running many agents concurrently increases the amount of conventional compute requirements surrounding the accelerators.

Venice scales to 256 Zen 6 cores with support for 512 threads, 16 memory channels, up to 1GB of L3 cache per socket, along with PCIe 6.0 and CXL 3.1 connectivity. AMD is also offering several Venice configurations for other applications, including general-purpose servers, high-frequency workloads, GPU hosts and high-density CPU sandbox systems used to execute agent tools.

Treating the CPU solely as a GPU host understates its role. Gateways, tokenization, vector search, databases and short-lived code execution stress different mixes of per-core performance, thread count, memory bandwidth and I/O. Specifically, AMD’s internal testing shows Venice significantly outperforming its current EPYC 9965 Turin CPU across five parts of the agentic AI pipeline, including gateway processing, context assembly, vector search, enterprise applications and short-lived tool execution. Individual gains vary by workload, but AMD details the overall generational improvement at up to a 1.7 times lift. As with the MI455X figures though, these comparisons come from AMD and will require independent validation.

Pensando networking and ROCm software advance

Keeping GPUs fed with data and coordinating traffic across racks directly affects utilization and operating costs. In fact, GPU utilization is a pretty sad state of affairs currently for some of the major frontier model providers.

As such, Pensando networking has become central to AMD’s roadmap. Helios can connect each MI455X to as many as three 800Gbps Vulcano AI NICs, while Salina DPUs handle front-end networking and infrastructure services.

On the software side, which is an equally critical component, AMD also introduced ROCm.AI, an AI-assisted development layer due to arrive in August. It includes reusable skills for coding agents, simplified management and Hyperloom, which can profile workloads, tune serving configurations, modify kernels and validate results.

These tools address two persistent AMD challenges: developer efficiency and ease of use, and software tuning. Automated optimization still has to produce repeatable gains without creating hard-to-maintain code, however. And while ROCm has progressed significantly over the last few years, NVIDIA’s CUDA retains an advantage in maturity, tooling and developer familiarity.

Customer commitments underscore rack-scale confidence

AMD now has commitments that give its MI450 generation and Helios considerably more weight. Meta and OpenAI have announced multi-generation agreements composed of up to 6GW of AMD compute capacity, with initial 1GW deployments planned for the second half of 2026.

Oracle plans a 50,000-GPU public cloud cluster beginning in the third quarter, while Microsoft will deploy Helios for Azure AI inference. Finally, just before the AMD event, Anthropic announced a strategic partnership for up to 2 Gigawatts of AMD-fueled AI compute, with its first gigawatt expected online in the first half of 2027.

Commitments of this scale reflect confidence in more than just MI455X performance. These customers are evaluating the complete architecture, including Venice CPUs, Pensando networking, ROCm software, rack integration, serviceability and AMD’s ability to deliver and execute across multiple product generations.

There is some financial alignment behind the agreements as well. AMD issued OpenAI performance-based warrants and committed to investing up to $5 billion in Anthropic. That context matters when evaluating these deals as market validation, but these planned deployments are substantial nonetheless and put Helios on a much stronger foundation as it begins shipping.

AMD expands its robotics and embedded foundation

AMD also expanded its physical AI portfolio, building on credible traction from its Xilinx-derived Kria adaptive system-on-modules and embedded technologies that are already powering robotics, machine vision and industrial automation applications.

The new Ryzen AI Embedded X100 combines up to 16 Zen 5 CPU cores, integrated Radeon graphics, a second-generation NPU and as much as 128GB of unified LPDDR5X memory shared across its compute engines. To me this looks a lot like a repackaging and optimization of the company’s Strix Halo platform, but with specific optimizations for the embedded space. Regardless, AMD is pairing X100 with the Kria AI Robotics Developer Platform, which includes a System Module or SOM, and a new Robotics Partner Network spanning hardware, software and platform providers.

Samples began shipping in June, with full production expected in the fourth quarter. This broader objective is to give developers a path across AMD x86 CPUs, GPUs, NPUs and FPGAs for real-time autonomous systems, rather than requiring them to assemble those hardware engines and software components independently.

Execution for AMD is now the test

AMD has assembled a credible platform for the burgeoning agentic AI market that’s blowing up currently with no signs of stopping. MI455X addresses memory and data movement, Venice handles dense agentic CPU workloads, Pensando networking connects global system resources, and ROCm.AI addresses software complexity. Finally, Helios assembles these components into a true competitive threat for NVIDIA’s latest Vera Rubin platform.

AMD’s open architecture may appeal to customers seeking supplier choice, but openness must also translate into reliable deployments, competitive total cost and software that does not require a significant rip-up. NVIDIA enters this cycle with a stronger ecosystem and far more rack-scale deployment experience. The true test will be how easily and reliably customers can integrate, operate and maintain these AMD solutions at scale.

As it stands, AMD now has major customers and a clearly defined architecture with systems engineering expertise behind it. Delivering Helios on schedule and showing that its performance claims translate into a real production workload throughput advantage and total cost of ownership gains will determine how much the competitive gap narrows. And of course, this is in a market that is clamoring for ever-more compute resources with a seemingly insatiable demand for AI services and capacity. That’s an environment for big iron success. Now AMD just has to deliver optimized, turnkey AI platforms. This is far easier said than done, but time will soon tell as deployments take shape this year.

This article is published as part of the Foundry Expert Contributor Network.
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Traditional phishing techniques are in decline as a result of the disruption of the Tycoon2FA phishing-as-a-service (PHaaS) platform, Microsoft said in a new report, “Email threat landscape: Q2 2026 trends and insights”.

“Phishing volume linked to the platform fell 92% from pre-disruption averages, including QR code phishing and CAPTCHA-gated phishing both declining from their March highs,” the company wrote in the report.

The takedown reduced activity across multiple phishing categories, forcing attackers to shift to newer delivery methods.

Riding this shift in were a few notable phishing campaigns, including an automated business email compromise (BEC) campaign that reached 42,000 organizations in under three hours, and a multi-stage phishing campaign that used nested email (EML) files, calendar invitations, and a Microsoft authentication redirect to deliver malware.

To counter phishing attacks, Microsoft recommends blocking emails containing known bad URLs/ subject fields, enabling password-less authentication methods, or moving to MFA for accounts that still require passwords.

Tycoon2FA disruption sent attackers exploring

The take-down of Tycoon2FA forced its operators to abandon portions of their infrastructure and rework hosting, domain registrations, and delivery mechanisms.

“After falling 15% in March and another 22% in April, Tycoon2FA-linked phishing volume dropped 74% in May to just 1.5 million messages, then fell another 20% in June to 1.2 million, by far the lowest monthly volumes observed in at least a year,” Microsoft said.

The decline extended to QR Code lures and fake CAPTCHA pages, two phishing techniques in which Tycoon2FA accounted for 12% and 14% of industry activity in June, respectively. This indicated that the platform’s customer base had not been able to migrate to a replacement infrastructure.

But cutting off one head of the hacker hydra only gave rise to new tactics elsewhere.

The adaptation came in the form of using Microsoft Teams as a social engineering channel. Attackers established conversations to build trust before attempting credential theft or delivering malicious payloads. “Teams-based phishing volume climbed steadily throughout Q2, with the average number of detected attacks rising 19% from March to April, holding roughly flat into May (+1%), then increasing another 10% into June,” Microsoft said.

Microsoft also observed a highly automated BEC campaign that reached over 67,000 users using scripted emails, Amazon Simple Email Service (SES), and engagement tracking, alongside a separate phishing campaign targeting 107,000 users that abused Microsoft’s authentication flow and trusted cloud services, including Teams archive recording and ICS calendar invite, to disguise malware delivery behind legitimate infrastructure.

Phishing changes but the defense doesn’t

While QR Code and Captcha-based phishing attacks dropped significantly in the second quarter, business email compromise (BEC) charted jumped 121% between March and April, before dropping down again in May.

QR Code phishing represented 8.3 million attacks in June 2026, down from a peak of 18.7 million in March. Similarly, Captcha-gated phishing fell from 12 million attacks in March to 2.2 million in June.

BEC attacks hit 9 million in March, falling to 3.9 million in June.

But even as these phishing classics lost momentum and newer techniques emerged, Microsoft’s defensive advice remained rooted in the basics. It noted organizations should complement email filtering with phishing-resistant authentication such as passkeys and phishing-resistant MFA to reduce the effectiveness of credential theft campaigns.

The company also recommended strengthening Exchange Online Protection and Microsoft Defender for Office 365 with capabilities such as Safe links and Zero-hour Auto Purge (ZAP), in which malicious emails already delivered to mailboxes are removed before they are read, alongside enforcing password-less authentication methods like Windows Hello, FIDO keys, and Microsoft Authenticator.

Microsoft concluded its report with a list of indicators of compromise (IoCs) from the threats observed in the quarter to support detection efforts.

This article first appeared on CSO.

Every CIO I speak with today is wrestling with some version of the same question: How do we move faster with AI and deliver on our commitments?

It’s an understandable concern. Boards and CEOs are asking about AI. Business leaders are experimenting with use cases. Employees are discovering tools daily, while technology vendors promise unprecedented gains in productivity, innovation, and competitive advantage.

After hundreds of conversations with technology executives over the past year, I’ve become convinced that speed isn’t the real issue. The organizations pulling away from the pack aren’t necessarily adopting AI faster than everyone else. They’re executing more effectively — a subtle distinction that represents one of the defining leadership challenges of the AI era.

Technology has never been the hardest part of transformation. People, priorities, culture, and operating models are the biggest challenges. The ability to translate bold boardroom aspirations into thousands of thoughtful decisions made every day by architects, engineers, product managers, analysts, and business leaders is where competitive advantage is created. AI may be accelerating the pace of change, but it hasn’t changed that fundamental truth.

I’ve met plenty of executives who are exceptional in the boardroom. They know how to frame a vision, influence a board, and build confidence among investors and business leaders. I’ve also met remarkable technologists who instinctively understand the architectural decisions, engineering tradeoffs, and implementation details that determine how great ideas become reality. Modern CIOs, however, must move comfortably between both worlds. Afshean Talasaz is one who stands out among this rare breed.

Long before becoming CIO of Colonial Pipeline, Talasaz built his career from the ground up as a business professional, data scientist, and technologist. He has designed enterprise platforms, built AI capabilities, led technology organizations, and partnered closely with executive leadership teams on business transformation. Today, as an executive in residence with our Practitioners for Practitioners (P4P) community, he helps CIOs and business leaders navigate one of the most significant technology shifts of our generation.

While Talasaz brings deep knowledge of data and AI to the table, his greatest strength is his ability to create strategy and connect it with execution. He can spend the morning discussing enterprise reinvention with the board and the afternoon debating architectural principles with the teams responsible for bringing that vision to life.

That versatility gives Talasaz a unique lens on how CIOs can deliver value with AI.

Software companies have a term for engineers who understand every layer of the technology stack: full-stack developers. Listen to Talasaz and it becomes evident that the AI era requires something similar from technology leaders: a full-stack CIO.

The full-stack CIO: Leading with clarity

A full-stack CIO understands how every layer of the enterprise influences the next. They recognize that every strategic priority becomes a portfolio investment, every investment shapes an operating model, every operating model influences architecture, every architecture choice informs product decisions, every product decision shapes engineering priorities.

The best CIOs understand both ends of that journey. The extraordinary ones understand everything in between.

And those who execute best lead with clarity, Talasaz says.

“Everyone, from executives to middle managers to the people writing code, should be able to explain what we’re trying to achieve,” he emphasizes. “Clarity isn’t that we’ve handed out the PowerPoint. It’s that people genuinely understand where we’re going and can articulate it in their own language.”

One of the unintended consequences of the AI boom is that organizations are beginning to confuse activity with alignment. They have AI councils, AI governance committees, AI innovation labs, AI centers of excellence, AI pilots, and AI roadmaps. Yet if you stop ten people in the hallway and ask a deceptively simple question, What business problem are we actually trying to solve? you’ll often hear ten different answers.

As a result, architects optimize for one objective while product teams optimize for another. Business units pursue opportunities that seem perfectly reasonable from their perspective. Engineers make thoughtful technical decisions based on the information available to them. Individually, none of those decisions are necessarily wrong. Collectively, however, they create organizational drift. AI doesn’t create that problem. It simply accelerates the consequences.

And while AI can be a force multiplier for the positive when every decision is guided by a shared understanding of where the organization is headed, it can also be a force multiplier for the negative, resulting in an organization simply moving faster in different directions.

“When we have the fundamentals right, the tech infrastructure, the operating models, the nuances of how our business actually runs, we get the impacts of AI in a positive way,” Talasaz says. “When we don’t have those in place, AI can amplify the gaps or mute the benefits.”

At a time when so much of the conversation surrounding AI is focused on algorithms, agents, and automation, it’s an important reminder that organizations don’t execute strategy; people do.

Reducing organizational friction

Most executives are familiar with the concept of VUCA that characterizes today’s business environment. But Talasaz stresses the importance of turning this concern inward: “If the world outside our organizations is becoming more volatile, uncertain, complex, and ambiguous, what are we, as leaders, doing to the inside of our organizations?”

Leaders spend enormous amounts of time helping their organizations respond to external disruption but comparatively little time asking whether they are inadvertently re-creating those same conditions internally in response to those external needs. Are we reducing uncertainty or introducing more of it? Are we simplifying work or adding unnecessary complexity? Are we helping people focus on what matters most, or asking them to navigate competing priorities and shifting expectations?

Talasaz refers to this phenomenon as double VUCA — something I’ve witnessed repeatedly while working with CIOs over the past decade. Organizations often assume they’re struggling because of technology limitations when the real constraint is organizational friction. Teams wait for decisions. Priorities shift faster than roadmaps. Governance grows heavier. New committees are formed to solve problems created by existing committees. Everyone is working harder, yet the organization somehow feels slower.

AI amplifies both outcomes. Organizations with clarity become dramatically more effective because AI accelerates good decisions. Organizations without clarity simply accelerate confusion.

Operating model as strategy enabler

AI governance is one way to achieve greater clarity, but as Talasaz says, governance shouldn’t primarily exist inside policy manuals that few people read.

Instead, AI governance should be embedded in the daily rhythms of the organization, shaping how teams collaborate, how decisions are made, how products move from ideas into production, and how innovation happens safely without requiring constant escalation. In other words, it’s all about your operating model.

“If you had to pick one thing that isn’t technology, your operating model is the most important element for executing data and AI at scale,” he says.

The best operating models create enough clarity that capable people can make thousands of decisions independently and confidently, without having to wait for permission. By embedding good governance into the way it works, the organization becomes faster.

This advice echoes something I’ve heard repeatedly from some of the world’s most respected CIOs: High-performing organizations aren’t built on tighter control; they’re built on greater trust, supported by clear principles, shared expectations, and operating models that enable responsible decision-making at every level of the enterprise.

Talasaz points out that technology leaders tend to speak in terms of transformation. He suggests CIOs consider a different word: reinvention.

As he explains, transformation implies replacing what exists today with something new. Reinvention starts with a more clear-eyed and practical premise: Some things absolutely must change; others represent years, sometimes decades, of accumulated expertise, customer trust, operational discipline, and competitive advantage.

Reinvention is about building on those strengths while also creating new ways to deliver value. The leaders making the greatest progress in their AI journeys seem to recognize that it’s less about abandoning the past than thoughtfully preparing the organization for the future.

Closing the gap between strategy and execution

Full-stack CIOs must be able to map out the various layers of execution and planning that need to be done at every level of the organization to be successful. To help with this, Talasaz has developed a data and AI framework that draws on his own experiences “from the keyboard to the boardroom.”

As Talasaz sees it, too many organizations have been doing good work in isolation. “They’re doing a lot of the right things,” he says. “They’re just not connected.”

Boards may be discussing growth while business leaders redesign customer experiences. Product teams may be prioritizing new capabilities while architects modernize platforms. Data teams may be improving quality while engineers focus on delivery. Every group makes meaningful progress within its own domain, yet somewhere between strategy and execution, the connective tissue begins to disappear. Talasaz’s framework brings those connecting points to the forefront.

Crucially, the framework doesn’t begin with technology or AI or even with data. It begins with the experiences the organization hopes to create for its customers, employees, or partners. Many AI initiatives start with the question, “What can this technology do?” And indeed, we need to be inspired by the possibilities and challenged to think differently by what the technology can do. But, Talasaz emphasizes, we also need to ask what experiences we need to deliver for our business and how the technology can make that a reality.

The framework challenges CIOs to answer that question first. Only after the experiences are clearly defined does the conversation move to the capabilities required to deliver it, the business activities that support those capabilities, the AI and data products that enable them, and finally the data foundation that makes everything possible.

This shift in perspective ensures that, rather than allowing technology investments to search for business value, the business experience defines the technology required to deliver it. For CIOs, that’s more than a planning exercise. It’s a fundamentally different way of leading.

Over the coming months, the P4P community will be convening a series of small CxO roundtables to explore these issues and work more deeply with Afshean Talasaz’s 6×6 Data and AI Framework. CIOs and other enterprise leaders interested in participating are welcome to reach out to me directly.

I have worked alongside enterprise technology for more than 30 years and watched AI evolve from a lab experiment into the modern boardroom’s core focus. However, the last few years of implementing AI alongside our customers have delivered our most profound reality checks.

The initial hype has faded, leaving CIOs to drive real enterprise value. Based on my experience implementing Google, OpenAI and Anthropic technologies, here are the fundamental, technology-agnostic lessons every leader must anchor their strategy around.

AI as a leadership multiplier

The most common tactical error we see is treating AI as an isolated technology project. What I have observed among our customers is that true success does not come from organizations that define a standalone “AI strategy,” but rather from those leaders that integrate AI into their business strategy.

When our customers isolate AI and define an AI strategy, it inevitably treats it like a “technological toy” to experiment with. This approach yields fragmented, orphaned initiatives that fail to scale because they are fundamentally disconnected from their core corporate objectives. What I learned is that AI is not the ultimate destination; it is a powerful catalyst. We have replaced “What can AI do for our customers?” with a more strategic question, “How does AI accelerate their existing business goals?”

Think of AI like electricity. No modern corporation designs a standalone “electricity strategy.” Instead, all companies route it invisibly across the entire organization to illuminate offices, power production lines and drive communication. AI must be woven into the enterprise fabric in the exact same way, acting as an underlying utility that supercharges your existing operational model.

Integrating AI into the broader business strategy also dictates how we measure success. It forces a shift away from short-term tech vanity metrics and anchors the technology into a long-term roadmap.

When AI remains trapped within the IT department of our customers, we notice that it is relegated to a mere “software experiment.” To become a true competitive advantage, we observed that AI requires intense cross-functional orchestration. This perspective does not diminish the merit of the technical team; their expertise is fundamental for establishing the architecture, data governance and tools your enterprise requires. However, while IT builds the foundational infrastructure, it lacks the organizational authority to decide what should be built on top of it. Only the CEO or the owner of the company can step in to ensure AI leaves the “toy project” phase and integrates into the DNA of the organization.

The requirement for top-down, executive ownership stems from three critical realities observed in the field:

• Silo-smashing and data collaboration: True enterprise AI is data-hungry and that data lives across disparate business lines, finance, operations, marketing and customer service. Only the CEO possesses the cross-functional authority to demand that data silos be dismantled.
• Cultural transformation and fear mitigation: AI triggers widespread anxiety over job displacement across all industries and hierarchies. When relegated to an “IT project,” resistance spikes as teams view it as a threat to their livelihoods. When I saw the CEO lead this cultural shift directly is when I noticed the best results.
• C-Suite education and strategic alignment: The mandate for AI capability cannot just be delegated downward; the transformation must begin at the very top. I have conducted more than 70 presentations for the Board of Directors and C-Level teams. These people need to be actively educated not on technical code, but on specific business use cases, return on investment (ROI) frameworks and how AI resolves core organizational bottlenecks.

PwC’s data found that only 12% of enterprises have achieved both cost and revenue benefits from AI. Those elite 12% succeeded precisely because their CEOs embedded AI extensively across strategic decision-making and cross-functional workflows. AI is simply too disruptive and too critical to be left exclusively in the hands of technical experts. If AI is not on the CEO’s weekly agenda, it is fundamentally missing from the company’s true strategy.

AI as a new operational framework

Traditional IT systems have operated on strict algorithmic certainty: if you input a specific set of data, the system executes an immutable line of code and guarantees the same, predictable output every single time.

AI completely breaks this paradigm. Because modern AI is built on probabilistic models, it does not execute static formulas; instead, it predicts the most likely correct response based on mathematical probabilities. This means that AI solutions carry an inherent, small percentage of uncertainty and variability. A prompt entered today might yield a slightly different, though contextually valid, output tomorrow.

Executive leadership and organizational cultures must be actively educated to accept and navigate this fundamental shift. Traditional quality assurance frameworks for software are designed for a 100% success rate. Applying this rigid standard to AI will paralyze your initiatives, keeping 80% of your projects trapped eternally in the pilot phase. This happened to us in a food and beverage company in Latin America a couple of years ago. After this experience, we started to include conditions in our contracts that tolerate statistical margins of error and still define the project as a success.

In terms of cost calculation, we had to teach CIOs and business managers to forget the monthly subscription model for AI and learn to manage the primary unit of exchange in modern AI: the token.

To understand AI costs, executives must understand how large language models process data. AI models do not read full words; instead, they break text, images or code down into “pieces” called tokens. As a baseline, every 100 words process as approximately 130 to 140 tokens. Because the major AI providers use the token as their currency, your business is billed dynamically based on the exact volume of tokens consumed by every query submitted (input) and every response generated (output).

Many leaders believe AI costs are fixed due to flat-rate enterprise tiers ($25–$30/user). This is a temporary illusion. These venture-capital-subsidized rates mask true operational costs and come with dynamic usage limits. Modeling long-term ROI on them guarantees a severe budget shock when true consumption pricing takes over.

The solution is not to halt AI adoption; doing so means losing your competitive edge. Instead, the cost per token must cease to be treated as a technical footnote relegated to the IT department. It must be elevated to a core business variable.

Risks in the AI adoption model

Since the beginning of the AI boom, I have seen all our customers making a critical tactical error that could cost them heavily in the medium term: they are focusing only on operational efficiency (reducing costs with AI).

I have observed that an alarmingly high percentage of companies remain trapped in pilot phases focused exclusively on short-term cost reduction. Bain & Company’s global Automation and AI Pathfinder Survey found that the largest share of companies measuring their AI initiatives (exactly 40%) realized cost reductions of 10% or less, heavily missing their internal targets. Our customers are putting too many resources and effort into marginal financial gains and in doing so, they are jeopardizing their most valuable assets: service quality, resilience and customer trust.

Utilizing AI solely to slash headcount or cut operational corners is a dangerous trap that introduces severe field liabilities. A financial service organization in Latin America announced that they saved $1 million in customer support by replacing humans with AI chatbots. However, the mid-term reality revealed a different story: a damaged brand reputation due to AI errors and an influx of frustrated clients fleeing because the automated system cannot handle special cases.

Putting a company on an extreme AI diet might make it look leaner on next quarter’s financial statement, but over-indexing on cost-cutting will ultimately leave the business too weak to compete when market dynamics shift. We are now inviting our customers to change the question from “How much money will AI save us?” to “How will we leverage AI to exponentially increase the long-term value of our enterprise?”

Deploying enterprise AI is a marathon, not a sprint, and the terrain changes with every mile. The organizations that thrive in this next era will be those that transition from fascination to discipline, treating AI not as a magic bullet for immediate savings, but as a core capability that demands rigorous governance, architectural foresight and cultural maturity. Navigating this shift requires moving past the theoretical hype and anchoring decisions in raw, field-tested reality.

As we continue to deploy these technologies across industries, the blueprint for success is being rewritten in real time. Let’s keep this conversation going as we map out the future of business intelligence together.

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Late in a large enterprise SAP transformation, the strategic governance conversations began to drift. Instead of executive decisions, we found ourselves debating whether the program needed dedicated testing, whether cutover required a full weekend, whether twenty Agile teams really needed coordination support and whether offshore resources were adding value at all.

The questions were not coming from the delivery teams. They were coming from the executive sponsor.

The sponsor had recently been elevated into a senior leadership role and had never sponsored a technology transformation at this scale. The challenge was not authority. The sponsor had every right to ask any question they wanted. The challenge was that strategic governance had quietly turned into a debate about delivery practices, because the sponsor did not yet have the transformation context to focus the conversation anywhere else.

This is not a story about a bad sponsor. The executive in this case was a capable senior leader with strong judgment and authentic intent. They had been placed into a role they had not yet been prepared for, and the pattern that followed was structural, not personal. It is one of the more common patterns I have observed across enterprise transformation programs, and one of the most consistently misdiagnosed.

Most program failures are not execution failures. They are sponsor mismatches.

When governance becomes a debate about delivery practices

When the sponsor does not understand what an enterprise transformation actually requires, governance forums stop functioning as decision bodies and start functioning as practice debates.

You see it in the questions that get asked. Why do we need a dedicated testing phase? Can the Build timeline be compressed? Why does cutover need a full weekend? Why do we need more Scrum Masters across 20 product teams? Can the US team simply work longer hours instead of using offshore resources? On one program, the sponsor suggested shifting the entire project’s working hours to India time, despite roughly 85 percent of the delivery organization being based in the United States.

None of these questions are unreasonable in isolation. Each one targets a real cost or timeline pressure. The problem is what is missing underneath them: an understanding of the operational risks the original choices were designed to mitigate.

When sponsors ask delivery-practice questions without that context, the program leadership team ends up defending the work instead of advancing it. Decision velocity drops. Trust between the program and its sponsor erodes. Senior delivery talent disengages from governance forums where the conversation never reaches the decisions they need made. What looks from the outside like an active sponsor producing engagement is, from inside the program, an active drain on the cycles needed to deliver.

The compounding cost is not unique to any single program. PMI’s research on executive sponsorship consistently identifies sponsor engagement quality, rather than sponsor presence alone, as one of the strongest predictors of project success. The visible symptom is debate. The actual cost is unmade decisions.

Authority is rarely the issue. Literacy is

When transformations stall under a mismatched sponsor, the diagnostic instinct is to question the sponsor’s authority. Are they senior enough? Do they have the cross-functional reach? Can they unblock?

In most of the programs I have led or advised, authority was not the limiting factor. The sponsor in the SAP program above had ample authority. They could unblock any decision the program needed. What had not been developed was the transformation literacy to know which decisions mattered, which were technical noise and which were execution risks that should not be optimized away.

This is what I have come to think of as the literacy problem. Sponsors elevated into transformation roles often have deep functional expertise (finance, operations, business unit leadership) but limited exposure to the distinct functions of PMO, organizational change management, agile delivery, testing and cutover, and how each one reduces a specific category of implementation risk. They are not expected to be SAP configuration experts. But they need enough transformation literacy to recognize which questions actually belong in a steering committee.

Harvard Business Review’s research on effective executive sponsorship has emphasized that sponsorship effectiveness depends as much on judgment as on authority. Judgment is where literacy becomes operational. A sponsor with authority but limited transformation literacy will optimize for speed and cost in ways that consistently underestimate risk. A sponsor with both will make the tradeoffs the program actually needs.

Prosci’s longstanding benchmark studies on change management have ranked active and visible executive sponsorship as the single greatest contributor to change success for two decades. The word that matters in that finding is active. Active sponsorship without transformation literacy can introduce real cost. Not because the sponsor is acting against the program, but because the optimization choices they make are based on incomplete information about what the program is built to protect against.

Shift the conversation from delivery practices to business risk

When the sponsor relationship is already in place and cannot be changed, the program leadership team has one move that consistently works: shift the conversation.

On the SAP program above, we stopped explaining why the testing phase existed. We started explaining the business risk of reducing it. We stopped debating the number of Scrum Masters. We started connecting delivery capacity to coordination across more than twenty Agile teams and the business cost of losing that coordination. We reframed offshore support as a way to maintain delivery momentum around the clock rather than asking the U.S. team to sustain fifteen-hour days.

The shift is from defending delivery practice to explaining business risk. The sponsor does not need to understand why testing takes the time it does. They need to understand what the program is exposed to if testing is compressed. They do not need to know how many Scrum Masters are statistically optimal for twenty Agile teams. They need to know what coordination breaks when the number is wrong.

This reframing accomplishes two things. First, it brings the conversation back to the level at which sponsors actually make decisions: tradeoffs between business outcomes and business risks. Second, it builds transformation literacy in the sponsor over time, almost as a byproduct. By the third or fourth iteration of business-risk-framed conversations, the sponsor begins to ask the right questions on their own.

In practice, this happens through small but deliberate moves. When the sponsor asks why a phase needs the time it takes, the program lead names two or three things that could go wrong if the time is cut and what each would cost the business. When the sponsor asks why a role is needed, the program lead names the work that would not get done without it. Every delivery-practice question gets converted into a business-risk answer.

The program leadership team’s job is not to make the sponsor an expert in SAP delivery. It is to provide enough transformation context so that executive decisions reflect both business priorities and implementation realities.

There are a few phrases I have used with executive sponsors over the years that capture the underlying issue. The sharpest one:

If the decision has to go above the sponsor, they are not the sponsor.

Sponsorship is defined by what the sponsor can decide without asking someone else. That is the test. Anything else is the appearance of sponsorship, not the substance.

For CIOs supporting enterprise transformation, the implication is direct. Sponsor selection, or sponsor preparation when selection is not an option, is not a hierarchy question. It is a transformation capability question. The same execution discipline that goes into defining decision rights, structuring governance and protecting delivery momentum should apply, with equal rigor, to assessing sponsor fit and building sponsor literacy before the program begins.

A sponsor does not need to be the technical expert. They do need to know when to trust the people who are.

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Agentic AI has advanced from the promises-and-pilots phase of 2025 to reality and rollouts in 2026. In the process, agentic AI is transforming virtually every aspect of customer relationship management (CRM), the platform that manages sales, marketing, and customer service.

“Last year, everybody was dipping their toes into the water,” says Keith Kirkpatrick, research director at The Futurum Group. This year, agentic AI has built momentum from the boardroom down, with companies recognizing that having an AI strategy is imperative. “They feel like if they don’t embrace it now, their competitors will.”

Harry Datwani, a principal at Deloitte Digital, adds that enterprise CRM customers have transitioned from “proof of concept” to “scale and execution.”

“Across sales, service, marketing, even in the commerce space, enterprises are really using AI and agentic,” he says.

“CRM in 2026 is undergoing a structural shift, not just an incremental evolution,” says Forrester analyst Kate Leggett, noting that AI is becoming a core part of CRM infrastructure, not just a feature or an add-on. According to Forrester data, around 70% of companies are already using AI in their CRM systems, she says.

Here are the hot AI-driven trends in CRM this year.

CRM becomes an action hero

CRM platforms have traditionally served as passive, static systems of record. Now, agentic AI is transforming CRM into a powerful, real-time solution that can act autonomously.

“Organizations that rethink CRM as a real-time, AI-powered system of action — and embrace agentic AI to handle complex, unpredictable work — are better positioned to deliver exceptional customer experiences,” says IDC analyst Neil Ward-Dutton. “This approach not only enhances satisfaction and loyalty but also drives operational efficiency and business agility.”

Forrester’s Leggett says that AI-powered CRM platforms have advanced from simple data capture to real-time decision-making and execution. Standard capabilities include next-best action recommendations, call summaries, automated updates, generated emails, knowledge creation, predictive forecasting, and deal scoring.

She adds that AI agents can now execute workflows, such as routing cases, sending follow-ups, and updating records (with human oversight). They can also handle end-to-end service and sales tasks autonomously, including case resolutions and sales development activities.

Agentic drives workforce changes

AI use in CRM systems is also impacting workforce strategies.

“We used to hire for deep expertise,” says Constellation Research analyst Liz Miller. “AI has commoditized expertise because I can take all that data from my CRM and train my AI models to go deep, to know everything about any product I’ve ever sold, from what has worked, what hasn’t, every price, every sale.”

Now, instead of hiring candidates with deep expertise, organizations are looking for candidates who can go wide. “I can train a model to have deep expertise. What I can’t train for is experience, because experience is what happens when a person has gone broad across a lot of different scenarios and faced complexity across that broad scenario,” says Miller.

For example, AI systems can automate many aspects of marketing, Miller notes, but there’s no substitute for creativity: people who can interrogate the data and come up with innovative marketing campaigns that connect with customers.

Terence Chesire, group vice president of ServiceNow CRM and industry workflows, says that organizations are using agentic AI to free up team members from repetitive, lower-value activities. Those employees have now moved to higher-level roles “where they’re working on transformational deals rather than just building a spreadsheet.”

“That’s what we’re seeing as super-exciting as organizations not just free up people, but the speed and effort reduction and the friction reduction in what they can do,” he adds.

Data layer takes center stage

AI’s promise to deliver actionable customer and marketing intelligence has placed even greater emphasis on the importance on sound data management practices for CRM.

“The light bulb has flashed on very brightly for our clients,” says Deloitte’s Datwani. “Everyone is talking about AI agents, but your ability to really extract value is inextricably linked to the quality of your data and the ability to make that data accessible. What we’re finding is that despite large investments over time our clients still have fragmented data. And so, they are data rich and insight poor.”

The good news, says Datwani, is that AI agents themselves can help clean up and organize data. And vendors such as Snowflake and Databricks, along with the traditional CRM powerhouses, are offering powerful data analytics solutions. “Everyone is battling for that data layer,” Datwani says.

Forrester’s Leggett adds that CRM platforms are converging with customer data platforms (CDPs), real-time event streams, and external data sources to create connected customer data networks. These real-time, connected data models can help organizations deliver hyper-personalization at scale.

Agentic ushers in pricing complexity

The shift from license- or subscription-based pricing to an outcome or consumption pricing model has the potential to help CIOs tie their CRM costs to specific business metrics, such as the number of customer service calls resolved per hour. But it has also introduced a new level of complexity when it comes to budgeting for CRM costs.

For example, Chesire says ServiceNow’s CRM pricing plan starts with a baseline subscription model, and on top of that, customers get a certain number of AI tokens per user and can buy additional tokens as AI usage ramps up.

Meanwhile, Salesforce has rolled out pay-per-resolution pricing with its recently unveiled AI Help Agent and last month acquired usage-based billing specialist m3ter. Oracle is also piloting outcome-based AI pricing.

All these approaches undercut the predictability of the subscription model, which will complicate CIOs’ cost calculus, Deloitte’s Datwani says. “Now, as you start to think about consumption and tokens, costs might look different. As folks are opening up the architecture with things like headless CRM, what will the cost model look like for API calls or MCP server calls? So, there’s many more variables,” he adds.

The rise of multi-agent orchestration

To act autonomously, agents need to access multiple data sets and software platforms seamlessly. As a result, the proliferation of agents, some embedded within specific vendor platforms and some created in-house, is going to require an orchestration layer, Futurum’s Kirkpatrick says.

He points out that organizations need to monitor and manage agents, enforcing the same type of policy-based access control that exists for people. Organizations also need to set limits on what domains a specific agent can get into, what types of data they can access, what lines can’t they cross.

Kirkpatrick predicts that a new class of orchestration tools will emerge, although it’s not clear whether that orchestration layer will be provided by the leading CRM vendors, hyperscalers, or third parties.

Datwani agrees. “The orchestration layer is an interesting area, where the traditional vendors are in on it, the hyperscalers are also offering it, and there are third parties. It’s my belief that there’s not going to be a clear winner.”

The interface becomes conversational

Enterprise users who have traditionally had to manually wrangle with CRM systems are likely to find the ability to employ voice commands using a natural language interface to be a game changer. For starters, a salesperson can say, “I have a meeting today with Customer X. Help me prepare.” The agent will collect relevant data, ingest it, and provide a summary with recommendations.

ServiceNow’s Chesire says voice-enabled CRM systems have an “almost magical” ability to record, transcribe, and understand the content of a call between a salesperson and a customer or potential customer. The system can then “build a quote” based on that conversation.

On the customer service side of the equation, AI-driven voice technology enables customers to speak to an AI agent, describe the problem using natural language, and get a response. The agent has the capability to, for example, solve a credit card dispute, order a replacement product, send out a service rep, or do whatever is needed to resolve the issue, says Chesire.

Beyond that, agentic technology is capable of understanding the underlying business process flaws that led to the product snafu, and make recommendations for ways to fix whatever led to the issue in the first place, he adds.

Agentic drives business process transformation

With the emergence of outcome-based pricing, organizations are taking a fresh look at how they measure the benefits of CRM systems. That conversation is leading to an even more important analysis of underlying business processes. Or, as Constellation’s Miller says, “The old adage of applying new technology to old processes only gets you more expensive old processes.”

“When we survey customers, we hear time and time again that the reason why they want to apply AI into their organizations is to foster exponential opportunity and exponential growth,” she says. “How do we get there with CRM has started to become the new conversation.”

According to Miller, AI systems breach the walls of siloed data and can take a fresh look at legacy workflows. They also don’t get sucked into turf wars between marketing and sales teams. As a result, they often recommend new actions that can lead to better processes. “I think it’s starting to happen. You’re starting to see applications where AI is beginning to accelerate decision-making and decision velocity,” she says.

“The next phase of maturity is going to be, how do we start to spread AI across our platforms so that we are seeing that holistic end-to-end relationship that we have always wanted to optimize. How do we thread that across platforms and across solutions. We’re starting to see organizations on the leading edge really start to pull those strategies together,” says Miller.

I have worked alongside enterprise technology for more than 30 years and watched AI evolve from a lab experiment into the modern boardroom’s core focus. However, the last few years of implementing AI alongside our customers have delivered our most profound reality checks.

The initial hype has faded, leaving CIOs to drive real enterprise value. Based on my experience implementing Google, OpenAI and Anthropic technologies, here are the fundamental, technology-agnostic lessons every leader must anchor their strategy around.

AI as a leadership multiplier

The most common tactical error we see is treating AI as an isolated technology project. What I have observed among our customers is that true success does not come from organizations that define a standalone “AI strategy,” but rather from those leaders that integrate AI into their business strategy.

When our customers isolate AI and define an AI strategy, it inevitably treats it like a “technological toy” to experiment with. This approach yields fragmented, orphaned initiatives that fail to scale because they are fundamentally disconnected from their core corporate objectives. What I learned is that AI is not the ultimate destination; it is a powerful catalyst. We have replaced “What can AI do for our customers?” with a more strategic question, “How does AI accelerate their existing business goals?”

Think of AI like electricity. No modern corporation designs a standalone “electricity strategy.” Instead, all companies route it invisibly across the entire organization to illuminate offices, power production lines and drive communication. AI must be woven into the enterprise fabric in the exact same way, acting as an underlying utility that supercharges your existing operational model.

Integrating AI into the broader business strategy also dictates how we measure success. It forces a shift away from short-term tech vanity metrics and anchors the technology into a long-term roadmap.

When AI remains trapped within the IT department of our customers, we notice that it is relegated to a mere “software experiment.” To become a true competitive advantage, we observed that AI requires intense cross-functional orchestration. This perspective does not diminish the merit of the technical team; their expertise is fundamental for establishing the architecture, data governance and tools your enterprise requires. However, while IT builds the foundational infrastructure, it lacks the organizational authority to decide what should be built on top of it. Only the CEO or the owner of the company can step in to ensure AI leaves the “toy project” phase and integrates into the DNA of the organization.

The requirement for top-down, executive ownership stems from three critical realities observed in the field:

• Silo-smashing and data collaboration: True enterprise AI is data-hungry and that data lives across disparate business lines, finance, operations, marketing and customer service. Only the CEO possesses the cross-functional authority to demand that data silos be dismantled.
• Cultural transformation and fear mitigation: AI triggers widespread anxiety over job displacement across all industries and hierarchies. When relegated to an “IT project,” resistance spikes as teams view it as a threat to their livelihoods. When I saw the CEO lead this cultural shift directly is when I noticed the best results.
• C-Suite education and strategic alignment: The mandate for AI capability cannot just be delegated downward; the transformation must begin at the very top. I have conducted more than 70 presentations for the Board of Directors and C-Level teams. These people need to be actively educated not on technical code, but on specific business use cases, return on investment (ROI) frameworks and how AI resolves core organizational bottlenecks.

PwC’s data found that only 12% of enterprises have achieved both cost and revenue benefits from AI. Those elite 12% succeeded precisely because their CEOs embedded AI extensively across strategic decision-making and cross-functional workflows. AI is simply too disruptive and too critical to be left exclusively in the hands of technical experts. If AI is not on the CEO’s weekly agenda, it is fundamentally missing from the company’s true strategy.

AI as a new operational framework

Traditional IT systems have operated on strict algorithmic certainty: if you input a specific set of data, the system executes an immutable line of code and guarantees the same, predictable output every single time.

AI completely breaks this paradigm. Because modern AI is built on probabilistic models, it does not execute static formulas; instead, it predicts the most likely correct response based on mathematical probabilities. This means that AI solutions carry an inherent, small percentage of uncertainty and variability. A prompt entered today might yield a slightly different, though contextually valid, output tomorrow.

Executive leadership and organizational cultures must be actively educated to accept and navigate this fundamental shift. Traditional quality assurance frameworks for software are designed for a 100% success rate. Applying this rigid standard to AI will paralyze your initiatives, keeping 80% of your projects trapped eternally in the pilot phase. This happened to us in a food and beverage company in Latin America a couple of years ago. After this experience, we started to include conditions in our contracts that tolerate statistical margins of error and still define the project as a success.

In terms of cost calculation, we had to teach CIOs and business managers to forget the monthly subscription model for AI and learn to manage the primary unit of exchange in modern AI: the token.

To understand AI costs, executives must understand how large language models process data. AI models do not read full words; instead, they break text, images or code down into “pieces” called tokens. As a baseline, every 100 words process as approximately 130 to 140 tokens. Because the major AI providers use the token as their currency, your business is billed dynamically based on the exact volume of tokens consumed by every query submitted (input) and every response generated (output).

Many leaders believe AI costs are fixed due to flat-rate enterprise tiers ($25–$30/user). This is a temporary illusion. These venture-capital-subsidized rates mask true operational costs and come with dynamic usage limits. Modeling long-term ROI on them guarantees a severe budget shock when true consumption pricing takes over.

The solution is not to halt AI adoption; doing so means losing your competitive edge. Instead, the cost per token must cease to be treated as a technical footnote relegated to the IT department. It must be elevated to a core business variable.

Risks in the AI adoption model

Since the beginning of the AI boom, I have seen all our customers making a critical tactical error that could cost them heavily in the medium term: they are focusing only on operational efficiency (reducing costs with AI).

I have observed that an alarmingly high percentage of companies remain trapped in pilot phases focused exclusively on short-term cost reduction. Bain & Company’s global Automation and AI Pathfinder Survey found that the largest share of companies measuring their AI initiatives (exactly 40%) realized cost reductions of 10% or less, heavily missing their internal targets. Our customers are putting too many resources and effort into marginal financial gains and in doing so, they are jeopardizing their most valuable assets: service quality, resilience and customer trust.

Utilizing AI solely to slash headcount or cut operational corners is a dangerous trap that introduces severe field liabilities. A financial service organization in Latin America announced that they saved $1 million in customer support by replacing humans with AI chatbots. However, the mid-term reality revealed a different story: a damaged brand reputation due to AI errors and an influx of frustrated clients fleeing because the automated system cannot handle special cases.

Putting a company on an extreme AI diet might make it look leaner on next quarter’s financial statement, but over-indexing on cost-cutting will ultimately leave the business too weak to compete when market dynamics shift. We are now inviting our customers to change the question from “How much money will AI save us?” to “How will we leverage AI to exponentially increase the long-term value of our enterprise?”

Deploying enterprise AI is a marathon, not a sprint, and the terrain changes with every mile. The organizations that thrive in this next era will be those that transition from fascination to discipline, treating AI not as a magic bullet for immediate savings, but as a core capability that demands rigorous governance, architectural foresight and cultural maturity. Navigating this shift requires moving past the theoretical hype and anchoring decisions in raw, field-tested reality.

As we continue to deploy these technologies across industries, the blueprint for success is being rewritten in real time. Let’s keep this conversation going as we map out the future of business intelligence together.

This article is published as part of the Foundry Expert Contributor Network.
Want to join?

Enterprise software developers continue to be in danger of falling victim to slopsquatting, where AI coding tools hallucinate the existence of nonexistent libraries and hackers create malicious packages in response.

The top AI coding tools are remarkably consistent in their hallucinations: Researcher Aleksandr Churilov found the same 127 fake package names generated by five different LLMs.

Slopsquatting is a relatively new form of malware attack that involves the creation of malicious packages in response to the hallucinations of AI coding tools, causing the malicious packages to be incorporated into legitimate applications.

Churilov set out his findings in a research paper, The Range Shrinks, the Threat Remains: Re-evaluating LLM Package Hallucinations on the 2026 Frontier-Model Cohort, which is yet to be peer-reviewed. He found 127 hallucinated package names were shared across Claude Sonnet 4.6, Claude Haiku 4.5, GPT-5.4-mini, Gemini 2.5 Pro, and DeepSeek V3.2.

 As of April this year, 53 of those names — 41 on the PyPI software repository and 12 on npm —are still available for registration.

According to the study, there are two reasons for this amount of conformity in the output of the models. First, models may learn the same incorrect package references from shared public training material, such as tutorials and documentation.

Second, they may independently extrapolate plausible names from ecosystem conventions. In this way, they could produce names that look correct, even if they don’t actually exist.

While Churilov’s research will worry CISOs and security-conscious developers, there is some relief. The research has not yet found any evidence that any of the remaining 53 names have been registered maliciously, nor used in an attack.

This article first appeared on InfoWorld.

Enterprise software developers continue to be in danger of falling victim to slopsquatting, where AI coding tools hallucinate the existence of nonexistent libraries and hackers create malicious packages in response.

The top AI coding tools are remarkably consistent in their hallucinations: Researcher Aleksandr Churilov found the same 127 fake package names generated by five different LLMs.

Slopsquatting is a relatively new form of malware attack that involves the creation of malicious packages in response to the hallucinations of AI coding tools, causing the malicious packages to be incorporated into legitimate applications.

Churilov set out his findings in a research paper, The Range Shrinks, the Threat Remains: Re-evaluating LLM Package Hallucinations on the 2026 Frontier-Model Cohort, which is yet to be peer-reviewed. He found 127 hallucinated package names were shared across Claude Sonnet 4.6, Claude Haiku 4.5, GPT-5.4-mini, Gemini 2.5 Pro, and DeepSeek V3.2.

 As of April this year, 53 of those names — 41 on the PyPI software repository and 12 on npm —are still available for registration.

According to the study, there are two reasons for this amount of conformity in the output of the models. First, models may learn the same incorrect package references from shared public training material, such as tutorials and documentation.

Second, they may independently extrapolate plausible names from ecosystem conventions. In this way, they could produce names that look correct, even if they don’t actually exist.

While Churilov’s research will worry CISOs and security-conscious developers, there is some relief. The research has not yet found any evidence that any of the remaining 53 names have been registered maliciously, nor used in an attack.

Traditional phishing techniques are in decline as a result of the disruption of the Tycoon2FA phishing-as-a-service (PHaaS) platform, Microsoft said in a new report, “Email threat landscape: Q2 2026 trends and insights”.

“Phishing volume linked to the platform fell 92% from pre-disruption averages, including QR code phishing and CAPTCHA-gated phishing both declining from their March highs,” the company wrote in the report.

The takedown reduced activity across multiple phishing categories, forcing attackers to shift to newer delivery methods.

Riding this shift in were a few notable phishing campaigns, including an automated business email compromise (BEC) campaign that reached 42,000 organizations in under three hours, and a multi-stage phishing campaign that used nested email (EML) files, calendar invitations, and a Microsoft authentication redirect to deliver malware.

To counter phishing attacks, Microsoft recommends blocking emails containing known bad URLs/ subject fields, enabling password-less authentication methods, or moving to MFA for accounts that still require passwords.

Tycoon2FA disruption sent attackers exploring

The take-down of Tycoon2FA forced its operators to abandon portions of their infrastructure and rework hosting, domain registrations, and delivery mechanisms.

“After falling 15% in March and another 22% in April, Tycoon2FA-linked phishing volume dropped 74% in May to just 1.5 million messages, then fell another 20% in June to 1.2 million, by far the lowest monthly volumes observed in at least a year,” Microsoft said.

The decline extended to QR Code lures and fake CAPTCHA pages, two phishing techniques in which Tycoon2FA accounted for 12% and 14% of industry activity in June, respectively. This indicated that the platform’s customer base had not been able to migrate to a replacement infrastructure.

But cutting off one head of the hacker hydra only gave rise to new tactics elsewhere.

The adaptation came in the form of using Microsoft Teams as a social engineering channel. Attackers established conversations to build trust before attempting credential theft or delivering malicious payloads. “Teams-based phishing volume climbed steadily throughout Q2, with the average number of detected attacks rising 19% from March to April, holding roughly flat into May (+1%), then increasing another 10% into June,” Microsoft said.

Microsoft also observed a highly automated BEC campaign that reached over 67,000 users using scripted emails, Amazon Simple Email Service (SES), and engagement tracking, alongside a separate phishing campaign targeting 107,000 users that abused Microsoft’s authentication flow and trusted cloud services, including Teams archive recording and ICS calendar invite, to disguise malware delivery behind legitimate infrastructure.

Phishing changes but the defense doesn’t

While QR Code and Captcha-based phishing attacks dropped significantly in the second quarter, business email compromise (BEC) charted jumped 121% between March and April, before dropping down again in May.

QR Code phishing represented 8.3 million attacks in June 2026, down from a peak of 18.7 million in March. Similarly, Captcha-gated phishing fell from 12 million attacks in March to 2.2 million in June.

BEC attacks hit 9 million in March, falling to 3.9 million in June.

But even as these phishing classics lost momentum and newer techniques emerged, Microsoft’s defensive advice remained rooted in the basics. It noted organizations should complement email filtering with phishing-resistant authentication such as passkeys and phishing-resistant MFA to reduce the effectiveness of credential theft campaigns.

The company also recommended strengthening Exchange Online Protection and Microsoft Defender for Office 365 with capabilities such as Safe links and Zero-hour Auto Purge (ZAP), in which malicious emails already delivered to mailboxes are removed before they are read, alongside enforcing password-less authentication methods like Windows Hello, FIDO keys, and Microsoft Authenticator.

Microsoft concluded its report with a list of indicators of compromise (IoCs) from the threats observed in the quarter to support detection efforts.

This article first appeared on CSO.

Traditional phishing techniques are in decline as a result of the disruption of the Tycoon2FA phishing-as-a-service (PHaaS) platform, Microsoft said in a new report, “Email threat landscape: Q2 2026 trends and insights”.

“Phishing volume linked to the platform fell 92% from pre-disruption averages, including QR code phishing and CAPTCHA-gated phishing both declining from their March highs,” the company wrote in the report.

The takedown reduced activity across multiple phishing categories, forcing attackers to shift to newer delivery methods.

Riding this shift in were a few notable phishing campaigns, including an automated business email compromise (BEC) campaign that reached 42,000 organizations in under three hours, and a multi-stage phishing campaign that used nested email (EML) files, calendar invitations, and a Microsoft authentication redirect to deliver malware.

To counter phishing attacks, Microsoft recommends blocking emails containing known bad URLs/ subject fields, enabling password-less authentication methods, or moving to MFA for accounts that still require passwords.

Tycoon2FA disruption sent attackers exploring

The take-down of Tycoon2FA forced its operators to abandon portions of their infrastructure and rework hosting, domain registrations, and delivery mechanisms.

“After falling 15% in March and another 22% in April, Tycoon2FA-linked phishing volume dropped 74% in May to just 1.5 million messages, then fell another 20% in June to 1.2 million, by far the lowest monthly volumes observed in at least a year,” Microsoft said.

The decline extended to QR Code lures and fake CAPTCHA pages, two phishing techniques in which Tycoon2FA accounted for 12% and 14% of industry activity in June, respectively. This indicated that the platform’s customer base had not been able to migrate to a replacement infrastructure.

But cutting off one head of the hacker hydra only gave rise to new tactics elsewhere.

The adaptation came in the form of using Microsoft Teams as a social engineering channel. Attackers established conversations to build trust before attempting credential theft or delivering malicious payloads. “Teams-based phishing volume climbed steadily throughout Q2, with the average number of detected attacks rising 19% from March to April, holding roughly flat into May (+1%), then increasing another 10% into June,” Microsoft said.

Microsoft also observed a highly automated BEC campaign that reached over 67,000 users using scripted emails, Amazon Simple Email Service (SES), and engagement tracking, alongside a separate phishing campaign targeting 107,000 users that abused Microsoft’s authentication flow and trusted cloud services, including Teams archive recording and ICS calendar invite, to disguise malware delivery behind legitimate infrastructure.

Phishing changes but the defense doesn’t

While QR Code and Captcha-based phishing attacks dropped significantly in the second quarter, business email compromise (BEC) charted jumped 121% between March and April, before dropping down again in May.

QR Code phishing represented 8.3 million attacks in June 2026, down from a peak of 18.7 million in March. Similarly, Captcha-gated phishing fell from 12 million attacks in March to 2.2 million in June.

BEC attacks hit 9 million in March, falling to 3.9 million in June.

But even as these phishing classics lost momentum and newer techniques emerged, Microsoft’s defensive advice remained rooted in the basics. It noted organizations should complement email filtering with phishing-resistant authentication such as passkeys and phishing-resistant MFA to reduce the effectiveness of credential theft campaigns.

The company also recommended strengthening Exchange Online Protection and Microsoft Defender for Office 365 with capabilities such as Safe links and Zero-hour Auto Purge (ZAP), in which malicious emails already delivered to mailboxes are removed before they are read, alongside enforcing password-less authentication methods like Windows Hello, FIDO keys, and Microsoft Authenticator.

Microsoft concluded its report with a list of indicators of compromise (IoCs) from the threats observed in the quarter to support detection efforts.

ISC2 has begun developing a vendor-neutral AI security certification aimed at cybersecurity professionals working to secure AI systems and manage emerging AI risks.

The nonprofit organization, best known for the CISSP certification, says it is seeking volunteers worldwide to help define the knowledge and skills that will shape the new credential. While ISC2 has not finalized the certification domains, the certification is expected to address both technical AI security and governance topics, with a pilot exam planned before the end of 2026.

According to Casey Marks, ISC2 chief operating officer, feedback from cybersecurity practitioners led ISC2 to conclude that AI security had grown beyond expanding AI content within existing certifications.

“AI has reached a tipping point,” Marks says. “AI no longer is just another tool; instead, it has fundamentally changed the cybersecurity practice itself.”

ISC2 already includes AI-related content in certifications including CISSP and CCSP, but Marks says practitioners have identified new responsibilities and risks that extend beyond those programs. “Enterprise security teams are currently grappling with significant knowledge gaps, particularly around securing model architectures against new vulnerabilities like prompt injection, data poisoning, and model inversion,” Marks adds.

Organizations are working to understand emerging governance frameworks, including the NIST AI Risk Management Framework and ISO/IEC 42001, while adapting traditional application security and security operations workflows to AI systems, he says.

ISC2 has not finalized the certification domains, but Marks says the organization expects the credential to address both technical controls and governance practices for securing AI systems and managing AI risk. The certification will use ISC2’s established certification development process, which relies on cybersecurity practitioners to define job roles, develop exam content, and validate competencies.

Marks says ISC2 will continue to update the certification through ongoing input from cybersecurity professionals, in addition to its regular certification review process.

The organization is also determining which professionals the certification will target. Marks says AI security responsibilities are emerging across security architecture, risk management, security operations, software development security, governance and compliance, communication and network security, and security assessment and testing. ISC2 says the certification will reflect how those roles are evolving.

For organizations that are building AI security programs now, Marks recommends using existing AI training resources, adopting established governance frameworks, creating cross-functional AI security working groups, and participating in the certification development process.

Marks says ISC2 expects AI knowledge to become part of most cybersecurity roles while a more specialized AI security discipline continues to develop. He says organizations will increasingly need professionals with foundational AI security knowledge, as well as specialists in areas such as adversarial machine learning, model architectures, and AI data pipelines.

Looking ahead, Marks says he expects AI security expertise to evolve into both a foundational skill for cybersecurity professionals and a specialized discipline of its own.

“At this time, we are seeing a hybrid evolution occurring in real time: AI security is simultaneously becoming a baseline expectation for all security roles, while also carving out a dedicated, highly specialized discipline,” Marks says.

Late in a large enterprise SAP transformation, the strategic governance conversations began to drift. Instead of executive decisions, we found ourselves debating whether the program needed dedicated testing, whether cutover required a full weekend, whether twenty Agile teams really needed coordination support and whether offshore resources were adding value at all.

The questions were not coming from the delivery teams. They were coming from the executive sponsor.

The sponsor had recently been elevated into a senior leadership role and had never sponsored a technology transformation at this scale. The challenge was not authority. The sponsor had every right to ask any question they wanted. The challenge was that strategic governance had quietly turned into a debate about delivery practices, because the sponsor did not yet have the transformation context to focus the conversation anywhere else.

This is not a story about a bad sponsor. The executive in this case was a capable senior leader with strong judgment and authentic intent. They had been placed into a role they had not yet been prepared for, and the pattern that followed was structural, not personal. It is one of the more common patterns I have observed across enterprise transformation programs, and one of the most consistently misdiagnosed.

Most program failures are not execution failures. They are sponsor mismatches.

When governance becomes a debate about delivery practices

When the sponsor does not understand what an enterprise transformation actually requires, governance forums stop functioning as decision bodies and start functioning as practice debates.

You see it in the questions that get asked. Why do we need a dedicated testing phase? Can the Build timeline be compressed? Why does cutover need a full weekend? Why do we need more Scrum Masters across 20 product teams? Can the US team simply work longer hours instead of using offshore resources? On one program, the sponsor suggested shifting the entire project’s working hours to India time, despite roughly 85 percent of the delivery organization being based in the United States.

None of these questions are unreasonable in isolation. Each one targets a real cost or timeline pressure. The problem is what is missing underneath them: an understanding of the operational risks the original choices were designed to mitigate.

When sponsors ask delivery-practice questions without that context, the program leadership team ends up defending the work instead of advancing it. Decision velocity drops. Trust between the program and its sponsor erodes. Senior delivery talent disengages from governance forums where the conversation never reaches the decisions they need made. What looks from the outside like an active sponsor producing engagement is, from inside the program, an active drain on the cycles needed to deliver.

The compounding cost is not unique to any single program. PMI’s research on executive sponsorship consistently identifies sponsor engagement quality, rather than sponsor presence alone, as one of the strongest predictors of project success. The visible symptom is debate. The actual cost is unmade decisions.

Authority is rarely the issue. Literacy is

When transformations stall under a mismatched sponsor, the diagnostic instinct is to question the sponsor’s authority. Are they senior enough? Do they have the cross-functional reach? Can they unblock?

In most of the programs I have led or advised, authority was not the limiting factor. The sponsor in the SAP program above had ample authority. They could unblock any decision the program needed. What had not been developed was the transformation literacy to know which decisions mattered, which were technical noise and which were execution risks that should not be optimized away.

This is what I have come to think of as the literacy problem. Sponsors elevated into transformation roles often have deep functional expertise (finance, operations, business unit leadership) but limited exposure to the distinct functions of PMO, organizational change management, agile delivery, testing and cutover, and how each one reduces a specific category of implementation risk. They are not expected to be SAP configuration experts. But they need enough transformation literacy to recognize which questions actually belong in a steering committee.

Harvard Business Review’s research on effective executive sponsorship has emphasized that sponsorship effectiveness depends as much on judgment as on authority. Judgment is where literacy becomes operational. A sponsor with authority but limited transformation literacy will optimize for speed and cost in ways that consistently underestimate risk. A sponsor with both will make the tradeoffs the program actually needs.

Prosci’s longstanding benchmark studies on change management have ranked active and visible executive sponsorship as the single greatest contributor to change success for two decades. The word that matters in that finding is active. Active sponsorship without transformation literacy can introduce real cost. Not because the sponsor is acting against the program, but because the optimization choices they make are based on incomplete information about what the program is built to protect against.

Shift the conversation from delivery practices to business risk

When the sponsor relationship is already in place and cannot be changed, the program leadership team has one move that consistently works: shift the conversation.

On the SAP program above, we stopped explaining why the testing phase existed. We started explaining the business risk of reducing it. We stopped debating the number of Scrum Masters. We started connecting delivery capacity to coordination across more than twenty Agile teams and the business cost of losing that coordination. We reframed offshore support as a way to maintain delivery momentum around the clock rather than asking the U.S. team to sustain fifteen-hour days.

The shift is from defending delivery practice to explaining business risk. The sponsor does not need to understand why testing takes the time it does. They need to understand what the program is exposed to if testing is compressed. They do not need to know how many Scrum Masters are statistically optimal for twenty Agile teams. They need to know what coordination breaks when the number is wrong.

This reframing accomplishes two things. First, it brings the conversation back to the level at which sponsors actually make decisions: tradeoffs between business outcomes and business risks. Second, it builds transformation literacy in the sponsor over time, almost as a byproduct. By the third or fourth iteration of business-risk-framed conversations, the sponsor begins to ask the right questions on their own.

In practice, this happens through small but deliberate moves. When the sponsor asks why a phase needs the time it takes, the program lead names two or three things that could go wrong if the time is cut and what each would cost the business. When the sponsor asks why a role is needed, the program lead names the work that would not get done without it. Every delivery-practice question gets converted into a business-risk answer.

The program leadership team’s job is not to make the sponsor an expert in SAP delivery. It is to provide enough transformation context so that executive decisions reflect both business priorities and implementation realities.

There are a few phrases I have used with executive sponsors over the years that capture the underlying issue. The sharpest one:

If the decision has to go above the sponsor, they are not the sponsor.

Sponsorship is defined by what the sponsor can decide without asking someone else. That is the test. Anything else is the appearance of sponsorship, not the substance.

For CIOs supporting enterprise transformation, the implication is direct. Sponsor selection, or sponsor preparation when selection is not an option, is not a hierarchy question. It is a transformation capability question. The same execution discipline that goes into defining decision rights, structuring governance and protecting delivery momentum should apply, with equal rigor, to assessing sponsor fit and building sponsor literacy before the program begins.

A sponsor does not need to be the technical expert. They do need to know when to trust the people who are.

This article is published as part of the Foundry Expert Contributor Network.
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Die Debatte über (generative) künstliche Intelligenz (KI) fokussiert sich meist auf die Produktivität des Einzelnen – und die Zahlen hierzu sind bemerkenswert. So zeigte ein großangelegtes Feldexperiment der Harvard Business School in Zusammenarbeit mit der Boston Consulting Group, dass der Einsatz generativer KI bei Wissensaufgaben sowohl die Ergebnisqualität als auch die Bearbeitungsgeschwindigkeit signifikant verbessert. Dabei ist der Nivellierungseffekt besonders beachtlich:

• Während erfahrene Fachkräfte ihre Leistung um rund 17 Prozent steigerten,
• lagen die Verbesserungen bei den schwächeren Teilnehmern bei über 40 Prozent.

Diese individuellen Produktivitätsgewinne übertragen sich jedoch nicht automatisch in gleichem Maße auf die Organisationsebene. Unternehmen schaffen nicht bloß durch die isolierte Performance Einzelner Wert, sondern vor allem durch die Fähigkeit, Wissen zu bündeln, komplexe Entscheidungen zu treffen und gemeinsam Innovationen hervorzubringen.

Wenn jedes Teammitglied zunehmend mit seinem eigenen KI-Assistenten interagiert, kann dies die Kernmechanismen erfolgreicher Zusammenarbeit beeinträchtigen. Die entscheidende Herausforderung besteht somit darin, den Zuwachs an individueller Produktivität in eine echte organisatorische Leistungssteigerung zu übersetzen.

3 Produktivitäts-Bruchstellen im KI-Zeitalter

Ob aus temporären Effizienzgewinnen nachhaltige Wettbewerbsvorteile entstehen, hängt deshalb maßgeblich davon ab, wie Führungskräfte die folgenden drei Bruchstellen gestalten, die aufeinander aufbauen. Diese repräsentieren jene organisatorischen Übergänge, an denen individuelle Produktivitätsgewinne durch KI in kollektive Leistungsnachteile umschlagen können – wenn sie nicht aktiv gestaltet werden.

1. Bruchstelle: Wissenssicherung

Der Weg zur Seniorität folgte lange einer stabilen Logik: Operative Erfahrung führte zu Expertise, diese wiederum zu Einfluss. Wer über mehr Wissen verfügte, übernahm komplexere Aufgaben und wurde zur zentralen Orientierungsperson im Team. Generative KI bricht diese Logik auf, da weniger erfahrene Mitarbeitende mithilfe von KI-Tools heute Analysen, Konzepte und Problemlösungen in hoher Qualität erstellen können. Ein Teil des traditionellen Wissensvorsprungs erfahrener Kräfte verliert dadurch seine Exklusivität.

Auf diese Weise gerät ein impliziter Erfolgsfaktor von Organisationen ins Wanken: der organische Wissenstransfer. Bislang floss Wissen primär über erfahrene Kräfte, was Mentoring und kollektives Lernen quasi „nebenbei“ sicherstellte. Fällt dieser Austausch weg, weil Aufgaben isoliert im Dialog mit der KI gelöst werden, besteht das Risiko eines doppelten Kompetenzverlusts:

• Beschäftigte in Junior-Rollen können mithilfe von KI überzeugende Ergebnisse liefern, ohne den zugrundeliegenden Lösungsweg vollständig verstehen zu müssen. Der Lerneffekt wird dadurch reduziert und die Fähigkeit zur eigenständigen Problemlösung sowie zur kritischen Validierung der KI-Ergebnisse eingeschränkt. Die Folge ist eine wachsende, unkritische Abhängigkeit von der Technologie.
• Erfahrene Fachkräfte laufen Gefahr, zur rein reaktiven Korrekturinstanz von KI-Ergebnissen zu werden. Ihre Erfahrung fließt dann nicht mehr aktiv in die Gestaltung ein, sondern beschränkt sich zunehmend auf die nachträgliche Qualitätskontrolle. Mögliche Folgen sind Motivationsverlust, mentaler Rückzug der Leistungsträger und der schleichende Verlust des in der Organisation vorhandenen Erfahrungswissens.

Um diesen doppelten Kompetenzverlust zu verhindern, müssen Führungskräfte den Rollenwandel der Seniorität aktiv gestalten. Künftig sollte sich diese nicht mehr primär über exklusives Fachwissen definieren, sondern über die Fähigkeit, die richtigen Fragen zu stellen, Zusammenhänge einzuordnen und Teams bei der kritischen Bewertung von KI-Ergebnissen anzuleiten. Diese Begleitung kann nicht erst im Rahmen der abschließenden Qualitätskontrolle erfolgen, sondern muss bereits während der Arbeit mit KI ansetzen.

Ziel ist es, Wissen, Erfahrungswerte und Kontext kontinuierlich zu vermitteln, die Urteilskraft der Junioren gezielt zu entwickeln und sie schrittweise zu einer eigenständigen Validierung und reflektierten Nutzung von KI-Ergebnissen zu befähigen.Gelingt dieser Rollenwandel nicht, können Teams zwar kurzfristig ihre individuelle Produktivität steigern, verlieren jedoch zunehmend das gemeinsame Verständnis für fachliche Zusammenhänge und den organisatorischen Kontext.

Die durch KI erzielten Produktivitätsgewinne können dann durch Fehlentscheidungen, steigenden Korrekturaufwand und einen schleichenden Qualitätsverlust auf Teamebene wieder aufgezehrt werden. Ohne die systematische Sicherung von Erfahrungswissen zu agieren, heißt, teure Fehler zu produzieren – nur deutlich schneller.

2. Bruchstelle: Qualitätssicherung

Die Herausforderung endet jedoch nicht bei der Wissenssicherung. Sie betrifft im nächsten Schritt auch die Art und Weise, wie Teams die Qualität ihrer Entscheidungen absichern, wenn ein wachsender Teil der Analyse-, Bewertungs- und Wissensarbeit durch KI unterstützt wird. Je mehr Vorarbeit KI übernimmt, desto stärker hängt die Qualität organisatorischer Entscheidungen davon ab, die generierten Ergebnisse kritisch zu überprüfen und einzuordnen.

Eine Besonderheit generativer KI besteht darin, dass ihre Leistungsfähigkeit keiner intuitiven Logik folgt. Die eingangs zitierte Studie beschreibt dieses Phänomen als „Jagged Technological Frontier“: KI-Systeme können bei bestimmten Aufgaben eine Performance auf Expertenniveau erreichen, während sie bei scheinbar ähnlichen Fragestellungen überraschend große Schwächen aufweisen. Die Grenzen dieser Leistungsfähigkeit sind jedoch nicht für jeden Nutzer ohne weiteres erkennbar.

Genau daraus entstehen neue Herausforderungen für Führungskräfte: Mit der Integration von KI in den Arbeitsalltag steigt das Risiko des sogenannten “Automation Bias” (PDF), also der Tendenz, algorithmischen Empfehlungen unkritisch zu vertrauen. Die Gefahr liegt dabei selten in offensichtlichen Fehlern, sondern in plausiblen (aber falschen) Antworten, die überzeugend formuliert sind und deshalb ungeprüft übernommen werden.

Zudem greift ein Beschleunigungseffekt: KI verkürzt den Weg von der Fragestellung bis zum Ergebnis erheblich und damit auch jene Diskussionen, mit denen Teams bislang die Qualität ihrer Entscheidungen abgesichert haben. Wo früher Analysen debattiert und Annahmen abgewogen wurden, liegt heute in Sekunden ein Resultat vor. Das eigentliche Risiko liegt dabei darin, dass Ergebnisse schneller entstehen als sie kritisch überprüft werden können. So ist es möglich, dass Produktivitätsgewinne mit einem Verlust an Ergebnisqualität einhergehen.

Führungskräfte sollten daher Strukturen schaffen, die den Einsatz von KI transparent gestalten und Ergebnisse offen zur Diskussion stellen. KI-generierte Inhalte müssen denselben kritischen Maßstäben unterworfen werden wie die Arbeit eines erfahrenen Teammitglieds. Dazu benötigen Teams Validierungskompetenz, eine Verantwortungskultur und etablierte Prüfprozesse. Die entscheidende Frage sollte daher nicht sein, ob ein Ergebnis vom Menschen oder der Maschine stammt. Sondern, wer dieses auf fachliche Korrektheit überprüft und die Verantwortung für die darauf basierende Entscheidung übernimmt.

KI steigert zwar die Geschwindigkeit – das wird jedoch erst dann zum echten Wettbewerbsvorteil, wenn es mit Urteilskraft und gelebter Accountability einhergeht.

3. Bruchstelle: Innovationssicherung

Wie zuvor beschrieben, kann der Einsatz generativer KI gemeinsame Diskussionen verkürzen, was wiederum die Innovationskraft des Unternehmens belasten kann. KI liefert dabei nicht nur einen ersten Lösungsvorschlag, sondern erhöht zugleich die Wahrscheinlichkeit, dass sich Teams früh auf eine gemeinsame Richtung festlegen. Echte Innovationen entstehen jedoch selten durch schnelle Einigkeit: Sie entstehen durch produktive Reibung, tiefgehende Debatten und dadurch, etablierte Denkmuster zu hinterfragen.

Ein wesentlicher psychologischer Mechanismus dieser frühen Konvergenz ist der sogenannte Ankereffekt: Da KI in Sekundenschnelle plausible Ergebnisse liefert, wirkt dieser erste Entwurf als kognitiver Anker. Das menschliche Gehirn orientiert sich somit unbewusst an diesem Startpunkt, was den Suchraum für alternative Lösungen vorzeitig verengt und so die Innovationsfähigkeit schwächen kann.

Führungskräfte stehen deshalb vor der zusätzlichen Aufgabe, produktiven Widerspruch bewusst zu organisieren. Kritische Rückfragen und konträre Sichtweisen sind das notwendige Gegengewicht zur KI-generierten Konvergenz. Und: Organisationen verlieren selten ihre Innovationskraft, weil ihnen Antworten fehlen. Vielmehr, weil sie aufhören, Alternativen ernsthaft zu diskutieren. Eine höhere Geschwindigkeit im Lösungsprozess führt daher nicht automatisch zu höherer Innovationsfähigkeit.

Entscheidend ist, dass Organisationen weiterhin Räume schaffen, in denen unterschiedliche Perspektiven aufeinandertreffen, bestehende Annahmen hinterfragt werden und neue Ideen entstehen können. Mit anderen Worten: KI erzeugt Konvergenz, Innovation braucht Divergenz.

KI schafft eine neue Realität

Diese drei Bruchstellen verdeutlichen, dass generative KI nicht nur Arbeitsprozesse, sondern auch die Grundlagen organisationaler Leistungsfähigkeit grundlegend verändern kann. Wissen entsteht anders, Entscheidungen werden anders getroffen und Innovation entwickelt sich unter veränderten Voraussetzungen.

Je stärker KI in den Arbeitsalltag integriert wird, desto entscheidender wird es, die genannten Bruchstellen bewusst zu gestalten. Der nachhaltige Nutzen von KI entsteht nicht allein durch den Einsatz der Technologie, sondern durch die Fähigkeit einer Organisation, ihre Strukturen, Lernprozesse und Entscheidungsmechanismen an diese neue Realität anzupassen. (fm)

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A new attack method found by Zenity Labs reveals that AI agents are becoming persistent insiders that attackers can recruit, rather than malware they have to install.

Its researchers have discovered AgentForger, a phishing-based attack that silently creates and launches a fully autonomous AI agent within OpenAI workspaces.

Once running, the agent has full access to apps like Outlook, Slack, SharePoint, and Google Drive. It is configured to operate indefinitely without further user interaction, can approve its own access by toggling “never ask” settings, and can continue to act on new assignments sent via email by the attackers that control it. Broad, unfettered access to systems allows it to perform reconnaissance, harvest sensitive data and credentials, impersonate victims, and launch phishing campaigns.

While OpenAI resolved the vulnerability four days after disclosure, on a larger scale, AgentForger sheds light on what can happen when AI agents go rogue.

“We’re moving into a world where software doesn’t just help people work. It works alongside them,” said Michael Bargury, co-founder and CTO of agentic AI security platform Zenity. “As AI agents become more capable, attackers will naturally look for ways to influence them, just as they’ve always looked for ways to influence people.”

A ‘persistent operator’ that acts without approval

OpenAI’s Workspace Agents can connect and work autonomously across Outlook, Gmail, Slack, Google Drive, SharePoint, and Teams. Users open the agent builder, describe what the agent can do in natural language, connect to tools, set approvals, review and test, schedule actions, then publish. For instance, an agent can autonomously handle incoming emails, review and take actions with approval, gather information from various sources to send out daily briefings, or automatically respond to questions in ChatGPT or Slack channels.

Normally, this is “useful automation,” Zenity AI red team researcher Mike Takahashi wrote in a blog post. But in this attack, “the same scheduler becomes the persistence mechanism.”

The creation workflow kicks off the moment a user clicks on a phishing link containing instructions from the threat actor. For the attack to work, a victim must be logged into ChatGPT and Workspace Agents, and have at least one integration with another app, such as Outlook, Gmail, Slack, Google Drive, SharePoint, or Teams.

Because those connections already exist, OAuth consent screens are not triggered. Furthermore, the victim does not need to click on another link, keep a Builder tab open, or even visit ChatGPT again.

The forged agent is a “persistent operator;” it is installed on the original click and given a schedule, and at those predetermined times, the agent invokes itself, scans for emails from attacker addresses with the subject line “task”, carries those orders out, then returns results to the same attacker-controlled email address.

It goes undetected because the attacker prompt instructs the Builder to toggle Outlook to never ask for approval of its actions. Typically, the default is “always ask,” to keep agents from taking unauthorized action; that switch gives agents the ability to act without asking for human approval.

“AgentForger showed that an attacker could deploy an autonomous insider agent inside your ChatGPT workspace with a single click,” said Bargury. From there, it can continue to access information, harvest credentials from various sources, impersonate employees, and carry out phishing attacks and fraud while “leveraging the trusted victim’s identity.”

A ‘planted accomplice’ that does all the work

Once activated, AgentForger can perform reconnaissance to create an internal map of a company. For instance, agents can scan Outlook, Slack, Teams, Google Drive, SharePoint, or calendar data to identify people, roles, active projects, internal discussions, or all-hands recurring meetings. This can help attackers identify where in the enterprise to target next, based on active teams and channels, projects in the works, or prominent users.

“This is the kind of internal context an attacker normally has to build slowly,” Takahashi noted. But in this scenario, action is based on a single emailed assignment. The attacker’s “planted accomplice” does all the work.

In another scenario, the agent can steal data by searching for and identifying financial documents, business agreements, or invoices. Or, it can steal credentials by scanning for messages containing passwords, one-time codes, access tokens, password recovery links, or API keys. Further, it can impersonate victims to carry out phishing scams, for instance, by sending legitimate-looking Teams messages instructing users to confirm their credentials on a fake Microsoft login page.

In all cases, collected information is organized, analyzed, and sent back to the attacker.

“AgentForger points to something much bigger than a single vulnerability,” said Bargury. “It’s less about one bug and more about understanding how the security model changes as AI becomes part of everyday business operations.”

FOMO exposing security gaps

This isn’t necessarily about trust, but more about the need to move fast and adapt, Bargury emphasized. AI agents are helping employees automate work, make decisions faster, and get more done. But enterprises fear they’ll fall behind if they don’t move quickly enough.

“The challenge is that we’re introducing a fundamentally new kind of technology into the enterprise,” said Bargury. “The pressure to integrate the next AI feature is outpacing the security controls needed to safely deploy it.”

However, the answer isn’t to slow down adoption, he emphasized; the business value is too significant. Rather, the first step is understanding where AI agents exist, who created them, what they’re connected to, and what they’re allowed to do. And when it comes to autonomous agents, enterprises need to pay attention to the processes that trigger them: A schedule, an incoming email, or another automated event.

“Those triggers should be governed just as carefully as the agent itself,” said Bargury.

High-impact actions should require approval where appropriate, and security teams should be able to quickly disable an agent or its triggers if something doesn’t look right, he said.

More broadly, AI agents are introducing the need for a new security model, he pointed out. The question is no longer just “Does this agent have permission?” It’s also, “Is this the behavior we intended?”

“The organizations that answer both questions will be in the strongest position to adopt AI safely,” Bargury said.

Check Point has confirmed that a critical security hole in its SmartConsole management tool, one that allows unauthenticated attackers to assume full admin privileges, is now being exploited in the wild. The vulnerability, CVE-2026-16232, was given a CVSS score of 9.3.

In its security alert, Check Point described the bug as one allowing an unauthenticated attacker to “obtain an application login token and use it to login via SmartConsole with full admin privileges and apply changes to the security policy and security configuration.”

The company has released a patch for the bug and also recommends that users “limit Trusted Clients, GUI clients, to trusted IP addresses/subnets.” That approach has always been a best practice, but practical networking realities today make it challenging to maintain. Check Point said that the exploit has impacted ten of its customers, all of whom it had notified directly.

Far worse than most

Frank Dickson, group VP for security at IDC, said this security hole is far worse than most.

“This hits harder than your average CVE because of where it lives,” he said. “The CVE targets the SmartConsole login on Check Point’s Security Management Server, the console that pushes policy to every gateway underneath it. Popping a gateway gets you one lock picked. Popping the management server is more like finding the One Ring: one stolen token to rule every gateway it manages, no need to fight each one individually. The attacker can rewrite policy, open new VPN paths and kill the logging.”

In an interview with CSO Online, Lotem Finkelstein, vice president of research at Check Point, said that the company learned of the vulnerability on Sunday, emailed customers the same day, and released the patch within 72 hours.

But when his team re-reviewed earlier logs, knowing what to look for, they spotted this hole being attacked as early as April, Finkelstein said.

The fact that, over the course of three months, the team only found ten organizations under attack, indicated that it has been very difficult for the attacker to find vulnerable systems, he noted; customers were, in the main, using secure settings to protect themselves.

Nonetheless, Finkelstein said, Check Point considers this hole to be “a severe vulnerability.”

Challenges of IP address restrictions

While it can be technically challenging to keep the IP address allowlists that Check Point recommends current, given DHCP’s ability to easily change those addresses, Assaf Morag, a cybersecurity researcher at Flare, noted that specifically limiting access to a management console is far more critical than limiting overall external access.

“Implementing Trusted Clients as a per-IP allowlist is impractical,” he said, but that is not the case with restricting management access. “The more scalable solution is to restrict access based on trusted administrative network segments such as VPN pools, management VLANs, or jump hosts rather than maintaining lists of individual DHCP-assigned client addresses,” he explained. “That gives you the security benefit without creating a full-time administrative task. Maintaining allowlists for individual hosts is much more practical when those hosts have stable, predictable IP addresses, rather than dynamically assigned DHCP addresses.”

Pieter Arntz, malware intelligence researcher at Malwarebytes, also noted that the constantly changing nature of global IP addresses can prove annoying to IT teams. Stressing that he is not familiar with Check Point’s specific settings, he noted, “Certain settings are a nuisance when applied strictly, and at some point the IT staff gets tired of constantly tweaking and they abandon the most secure path.”

Ideal platform for long-term attacks

Mike Wilkes, enterprise CISO at Aikido Security,  agreed that the severity and exposure of this hole is alarming.

“This is exactly the kind of vulnerability that keeps CISOs awake at night because it strikes at the one system that is supposed to stand between the attacker and everything else. An authentication bypass that grants administrative control of a perimeter firewall isn’t just another CVE to patch. It’s an invitation for an adversary to rewrite the rules of the network itself,” he said. “The uncomfortable reality is that nobody runs a CrowdStrike agent on their firewall. Once an attacker owns an edge device, they gain a uniquely privileged position that often falls outside the visibility of traditional endpoint security, making it an ideal platform for persistence, credential theft, traffic manipulation, and long-term espionage.”

IDC’s Dickson strongly encouraged CISOs to deploy the patch, not to just change settings to mitigate the issue. 

“Apply the actual hotfix,” he said. “Don’t just restrict Trusted Client IPs and call it done. That’s a stopgap, not a fix. Any internet-facing management console, Check Point or otherwise, is a five-alarm architecture problem independent of this CVE.”

And, he added, “since attackers here can disable logging, audit admin activity going back before the bug surfaced. Quiet logs aren’t proof nothing happened. This is the recurring theme with ‘single pane of glass’ security tools: the console built to make everything easier to run is also the one thing you really don’t want someone else driving.”

AMD executives took to the stage at its Advancing AI 2026 event in San Francisco today to detail the company’s next generation of AI infrastructure solutions, from Instinct MI455X AI accelerator GPUs and 6th Gen EPYC “Venice” CPUs, to Pensando networking, ROCm.AI software and its Helios rack-scale platform that ties it all together.

AMD has been working towards rack-scale AI system solutions for years. Its ZT Systems acquisition last year added valuable engineering talent and intellectual property that is now finally bearing the real fruits. Its Helios AI platform is a major platform evolution for AMD, with shipments scheduled to begin in the second half of this year (which is here and now).

The announcements at Advancing AI show how the company has engineered its AI platform solutions for large reasoning models, sustained inference and agentic workflows. These workloads pressure memory capacity, data movement, networking and CPU orchestration. AMD’s approach is to keep as much data close to the compute engines as possible and move it more efficiently throughout the system, but there’s deeper nuance here that’s obvious versus AMD’s chief rival, NVIDIA.  

AMD’s MI455X targets the AI memory wall

The Instinct MI455X GPU is the compute engine that fuels the Helios rack, and the first GPU based on AMD’s new CDNA 5 architecture. Built with a modular mix of 2nm and 3nm chiplets, it carries 432GB of HBM4 and 23.3TB/s of peak memory bandwidth.

Compared to AMD’s current MI355X, the MI455X offers 1.5 times the memory capacity, up to 2.9 times the peak memory bandwidth and up to four times the peak matrix performance with MXFP4 and MXFP8 data types, which are lower-precision numerical formats designed to accelerate AI processing while reducing memory demands. With MXFP6 (6-bit floating point), performance is rated at up to twice that of MI355X.

AMD also shared some actual, measured internal results using production silicon. The company claims MI455X delivers 3.8 times higher FP8 decode performance, 3.5 times more measured FP4 compute performance and between 2.5 and 3.5 times more networking bandwidth than MI355X, depending on the transfer path tested. Those figures provide more context than just numerical specifications, though they remain AMD-provided comparisons that will need independent validation.

AMD

The architectural choices behind the numbers are important. Reasoning models and long context windows require sizeable KV caches for maintaining AI attention states, while mixture-of-experts models frequently move large amounts of data across accelerators. MI455X should let more model data, activation states and cache remain local. New dedicated IP in hardware can transfer data while the GPU continues processing, and expanded cache and multicast capabilities are designed to reduce redundant data movement to further improve efficiency.

The aforementioned lower-precision formats can also raise throughput and reduce memory use, but model developers still have to determine where they can be applied without unacceptable accuracy loss.

AMD’s Helios rack takes aim at Vera Rubin

Dave Altavilla

Helios is AMD’s primary rack-scale competitor to NVIDIA’s Vera Rubin platform. Each liquid-cooled rack combines 72 MI455X GPUs, 18 single-socket Venice host CPUs and Pensando networking technologies.

In its most complete, premium configuration, AMD rates Helios for 2.9 exaflops of low-precision AI compute, with 31TB of aggregate HBM4 capacity, 1.7PB/s of memory bandwidth, 260TB/s of bidirectional scale-up bandwidth and 43TB/s of scale-out bandwidth.

These are formidable figures, but they are technical specifications rather than actual application benchmarks. The more consequential development is AMD’s move from collections of eight-GPU servers to a 72-GPU shared-memory domain. Models too large for one node can operate across the rack without treating every exchange as a scale-out networking transaction, which benefits large-model inference as well as training.

AMD uses UALink over Ethernet, or UALoE, for an open standard scale-up fabric. Each MI455X provides 3.6TB/s of bidirectional scale-up bandwidth, while the complete rack delivers all-to-all connectivity through a single switch layer. AMD also claims six times more scale-out bandwidth per GPU than MI355X when MI455X is configured with three Pensando Vulcano 800 AI NICs.

While open standards give cloud providers more control over suppliers and system design, AMD and its partners now have to prove those components can deliver the predictable performance, reliability and deployment experience customers expect from a tightly controlled, more vertically integrated platform.

Finally, AMD designed Helios with automatic rerouting around failed links, virtual rack partitions, tray-level serviceability and rack-wide power, cooling and health monitoring. Major hyperscalers and potentially large-scale enterprise customers will likely key in on these capabilities, which can affect the availability, total cost and consistency of the AI services they consume.

Kind of like cowbell, AMD Venice gives agentic AI more CPU

AMD

AMD’s agentic CPU messaging regarding its upcoming Venice-based EPYC processors is mostly marketing speak, but the underlying requirement is very real. An AI agent can invoke retrieval, databases, security checks, code execution and other tools before a GPU generates a response. Running many agents concurrently increases the amount of conventional compute requirements surrounding the accelerators.

Venice scales to 256 Zen 6 cores with support for 512 threads, 16 memory channels, up to 1GB of L3 cache per socket, along with PCIe 6.0 and CXL 3.1 connectivity. AMD is also offering several Venice configurations for other applications, including general-purpose servers, high-frequency workloads, GPU hosts and high-density CPU sandbox systems used to execute agent tools.

Treating the CPU solely as a GPU host understates its role. Gateways, tokenization, vector search, databases and short-lived code execution stress different mixes of per-core performance, thread count, memory bandwidth and I/O. Specifically, AMD’s internal testing shows Venice significantly outperforming its current EPYC 9965 Turin CPU across five parts of the agentic AI pipeline, including gateway processing, context assembly, vector search, enterprise applications and short-lived tool execution. Individual gains vary by workload, but AMD details the overall generational improvement at up to a 1.7 times lift. As with the MI455X figures though, these comparisons come from AMD and will require independent validation.

Pensando networking and ROCm software advance

Keeping GPUs fed with data and coordinating traffic across racks directly affects utilization and operating costs. In fact, GPU utilization is a pretty sad state of affairs currently for some of the major frontier model providers.

As such, Pensando networking has become central to AMD’s roadmap. Helios can connect each MI455X to as many as three 800Gbps Vulcano AI NICs, while Salina DPUs handle front-end networking and infrastructure services.

On the software side, which is an equally critical component, AMD also introduced ROCm.AI, an AI-assisted development layer due to arrive in August. It includes reusable skills for coding agents, simplified management and Hyperloom, which can profile workloads, tune serving configurations, modify kernels and validate results.

These tools address two persistent AMD challenges: developer efficiency and ease of use, and software tuning. Automated optimization still has to produce repeatable gains without creating hard-to-maintain code, however. And while ROCm has progressed significantly over the last few years, NVIDIA’s CUDA retains an advantage in maturity, tooling and developer familiarity.

Customer commitments underscore rack-scale confidence

AMD now has commitments that give its MI450 generation and Helios considerably more weight. Meta and OpenAI have announced multi-generation agreements composed of up to 6GW of AMD compute capacity, with initial 1GW deployments planned for the second half of 2026.

Oracle plans a 50,000-GPU public cloud cluster beginning in the third quarter, while Microsoft will deploy Helios for Azure AI inference. Finally, just before the AMD event, Anthropic announced a strategic partnership for up to 2 Gigawatts of AMD-fueled AI compute, with its first gigawatt expected online in the first half of 2027.

Commitments of this scale reflect confidence in more than just MI455X performance. These customers are evaluating the complete architecture, including Venice CPUs, Pensando networking, ROCm software, rack integration, serviceability and AMD’s ability to deliver and execute across multiple product generations.

There is some financial alignment behind the agreements as well. AMD issued OpenAI performance-based warrants and committed to investing up to $5 billion in Anthropic. That context matters when evaluating these deals as market validation, but these planned deployments are substantial nonetheless and put Helios on a much stronger foundation as it begins shipping.

AMD expands its robotics and embedded foundation

AMD also expanded its physical AI portfolio, building on credible traction from its Xilinx-derived Kria adaptive system-on-modules and embedded technologies that are already powering robotics, machine vision and industrial automation applications.

The new Ryzen AI Embedded X100 combines up to 16 Zen 5 CPU cores, integrated Radeon graphics, a second-generation NPU and as much as 128GB of unified LPDDR5X memory shared across its compute engines. To me this looks a lot like a repackaging and optimization of the company’s Strix Halo platform, but with specific optimizations for the embedded space. Regardless, AMD is pairing X100 with the Kria AI Robotics Developer Platform, which includes a System Module or SOM, and a new Robotics Partner Network spanning hardware, software and platform providers.

Samples began shipping in June, with full production expected in the fourth quarter. This broader objective is to give developers a path across AMD x86 CPUs, GPUs, NPUs and FPGAs for real-time autonomous systems, rather than requiring them to assemble those hardware engines and software components independently.

Execution for AMD is now the test

AMD has assembled a credible platform for the burgeoning agentic AI market that’s blowing up currently with no signs of stopping. MI455X addresses memory and data movement, Venice handles dense agentic CPU workloads, Pensando networking connects global system resources, and ROCm.AI addresses software complexity. Finally, Helios assembles these components into a true competitive threat for NVIDIA’s latest Vera Rubin platform.

AMD’s open architecture may appeal to customers seeking supplier choice, but openness must also translate into reliable deployments, competitive total cost and software that does not require a significant rip-up. NVIDIA enters this cycle with a stronger ecosystem and far more rack-scale deployment experience. The true test will be how easily and reliably customers can integrate, operate and maintain these AMD solutions at scale.

As it stands, AMD now has major customers and a clearly defined architecture with systems engineering expertise behind it. Delivering Helios on schedule and showing that its performance claims translate into a real production workload throughput advantage and total cost of ownership gains will determine how much the competitive gap narrows. And of course, this is in a market that is clamoring for ever-more compute resources with a seemingly insatiable demand for AI services and capacity. That’s an environment for big iron success. Now AMD just has to deliver optimized, turnkey AI platforms. This is far easier said than done, but time will soon tell as deployments take shape this year.

This article is published as part of the Foundry Expert Contributor Network.
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Every CIO I speak with today is wrestling with some version of the same question: How do we move faster with AI and deliver on our commitments?

It’s an understandable concern. Boards and CEOs are asking about AI. Business leaders are experimenting with use cases. Employees are discovering tools daily, while technology vendors promise unprecedented gains in productivity, innovation, and competitive advantage.

After hundreds of conversations with technology executives over the past year, I’ve become convinced that speed isn’t the real issue. The organizations pulling away from the pack aren’t necessarily adopting AI faster than everyone else. They’re executing more effectively — a subtle distinction that represents one of the defining leadership challenges of the AI era.

Technology has never been the hardest part of transformation. People, priorities, culture, and operating models are the biggest challenges. The ability to translate bold boardroom aspirations into thousands of thoughtful decisions made every day by architects, engineers, product managers, analysts, and business leaders is where competitive advantage is created. AI may be accelerating the pace of change, but it hasn’t changed that fundamental truth.

I’ve met plenty of executives who are exceptional in the boardroom. They know how to frame a vision, influence a board, and build confidence among investors and business leaders. I’ve also met remarkable technologists who instinctively understand the architectural decisions, engineering tradeoffs, and implementation details that determine how great ideas become reality. Modern CIOs, however, must move comfortably between both worlds. Afshean Talasaz is one who stands out among this rare breed.

Long before becoming CIO of Colonial Pipeline, Talasaz built his career from the ground up as a business professional, data scientist, and technologist. He has designed enterprise platforms, built AI capabilities, led technology organizations, and partnered closely with executive leadership teams on business transformation. Today, as an executive in residence with our Practitioners for Practitioners (P4P) community, he helps CIOs and business leaders navigate one of the most significant technology shifts of our generation.

While Talasaz brings deep knowledge of data and AI to the table, his greatest strength is his ability to create strategy and connect it with execution. He can spend the morning discussing enterprise reinvention with the board and the afternoon debating architectural principles with the teams responsible for bringing that vision to life.

That versatility gives Talasaz a unique lens on how CIOs can deliver value with AI.

Software companies have a term for engineers who understand every layer of the technology stack: full-stack developers. Listen to Talasaz and it becomes evident that the AI era requires something similar from technology leaders: a full-stack CIO.

The full-stack CIO: Leading with clarity

A full-stack CIO understands how every layer of the enterprise influences the next. They recognize that every strategic priority becomes a portfolio investment, every investment shapes an operating model, every operating model influences architecture, every architecture choice informs product decisions, every product decision shapes engineering priorities.

The best CIOs understand both ends of that journey. The extraordinary ones understand everything in between.

And those who execute best lead with clarity, Talasaz says.

“Everyone, from executives to middle managers to the people writing code, should be able to explain what we’re trying to achieve,” he emphasizes. “Clarity isn’t that we’ve handed out the PowerPoint. It’s that people genuinely understand where we’re going and can articulate it in their own language.”

One of the unintended consequences of the AI boom is that organizations are beginning to confuse activity with alignment. They have AI councils, AI governance committees, AI innovation labs, AI centers of excellence, AI pilots, and AI roadmaps. Yet if you stop ten people in the hallway and ask a deceptively simple question, What business problem are we actually trying to solve? you’ll often hear ten different answers.

As a result, architects optimize for one objective while product teams optimize for another. Business units pursue opportunities that seem perfectly reasonable from their perspective. Engineers make thoughtful technical decisions based on the information available to them. Individually, none of those decisions are necessarily wrong. Collectively, however, they create organizational drift. AI doesn’t create that problem. It simply accelerates the consequences.

And while AI can be a force multiplier for the positive when every decision is guided by a shared understanding of where the organization is headed, it can also be a force multiplier for the negative, resulting in an organization simply moving faster in different directions.

“When we have the fundamentals right, the tech infrastructure, the operating models, the nuances of how our business actually runs, we get the impacts of AI in a positive way,” Talasaz says. “When we don’t have those in place, AI can amplify the gaps or mute the benefits.”

At a time when so much of the conversation surrounding AI is focused on algorithms, agents, and automation, it’s an important reminder that organizations don’t execute strategy; people do.

Reducing organizational friction

Most executives are familiar with the concept of VUCA that characterizes today’s business environment. But Talasaz stresses the importance of turning this concern inward: “If the world outside our organizations is becoming more volatile, uncertain, complex, and ambiguous, what are we, as leaders, doing to the inside of our organizations?”

Leaders spend enormous amounts of time helping their organizations respond to external disruption but comparatively little time asking whether they are inadvertently re-creating those same conditions internally in response to those external needs. Are we reducing uncertainty or introducing more of it? Are we simplifying work or adding unnecessary complexity? Are we helping people focus on what matters most, or asking them to navigate competing priorities and shifting expectations?

Talasaz refers to this phenomenon as double VUCA — something I’ve witnessed repeatedly while working with CIOs over the past decade. Organizations often assume they’re struggling because of technology limitations when the real constraint is organizational friction. Teams wait for decisions. Priorities shift faster than roadmaps. Governance grows heavier. New committees are formed to solve problems created by existing committees. Everyone is working harder, yet the organization somehow feels slower.

AI amplifies both outcomes. Organizations with clarity become dramatically more effective because AI accelerates good decisions. Organizations without clarity simply accelerate confusion.

Operating model as strategy enabler

AI governance is one way to achieve greater clarity, but as Talasaz says, governance shouldn’t primarily exist inside policy manuals that few people read.

Instead, AI governance should be embedded in the daily rhythms of the organization, shaping how teams collaborate, how decisions are made, how products move from ideas into production, and how innovation happens safely without requiring constant escalation. In other words, it’s all about your operating model.

“If you had to pick one thing that isn’t technology, your operating model is the most important element for executing data and AI at scale,” he says.

The best operating models create enough clarity that capable people can make thousands of decisions independently and confidently, without having to wait for permission. By embedding good governance into the way it works, the organization becomes faster.

This advice echoes something I’ve heard repeatedly from some of the world’s most respected CIOs: High-performing organizations aren’t built on tighter control; they’re built on greater trust, supported by clear principles, shared expectations, and operating models that enable responsible decision-making at every level of the enterprise.

Talasaz points out that technology leaders tend to speak in terms of transformation. He suggests CIOs consider a different word: reinvention.

As he explains, transformation implies replacing what exists today with something new. Reinvention starts with a more clear-eyed and practical premise: Some things absolutely must change; others represent years, sometimes decades, of accumulated expertise, customer trust, operational discipline, and competitive advantage.

Reinvention is about building on those strengths while also creating new ways to deliver value. The leaders making the greatest progress in their AI journeys seem to recognize that it’s less about abandoning the past than thoughtfully preparing the organization for the future.

Closing the gap between strategy and execution

Full-stack CIOs must be able to map out the various layers of execution and planning that need to be done at every level of the organization to be successful. To help with this, Talasaz has developed a data and AI framework that draws on his own experiences “from the keyboard to the boardroom.”

As Talasaz sees it, too many organizations have been doing good work in isolation. “They’re doing a lot of the right things,” he says. “They’re just not connected.”

Boards may be discussing growth while business leaders redesign customer experiences. Product teams may be prioritizing new capabilities while architects modernize platforms. Data teams may be improving quality while engineers focus on delivery. Every group makes meaningful progress within its own domain, yet somewhere between strategy and execution, the connective tissue begins to disappear. Talasaz’s framework brings those connecting points to the forefront.

Crucially, the framework doesn’t begin with technology or AI or even with data. It begins with the experiences the organization hopes to create for its customers, employees, or partners. Many AI initiatives start with the question, “What can this technology do?” And indeed, we need to be inspired by the possibilities and challenged to think differently by what the technology can do. But, Talasaz emphasizes, we also need to ask what experiences we need to deliver for our business and how the technology can make that a reality.

The framework challenges CIOs to answer that question first. Only after the experiences are clearly defined does the conversation move to the capabilities required to deliver it, the business activities that support those capabilities, the AI and data products that enable them, and finally the data foundation that makes everything possible.

This shift in perspective ensures that, rather than allowing technology investments to search for business value, the business experience defines the technology required to deliver it. For CIOs, that’s more than a planning exercise. It’s a fundamentally different way of leading.

Over the coming months, the P4P community will be convening a series of small CxO roundtables to explore these issues and work more deeply with Afshean Talasaz’s 6×6 Data and AI Framework. CIOs and other enterprise leaders interested in participating are welcome to reach out to me directly.

Healthy software companies typically don’t suddenly eliminate one-fifth of their workforce, but monday.com is doing just that as it bets on flatter teams, AI agents, and customer implementation expertise as the winning combination in the AI era.

Monday.com co-founder and co-CEO Eran Zinman today announced the “very difficult decision” to reduce the AI work platform company’s global workforce by about 20%, or 620 people.

The move has nothing to do with increasing margins or replacing humans with AI, he insisted in his post on LinkedIn; rather, it’s a calculated decision to trim down and hone the company’s focus as AI becomes integral to day-to-day workflows.

“This is not a distress signal; it is a deliberate reset, disclosed with its price attached,” said Sanchit Vir Gogia, chief analyst at Greyhound Research. “The industry has quietly swapped the meaning of productivity, and this filing is the clearest exhibit yet.”

A ‘significant opportunity’ in technology

In a SEC filing this week, monday.com said its restructuring plan reflects the “ongoing transformation of its product, marketing, and go-to-market strategy.” The move is intended to support a “leaner, more focused operating model” as the company continues to invest in its AI-driven strategy.

Zinman noted in his post that the company has shifted to “doing the work with AI and not just managing it,” and is focused on building environments where “people and AI agents [work] together in one workspace.”

In recent months, monday.com has evolved its products, strategy, and the way it serves its customers, and Zinman contended that “the organization we built for our previous chapter is not the organization that fits the new AI era.” Monday.com needs to “execute more decisively,” take on new challenges, and quickly respond to market changes, he said.

“We have never seen such a significant opportunity in software, driven by such exciting technology,” Zinman noted. He emphasized that the reduction is not to replace people with AI, nor to improve margins; the “vast majority” of savings will be reinvested into talent, products, and AI.

The restructuring will result in a “flatter organization” with fewer management layers and smaller, more autonomous teams, and monday.com also has a new go-to-market model, Zinman explained. Customers expect “deeper implementation support” as they deploy AI, and the company will work more closely with customers, increase its on-site presence, create new roles, and “adapt many existing ones.” In its SEC filing, the company said it expects to continue hiring in “key strategic areas” throughout 2026.

Workers will be expected to work better, “not harder,” Zinman noted. He pointed to several past examples where work could have been done in a few days, but instead took many months with “multiple meetings and endless friction.”

“This wasn’t people’s fault and everyone was frustrated by this,” he said. “Our new org changes ownership to allow people to make decisions and move fast.”

A spokesperson for monday.com declined to comment further on the staff reductions.

Monday.com’s key market advantages

Monday.com certainly isn’t struggling; the company expects 19% to 20% year-over-year growth in 2026.

“Companies in that position do not restructure because they must,” Greyhound’s Gogia noted. “They restructure because they have decided to become something else.”

Melody Brue, VP and principal analyst at Moor Insights & Strategy, pointed out that organizational redesign is important for real AI transformation, but while it can signal confidence to the market, it can still be “devastating” to humans.

While the company looks as though it’s trying to do right, that ultimately remains to be seen, she said. “There are often hidden internal bruises that can surface long after layoffs.”

Monday.com’s advantage is in its “structured substrate,” Gogia noted; its boards, permissions and typed workflows give agents something firmer to act on than just documents and chat history. The company highlights its natively built agents that can be configured by any team member, as well as connectors with Claude, Microsoft Copilot, and ChatGPT, and dedicated routes for external agents to authenticate and operate.

“For some time, the sharper enterprise question has been shifting from who has an agent to who owns the governed runtime in which an agent can safely act,” he said. “Structured work is a serious claim on that runtime.”

But parts of monday.com’s agent estate remain in staged release, and its product is ultimately “mid-transition,” Gogia pointed out; its agent builder carried a beta label as recently as March,. Also, the company’s pricing model changed in May to a hybrid model charging for seats as well as mandatory AI credits. And, while its AI-powered no-code builder monday vibe passed $1 million in annual recurring revenue within two and a half months, monday.com has not released subsequent outcomes, usage volumes, or attach rates.

Further, there’s an element of “gravity” with its competitors, he observed. Asana is reorganizing teams around agents, Atlassian is wiring agents into the developer estate, and others are simply bundling them into their offerings: Microsoft is doing so across the productivity stack, and ServiceNow across enterprise operations, each with identity and procurement built in.

“Their pull is strongest exactly where monday.com wants to grow, in the largest accounts, where control-plane depth and administrative reach decide the deal,” said Gogia.

Actions for the near-term

Going forward, buyers should focus on operating risk, not headline risk, Moor’s Brue noted. In practice, that’s continuity of service, roadmap consistency, and strength of enterprise support. Productivity should be valued as better outcomes per unit of organizational effort, not mere activity.

“It should be a measure of how much smoother, faster, and more effective the operating model becomes when AI is built into the work,” said Brue.

Gogia noted that strain surfaces first in customer service, and monday.com’s attention is being redistributed. The company’s annual report disclosed that its focus is now concentrated on the largest accounts, with support for medium-sized clients moved to an AI-first and human-supported model.

During the first month of the transition, buyers should track named account continuity and escalation times, he advised. By the first quarter, keep an eye on whether credit governance and admin controls mature on schedule, and if the roadmap beyond the AI estate keeps pace. By the half-year mark, determine whether promised implementation depth is producing outcomes or “simply more billable engagement.”

Support tiers should be enumerated in writing before renewal, and buyers should contract for “side exits,” Gogia emphasized, with overage pricing fixed in advance, the right to pause consumption, and portability for workflows and agent configuration “if the relationship sours.” Finance should also insist on monthly consumption reporting by capability. Further, integration efforts, partner dependency, and change management should be considered first-class costs of the agent era, “not as afterthoughts to a license.”

“A license was a known cost,” said Gogia. “A meter is a behavior, and behavior is harder to forecast than headcount.”

This article originally appeared on CIO.com.

Healthy software companies typically don’t suddenly eliminate one-fifth of their workforce, but monday.com is doing just that as it bets on flatter teams, AI agents, and customer implementation expertise as the winning combination in the AI era.

Monday.com co-founder and co-CEO Eran Zinman today announced the “very difficult decision” to reduce the AI work platform company’s global workforce by about 20%, or 620 people.

The move has nothing to do with increasing margins or replacing humans with AI, he insisted in his post on LinkedIn; rather, it’s a calculated decision to trim down and hone the company’s focus as AI becomes integral to day-to-day workflows.

“This is not a distress signal; it is a deliberate reset, disclosed with its price attached,” said Sanchit Vir Gogia, chief analyst at Greyhound Research. “The industry has quietly swapped the meaning of productivity, and this filing is the clearest exhibit yet.”

A ‘significant opportunity’ in technology

In a SEC filing this week, monday.com said its restructuring plan reflects the “ongoing transformation of its product, marketing, and go-to-market strategy.” The move is intended to support a “leaner, more focused operating model” as the company continues to invest in its AI-driven strategy.

Zinman noted in his post that the company has shifted to “doing the work with AI and not just managing it,” and is focused on building environments where “people and AI agents [work] together in one workspace.”

In recent months, monday.com has evolved its products, strategy, and the way it serves its customers, and Zinman contended that “the organization we built for our previous chapter is not the organization that fits the new AI era.” Monday.com needs to “execute more decisively,” take on new challenges, and quickly respond to market changes, he said.

“We have never seen such a significant opportunity in software, driven by such exciting technology,” Zinman noted. He emphasized that the reduction is not to replace people with AI, nor to improve margins; the “vast majority” of savings will be reinvested into talent, products, and AI.

The restructuring will result in a “flatter organization” with fewer management layers and smaller, more autonomous teams, and monday.com also has a new go-to-market model, Zinman explained. Customers expect “deeper implementation support” as they deploy AI, and the company will work more closely with customers, increase its on-site presence, create new roles, and “adapt many existing ones.” In its SEC filing, the company said it expects to continue hiring in “key strategic areas” throughout 2026.

Workers will be expected to work better, “not harder,” Zinman noted. He pointed to several past examples where work could have been done in a few days, but instead took many months with “multiple meetings and endless friction.”

“This wasn’t people’s fault and everyone was frustrated by this,” he said. “Our new org changes ownership to allow people to make decisions and move fast.”

A spokesperson for monday.com declined to comment further on the staff reductions.

Monday’s key market advantages

Monday.com certainly isn’t struggling; the company expects 19% to 20% year-over-year growth in 2026.

“Companies in that position do not restructure because they must,” Greyhound’s Gogia noted. “They restructure because they have decided to become something else.”

Melody Brue, VP and principal analyst at Moor Insights & Strategy, pointed out that organizational redesign is important for real AI transformation, but while it can signal confidence to the market, it can still be “devastating” to humans.

While the company looks as though it’s trying to do right, that ultimately remains to be seen, she said. “There are often hidden internal bruises that can surface long after layoffs.”

Monday.com’s advantage is in its “structured substrate,” Gogia noted; its boards, permissions and typed workflows give agents something firmer to act on than just documents and chat history. The company highlights its natively built agents that can be configured by any team member, as well as connectors with Claude, Microsoft Copilot, and ChatGPT, and dedicated routes for external agents to authenticate and operate.

“For some time, the sharper enterprise question has been shifting from who has an agent to who owns the governed runtime in which an agent can safely act,” he said. “Structured work is a serious claim on that runtime.”

But parts of monday.com’s agent estate remain in staged release, and its product is ultimately “mid-transition,” Gogia pointed out; its agent builder carried a beta label as recently as March,. Also, the company’s pricing model changed in May to a hybrid model charging for seats as well as mandatory AI credits. And, while its AI-powered no-code builder monday vibe passed $1 million in annual recurring revenue within two and a half months, monday.com has not released subsequent outcomes, usage volumes, or attach rates.

Further, there’s an element of “gravity” with its competitors, he observed. Asana is reorganizing teams around agents, Atlassian is wiring agents into the developer estate, and others are simply bundling them into their offerings: Microsoft is doing so across the productivity stack, and ServiceNow across enterprise operations, each with identity and procurement built in.

“Their pull is strongest exactly where monday.com wants to grow, in the largest accounts, where control-plane depth and administrative reach decide the deal,” said Gogia.

Actions for the near-term

Going forward, buyers should focus on operating risk, not headline risk, Moor’s Brue noted. In practice, that’s continuity of service, roadmap consistency, and strength of enterprise support. Productivity should be valued as better outcomes per unit of organizational effort, not mere activity.

“It should be a measure of how much smoother, faster, and more effective the operating model becomes when AI is built into the work,” said Brue.

Gogia noted that strain surfaces first in customer service, and monday.com’s attention is being redistributed. The company’s annual report disclosed that its focus is now concentrated on the largest accounts, with support for medium-sized clients moved to an AI-first and human-supported model.

During the first month of the transition, buyers should track named account continuity and escalation times, he advised. By the first quarter, keep an eye on whether credit governance and admin controls mature on schedule, and if the roadmap beyond the AI estate keeps pace. By the half-year mark, determine whether promised implementation depth is producing outcomes or “simply more billable engagement.”

Support tiers should be enumerated in writing before renewal, and buyers should contract for “side exits,” Gogia emphasized, with overage pricing fixed in advance, the right to pause consumption, and portability for workflows and agent configuration “if the relationship sours.” Finance should also insist on monthly consumption reporting by capability. Further, integration efforts, partner dependency, and change management should be considered first-class costs of the agent era, “not as afterthoughts to a license.”

“A license was a known cost,” said Gogia. “A meter is a behavior, and behavior is harder to forecast than headcount.”

A global law enforcement crackdown has seized infrastructure serving the massive phishing-as-a-service (PhaaS) group Kratos, as well resulting in the arrest of an unnamed Kratos “developer and technical administrator” in Indonesia. 

The effort was managed by German law enforcement and involved agencies from the US, Indonesia and other countries.

Although a German statement claimed that the Kratos infrastructure “has been completely disabled” and that “Kratos-supported phishing campaigns can no longer be carried out,” cybersecurity analysts and consultants question how much of a dent in enterprise phishing activity will result, and how long it will last.

“A server seizure and a single arrest overseas remove infrastructure, not the intellectual property,” said Frank Dickson, group VP for security at IDC. “PhaaS kits get cloned, forked and resold routinely, and the 1,800 Kratos customers didn’t vanish. They just lost a vendor in a market where vendors get replaced fast.”

He added, “seizing 200-plus servers and arresting the developer pulls a major supplier out of that specific niche. It doesn’t touch the broader phishing economy. For every roach that you squish, there are a hundred that you do not see.”

Noah Kenney, principal consultant at Digital 520, takes an even more pessimistic view, arguing that there might not even be that much of a short-term phishing slowdown. 

“What makes this different from a botnet or ransomware takedown is that the people running the attacks were never part of the organization. Kratos was just a vendor,” Kenney said. “The 1,800 customers who bought it still have their target lists, their sending infrastructure and whatever access they had already established. The tooling went dark, but the people phishing your employees last week are still working, shopping for a replacement that already exists. Enterprises should not read this as a drop in (likely) threat volume.”

One thing that the security community seems to agree on is that Kratos was a major player in the lucrative PhaaS space. But precisely determining the percentage of PhaaS activity controlled by Kratos is impossible, given that Kratos sold their kits to others. Security researchers even disagree on what they should call Kratos kits.

“Microsoft tracks this kit as SneakyLog, others tie it to Sneaky 2FA, and KnowBe4 disputes the lineage entirely. When the security industry cannot agree on what a kit is to be called, that is because renaming and reselling is continuous rather than something that happens after a raid,” Kenney said. “What actually changed this time is the arrest and the [shutdown of the] servers. Standing up new hosting is only a weekend of work, but replacing a developer who understood how to keep an adversary in the middle proxy stable and evasive at scale is harder.”

IDC’s Dickson added that the biggest value from the takedown is in the information gleaned from the seized servers. 

“Kratos operated in the adversary-in-the-middle category, generating convincing fake Microsoft 365 login pages that harvest session tokens and step past MFA, the exact technique behind a lot of the business email compromise activity of the past two years,” he said. “I would love to see what law enforcement does with the customer list. That, my friend, is gold.”

Regardless, Assaf Morag, a cybersecurity researcher at Flare, dubbed the German crackdown “symbolic,” given Kratos’ reach within phishing circles. 

He argued that the very nature of software makes it all but impossible to shut down in a meaningful way.

“Although this is malicious infrastructure, it is still software, and modern development and deployment practices make it relatively quick to rebuild or replicate,” he said. “Demand is likely to shift to competing providers, allowing the ecosystem to recover even if this particular operation has been disrupted.”

Pieter Arntz, malware intelligence researcher at Malwarebytes, agreed that the crackdown is disruptive but not definitive. 

“This appears to be more than a routine website seizure. The reporting points to a PhaaS platform with centralized infrastructure, subscription-style customers, and Microsoft 365 session theft / MFA-bypass tooling, so taking down the backend likely hurts many downstream affiliates at once. In that sense, it is a meaningful disruption to the phishing ecosystem, not just one campaign,” Arntz said.

But, he added, “a rebrand or partial re-emergence is plausible, which is the historical pattern for PhaaS operations. Even if the core infrastructure is gone, the code, customer lists, and operator tradecraft can survive.”

This means that customers and affiliates can shift to other phishing kits, he said, so it’s likely that the takedown will create a temporary decline in Kratos-specific activity, but probably not a lasting reduction in phishing overall.

Flavio Villanustre, CISO for the LexisNexis Risk Solutions Group, also concluded that the impact of this crackdown will be short-lived. 

“For each criminal organization that is dismantled, ten new ones pop out of nowhere. Unless there is a coordinated international effort by more than a few countries, this is a whack-a-mole exercise,” he said. “These are all loosely connected individuals and akin to a lernaean hydra, with two heads growing whenever you chop off one. Their leadership emerges from their lines organically without a real center of control. This makes it almost impossible to completely eliminate these criminal organizations.”

At Cisco, VP of engineering Jason Andrews deals with all the same technical issues as every other company deploying AI, including ensuring it’s governed, secure, and integrating multiple data sources, legacy systems, and AI models.

But these issues are relatively straightforward compared to the bigger challenges relating to the fast pace of change, specifically how AI can touch and transform nearly every aspect of business.

“We’re thinking about it every day,” he says. “My belief is we’ll be seeing a massive acceleration of everything.”

In coding, for example, he’s witnessing productivity increases up to 110% with AI assistants. “I can build apps or custom integrations a lot faster,” he adds.

And the real benefit of AI isn’t just in speeding up individual steps in a process, but in making AI the core of a new business process. But building it from scratch puts even more pressure on organizations trying to get employees up to speed on new ways of doing things.

“We want to move fast, train people, and get them onboarded,” he says. “But what I thought AI was going to do for my organization nine months ago is different from three months ago.” So by the time something is rolled out, it’s changed three times.

“I struggle with the change management aspect,” he says. “The legacy model of change management isn’t fast enough. How do you create that constant learning?”

One of the ways Cisco approaches it is to create communities where people can talk about these issues and share best practices and governance, and you have to keep people’s minds open that every day is going to be different than the last, Andrews adds.

Testing the AI waters

Cisco isn’t the only organization struggling with change management in the face of the AI tsunami. In a survey of 2,000 global CEOs IBM released in May, 83% of them said AI success depends more on adoption than on the technology itself, and 77% said talent and technology roles are converging.

“Thanks to Claude Code, our entire development cadence is exponentially greater than a year ago,” says Andrew Johnson, CIO at Brownstein Hyatt Farber Schreck, a Denver-based law firm with about 700 employees and clients around the US. But, as with Cisco, the biggest challenge isn’t technical.

“In our industry, with our circumstances, we’re probably less constrained by technical capability than organizational constraints, culture, aptitude, the need to bind people to technology, and what helps me and the client,” he says. “There’s a tremendous amount of cultural shift that has to happen in our organization, which is far more demanding of my attention and complexity of thought than the technical stuff.”

Companies that bill by the hour, such as law firms, may face additional challenges as attorney productivity increases because billable hours might go down. Alternatively, the total number of cases could go up as litigation becomes less expensive. Either way, firms that adapt will see competitive advantage, and the rest will fall behind, putting more pressure on the need for change management.

“If people can’t embrace technology, we won’t be able to get a lot of value out of it,” says Johnson. “I’m talking to people about adapting their way of work. There are certainly a lot of people intrigued and anxious to dive in. They recognize the connection between the potential of the technology and what we do.”

But helping everyone see that connection and then working with them to change their habits is difficult, and requires solid relationships and good communications. “That’s been far more of a bottleneck for us,” he says.

To address the issue, the firm has developed a network of technology champions who also understand the legal side of the business. “Now we need lawyers who know how to use the technology and can articulate these things to the people we’re trying to reach,” Johnson says.

But change management is only one leadership bottleneck slowing AI adoption. Companies also struggle with figuring out their vision for AI, with slow decision-making, and a tendency to focus on the past instead of the future.

Vision and strategy

In another survey, this time of 950 business leaders released by Grant Thornton in April, 51% said strategy is the biggest driver of ROI when it comes to AI adoption, but 79% of operations leaders said they don’t have a fully developed and implemented AI strategy.

“Having leadership understanding why AI is needed and what objective they’re trying to achieve is very important,” says Shivi Verma, senior manager of engineering at Docusign. “Sometimes leadership doesn’t have a strategy for their organization on how AI should be adopted. Many times it’s bottom-up, which creates a chaotic experience.”

When Docusign started adopting gen AI, different teams and organizational units wanted to go in different directions. “All were coming up with their own strategy and tooling,” he says. So Docusign brought business leaders together to understand the pain points, and decide on the technology.

“Getting requirements and placing a bet on a specific technology was important,” he says, “as well as pivoting to a different technology if needed.”

In order to adapt to changes, the company wanted to have a nimble approach, starting with smaller use cases, with power users, and problem areas.

“We try to plan for four to six months,” he adds. “We set expectations for our leadership that we place a bet with a specific technology, but want to be able to pivot.”

Today, the leadership challenge front lines have moved yet again, to agentic AI. “Folks are creating their own agents and deciding their own permissions,” Verma adds. “We’re still coming up with a governance strategy.”

Slow decision-making

When it comes to AI deployments, Dan Diasio, global AI consulting leader at EY and CTO for its US consulting business, admits he’s a bottleneck.

There’s a great deal of interest in what AI can do, and using a variety of new AI tools. But since the firm deals with sensitive client data, safety is paramount. It’s a slow process, but important to build secure infrastructure, and to have trust in the technology. “That’s a reasonable bottleneck that makes sense,” he says.

Trust in the tools they work with is essential because clients expect it. “Every tool we use has to go through a detailed security and information privacy impact assessment, as well as a whole other set of controls so they can be used appropriately and safely,” he says.

These reviews can take a lot of time, though, and in the age of AI, speed is a highly valued currency. So how do you balance the two, when safety reviews can require input from a lot of different stakeholders and be extremely time intensive?

“We’ve stood up a team to be able to quickly certify and address a variety of platforms,” Diasio says. “Instead of working with different departments in the way we used to, we’ve started identifying representatives from different departments into a cohort. Decisions we used to make in months now take weeks.”

According to a West Monroe survey of more than 1,200 leaders released earlier this year, slow decision-making is already showing up on the bottom line. Nearly three out of four leaders said their organizations lose up to 5% of annual revenue to slow decision-making and delayed execution.

And the top reasons for the delays? According to 40% of the managers surveyed, the problem was the skills gaps of overwhelmed teams, and 35% pointed to layers of management or approvals. Nearly half said they’re spending 10 to 25% of their time on rework, excessive approvals, and unnecessary meetings, and more than half say up to 50% of their projects fail or lose momentum to delays.

Focus on the future, not the past

When it comes to the decision about where to apply AI in an organization, the tendency, Diasio says, is to turn to the experts with the most expertise in the business. But these are the same people most likely to focus on improving on what they’re already doing.

“And that often blinds people to what’s possible in the future,” he says. “That becomes a significant bottleneck.” So the solution is to revamp the decision-making process around the new reality.

“What we see some advanced companies do is give people who don’t understand the process but understand the technology equal footing with people who don’t understand the technology but understand the process,” he says. “A lot of companies are disproportionately focused on just addressing their operating model right now.”

Instead of focusing on what they’re currently doing, AI-native companies will start with a focus on the customer, he says. This shift in focus isn’t likely to show up immediately on the bottom line, or result in the highest possible number of pilots going into production.

“If leaders are in a position where they’re justifying the use of a technology to the board or their CFO, they become a bottleneck when they start demonstrating their value in terms of the number of things they’re doing,” Diasio says.

But 150 or 200 use cases deployed into production may feel like progress, like things are happening in the organization. But all these use cases are a waste of time and money if they’re applied to existing processes that don’t move the needle. “We see that happen in organizations today,” he says. “Maybe we need to reinvent the processes.”

It’s no secret that companies will need to change in order to adapt to AI. Deloitte recently surveyed 660 global technology leaders and 81% said their current operating model can deploy and govern AI enterprise-wide, but 75% also said their organization must change its operating model within the next 12 to 18 months to drive greater value.

AI ROI is real, says China Widener, Deloitte vice chair and US tech, media, and telecom industry leader. But it’s currently weighted toward efficiency gains, with broader business transformation and revenue upside still developing.

Another Deloitte survey showed that the clearest results from AI were in productivity, with 66% of organizations reporting gains, and cost efficiency, with 40% saying AI reduces costs. “However, revenue impact is still emerging,” says Widener. “Only one in five companies says AI is driving top-line growth today.” But optimism prevails, with 74% expecting it to do so in the future.

When Anthropic unveiled Project Glasswing and the Mythos model, much of the discussion focused on the capabilities themselves.

Security leaders debated what these systems could mean for vulnerability discovery, exploit development and the pace of offensive innovation. Researchers examined technical benchmarks. Industry observers questioned how quickly these capabilities might fall into attackers’ hands.

Those conversations are important. They also point to a larger question that predominates my discussions with CISOs: How much time do we have?

Over the past year, conversations about AI in cybersecurity have changed noticeably. Twelve months ago, security leaders wanted to understand whether AI could meaningfully improve security operations. They wanted to know whether it could accurately investigate alerts, reduce analyst workload and operate reliably in production environments.

Today, security leaders are asking about timelines, implementation, how quickly AI is changing the threat landscape and what that means for how security teams operate.

Anthropic’s Mythos and Glasswing, OpenAI’s Daybreak and advances in DeepSeek accelerate those conversations. Each development provides another glimpse into the pace at which AI capabilities are advancing.

AI now reasons through security problems that historically required highly specialized expertise. The implications span vulnerability discovery, attack-path analysis, reconnaissance, social engineering and security operations.

The shift reflects a broader reality: cybersecurity is entering a period where the pace of adaptation may matter as much as the quality of defenses themselves. AI is accelerating both offense and defense simultaneously. Organizations are quickly redesigning security operations around that reality.

One consequence is becoming increasingly visible. For years, cybersecurity teams invested enormous effort in discovering threats, identifying vulnerabilities, gathering telemetry and collecting intelligence. AI is accelerating many of those activities simultaneously. Visibility is improving. Discovery is accelerating. Investigations are becoming faster and more comprehensive.

The bottleneck is beginning to move. The challenge increasingly centers on how quickly organizations can act on what they know. The organizations that gain an advantage may not be the ones with the most information. They will be the ones who can operationalize that information the fastest.

The timeline is compressing

Cybersecurity has experienced many major technology transitions. Cloud computing changed infrastructure. Mobile devices expanded the attack surface. Digital transformation connected systems that were previously isolated.

AI introduces a different dynamic.

Most technology transitions unfolded over years. Organizations had time to evaluate, pilot, deploy and gradually adapt operating models.

The current AI cycle moves at a different pace.

Capabilities improve continuously. New models arrive every few months. New research emerges every few weeks. Security teams absorb developments at the same time attackers do.

Vulnerability discovery provides a useful example. Security teams have long operated around a familiar cycle of discovery, validation, remediation and protection. AI systems accelerate every stage of that process. Similar patterns exist in phishing, reconnaissance, social engineering and attack planning.

A vulnerability that once moved through that cycle over weeks increasingly now moves through those stages in days or, in some cases, hours.

Attackers are already operating at the speed of AI. Defenders are now focused on reaching the same level of operational speed.

This shift is changing the questions CISOs ask.

Early discussions focused on capability. Could AI investigate alerts accurately? Could it operate reliably in production environments? Could it be trusted with meaningful security work?

As organizations gained experience with AI, the discussion shifted toward implementation. Security teams began evaluating where AI could create operational leverage and how quickly they could deploy it into existing workflows.

Today, many CISOs are focused on timing.

The pace of advancement is influencing planning horizons, budget decisions and operating-model discussions. Security leaders are evaluating how quickly they can introduce AI into investigations, threat hunting, detection engineering and response workflows. Boards are asking questions. Executive teams are paying attention.

Security programs that once viewed AI as a future initiative increasingly view it as a current operational priority.

The industry is moving from evaluating AI as a technology to incorporating AI as a security capability.

The timeline compression creates pressure on the traditional security operations model. Investigation speed, response speed and defensive coverage increasingly determine whether organizations can keep pace with adversaries operating with AI assistance.

Security operations are entering a new phase

The impact of AI is becoming particularly visible inside the SOC.

Many security operations centers were built around a straightforward assumption: alerts flow to human analysts who conduct investigations. Operational capacity scales primarily through hiring.

The volume of security data, the number of alerts and the complexity of modern environments have steadily increased. Security teams have responded by building processes, adding tools and creating specialized analyst roles.

AI introduces a new source of operational capacity.

Investigations that require analysts to examine dozens or hundreds of artifacts across endpoint, identity, cloud, network and email systems can now be performed in minutes. Analysts gain access to investigative depth and consistency that would be difficult to achieve manually at scale.

Many security leaders now view this capability through the lens of operating model design. They are examining how investigations are performed, how work is distributed and where human expertise creates the greatest value.

The evolution of the analyst role

One of the most important developments emerging from early production deployments is the evolution of analyst responsibilities.

Security analysts remain central to security operations. Their expertise becomes even more valuable as AI systems take on larger portions of investigative work.

Threat hunting, detection engineering, response strategy, governance and oversight are receiving increased attention. Analysts spend more time shaping how investigations are conducted, evaluating outcomes and improving overall security operations.

Many organizations are already beginning this shift.

Teams are investing more heavily in proactive security activities. Detection engineering programs are expanding. Threat hunting is becoming more accessible. Analysts are spending more time improving systems and less time repeating investigative tasks.

These changes create what I think of as an analyst-amplified SOC: an environment where AI expands the reach of security professionals and enables deeper security work across the organization.

Trust is critical and it doesn’t have to compromise speed

Faced with a compressing timeline, the instinct is to treat speed and trust as a trade-off, i.e., move faster, verify less. That trade-off feels inevitable. It isn’t.

You don’t trust AI in the abstract. You trust that a system understands your tools, your telemetry and the edge cases that only exist in your network. The problem was never speed. It’s speed without context. The faster a context-blind system runs, the more decisions you’re left unable to verify.

The tension eases when the system is quick to deploy and tunes to your environment once it’s there, rather than treating every network the same. Speed stops being the thing you trade against trust. The more it learns about your environment, the sharper and more trustworthy it becomes, so the two compound rather than compete. Trust still develops through operational evidence such as measurable outcomes, visibility into decisions and consistent performance. But where that evidence accrues matters.

The organizations making the fastest real progress understand this. They don’t compromise quality and trust for speed. They invest in AI that earns trust inside their own environment, so they don’t have to choose.

Leadership during a period of rapid change

The conversations surrounding Mythos and Glasswing reflect a broader reality facing security leaders.

AI is becoming part of both offense and defense. Security teams are incorporating it into investigations, detection engineering, response workflows and threat hunting. Attackers are incorporating it into their own operations.

Security leaders have an opportunity to modernize operating models, expand defensive capacity and build organizational experience while these capabilities continue to evolve.

The organizations making progress today are investing in readiness. They are building experience, adapting workflows and preparing teams for a new model of security operations.

The next phase of cybersecurity will be defined by how effectively organizations combine human judgment with machine-scale execution.

The question facing security leaders is increasingly clear: How quickly can their organizations adapt to a continuously changing threat environment?

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Many enterprises are investing tens of millions in modernizing their SAP landscapes, but are often underestimating a crucial factor for success, the training of their own developers, according to the German-Speaking SAP User Group, DSAG.

The user association urges CIOs to treat the continuing education of SAP developers not as a voluntary training measure but as a strategic investment program in a new report on upskilling [PDF, in German]. Well-trained developers are essential for building stable, maintainable in-house projects without accumulating technical debt, but without continuing education during the upgrade to S/4HANA, the potential of the new technologies will remain untapped, it warned.

Outdated expertise becomes a project risk

As the authors explain, while many ABAP developers have decades of experience with SAP R/3 or ECC and possess extensive process knowledge, development paradigms have fundamentally changed with S/4HANA, Clean Core, and ABAP Cloud.

In the long term, this threatens to lead to poor architectural decisions, time-consuming workarounds, and in-house developments that will need to be maintained with every release, according to DSAG. Many business consultants, too, are still relying too heavily on classic GUI transactions and not taking modern Fiori technologies sufficiently into account.

The result is what the SAP user group refers to as “skills debt.” This debt remains invisible at first but later becomes apparent in the form of longer projects, rising maintenance costs, and a growing dependence on external service providers.

Skill building must start before the project

The DSAG authors view the timing of training as particularly critical. Those who wait until an ongoing S/4HANA migration project is underway to begin building expertise significantly increase the project risk. A lack of knowledge about CDS, RAP, or Fiori leads to architectural decisions that must later be corrected at great expense. At the same time, the necessary learning effort can hardly be managed alongside day-to-day business operations.

But even after the migration is complete, SAP developers must continue their training, according to DSAG. The authors warn that anyone who continues to work as they did on ECC will miss out on the opportunities offered by current SAP technologies — even if everything still works technically. At the same time, they can immediately apply what they’ve learned, which helps solidify their new knowledge.

AI no replacement for developer expertise

While AI tools can generate and explain code, this requires that developers be able to evaluate the results from a technical perspective, and according to DSAG the same applies to development in the SAP environment: “Only those who understand what constitutes good SAP code can use AI as an accelerator,” the authors write. Otherwise, AI acts as a risk amplifier and, in the worst case, merely accelerates the accumulation of technical debt.

The prerequisites for successful AI deployment are solid software engineering knowledge, automated testing, and an understanding of modern SAP development.

DSAG’s five recommendations

DSAG recommends that CIOs firmly integrate continuing education into their transformation strategy with five measures:

• defining mandatory learning paths for different roles, such as ABAP, CAP, or integration developers, as well as business consultants,
• providing suitable sandbox and test environments,
• mandatorily including training time in capacity planning,
• coordinating training schedules with migration and modernization projects, and
• using existing DSAG guidelines as a reference framework for development.

Military strategists know that asymmetric wars are lost not at the point of attack but at the seams between defensive units, where no single commander owns the territory and information moves slower than the threat. In January 2024, a finance employee at Arup’s Hong Kong office learned this lesson for $25 million, joining a video call with what appeared to be the engineering firm’s chief financial officer and several colleagues, receiving instructions to wire funds to a designated account, and complying. Every face on the screen was a deepfake, cloned from publicly available footage of the actual executives. The attackers conducted the entire meeting in real time and vanished before anyone in the organization realized the CFO had never logged on.

The incident would be remarkable enough as a one-off, but it represents a pattern accelerating well beyond isolated cases. Global payment fraud reached $33.4 billion in 2024 according to the Nilson Report, and the US absorbed a disproportionate 42% of those losses despite processing only 25% of global card transactions. The latest FBI Internet Crime report identifies more than one million complaints and nearly $21 billion in cyber-enabled crime losses in 2025 (up from $16 million in 2023), while Deloitte projects AI-enabled fraud in the US will hit $40 billion by 2027. This increasingly includes crypto-related fraud, not just credit card or traditional banking fraud.

For anyone who oversees financial operations, risk or payment technology infrastructure, these numbers are not forecasts of a future “regional conflict.” Instead, they are the current cost of a war most institutions have not yet recognized they are fighting.

Reconnaissance at scale: How AI redraws the attacker’s map

The conventional narrative around AI-powered fraud emphasizes speed: Faster phishing, faster credential stuffing, faster social engineering. Jason Kikta, CTO of Automox, sees the shift differently. “The main threat from AI misuse isn’t faster execution, as automation has been leveraged for years,” Kikta says. “The true dangers are lower barriers to entry and faster adaptation, giving attackers the ability to pivot techniques in near real-time.”

The distinction means that execution is a quantitative improvement, the kind existing defenses can absorb by scaling up. Lower barriers to entry and real-time adaptation are qualitative: A force multiplier that turns every amateur into an equipped operator with a coach that learns from each failed attempt. Deepfake-as-a-service platforms now produce voice clones from three seconds of audio. AI-driven vulnerability scanning maps an institution’s unpatched endpoints while the security team is still scheduling the review meeting. In 2024, 269 million stolen credit card records appeared on dark web platforms, giving AI-equipped attackers what military intelligence analysts would call an order of battle: A detailed map of the defender’s exposed positions, ready to be mined for patterns, tested against live systems and exploited at machine speed.

The result is a combined arms threat, one that operates across domains simultaneously the way a competent military force coordinates air, ground and intelligence rather than running them as independent campaigns. The same AI that crafts a convincing business email compromise can probe unpatched point-of-sale systems to install digital skimmers. The same synthetic identity that opens a fraudulent credit card account can exploit a payment authorization vulnerability discovered through automated scanning. Card-not-present fraud now accounts for 71% of all US card fraud losses, and the attack surface keeps expanding as digital wallets and e-commerce push more transactions into channels where physical card verification is impossible.

Attackers treat endpoint management gaps and transaction monitoring gaps as a single attack surface, while most defenders continue to patrol them as separate territories.

Fragmented command: The structural vulnerability AI exploits

Consider how most financial institutions, crypto platforms and digital asset intermediaries actually organize their defenses: A cybersecurity team focused on identity compromise, endpoint protection and infrastructure threats; a fraud team focused on account takeover, mule networks and scam typologies; an AML or financial crimes team focused on wallet screening, sanctions exposure and suspicious activity reporting; and an AI risk or digital trust team, if one exists at all, focused on synthetic media, model abuse and impersonation. Each function has its own tooling, budget, reporting line and intelligence feeds. In crypto markets, where value can move irreversibly across wallets, chains, mixers, exchanges and OTC brokers in minutes, those silos create exploitable gaps between detection, attribution, interdiction and recovery.

A pig-butchering scam that begins on a dating app, migrates to WhatsApp, directs a victim to a fake crypto investment platform, and then launders proceeds through nested services and cross-chain bridges is not just a fraud event. It is also a cybersecurity event, a financial crimes event, an identity event, a platform abuse event and, increasingly, an AI-enabled social engineering event. Chainalysis reported that high-yield investment scams and pig-butchering schemes were among the most successful crypto scam types in 2024, while also noting growing use of AI in fraud and scams.

Research published by the University of California, Davis found that these schemes follow a staged lifecycle: Trust-building, fabricated investment returns, escalating deposits, withdrawal obstruction and re-targeting of victims after the initial loss. When each part of that lifecycle is monitored by a different team, the institution sees fragments of the attack rather than the economic system of the crime.

“Fraud no longer happens in isolated channels,” observes Jeff Li, Global Product & Designer Lead at Binance. “AI-powered scams move seamlessly across platforms, and payment systems, making fragmented defenses increasingly ineffective.” He believes that the future of security depends on unified intelligence — combining AI, real-time monitoring, secure infrastructure and cross-functional response mechanisms into a single coordinated defense system.

“We’ve invested heavily in AI-driven risk detection, real-time scam warnings and infrastructure to stay ahead of evolving threats, continues Li, claiming that from Q1 2025 to Q1 2026, these efforts helped Binance prevent over $10 billion in potential user losses and protected more than 5 million users globally. As AI continues to reshape both fraud and fraud prevention, the focus remains on building systems that can protect users, not just at scale, but in real time.

Unified command: From org chart to battle plan

Kikta’s assessment contains a contrarian detail worth teasing apart: “The good news is that a strong compliance program prioritizing depth of coverage and speed of enforcement will hold up against AI-enabled fraud,” he says. In a landscape saturated with predictions that existing defenses are obsolete, Kikta argues that the fundamentals of patch management, endpoint hygiene and compliance rigor still hold, provided the clock speed at which those fundamentals execute keeps pace with the adversary.

That clock speed is the operational link between cybersecurity and card fraud prevention. An unpatched point-of-sale terminal or payment gateway exposed for 30 days represents 30 days of reconnaissance opportunity for an AI scanner probing for places to install a digital skimmer or intercept card data in transit. A compliance gap in identity verification is an open invitation for synthetic identities to open accounts and run fraudulent transactions. Endpoint management data and transaction monitoring data describe the same attack surface from different angles, and fusing those streams into a single operational picture, the financial equivalent of a military intelligence fusion center, gives defenders something the current siloed structure cannot: Visibility into an attack developing across domains before it reaches the payment layer.

The value of that convergence extends beyond defense. A unified data layer across cyber, fraud and payments creates consolidated threat intelligence that can inform underwriting decisions, merchant risk scoring and product design. Organizations that treat converged security data as a business intelligence asset (not merely an operational feed) will find they have built something with commercial utility well beyond the security operations center.

Mascaro frames the prescription in terms that belong in a boardroom, not a SOC. “The real competitive advantage in fraud isn’t your AI stack,” he says. “It’s leadership’s clarity to unify risk disciplines that everyone else keeps in separate departments.”

Field manual: What winning institutions do differently

The institutions gaining ground in this new form of asymmetric conflict share a common operational posture: They treat endpoint management as card fraud prevention rather than IT maintenance, and they feed cyber, fraud and payments intelligence into a single picture rather than three separate briefings. The defensive AI advantage, such as it is, comes from that integration, not from any single model’s sophistication.

Adversaries have already unified their operations. Yet, payment processors and financial institutions that keep running separate campaigns on separate fronts, with separate intelligence, will keep conducting after-action reviews of battles they have already lost.

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For the past three years, the AI conversation has been dominated by scale. Bigger models, bigger compute clusters, bigger headlines. But the next wave of competitive advantage won’t come from who can rent the biggest model; it will come from who can build the smallest one that knows their business.

That model is the small language model (SLM): Compact, purpose-built, trained on an organization’s own data and run under that organization’s own governance. And it is about to become one of the most consequential strategic assets available to both the private and public sector.

The problem with renting intelligence

Right now, most organizations consume AI the way they once consumed electricity from a single utility by plugging into a handful of frontier models built by a small number of global vendors. These models are extraordinary generalists. They are also, by design, generic. They are tuned to be safe, broad and useful to everyone, which means they are optimised for no one in particular.

That’s a problem for any organization trying to build genuine differentiation. If every competitor in your sector is calling the same foundation model with the same prompts, the model itself is not your edge. Your edge is what only you know, your proprietary data, your institutional judgement, your operating history. A generic model can’t see any of that unless you keep feeding it to them, turn after turn, at cost, with no lasting memory and no guarantee of where that data ends up.

An SLM flips that equation. Trained on an organization’s own document libraries, case histories, policy archives, transaction data and operational know-how, it becomes a model that thinks the way your organization thinks, because it was built from your organization’s accumulated judgement. It doesn’t need to be the smartest model in the world. It needs to be the most useful one for you.

I’ve seen this play out directly. At one of Australia’s largest integrated tourism and cruise businesses, simultaneously a B2C retailer, a B2B distributor to thousands of agency and wholesale clients globally, an aggregator marketplace for more than 1,800 independent tourism operators, and a cruise operator with offshore shared services spanning finance, customer contact and content management. The constraint wasn’t a lack of access to large general-purpose models. It was that none of them understood the business: 1,800 different operator catalogues, each with its own pricing logic, inventory quirks and content conventions; years of customer contact history with its own vocabulary and escalation patterns; a marketplace search experience that needed to reason over the business’s own product taxonomy, not the open web’s.

Models trained and tuned on that proprietary data, operator listings, historical tickets, booking and pricing data delivered results a generic model never could. Domain-tuned content drafting cut operator listing time by 70% and eliminated a 23-day onboarding backlog outright, taking new-operator time-to-live from 23 days to three. A semantic search model trained on the marketplace’s own product catalogue lifted booking conversion by 24%. AI-driven triage trained on the business’s own contact history cut Tier 1 escalations by 34%. None of this came from a smarter foundation model. It came from a smaller, more specific one that knew the business.

Why “small” is the strategic choice, not the compromise

There’s a temptation to treat SLMs as the budget option, what you build when you can’t afford a frontier model. That’s the wrong frame. The evidence is already compelling: Microsoft’s Phi-4 family of small models, released in early 2025, demonstrated that a 14-billion-parameter model can match or exceed the performance of models many times its size on complex reasoning and domain-specific tasks while running at a fraction of the compute cost and on-premise, entirely within an organization’s own infrastructure. Smaller, domain-trained models are increasingly outperforming general-purpose giants on narrow, high-value tasks, with far tighter control over data residency, security and explainability.

For a CIO or CTO, that combination of lower cost, tighter governance, higher task-specific accuracy is rare enough to demand attention on its own. But the deeper value sits one layer up, at the operating model. An SLM trained on your service history can sit inside claims processing, citizen services, clinical triage, asset maintenance scheduling or M&A due diligence quietly compounding institutional knowledge into a reusable asset rather than letting it walk out the door every time someone retires or resigns.

That is the real shift: AI capability stops being a subscription and starts being a balance-sheet asset. It can be valued, protected, audited and improved because it belongs to you.

The public sector’s hidden advantage

Nowhere is this more obvious than in government. The public sector sits on some of the richest, least-exploited data and institutional knowledge in the country: Decades of policy outcomes, service delivery history, regulatory precedent, infrastructure records and frontline expertise. Most of it has never been put to systematic use because no commercially available model was ever trusted to touch it, and rightly so.

A small, sovereign, purpose-built model changes that calculus. Trained, hosted and governed entirely within government infrastructure, an SLM doesn’t require sensitive citizen or policy data to leave a secure perimeter. The Australian Government has already recognised this direction: The APS AI Plan, released in November 2025, commits to expanding the GovAI platform to provide all public servants with secure, sovereign AI tools operating entirely within Australian Government infrastructure. SLMs tuned to individual agency mandates are the logical next step and a more powerful one than any generic government-wide tool can deliver.

Rather than each agency independently negotiating with the same handful of overseas vendors, a coordinated approach of common standards for model governance, shared security architecture, common evaluation frameworks and pooled infrastructure investment would let agencies build and reuse SLM capability horizontally, the way shared services and common ICT platforms have been built before. Each agency gets a model genuinely tuned to its mandate, but the security model, audit trail and assurance framework are consistent, government-backed and independently verifiable.

Done well, this isn’t just an efficiency play. It’s a sovereignty play. As GovTech Review has noted, large language models hosted offshore create data flows that extend beyond Australia’s borders in ways that are rarely transparent, a risk that is simply untenable for government. Sovereign, purpose-built models keep Australian public data, public knowledge and the resulting capability uplift inside Australian hands, rather than exporting both the data and the long-term value to offshore platforms.

Why this belongs in the innovation budget, not the IT budget

The instinct in many organizations is to treat AI spend as an IT line item, something to be minimised, benchmarked and squeezed for cost efficiency. SLMs deserve a different treatment. They are closer to R&D than infrastructure: An investment in converting accumulated institutional knowledge into a durable, defensible capability.

That argument holds in the private sector too. A PE-backed portfolio company, a regulated financial services firm, a healthcare provider — each has years of proprietary operating data sitting idle in case files, transaction logs and service records. An SLM built on that data is a way of turning a sunk cost, decades of operational history, into a forward-looking asset that compounds with every additional case it processes.

Boards and executive committees that are still asking “what is our AI strategy?” as a single, undifferentiated question are asking the wrong thing. The better question is: Which parts of our operation are rich enough in proprietary data and judgement to justify owning the model outright, rather than renting someone else’s?

The opportunity in front of us

The first wave of enterprise AI adoption was about access: Getting a capable model into people’s hands quickly. The next wave will be about ownership: Who controls the model, who controls the data it was built on, and who captures the long-term value of the institutional knowledge it encodes.

Australia, with a public sector rich in data and a private sector with deep vertical expertise in financial services, resources, healthcare and logistics, is well placed to lead on this if it treats small, sovereign models as a genuine national capability question, not a procurement footnote. The organizations, and the country, that move early will not just save money. They will own something their competitors can’t easily replicate: An AI that knows them.

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Something interesting happened during an internal evaluation of AI meeting transcription tools at Tungsten Automation. The products worked. They weren’t bad. But sitting across from the pricing, we kept asking the same question: what exactly are we paying for?

We already had a secure enterprise AI environment. Building a meeting summary workflow took days, not months. We customized the outputs, injected our own internal context, and controlled security our way instead of working around someone else’s roadmap. We built it. It works better. We own it.

That’s not a knock on those vendors. It’s a signal of something more fundamental happening across enterprise software.

The moat was never the product

For two decades, SaaS rode a favorable asymmetry: building internal tools was hard, integrations were messy, and even modest automation required developers and long timelines. Buying was faster and cheaper than building. That asymmetry fueled the explosion of SaaS into every corner of the enterprise stack.

AI is collapsing that asymmetry. Large language models and agentic workflows can orchestrate APIs, move data between systems, generate interfaces, and automate business logic with a fraction of the engineering effort required even two years ago. The integration friction that once protected entire product categories is evaporating.

The vendors most exposed are not the deeply embedded enterprise platforms. They’re the lightweight workflow layers, the products that essentially put a polished interface on top of accessible data and relatively straightforward processes. Reporting dashboards. Meeting tools. Narrow productivity applications. These products created value by simplifying implementation. That rationale is getting harder to sustain when implementation is no longer the real barrier.

Here’s the part most analyses miss: it’s not just that AI makes development faster. It’s that agents change the integration model entirely. For 30 years, enterprise software was built for humans navigating UIs. Agentic systems don’t use UIs. They call APIs, read from multiple sources simultaneously, and move data freely across systems. The switching costs that once made incumbent software sticky are collapsing, because an agent doesn’t care which UI it used last quarter.

The SaaS that survives

The question isn’t whether SaaS survives. It’s which SaaS survives.

The companies with durable positions are not the ones with the cleanest interface. They’re the ones that transfer operational risk customers genuinely cannot absorb themselves. Compliance. Regulatory certification. Accumulated domain expertise. Liability.

Think about compliant invoicing across 140 countries. That’s not a workflow someone builds in a sprint. The certifications alone take years. A single regulatory change in one jurisdiction can break an AP process for a global enterprise overnight. Customers don’t pay for that capability because it’s technically complex. They pay because they cannot afford to own the risk of getting it wrong.

That’s the distinction that matters: AI lowers the cost of building software. It does not lower the cost of absorbing risk. The vendors who understand this are building durable businesses. The ones who don’t are quietly subsidizing their customers’ internal build programs.

Software sells features. Platforms sell accountability.

The prototype trap

The danger for enterprise buyers right now is overcorrection. Every successful prototype looks like a cost-saving opportunity. Very few survive the jump to production.

Building a workflow with generative AI is becoming straightforward. Maintaining it is not. Models evolve. Outputs drift. Governance requirements tighten. What worked cleanly in a controlled environment behaves differently at scale, and the failure mode is worse than traditional software. Rule-based automation, when it fails, fails obviously. Agents fail silently, confidently, at scale, often with a completely reasonable-sounding explanation.

Engineering teams that take on AI-powered systems need to solve for observability, model drift, access controls, audit trails, and long-term maintenance ownership. In regulated industries, they need to demonstrate exactly how the system reached every decision. That’s not a weekend project. That’s an ongoing operational commitment that compounds over time as models change and regulatory requirements evolve.

Before a team decides to replace an external platform with internal AI tooling, the honest question isn’t, “Can we build this?” The real question is, “Are we prepared to own this in production, for years, as the underlying models change beneath us?” Sometimes the answer is yes. Often the answer is no, and the true cost only becomes visible after the vendor contract is canceled.

Build vs. partner: a sharper frame

The build vs. buy framing has always been too binary. The right question is build vs. partner.

Partner for the capabilities where risk transfer, regulatory complexity, and domain expertise create genuine value your team cannot replicate. Build for the capabilities that actually differentiate your business from your competitors. Don’t burn your best engineers rebuilding compliant invoice processing or production-grade document extraction. Those aren’t competitive advantages. They’re table stakes, and someone else has already paid the cost, across decades, to make them reliable.

The organizations getting this right are honest about where they create unique value. They focus development there, and partner for everything else. The ones getting it wrong are vibe-coding solutions to non-differentiating problems while their actual competitive moat goes unattended.

The true value of software

We’re not watching the death of SaaS. We’re watching the end of the friction-based value proposition: the idea that software is worth renewing because integration used to be painful. That rationale is largely gone.

What survives is software that does something customers cannot reasonably replicate internally: absorb risk, maintain regulatory compliance, deliver operational reliability at scale, and bring genuine domain expertise into a production-grade system that someone else already stress-tested for years.

The vendors who recognize this are already repositioning around accountability, governance, and outcomes. The ones who haven’t will find the next renewal conversation noticeably harder.

Software sells features. Platforms sell accountability. That distinction is about to separate a lot of winners from a lot of cautionary tales.

—

New Tech Forum provides a venue for technology leaders—including vendors and other outside contributors—to explore and discuss emerging enterprise technology in unprecedented depth and breadth. The selection is subjective, based on our pick of the technologies we believe to be important and of greatest interest to InfoWorld readers. InfoWorld does not accept marketing collateral for publication and reserves the right to edit all contributed content. Send all inquiries to doug_dineley@foundryco.com.

Attackers are increasingly using AI agents to automate all phases of cyberattacks, prompting the security industry and enterprises to find new network defense approaches. One technique that shows promise is to intentionally plant decoy files with prompts that trigger the content safety guardrails built into LLMs with the goal of crashing rogue agentic workflows.

Using decoy resources as tripwires that alert defenders about potential unauthorized access is not a new idea in cybersecurity. These are known as canaries — after the canary in the coal mine early warning system — and can be fake documents, AWS access keys, database dumps, DNS records, and even URLs that would not be queried by legitimate processes, but would be attractive targets for attackers.

What’s new in the approach devised and tested by security firm Tracebit is to use these decoy resources not merely to trigger alerts, but to actually stop AI agents, buying defenders more time. Dubbed “context bombing,” the technique takes advantage of the fact that LLMs are inherently vulnerable to prompt injection — acting on instructions they might encounter inside the data they process.

Enterprises that build their own AI agents have to worry about malicious prompts placed by attackers on web pages, emails, documents, code comments, and in other third-party resources those agents might access. With no defenses in place, companies risk their own agents being hijacked and used against them to perform unauthorized actions. But the malicious AI agents used by attackers have the same vulnerability.

“We call the defensive version a context bomb: a short piece of text designed to trigger a model’s safety guardrails, planted directly in the attacker’s path — a decoy secret, environment variable, or DNS record,” Sam Cox, Tracebit’s CTO, said in a blog post. “An AI agent that reads it will frequently refuse to continue. You still get the alert; and the attack now halts early instead of merely being detected.”

Context bombing triggers massive drop in attack success rate

Tracebit’s tests performed in an AWS test environment cut the success rate normally achieved by AI models across multiple attacks paths by up to 90% by simply adding instructions that would trigger their content safety guardrails. LLMs are trained to refuse answering questions about creating biological, chemical, or nuclear weapons, or, in the case of Chinese open-weight models, sensitive political topics such as the Tiananmen Square massacre.

Furthermore, once one of these banned instructions make it into the context window, the whole session is poisoned, and the model will often refuse to continue without manual intervention. The researchers ran many tests to find short strings that would trigger model safety guardrails reliably, but it’s worth noting that the identified strings were different between the tested models: Claude Opus 4.8, Gemini 3.1 Pro, GLM 5.2, DeepSeek V4 Pro, and Kimi K2.6.

During baseline tests the AI agents managed on average to obtain full account admin in 54% of the 154 attack runs and full compromise (admin + persistence) in 36% of tests. With the context bombs in place, their success rate dropped to 5% for admin access and 1% for full compromise. Also, in 91% of baseline attack runs, the agents managed to complete at least one of ten possible attacks paths, but their average success rate dropped to 15% with the context bombs.

The models from Western AI labs — Opus and Gemini — proved the most capable at reaching full admin access, with 93% and 70% success rates, but were also the most impacted by the context bombs with both their success rates dropping to 0%. This shows that the content safety guardrails are much stronger in these models compared to the Chinese ones that were tested.

Attackers experimented with safety refusals first

The Tracebit researchers had already been experimenting with AI canaries for alert purposes. A paper published in May showed that canaries alerted defenders in 95.9% of 162 successful attack runs performed with AI agents using 10 different AI models. The alerts were triggered 8 minutes before the agents performed critical actions, while the runs required 14 minutes on average to reach admin access.

During those tests the researchers observed that if they instructed the models that the network might include deception, their success rate for full admin access and persistence dropped from 20% to 3% on average.

Then in June, researchers from security firm Socket.dev came across a software supply chain attack involving malicious PyPI wheels that contained prompt injections with content designed to trigger safety guardrails inside AI models. The malicious prompts were included in code comments at the start of the files and the purpose was likely to evade detection from LLM-powered security scanners.

“This header appears designed for AI-mediated analysis, not for Node, Bun, or Python,” the Socket.dev researchers said at the time. “It attempts to derail scanners or analyst copilots that feed the beginning of a file to a language model without clearly isolating the content as untrusted data. In weak pipelines, this can cause refusal behavior, prompt confusion, context pollution, or premature classification before the scanner reaches the actual malware.”

The Tracebit researchers then had the idea to flip the script and trigger such safety refusals through their canary technique against malicious AI agents. So not only does the agent run stop, but an alert is also triggered because the canary was accessed.

There is a risk that the canaries could also be discovered and accessed accidentally by legitimate LLM-powered tools used by engineering or security teams. But at the same time this means organizations could potentially deploy such canaries in sensitive places to stop their own AI agents that might become hijacked or go off the rails on their own.

There are many reports online where AI models performed destructive or unauthorized actions like deleting databases and folders or elevating their privileges because they got struck in failure loops and explored creative ways to complete their tasks. This is even more common with autonomous AI agents that are tasked to reach a goal without human intervention or supervision.

“The speed of autonomous AI attacks is why deception is climbing the priority list for security programs,” Tracebit’s Cox said. “When the attack chain takes minutes rather than days, every minute of response time you can claw back matters — and a control that stops the attacker outright, rather than just reporting them, changes the economics significantly.”

Microsoft has issued a warning about a recent surge in ACR Stealer activity that uses ClickFix-style social engineering to steal credentials, browser data, and sensitive business documents.

In a new report, Microsoft researchers detailed two separate campaigns observed between late April and mid-June 2026 that use different execution techniques for the same theft.

The campaign was seen tricking users into executing malicious commands to resolve a fake issue. Once the malware is executed, it extracts browser-stored credentials, session tokens, and documents, which can potentially allow attackers to access cloud services, impersonate users, and conduct follow-on intrusions across enterprise environments.

Nick Tausek, lead security automation architect at Swimlane, thinks attackers could be using two distinct chains to trick defense tuned on individual indicators.  “By changing the delivery and execution patterns, attackers can evade defenses tuned to one known chain and make related incidents appear disconnected,“ he said. “Security teams may split the activity across separate investigations, delaying recognition of the shared malware and objective.”

ACR Stealer is an information-stealing malware family Microsoft believes is offered through a malware-as-a-service (MaaS) model, with possible links to the Amatera Stealer.

WebDAV and MSHTA-based chains

Although both campaigns begin with ClickFix lures, Microsoft’s analysis shows they diverge after initial execution. One attack chain uses WebDAV-hosted DLLs, PowerShell, Python loaders, scheduled-task persistence, and even blockchain-based infrastructure called the “EtherHiding” technique, to complicate detection and command and control (C2) discovery.

The second chain uses MSHTA, heavily obfuscated PowerShell, stenography, and predominantly fileless, in-memory execution to minimize forensic trails.

“The most troubling part of ACR Stealer is the flexibility surrounding the theft. One chain invests in persistence and layered infrastructure, while the other favors memory execution and fewer forensic traces,” Tausek said. “Those approaches look different to defenders, yet both turn a simple ClickFix lure into stolen credentials, tokens, and business documents.”

Microsoft researchers said protections against these campaigns have now been added to Defender. “Microsoft Defender for Endpoint can help surface both campaigns through behavioral coverage for living-off-the-land execution, suspicious WebDAV and MSHTA activity, obfuscated PowerShell, scheduled-task persistence, in-memory payload execution, and browser credential theft,” they said.

Mitigations include ClickFix-targeted detections

The report highlighted that neither of the campaigns exploits any software vulnerability, depending solely on ClickFix-based social engineering.

Microsoft warned its Defender customers that ClickFix attacks are on the rise and shared XDR queries to identify suspicious commands executed through ClickFix-based activity observed while delivering the ACR Stealer.

Microsoft also recommended, as general defense, monitoring for suspicious PowerShell activity, MSHTA execution, WebDAV connections, and attempts to access browser credential stores, while also enabling Microsoft Defender SmartScreen and Attack Surface Reduction (ASR) rules to block common malware delivery techniques.

“The campaigns do not need to directly aid one another to be effective. Together, they create ambiguity and stretch limited SOC resources,” Tausek explained. Security teams need enough visibility to correlate endpoint, identity, and network activity as one evolving intrusion, he added.

Microsoft also shared a list of C2 addresses and payload hosting domains for defenders to add to their detection.

Major AI labs are unleashing forward-deployed engineers (FDEs) to try and grab enterprise customers. Large consultancies are dishing out tokens and assembling armies of consultants — both human and agent — to do the same.

But smaller firms are in the mix now, as well. AI is helping 28Stone Consulting, a New York-based, 230-person technology consultancy for capital markets, punch above its weight against larger rivals in the rush to deliver FDEs.

In this Q&A, Thomas Dolan and Frank Erickson, founders of 28Stone, argue that agentic AI isn’t a one-size-fits-all solution in vertical markets; success takes discipline, deep domain expertise, and human involvement to mitigate risk.

Many enterprises continue to struggle with the use of AI agents, which is consultancies are stepping in to get projects off the ground. 28Stone is among those that have published blueprints and methodologies on the development and delivery of agentic AI workflows with humans in the loop.

Computerworld spoke with both founding partners about why companies are still stumbling with agentic AI rollouts, and what a disciplined delivery process actually looks like.

After 15 years of delivering software for capital markets firms, is ‘AI-first’ a real distinction or just positioning?

Dolan: “We’re not shying away from being AI-forward. What needs to shine through is AI done intelligently — not stuff you get by buying some tokens for somebody on the trading desk. We’re an AI-first firm.”

Erickson: “And it’s temporary. At some point, AI is going to be synonymous with software development.

“The whole idea of an AI SDLC (software development lifecycle) versus an SDLC is going to be one and the same, a lot like cloud computing today. To not include AI in your strategy, you’d look like a COBOL vendor.”

What does agentic AI delivery look like?

Dolan: “We’ve got several AI initiatives delivering a pure agentic approach. We’ve doubled down on the human expertise wrapper in the SDLC. That doesn’t mean sacrificing any of the benefits of the AI models — quite the opposite.

“You don’t achieve anywhere near the same level of value from applying AI without keeping that expertise — industry, functional and technical — throughout the process.”

Where do humans stay in the loop once agents are doing the work?

Dolan: “We’re believers in starting with requirements discovery. Someone who knows the analytical nuances of a good business analyst is critically important; shaping a product owner’s business information through a markup file that can be fed into a BA agent, then treating the output as if it came from a very fast junior BA. Only then is the story complete.

“The developer takes that story, transforms it into the most efficient input, then owns the output, because they’re accountable for that code. A developer should own the code on both the input and output side.

“Your product owner, who knows the business, that’s great. But expecting them to interact with an agent and output enterprise code is ridiculous. It’s not a great plan.“

Why not just put one do-everything person in charge of AI and agents?

Erickson: “Every analyst, programmer or software engineer isn’t a great requirements analyst. And a great domain analyst with some technical background won’t know if the agent’s code is garbage, maintainable, performant.

“It’s unrealistic to expect one individual to have that breadth across domain, software engineering, testing, deployment. Clients ask all the time, and we push back: ‘Great, if you can find that guy, they’re few and far between.’ To deliver at the enterprise level, you need the human expertise, at depth.“

Dolan: “There’s system speed and latency, important in parts of finance. Then there’s speed of delivery, because other areas evolve quickly and time-to-market is critical.

“Our human wrapper may at first pass come across as a little slowed down. Maybe it is. But [Erickson] has a good analogy about one of the dangers of AI: you can end up going really fast in the wrong direction. By the time you look up, you’re way off base and have to backtrack.“

What about AI in your sector do you think is overhyped?

Dolan: “The hype around the ease of use of AI and the democratization of enterprise software delivery — that ‘anybody could do it now, it’s all being done by machines’ — is another idea that could prove costly in the long run.

“This do-it-yourself reaction is dangerous for clients, and for trust in the overall AI benefit, which is real. We compare it to the beginning of offshoring 20, 30 years ago: a golden idea that was going to cure everything. A lot of firms did it thoughtlessly, thinking it’s just labor arbitrage, and it almost inevitably failed. That all-or-nothing mentality missed that offshoring is an amazing way of getting better value for your dollar, but it has to be done thoughtfully, so the delivery process — the thing that ties it all together — stays unsevered.

“We’re seeing that now. I’ve heard, ‘We’ll just push a button, the machine’s building the system.’ The machine is not building the system. It might be writing the code, the story, running the tests.

The system is built by a team of engineers you bring in and trust. My fear is that people will say, ‘We don’t need this vendor or this technology team. I’ve got a product team. They might not be able to code at all, but they know the business,’ and it fails dramatically. 

“Then people say, ‘We played with AI, it’s not ready yet,’ and throw it all away. One of the best things we can do is ensure clients know the benefit is real.“

Erickson: “The hype can be summed up in a single phrase: vibe coding. That has done AI a massive disservice, because there’s a huge difference between vibe coding and enterprise software development, and some of the loudest proponents of AI are too latched on to it. In our industry, the only way to succeed would be a stable of unicorns. It just doesn’t scale. I get perturbed when our people internally refer to AI tooling as vibe coding; if they think that’s what they’re doing, they’re misunderstood.“

When you engage clients at different levels of AI maturity, how do you get them to a understand what works?

Dolan: “95% of our take on an agentic approach is in line with everyone else’s, but that 5% matters, especially in requirements discovery, in who’s giving the requirements and how they’re thought of. It can set you up for dramatic errors, given the speed at which you’re moving.

“There’s a dangerous human tendency we’re seeing among clients to try and cut corners at the start of a project and — in lieu of having deep, expert driven discovery sessions — just summarize what they may want using AI.

“We would hope our clients are collaborative, everyone understanding it’s early days. If a client insists on doing something we feel strongly against, like a product owner completely owning everything right up to code generation, that’s an issue we have to either push back strongly on or step out of the accountability for.“

AI body shops — LLM providers and giant consultancies — are emerging to help enterprises deploy AI. Does that model work?

Dolan: “Whether you’re partnering with an LLM or with an AI-first, generic software provider — ‘Hey, we’re not industry guys, but we know AI delivery’ — you end up, if you’re a bank or a broker-dealer, saying: ‘All right, we know our business, these guys know the AI side of it. What could go wrong? Put us together and we’ll have quality engineering.’

“The problem is what you miss: the know-how of putting industry and technical expertise together and actually delivering financial services systems. The people working at the generic delivery firms, whether an AI-only firm or a body shop somewhere, don’t have that capability.“

Does AI change the economics for smaller consultancies like yours competing against the big firms, and does it cut both ways?

Dolan: “Over our 15 years pre-AI, there were two recurring reasons we’d lose a project. One: ‘We’d love to work with you guys, given your subject matter expertise, but the costs just aren’t there compared to my budgets. I’m being forced to go to a body shop or an [offshore] delivery center.’ The other side of that coin: ‘We love your capabilities, but you’re a firm of 230 people and I need 300, 400 people.’

“AI changes the options for clients. You don’t have to sacrifice the niche vendor who knows your space just because you need a larger team or a cost target. AI levels the playing field and should allow smaller firms to compete with the larger, big-box generic firms, the Accentures of the world.“

Erickson: “It redefines what scale means. You can look at velocity as a measure of your cost to deliver, not a rate card. Scale can’t be defined in terms of headcount anymore. It’s got to be defined in terms of output.

“There’s a threat in it, too. If you’re an Accenture with hundreds of thousands of low-cost software engineers, how do you train all those people? I feel for them. But for us, a couple hundred people with a specific domain focus, it’s a huge opportunity.“

How has the profile of the people you and others hire changed with this agentic process?

Erickson: “You’re still looking for people with strong engineering and design backgrounds, and communication skills, because they interact across the software development lifecycle more than in the past.

“Many take too much joy in typing out perfect code. Sorry, I don’t need you writing for-loops and classes anymore. I need you reviewing them, understanding them, operating at a higher level. That’s a different kind of person: an engineer, not a programmer or a coder. On the [business analyst] side it’s similar: people took great pride in detailed user stories covering every path. Now it’s conversations, prompts, reviewing output — less doing, more interacting.

“More than ever, they have to be interested in the domain. They can’t just be, ‘I want to learn everything there is to know about Java.’ That’s too narrow. They don’t have to be an expert; they have to be interested. In our case, capital markets is a specific niche. The biggest challenge is getting familiar with the tools — finding time, while delivering for customers, to ramp up and make the mistakes you need to without jeopardizing projects.“

What about governance? Who’s keeping AI delivery and its costs under control?

Erickson: “This is evolving rapidly. People aren’t sure how to put governance around this. The most obvious is financial governance. People are starting to get hefty bills. One of our clients spent a million dollars on tokens over the last eight weeks alone. Sticker shock. The token-maxing policies are starting to show their flaws. It’s wild west still: learn on the fly, then figure out what needs to be governed.“

Are CIOs actually opening their wallets? And when they do, what’s the smarter way to invest?

Erickson: “There’s still a lot of caution. Forecasts keep going down on how long something should take. So: ‘I could wait three months and maybe still get it delivered by the same date someone’s promising me now, but for half the price. I’m going to wait and see when equilibrium is met.’ We haven’t seen the wallets open up like crazy — it’s slow adoption.“

Dolan: “One of our clients is looking at it from a productivity-boost perspective: instead of doing the same for less, I can do much more for the same. AI lets clients pull the trigger on things they wouldn’t have in the past — projects that might not have been approved pre-AI, where the costs have come down to a point that’s palatable with the business.“

Erickson: “And that’s the story we’re hoping to hear more of. There isn’t a huge cost anymore to exploring a business opportunity. The time and money that would have gone to a return-on-investment study could be spent on a proof-of-concept with AI, and the project done a few weeks later. Maybe [there’s] a hint of things to come, where decisions start being made quicker. 

“There’s a little fear on our side, though: a lot of tiny little projects is tough for a consulting business.“

The emergence of artificial intelligence is beginning to expose a profound weakness in the way modern enterprises measure performance.

For decades, business evaluation systems have been built around the logic of the industrial and transactional economy. Revenue growth, operating margins, earnings per share, labor productivity, return on investment and market share became the dominant indicators of organizational success because they reflected the economic realities of a world in which value creation was primarily tied to physical production, labor efficiency, scale and later the automation of information processing. AI, however, is altering the very structure of enterprise value creation, and in doing so it is creating a widening separation between perceived future value and actual realized economic performance.

Much of the current discussion surrounding AI performance measurement reflects this tension. The overwhelming majority of AI-related metrics being celebrated today are not direct measures of realized enterprise outcomes. They are largely indicators of capability formation, market positioning, experimentation or investor signaling. Metrics such as AI spending levels, number of AI use cases, GPUs deployed, copilots implemented, models placed into production, AI hiring growth or agentic AI pilots all serve primarily as proxies for anticipated future advantage. These indicators may influence stock valuations, analyst sentiment and strategic narratives, but their relationship to measurable operational performance is often indirect, delayed or in some cases entirely speculative.

This distinction is critically important because capital markets have historically rewarded the expectation of technological transformation long before actual economic results materialized. During previous technological revolutions—including electrification, enterprise resource planning, the internet, cloud computing and mobile platforms—valuation expansion frequently preceded measurable productivity gains by many years. The market priced future possibility before operational economics caught up. In many instances, investors rewarded firms simply for appearing strategically aligned with the dominant technological shift of the era. AI appears to be following a similar trajectory.

The phenomenon resembles the famous productivity paradox articulated by economist Robert Solow, who observed that “you can see the computer age everywhere but in the productivity statistics.” AI today is visible everywhere: in investor presentations, earnings calls, technology conferences, product announcements and boardroom strategies. Yet in many industries, its measurable contribution to enterprise productivity, profitability or economic resilience remains difficult to isolate with precision. This does not necessarily mean AI lacks value. Rather, it reflects the reality that traditional accounting and performance systems were never designed to measure the forms of value AI increasingly produces.

Artificial intelligence creates benefits that are often diffuse, cumulative and difficult to attribute directly to financial outcomes. AI may improve forecasting accuracy, reduce fraud, accelerate decision cycles, augment employee effectiveness, improve customer interactions, optimize logistics or enhance cybersecurity resilience. These benefits frequently manifest as second-order effects distributed across the enterprise rather than as immediately visible financial events. The causal chain between AI investment and realized business performance can therefore become extraordinarily difficult to quantify. A company may become operationally more intelligent without immediately becoming measurably more profitable.

At the same time, AI introduces a profound danger: organizations may increasingly optimize for technological narrative rather than durable enterprise economics. Many firms today are pursuing AI primarily because markets reward the appearance of AI leadership. Investor enthusiasm, analyst pressure and competitive fear create incentives to demonstrate visible AI activity regardless of whether measurable economic value has actually been achieved. In this environment, AI metrics can easily become instruments of valuation signaling rather than instruments of operational truth.

This distinction between signaling and substance may become one of the defining economic challenges of the AI era. An organization may announce aggressive AI deployment programs, reduce headcount and report short-term margin improvements while simultaneously increasing hidden forms of technological fragility. Infrastructure costs may rise dramatically as GPU consumption, cloud usage, data engineering requirements and cybersecurity complexity expand. Technical debt may accelerate as AI-generated code proliferates without sufficient architectural discipline. Institutional knowledge may erode as organizations become excessively dependent on opaque models and automated systems. Long-term innovation capacity may weaken if enterprises divert disproportionate resources toward maintaining internally generated AI systems rather than building new strategic capabilities.

What measuring AI value might actually look like

The distinction between AI activity and AI value becomes clearer when viewed through the kinds of measures organizations choose to track. Many enterprises today emphasize indicators such as the number of AI models deployed, copilots implemented, agents created, prompts executed, tokens consumed or employees using AI tools. These metrics demonstrate adoption and technological activity, but they reveal relatively little about whether AI is producing meaningful business outcomes.

Measures of enterprise value look quite different. A manufacturer might evaluate whether AI improves demand forecasting accuracy enough to reduce inventory carrying costs or stockouts. A financial institution might measure whether AI meaningfully lowers fraud losses, accelerates loan processing or improves regulatory compliance. A healthcare provider could assess reductions in administrative burden, faster clinical decision support or improvements in patient throughput. In each case, the objective is not simply to measure AI deployment, but to determine whether AI creates measurable improvements in operational performance, economic outcomes or organizational resilience.

Ultimately, organizations may need to ask a different question: not “How much AI are we using?” but “How much business value does each unit of AI investment create?” That shift—from measuring technological activity to measuring economic outcomes—may become one of the defining management disciplines of the AI era.

Under traditional accounting frameworks, many of these deteriorations remain largely invisible. Quarterly earnings may improve even as underlying enterprise resilience declines. Stock prices may rise even as operational complexity becomes increasingly unsustainable. In this sense, the AI era threatens to widen the gap between financial appearance and organizational reality.

This is why the future of enterprise measurement cannot simply involve adding AI metrics to existing financial scorecards. The challenge is far deeper. AI forces a reconsideration of what business performance actually means. Historically, enterprises were measured largely through static indicators of efficiency and output. Increasingly, however, competitive advantage may depend less on traditional efficiency and more on adaptive intelligence: the ability of an organization to learn faster, make better decisions, integrate human and machine capabilities effectively, manage technological complexity sustainably and convert computational power into durable economic outcomes.

The most important future performance measures may therefore revolve around questions traditional accounting rarely addresses. How effectively does an enterprise convert technology investment into sustainable business capability? How economically efficient are its AI operations relative to the value they generate? How resilient is the organization to AI failure, cybersecurity disruption or infrastructure inflation? How successfully does it preserve and amplify human expertise rather than simply eliminate labor? How rapidly can it learn, adapt and operationalize new knowledge?

These are not merely technology questions. They are questions of enterprise economics, organizational sustainability and long-term competitive viability.

The companies that ultimately succeed in the AI era may not be those with the largest AI budgets, the greatest number of pilots or the most aggressive automation programs. They may instead be the firms that best understand the economics of technological capability itself: organizations capable of balancing innovation with resilience, automation with human augmentation and technological ambition with sustainable operational design.

The coming decade is therefore likely to produce a widening divide between enterprises optimizing for AI-driven valuation narratives and enterprises optimizing for measurable, durable economic performance. In the short term, these may appear to be the same thing.

Over time, however, the distinction will become increasingly visible. Some organizations will discover that AI has enhanced genuine enterprise capability. Others will discover that they merely optimized the appearance of transformation while silently accumulating new forms of economic and operational risk.

Artificial intelligence is not simply changing business operations. It is exposing the inadequacy of many of the measures used to evaluate business success itself. The central challenge of the AI economy may ultimately become not whether organizations adopt AI, but whether they can distinguish between technological activity and actual economic value creation.

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Enterprise AI is entering a new phase. While the first wave of generative AI focused on human productivity and content creation, the next wave — agentic AI — will fundamentally change how organizations operate. Agentic AI systems are capable of reasoning, planning, making decisions and executing actions across applications, workflows and business processes with minimal human intervention.

As organizations move toward agentic frameworks that can independently resolve customer issues, optimize supply chains, manage infrastructure, coordinate workflows and even operate IT environments, one reality becomes clear: The network becomes the nervous system of the autonomous enterprise.

The infrastructure requirements of agentic AI differ dramatically from those of traditional applications. These systems are highly distributed, continuously exchanging information, interacting with APIs, accessing multiple data sources and making decisions in real time. The performance, security, visibility and adaptability of the network will directly determine the effectiveness of AI agents. Organizations that view AI readiness solely as a compute or data challenge risk overlooking one of the most critical enablers of future success — the network itself.

From AI-ready networks to autonomous networks

The long-term destination is the autonomous network: A network capable of self-monitoring, self-optimizing, self-healing and self-securing through the use of AI and automation. However, autonomous networking will not emerge overnight. The investments enterprises make today to support agentic AI are the same foundational building blocks required for tomorrow’s autonomous operations.

In many ways, agentic AI serves as both the driver and beneficiary of network transformation. AI agents require networks that can dynamically adapt to changing demands, while autonomous networks will increasingly rely on AI agents to manage and optimize themselves. The result is a reinforcing cycle where AI and networking evolve together.

The core characteristics of the network of the future

One of the most critical requirements for AI-ready networks is real-time observability and telemetry. Agentic AI thrives on context, and AI agents must continuously gather information from users, applications, devices, clouds, security systems and operational platforms. Future-ready networks must provide end-to-end visibility across campus, branch, cloud and data center environments. High-fidelity telemetry streams, real-time performance monitoring, application-aware analytics, AI-aware analytics and unified operational visibility are essential. Without comprehensive visibility, AI agents operate with incomplete information, limiting their effectiveness and increasing operational risk.

Another cornerstone is intent-based automation. Traditional networks are configured manually, often requiring administrators to define thousands of individual settings. In contrast, autonomous networks operate according to business intent. Enterprises increasingly need to define desired outcomes — such as maintaining application performance, optimizing user experience or automatically isolating compromised devices — rather than micromanaging configurations. The network continuously adjusts itself to achieve those objectives, providing the foundation upon which AI agents can make decisions safely and consistently.

Agentic AI also introduces entirely new traffic patterns that require AI-optimized connectivity. Large language models, retrieval systems, vector databases, cloud AI services, edge inference platforms and multi-agent orchestration frameworks create significant east-west and cloud-bound traffic. Future networks must provide low-latency connectivity, high-capacity fabrics, dynamic traffic engineering, edge-to-cloud optimization and policies that identify and prioritize AI workloads. The organizations that can move data efficiently will gain a competitive advantage in AI execution speed and responsiveness.

Security is another non-negotiable element. Agentic AI expands the enterprise attack surface because AI agents increasingly access sensitive systems, interact with APIs, consume proprietary data and execute actions across business environments. Future-ready networks must embed zero trust security into their architecture, with continuous identity verification, fine-grained access controls, microsegmentation, policy-driven authorization and continuous risk assessment. Security can no longer be bolted onto the network; it must be integral to its design and AI agents need to adhere to their own identity rules.

Finally, distributed intelligence across edge and cloud environments is essential. Many AI use cases require decisions to occur close to the source of data. Manufacturing systems, healthcare environments, retail operations, transportation networks and smart facilities often cannot tolerate the latency associated with centralized processing. Future networks must support edge AI deployment, distributed processing architectures, local inference, hybrid cloud operations and intelligent workload placement. The ability to move intelligence closer to users, devices and operational environments will become increasingly important as agentic AI expands across the enterprise.

Human expertise remains essential

Despite rapid advances in AI, the future will not eliminate the need for human expertise. In fact, it may increase its importance. One of the most significant misconceptions surrounding AI is that automation eliminates the need for skilled professionals. The reality is that autonomous systems require expert oversight, governance, validation and continuous optimization.

As AI systems become more capable, enterprises will need professionals who understand network architecture, security policy, AI governance, operational risk management, data quality, regulatory compliance and human-in-the-loop decision frameworks. The challenge is compounded by the unprecedented pace of AI innovation. New models, architectures, orchestration frameworks, security concerns and governance requirements emerge almost monthly. Most enterprise IT teams cannot be expected to independently evaluate every development while simultaneously modernizing infrastructure and maintaining day-to-day operations.

Organizations need access to experts who continuously track technology evolution, understand emerging best practices and can help translate innovation into practical deployment strategies. These experts provide not only implementation support but also ongoing operational guidance, helping enterprises maintain appropriate human oversight as AI capabilities expand. The future is not fully autonomous decision-making without people; it is intelligent automation operating under expert human governance.

5 actions enterprises should take now

Organizations should be preparing for the autonomous future right now. The following investments deliver immediate value while laying the groundwork for long-term AI transformation:

1. Modernize network observability. Establish comprehensive visibility across users, applications, devices, clouds and infrastructure. Rich telemetry and operational data will become the fuel that powers both Agentic AI and autonomous network operations.
2. Build an automation-first operating model. Identify repetitive operational processes and begin automating them. Automation maturity is a prerequisite for autonomous networking and creates the operational foundation AI agents will eventually leverage.
3. Adopt zero-trust principles across the enterprise. Implement identity-centric security controls, segmentation and continuous policy enforcement. As AI agents gain access to enterprise systems, security architectures must evolve to leverage the same identity controls.
4. Design for edge-to-cloud AI workloads. Evaluate network architectures for latency, bandwidth and resiliency requirements associated with distributed AI. Future AI deployments will span data centers, public clouds, branch locations and edge environments.
5. Invest in skills and strategic partnerships. Develop internal expertise while leveraging partners that possess deep networking, automation, security and AI knowledge. Human expertise remains one of the most important success factors in building AI-ready and autonomous infrastructures.

The road ahead

Agentic AI is poised to transform enterprise operations in much the same way cloud computing transformed infrastructure and the internet transformed business itself. But AI agents cannot operate effectively without a modern network foundation. The enterprises that succeed will recognize that AI readiness extends beyond models and data. It requires networks that are observable, automated, secure, intelligent and increasingly autonomous. The investments made today in AI-ready networking are not merely infrastructure upgrades — they are strategic building blocks toward the autonomous enterprise of the future, where AI agents and autonomous networks work together under human guidance to deliver unprecedented levels of agility, efficiency, and innovation.

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For diversified enterprises, few operating model questions are as persistent or polarizing as centralization versus decentralization. Decentralization promises speed, ownership, and local responsiveness. Centralization promises efficiency, standardization, and leverage. Both can be right. Both can be wrong. The challenge is that many organizations end up with both models operating at once, without enough clarity about why.

The result of fragmented systems, duplicated capabilities, inconsistent data, rising IT spend, and a complexity tax that compounds over time is familiar to many CIOs. What starts as autonomy can become architectural sprawl. What starts as enterprise leverage can become bureaucracy. And as companies modernize core platforms, integrate data, and scale capabilities like AI, the tension becomes harder to ignore.

Paul Krebs has lived that tension from multiple vantage points. Most recently as CIO and chief transformation officer at Koch Industries, and previously a technology and transformation leader at The Coca-Cola Company, he’s worked in environments where business units value autonomy, enterprise scale matters, and the wrong operating model can slow progress just as easily as the wrong technology architecture.

His conclusion isn’t that CIOs should pick a side, but they need a more intentional form of centralization, one that starts with business architecture, clarifies decision rights, and continually revisits where capabilities should sit as the organization matures.

Centralization: a design choice, not a doctrine

In diversified organizations, decentralization often starts as the default because it aligns with how the business creates value. Local businesses understand their customers, markets, regulatory environments, and operating realities, and giving them decision rights can increase speed and accountability.

In Krebs’ experience, the default model often leaned toward decentralization, he says, with the belief that optimizing for customers and markets would allow different businesses to be as responsive as possible to the specific customers and markets they served. But that logic isn’t complete. Leaders also need to ask whether there’s a compelling case where a more centralized approach can generate additional value, accelerate progress, or optimize investments.

Digital transformation created one of those moments. Krebs recalls around 2016 when Koch challenged its businesses to build multi-year digital transformation roadmaps. The ambition was there, but the capabilities to execute at the necessary pace weren’t evenly distributed. In response, the organization invested more aggressively from the center, building shared services and centers of expertise in areas such as business transformation, enterprise applications, and data and analytics.

The purpose was acceleration, not control. Centralizing those capabilities helped accelerate learnings, capability building, and their ability to deploy new solutions at scale. But the move wasn’t treated as permanent. “There was always a belief that the centralization push should be re-looked at on a regular basis, not thought of as a forever decision,” he says.

Know what belongs at the center

Over time, Krebs learned that  the capabilities most likely to remain centralized were those where scale, consistency, and risk management mattered more than local differentiation. Infrastructure, collaboration platforms, cybersecurity, cloud management, FinOps, and the help desk were natural candidates to remain shared services.

Other areas were more nuanced. Some application capabilities moved back into the businesses as local maturity increased. Many data and insights capabilities also moved closer to the business once teams had built enough muscle to own them. Meanwhile, certain emerging capabilities such as spatial technologies like AR/VR remained centralized because it didn’t yet make sense for each business to build them independently. Many companies have lived this journey as well, for example, with gen AI, which often started with a center of excellence, and then evolved into a more decentralized approach, enabling teams across the business to innovate quickly.

That distinction avoids the trap of treating the enterprise as one uniform operating model. “Both models can be successful, and both have advantages,” he says. “That’s what makes the balance so difficult.”

Centralization provides a clearer path to execution at scale and cleaner decision rights, but it requires change management and careful attention to bureaucracy. Decentralization provides ownership and speed, but it can also over index toward preference versus real differentiation, he adds, while making architecture harder to scale later.

Don’t confuse standardization with centralization

One of the most important distinctions Krebs makes is between centralization and standardization. Many organizations treat them as interchangeable, but they’re not.

“You can have a centralized team that can manage the nuances of different requirements,” Krebs says. “You can also have a centralized standard platform that can be used in a decentralized manner.”

That distinction opens up more operating model choices. A company may centralize a platform but decentralize how business teams configure or use it. It may standardize process patterns while keeping execution close to the region or business unit. It may also centralize architectural governance while allowing local teams to move quickly within defined guardrails.

This is especially important in global organizations, where regional needs are real but not always unique. Krebs advises leaders to examine whether local requirements can be made more generic and reusable. The risk is solving each local requirement as a one-off, so the better path is to understand the underlying requirement, build it in a way that can scale, and still allow local teams to execute within the standard model.

Let business architecture lead technology architecture

Few topics expose the centralization tension more clearly than ERP consolidation. Many diversified companies, particularly those shaped by acquisition, end up with dozens or hundreds of ERP instances. Some leaders push for massive consolidation. Others prefer to build integration layers on top of the existing environment.

Krebs’s starting point is neither technology nor cost. It’s business architecture. “The easiest and most effective path is when the IT or systems architecture follows and aligns to the business architecture,” he says.

If the business is truly going to operate processes separately, separate systems may be appropriate. But if the organization has numerous teams, processes, and tools, leaders need to ask whether there’s enough differentiation and value to justify that complexity.

The same logic applies to M&A. Companies can get into trouble when integration synergies are held hostage by ERP migration timelines. Instead, Krebs advises starting with the business integration strategy. Understand where the synergies are, how the business architecture should come together, and then decide whether the IT architecture needs to be fully integrated, or whether a data layer, reporting platform, or other integration approach can deliver value faster.

Make the cost of complexity visible

CIOs in decentralized companies often face a frustrating dynamic. The business wants autonomy and speed, but the same leadership team still questions why IT spend is high relative to benchmarks. Krebs says the answer starts with cost alignment and visibility.

In environments with a mix of centralized and decentralized services, Krebs saw centralized capabilities like infrastructure, help desk, and security perform well on benchmarks. More decentralized areas, such as BI, reporting, and commercial applications, often had more redundancy and higher cost.

The point isn’t to blame the business but make the economics of complexity visible. CIOs need to show how flexibility in one area may require multiple systems, data stores, or teams elsewhere. “I understand we want flexibility here,” Krebs says. “But leaders must see when that flexibility may cost the company money, and be clear on whether the value justifies it.”

That shifts the conversation from IT cost to business service economics. A single aggregate IT spend number is rarely useful in a decentralized environment. More helpful is a capability-based view that shows which areas are scaled efficiently, which are fragmented, and where the business architecture is driving the technology cost structure.

Revisit the model as maturity changes

For a new CIO entering a decentralized environment, Krebs cautions against immediately declaring that too many things need to be centralized. The better starting point is curiosity. “I would begin with just trying to understand why they’ve made the decisions they have,” he says.

From there, CIOs can engage leaders in a conversation about the target operating model, connecting business architecture to technology, data, and organizational capabilities. Once the direction is clear, he advises CIOs to work with the willing. Find the parts of the organization that already see the need for change, prove the model there, and scale from demonstrated success.

Regardless of execution, though, the right model changes over time. A low-maturity capability may benefit from centralization because the organization needs to build talent, avoid reinventing the wheel, and accelerate learning. As maturity grows, decentralization may make more sense because business teams need flexibility to adapt quickly. Once maturity is high and patterns stabilize, the organization may be ready to centralize again to leverage scale.

“Once I’ve decided I’m going to start with centralized or decentralized, you don’t necessarily need to stay in that model,” Krebs says. “You need to be continually revisiting the operating model as your organization matures and evolves.”

That may be the heart of smart centralization. It rejects the false permanence of operating model decisions, and recognizes that autonomy and scale are both valuable, but in different places, at different times, for different reasons.

Security operations centers (SOCs) have spent years struggling under the weight of growing alert volumes, expanding attack surfaces, and chronic staffing shortages. Now artificial intelligence is adding a new complication: not just more information, but more machine-generated information that must itself be evaluated.

“There is an asymmetry here because you now have to parse through a lot of AI slop to get to, ‘Okay, is this real or not?’” Fernando Montenegro, vice president and practice lead at The Futurum Group, tells CSO.

His observation captures a growing concern among security leaders. AI is helping attackers and defenders move faster, but it is also creating new forms of cognitive burden for the humans tasked with separating signal from noise.

As AI accelerates vulnerability discovery and enables more automated reconnaissance and exploitation, defenders are increasingly responsible for overseeing systems whose outputs can be difficult to interpret or verify. The challenge is not simply more work. It is that the volume, speed, and complexity of that work are increasing simultaneously.

Yet experts who study and advise SOCs reject the idea that collapse is inevitable. Instead, they describe an industry entering a difficult transition that could reshape how security teams operate and how humans and machines share responsibility for defense.

The vulnerability surge is exposing years of security debt

One of the most immediate concerns is the possibility that AI dramatically increases the number of vulnerabilities organizations must identify and remediate.

Chris Crowley, a longtime cybersecurity instructor and SOC expert, argues that organizations are facing the consequences of years of accumulated technology debt.

“A lot of what we’re going to have to account for in the next couple of years is a technology debt of vulnerable software that has been deployed because it’s good enough to solve the problem, but then there are all these latent cyber issues, flaws, vulnerabilities that weren’t discovered prior to deployment,” he tells CSO.

AI-assisted vulnerability discovery has the potential to expose those weaknesses at a pace defenders have never experienced before.

“The compression of work that is being dropped on us is unprecedented,” Crowley says. “We’ve just been ignoring it for decades.”

He does not believe AI will necessarily create entirely new classes of vulnerabilities. Instead, he expects defenders to confront much larger volumes of familiar problems.

“We’re going to have 100 of these simultaneously,” he says, referring to the kinds of high-priority vulnerabilities security teams traditionally handle one at a time.

The AI challenge for many SOCs may be less a novelty problem than a volume problem. Security teams already know how to patch systems, prioritize remediation, and respond to critical exposures. What changes is the scale and speed at which those demands arrive.

Organizations with mature patching, prioritization, escalation, and response processes may struggle but adapt. Organizations that have treated security operations as a bare-minimum compliance function may find themselves overwhelmed.

For CISOs, Crowley says, that means treating “patch now” less as an occasional emergency state and more as a permanent operating posture. As AI accelerates vulnerability discovery, the distinction between routine maintenance and crisis response may continue to blur.

He compares the situation to disaster recovery planning. Organizations that wait until a crisis arrives to establish staffing plans, escalation paths, and remediation processes may discover there is not enough help available.

Cognitive overload may become the defining challenge

While vulnerability discovery receives much of the attention, Montenegro believes security leaders need a broader framework for understanding AI’s impact.

Organizations should think about AI through three lenses, he says: security for AI, AI for security, and security from AI. The first involves protecting AI systems. The second involves using AI to improve defensive operations. The third asks what happens when adversaries use AI against the organization.

For SOCs, all three categories are beginning to overlap.

As AI makes it easier to create reports, assessments, vulnerability submissions, and other operational artifacts, humans remain responsible for determining whether that information is accurate and useful.

“It becomes much easier to generate content,” Montenegro says, “but if you’re going to review that content as a human, the onus on you now is that much larger.”

The result is a new form of cognitive overload. Security professionals may spend increasing amounts of time evaluating machine-generated information instead of conducting higher-value security work.

Organizations can increasingly use AI to summarize reports, evaluate alerts, and assist with investigations, but humans remain responsible for validating the results.

“We’re not at the stage yet where people are comfortable” handing off critical decisions entirely to AI, he says.

That leaves defenders caught between two competing realities: AI is creating more information to process, but AI is also becoming one of the few viable tools for managing that growing workload.

For Montenegro, the principle should be to automate tasks, not roles. AI can absorb repetitive investigative steps, but organizations should be cautious about removing humans from the process entirely.

The risk, he says, is that if organizations hide too much complexity behind automated outputs, analysts may lose opportunities to develop the domain knowledge needed to advance.

“How is that professional who is reacting to those alerts growing as a professional?” he says.

The gap between mature and struggling SOCs may widen

Not every organization will experience the impact of AI in the same way.

John Hubbard, senior cybersecurity consultant and SANS instructor, believes the industry’s response will largely depend on how well organizations have prepared for operational stress before AI arrives at scale.

“I would roughly break security operations teams into two camps,” Hubbard tells CSO. “There are the ones that are definitely struggling, are already overwhelmed. And then some are doing really well.”

The struggling organizations tend to be understaffed, underfunded, undertrained, or dependent on ad hoc processes. Every incident feels different, forcing teams to improvise under pressure.

“Getting hit with something like this can certainly be an accelerant for burnout if they weren’t already experiencing it,” Hubbard says.

By contrast, mature security teams have already invested in processes, training, exercises, and automation. “The teams that are doing a really solid job now are probably not super overwhelmed because they’ve developed the processes and procedures to be ready for this kind of thing,” Hubbard says.

He compares successful SOCs to fire departments. Firefighters cannot predict exactly where the next emergency will occur, but they know how to respond because they have rehearsed those responses repeatedly.

“The teams that kind of can react like a fire department are the ones that are getting it right,” he says.

Those organizations conduct tabletop exercises, adversary emulation exercises, red-team assessments, and incident response drills. As a result, they can absorb additional workload without descending into panic.

Burnout remains the industry’s most difficult problem

Despite widespread concern about AI-enabled attacks, none of the experts view AI solely as a threat. Several argue that AI will become essential for helping defenders cope with the challenges it creates.

Jose-Marie Griffiths, president emerita and former CIO of Dakota State University, believes AI can help security teams sift through overwhelming volumes of information and identify the signals that matter most.

“People who work in SOCs are now seeing overwhelming volumes of data, and they’re getting fatigued,” Griffiths tells CSO.

AI can help automate portions of analysis, validate alerts, and improve visibility into complex environments. But Griffiths cautions that some AI-assisted vulnerability discovery tools are also producing large numbers of false positives.

That matters because false positives do not eliminate work. They create it. As organizations confront escalating volumes of findings, distinguishing genuine risk from erroneous results may become as important as discovering vulnerabilities in the first place.

The experts agree that technology alone will not determine outcomes. People will.

Crowley argues that cybersecurity professionals must recognize that uncertainty is intrinsic to the profession. “We are the group that deals with uncertainty,” he says. “That’s really and truly what cybersecurity is.”

That reality places responsibility on both individuals and organizations. Analysts need mechanisms for managing stress. Teams need to recognize when colleagues are approaching their limits. Managers need to establish healthy escalation practices and realistic expectations.

Hubbard rejects the notion that burnout is inevitable.

“It is not a foregone conclusion that security operations jobs have to be a painful grind that everyone hates,” he says.

He has seen organizations where employees remain engaged for years because leaders actively manage workload, create supportive cultures, and encourage open communication.

That includes making it safe for analysts to admit when they have reached their limits. “If people are unwilling to say, ‘I’m maxed out right now, and I’m going crazy,’ that’s going to be the thing that breaks a lot of teams,” Hubbard says.

Pay alone may not solve the problem. Crowley pointed to SANS/SOC survey findings showing that compensation ranked fourth among retention factors, behind meaningful work, training, and professional development.

The future SOC may look very different

Griffiths believes organizations will need to respond not only with better technology but with structural changes. Traditional tiered SOC models may need to evolve into more collaborative teams with diverse expertise working together in real-time.

“I think we’re going to have to eliminate the hierarchies a little bit and have teams of people with different expertise working together,” she says.

She also argues that organizations should invest in human expertise rather than simply increasing AI consumption. “Buy engineers, not tokens,” she says.

Professional networks and peer support will matter as much as any tool, Griffiths says, because defenders need trusted communities where they can compare notes, share practices, and avoid facing sustained pressure in isolation.

If there is a consensus emerging among experts, it is that AI is exposing weaknesses that already existed.

The staffing shortages, alert fatigue, burnout, and process failures affecting SOCs did not begin with generative AI. AI is simply amplifying them.

At the same time, AI is providing new tools that may help organizations manage those very challenges.

The future SOC may spend less time manually triaging alerts and more time validating automated findings, conducting threat hunting, and making strategic decisions. Human expertise may increasingly be paired with AI systems that act as operational partners.

The transition will not be painless. Some teams will struggle. Some practitioners may leave the field. Others will adapt and thrive.

“In a way,” Griffiths says, “we’re turning the whole SOC inside out.”

Montenegro sees the transition as a cybersecurity version of the Red Queen effect: defenders and attackers must keep running simply to stay in place.

Borrowing from science-fiction author William Gibson, Montenegro offered perhaps the simplest description of the industry’s current moment: “The future is already here. It’s just unevenly distributed.”

For security leaders, that future is arriving in the form of AI-generated vulnerabilities, AI-assisted investigations, and AI-enabled adversaries. The question is no longer whether security operations centers will change. It is whether organizations can adapt quickly enough to keep pace.