2026 will be an interesting year. We’ll undoubtedly see several notable IPOs, a relentless hype cycle and technology leaders frantically trying to make sense of it all. The choices that are made will determine a company’s future. At the center of the all will be the Chief AI Officer, who will have the worst job in the world.
I say this only half-jokingly because I’ve been at the tail end of more than one technology hype cycle. Whether it’s dot-com, the cloud boom, or now AI, one thing remains eternal: the bill eventually comes due. Early estimates for 2025 put large organizations’ AI spending at 5% of revenue. Even smaller organizations, due to changes in Microsoft licensing, are spending more than $30/seat on CoPilot alone.
Throughout the year, we’ve seen many reports from McKinsey and others all telling the same story: most people are still in the ‘pilot’ phase of their AI initiatives. With so much money spent and so many pilots underway, why are we seeing slow scaling in the enterprise? It’s because things are moving too fast for comfort, and the benefits are unclear.
AI is a powerful technology that is advancing faster than anything before, but keeping up with the Joneses is not a corporate strategy. Implementations take time, especially with fine-tuning. LLMs are nondeterministic, which means they require significant oversight during upgrades. There are no guarantees, and I promise the Terms of Service are not in your favor.
All this considered, it’s looking like a challenging year for newly minted CAIOs. It’s not all doom and gloom, though. Some strategies can be used to get control and make good on a year of trials and promises.
Cull the Pilot Projects
In any organization, at any scale, the nature of AI is that it’s incredibly easy to try on for size. Most companies I speak to have far too many AI pilot projects underway, many of them in the so-called ‘shadow AI’ realm. At this point, it should be obvious which ones are moving the needle and which ones aren’t. If you’ve got a pilot that isn’t making the grade, you’re just diluting spend across projects.
There’s no reason to keep forcing AI into situations just because. Stop the projects that aren’t working out, and double down on the ones that are. As technology continues to grow and your organization sees success with projects that deliver value, you can revisit any cancelled pilot projects. This isn’t failure, it’s just recognizing that now might not be the right time for everything you want to do.
Add Governance Now
If you haven’t already, add governance now. The question is: if you have a pilot that’s working well and you want to scale it, how do you keep it working well in the future? Investing in governance and observability solutions lets you monitor your successful implementations and take evasive action if needed.
AI systems are complex and non-deterministic. It’s going to be hard to explain how your LLM messed up a company policy today when it was getting it right last week, and everyone found out on Reddit because you didn’t see it coming.
Upgrade cycles are accelerating, and they’ll get worse as leading foundation-model players compete more aggressively for market position. Without strong governance and observability frameworks, you are quite literally flying blind.
Make Friends with your CISO
AI accelerates everything, including the stuff you are bad at. Scaling AI requires you to be good at the fundamentals. That means making sure your infosec friends have a comprehensive understanding of your AI systems, what data they have access to, and what permissions they have on that data. Always remember, when it comes to AI in 2026, everyone is still new at this, and it’ll take cooperation to keep you and your company from becoming the next data breach headline.
The fundamentals include enhanced phishing and security training for everyone interacting with these systems. Prompt injection is a very real threat, and a simple copy/paste into an AI chat can have unintended consequences.
You Don’t Need Everything
The news doesn’t stop. Every day there is a new product, a new model or a new feature. You don’t need them all, and in fact, it’s best to avoid them. Chasing every shiny new thing leads to scope creep and project schedule slippage. AI differs from the classic understanding of enterprise software, but implementations do not.
Leadership still wants delivery on time and on budget. As I’ve said before, shiny objects are how you catch raccoons, not run a business. This industry wants to keep your focus shifting from thing to thing, and you’ve got to resist.
Realize AI is Not an Architecture
Maybe this should be filed under “be good at the fundamentals,” but your AI implementation will not fix a broken enterprise architecture. Process deficiencies will still manifest, only faster. Data quality problems will be amplified. For AI to be effective, you must have a solid enterprise architecture.
It all comes down to this: your business operates on a particular cadence that’s driven by the products and services you sell. Sounds obvious, but it doesn’t matter if customer service clears orders faster if shipping and receiving can’t speed up fulfillment. You can’t do everything at once, nor should you try.
Work Backwards
On the topic of architecture, consider working backwards. I frequently see people begin AI projects at the start of a workflow. This is a logical thing, but in many cases results in frustration and disillusionment since the benefits of the AI implementation remain hidden.
Working backwards through a workflow is a great strategy to keep your AI initiative from creating more downstream headaches.
Educate the Bosses
It’s difficult to explain to a CEO that they can’t have what they want as fast as they want it because it’s not the right thing to do. Taking a step back can be hard, but in these times, that’s precisely what is required. AI is a powerful, world-changing technology, but its shortcomings can come at you fast.
Back to the CAIO being the worst job in the world in 2026: it doesn’t have to be, for you. If you play your cards right, you’ll shore up the fundamentals in short order, ensure your organization is prepared and trained, and, as a CAIO, you’ll have a great year filled with success. If you don’t, it’s going to be a rough one. Either way, with things moving as fast as they are, it’s going to be a wild ride.
