CIOs, CTOs Held Responsible for AI They Can’t Control

IBM surveyed 2,000 C-level technology executives worldwide and found two-thirds of CIOs and CTOs are held responsible for AI systems they cannot fully control. Only 11% of respondents said they are fully prepared to scale AI agents.

Eighty percent reported they received transformation mandates from their CEOs. Respondents expect a 38% increase in deployed AI agents by 2027, and 77% said AI adoption already outpaces current governance capabilities.

Organizations reported an average of 54 AI agent incidents last year that required human correction. Seventeen percent of those incidents were classified as high severity and took more than four hours to contain. Among reported consequences, 37% involved data exposure or security breaches, 33% led to cascading system failures, and 17% caused compliance issues. Nearly six in ten technology leaders named security and compliance as top barriers to scaling AI agents.

IBM compared governance approaches and found firms that build controls into AI deployments had 25% fewer incidents as AI scaled. Those firms deployed 16 times as many AI agents, achieved 18% higher operating margins, and spent about one quarter of the AI budget used by organizations relying on manual governance.

On finance, AI spending is projected to grow from just under 15% of IT budgets in 2025 to nearly 25% by 2027. Eighty-four percent of surveyed CIOs and CTOs have not fully operationalized AI financial management, and 85% lack full visibility into real-time AI spending. Organizations with stronger financial discipline deployed 2.4 times as many AI agents without increasing AI or IT budgets and were three times more likely to report full readiness for scale.

Companies that kept workloads portable and models replaceable reported a 10% higher return on AI investment in 2025. The report finds architecture, governance and investment choices determine how fast organizations can expand AI, what risks they can absorb and which opportunities remain viable.

“For CIOs and CTOs, the challenge now is scaling AI systems that operate continuously and autonomously, often within governance models and architectures designed for a far slower, more predictable environment,” Matt Lyteson, IBM’s CIO, said.