EY Creates Dedicated AI Office to Govern Cross-Functional Spending

A New Corporate Function for AI Governance

EY is establishing an "AI Value Realization Office" to centralize how the firm allocates AI spending and measures its impact across the organization. The dedicated function represents a structural response to a practical problem: AI investments don't fit neatly into traditional departmental budgets.

Dan Diasio, EY's global consulting AI leader, told Business Insider the office should be fully operational within months. Its mandate includes governing AI spending, monitoring usage patterns, deciding which initiatives merit scaling, and overseeing how the technology reshapes roles across the firm.

Why it matters

This move signals a broader shift in how enterprises may need to organize around AI. As companies move from experimentation to scaled deployment—and confront the real costs of token-based pricing—the question of who controls AI budgets and measures returns becomes strategic. EY's approach suggests AI may require dedicated governance structures similar to how HR emerged during the Depression or treasury functions formed when currency risk grew in the 1970s.

The Cross-Functional Value Problem

Most organizations fund technology and tools along departmental lines—IT gets a budget, finance gets another, sales a third. But AI applications frequently span multiple functions, and Diasio argues that siloed funding leaves significant value unrealized.

Research from EY-Parthenon found that 75% of potential enterprise value from AI comes from horizontal initiatives that cross departmental boundaries, compared to just 25% from projects contained within single functions. The new office will direct funding toward these higher-value opportunities rather than letting each department pursue isolated use cases.

The office won't just track dollar-for-dollar returns. It will assess whether AI initiatives are actually changing business performance across the organization.

Cost Pressures Drive Governance

EY has committed substantial resources to AI—the firm announced $1.4 billion in 2023 toward building its EY.ai platform foundation. Like other enterprises, it now faces pressure from evolving pricing models as AI providers shift away from subsidized experimentation.

The firm has deployed an "invisible" AI router behind some specialized tools that directs employees to the most appropriate model for each task. Since implementation in April, this routing system and related governance measures have reduced token consumption by 60%.

Those cost-management strategies matter increasingly to clients as well. An EY US AI Pulse survey of 534 senior decision-makers, conducted between April and May and released in July, found that 98% said token spending had prompted them to reconsider their AI approach.

Diasio noted that companies have generally funded AI so far by tightening budgets across the board and reallocating existing funds. He expects giving AI governance more organizational authority—through functions like the value realization office—will become critical as clients scale their deployments.

Most EY clients haven't yet established dedicated AI offices, Diasio said, though he anticipates the model will spread over time as organizations clarify what their structure should look like on the other side of AI adoption.

These details were first reported by Business Insider.