briefings

Locally Rational, Globally Expensive

Across a large organisation, IT, sales operations, finance, and operations are each using AI for the same class of work: reducing signal noise, automating routing, handling exceptions. Four names, four contracts, four governance frameworks, one operating problem.

Each decision was locally rational. The function had a real problem, a tool that fit, and a way to buy it without a committee. The terms are local; the cost is global. The aggregate is structural debt: duplicated tooling, divergent governance, redundant skills, compounding every quarter.

The vendor market makes it worse. Because each function named the problem differently, the market built separate categories to match, and sells the fragmentation back at full price. The org chart became the procurement strategy.

The fix is not centralisation, which would reintroduce the latency each function was avoiding. It is governing the common underlying mechanism while leaving execution local.

Read the full argument in Locally Rational, Globally Expensive.