UK business leaders have a 'limited understanding' of AI usage costs – and it's coming back to bite them
Companies where CEOs are accountable for AI decisions report higher confidence in their strategy
Most UK business leaders have a “limited understanding” of their AI budgets, and they're struggling to turn AI investment into measurable business outcomes.
KPMG’s latest Global AI Pulse report found that 26% of UK companies are now using AI as part of everyday work, up from 18% in the first quarter of this year.
This increased adoption means that managing usage costs is becoming both more complex and more critical to realizing value.
Three-in-ten UK leaders told the firm that they struggle with usage-based costs, while 42% have only partial visibility into AI spending. One-third, meanwhile, cited “limited understanding” of AI cost structures, including tokens, as a challenge to deploying AI agents.
“AI is moving rapidly into everyday work, but scaling it responsibly brings a new set of challenges," said Dr Leanne Allen, head of AI at KPMG UK.
"Leaders now need to show not just that AI can be deployed, but that it can be trusted, financially controlled and clearly linked to value. Cost visibility is central to that."
Enterprises need a clear path with AI
According to KPMG, companies where CEOs are accountable for AI decisions often report higher confidence in their AI strategy, and are more likely to unlock meaningful business value and stronger returns on investment.
"As organizations use more AI tools and agentic systems, they need to understand how costs build, where value is being created and where governance controls are needed. Without that clarity, it becomes harder to make confident investment decisions or demonstrate returns," said Allen.
“Clear accountability, practical governance, and workforce adoption must move together if businesses are to turn AI momentum into sustained value.”
To help manage AI costs, the survey found organizations are implementing stronger governance controls, including monitoring and spending controls.
More than half (57%) of UK leaders report having AI cost monitoring dashboards, with 61% embedding cost reviews as part of AI approval processes to enable stronger control and decision-making.
Notably, organizations with stronger cost visibility are four-times more likely to report established ROI, at 25% versus 6%.
“AI cost management cannot sit as an afterthought. If businesses want to scale AI responsibly, they need to build financial discipline into the way AI is approved, monitored and governed from the start," said Allen.
"The organizations that can see their AI costs clearly are better placed to understand what is working, what is not and where to keep investing.”
AI costs are spiralling
Surging AI costs have become a recurring pain point for enterprises across a range of industries in recent months. As ITPro reported in June, these surging costs are the result of AI provider shifts toward consumption-based billing combined with increased usage rates.
The ‘tokenmaxxing’ trend, whereby users are encouraged to ramp up their use of AI tools, has already caused serious issues for some major companies, such as Uber.
Uber revealed that it used its entire annual AI budget in just four months after encouraging staff to use the technology, prompting a rethink of how AI is used internally. This included the introduction of a $1,500 monthly cap per employee, which is tracked through an internal dashboard.
Accenture has also urged staff to stop using AI for needless tasks in a bid to tackle mounting costs.
Last week, analysts at Gartner told ITPro that tackling this problem will require a concerted focus on cost optimization practices, including the use of context engineering techniques to maximize the use of the technology.
This call to action by Gartner came after research found AI token costs could exceed developer salaries by 2028.
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