In boardrooms and team meetings around the world, the promise of artificial intelligence (AI) looms large. Leaders are told that AI will streamline operations, enhance decision-making and supercharge productivity. But while many organizations are seeing gains from AI, another less visible trend is unfolding—AI is reinforcing functional silos, a problem with which companies have struggled for decades. This can cause performance to go into reverse as departments retreat into their own AI-powered worlds. While each function improves its individual operations, the organization becomes less able to deliver on its corporate strategy.