As companies in all industries explore the rising power of artificial intelligence (AI), they face a familiar dilemma: Should we build or buy? This is rarely an either-or choice. AI vendors have attracted most of the AI talent, so companies are compelled to work with them. At the same time, AI vendors rely heavily on data that only their customers can provide, so such vendors need to work more closely with clients than they may be accustomed to doing.

Consequently, companies have several challenges. They must decide how to select and work with AI vendors both efficiently and in ways that strengthen rather than sacrifice competitive advantage. And they should have a plan for building their internal AI capabilities in an era of short-term scarcity.