Risk Multiplier or Mitigator? What AI Adoption Tells Sureties About Contractor Maturity

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By Carl Oliveri of Grassi

The construction industry is embracing AI with no shortage of enthusiasm. Yet for all the excitement, adoption is outpacing execution. A 2025 global survey of more than 2,200 construction professionals by RICS found that firms planning to increase Artificial Intelligence (AI) investment outnumber those actively using it by more than 2 to 1, with 78% of organizations still in non-adoption or early pilot phases.

What is slowing meaningful adoption is not a failure of ambition, but organizational readiness. AI performs in proportion to the environment it operates in, and many contractors are still determining how and where these tools fit into core workflows that govern estimating, project execution, and financial management.

For sureties assessing contractor performance, the most telling sign of organizational maturity is not whether a contractor uses AI, but whether it is applied with the controls and accountability needed to close the execution gap.

High-Impact AI Use Cases for Contractors

Many contractors are keen to harness AI’s potential, and for good reason. Recent advances in large language models and machine learning offer compelling tools to address long‑standing construction challenges.

Sophisticated contractors are leveraging AI for:

  • Predictive scheduling and forecasting: AI ingests historical performance, labor rates, and external variables, such as supply chain conditions and weather data, to refine schedules and stress‑test backlog assumptions.
  • Cost monitoring and anomaly detection: Automated analysis of cost trends can highlight margin risk, provided baseline data is reliable and escalation protocols are clearly defined.
  • Back-office automation: Automating invoicing, payables, and expense management reduces manual errors and improves cash‑flow predictability.
  • Resource allocation: AI‑driven analytics identify underutilized labor, equipment, or materials, enabling earlier corrective action to protect productivity and margins.
  • Safety and compliance monitoring: Embedded AI in wearable devices and monitoring platforms allows early identification of safety or compliance risks, supporting swift intervention and reducing exposure to claims.

Risk Magnified, Not Created or Erased

AI doesn’t inherently reduce or increase risk. Instead, it amplifies the strengths and weaknesses that already exist. For sureties evaluating organizational maturity, the following concepts are worth keeping front of mind:

  1. AI doesn’t question its inputs. The foundation of any AI system is the data feeding it. When job cost inputs, historical data, and WIP schedules are inconsistent or fragmented, AI-generated forecasts don’t surface those problems. Instead, they absorb them, smooth them over, and produce outputs that look authoritative. 
  2. Human oversight can’t be replaced. Decisions should be traceable to a responsible individual, a documented process, and a clear review trail. If the explanation stops at “the system flagged it,” that is a governance gap.
  3. Progress often expands the surface area for risk. Every new system integration, automated workflow, and AI-connected platform is a new point of entry. Sureties should ask not only what tools a contractor has implemented, but whether their cybersecurity posture has kept pace.

The True Markers of AI Readiness

For sureties seeking an accurate assessment of AI‑related risk, the most reliable indicators are organizational, not technological:

    • Clear Governance: Policies define which AI solutions are approved, who may deploy them, and how outputs are monitored.
    • Defined Accountability: Human expertise remains the final checkpoint. AI may inform estimates, schedules, or forecasts, but ownership of outcomes is never outsourced to technology.
    • Integrated Cybersecurity: Data protection and system controls are embedded from the outset and evolve alongside the contractor’s digital footprint.

    The Bottom Line

    The core lesson for sureties is this: Don’t be distracted by dazzling new software. Instead, interrogate the controls, governance, and cultural discipline that underpin AI’s use. These organizational fundamentals determine whether technology becomes a risk multiplier or a true risk mitigator.

    Carl Oliveri, CPA, CCIFP, is the Construction Practice Leader and a Partner at Grassi. He has more than 25 years of experience advising owners and executives in the construction industry, particularly in project-centric and companywide financial modeling, operational strategy development, financial statement accounting services, income tax method analysis, and more. This extensive industry experience enables him to offer valuable insights and advice to construction clients on market trends and best practices. Oliveri serves on the NASBP CPA Advisory Council. He can be reached at [email protected] or 212.223.5047.

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