As we move deeper into 2025, the use of artificial intelligence in government contracting is no longer a cutting-edge experiment—it’s becoming standard operating procedure. At the same time, the policies that govern AI use are starting to materialize with greater clarity and consequence. What was once a future-facing conversation about ethics and potential is now a real-time discussion about compliance, accountability, and risk.
For business development leaders in the federal space, this shift has immediate implications. Proposal automation tools—once seen primarily as time-saving resources—are now under a growing spotlight. As regulatory scrutiny increases, BD teams must be prepared to justify not just that they use AI, but how, where, and why.
Throughout the first quarter of this year, federal agencies have begun incorporating AI-specific language into RFPs and RFIs, especially for contracts involving controlled information, emerging technologies, or cybersecurity services. Meanwhile, Congress continues to hold hearings and propose legislation around safe and transparent AI use in federal procurement. Although there’s no sweeping regulation yet, the groundwork is being laid. This is no longer theoretical—contractors must act now to align with an evolving compliance environment.
One of the most immediate concerns is how AI-enabled proposal tools handle sensitive or proprietary information. Agencies are increasingly cautious about data being processed via third-party large language models, particularly when that data includes past performance narratives, pricing strategies, or classified project references. Even when using widely adopted proposal automation software, companies must ensure that content remains within secure environments and that AI-generated outputs are subject to rigorous human oversight.
This isn’t just about satisfying contracting officers. It’s about maintaining trust and reducing risk. For many agencies—particularly those in defense, intelligence, and homeland security—the question is not whether you can use AI, but whether you can demonstrate governance over it.
The growing emphasis on traceability and human review means business development teams need to evolve how they manage proposal development workflows. If AI is being used to generate first drafts, suggest compliance mappings, or retrieve reusable content from past bids, teams must be able to document those steps. A clear policy outlining which tools are authorized, how outputs are reviewed, and who is accountable for final content is quickly becoming a baseline expectation.
Beyond compliance, there’s also strategic positioning to consider. Agencies are becoming more AI-aware, and that awareness is shaping how they evaluate contractor maturity. Being able to explain that your proposal automation is not only efficient but secure, auditable, and aligned with emerging policy sends a powerful signal. It shows you’re not just using new tools—you understand the implications and are prepared to operate responsibly.
For forward-thinking BD executives, this is a chance to lead. Teams that proactively assess their AI use, engage in internal policy development, and integrate compliance reviews into the proposal process will be better positioned to adapt to whatever formal regulations emerge later this year. In fact, these early moves may become differentiators in upcoming bids.
The practical steps are clear. Start by auditing your AI proposal tools—where is data processed, how is it stored, and what safeguards are in place? Then, create internal guardrails. Even a lightweight AI usage policy can go a long way toward demonstrating responsible behavior to both internal stakeholders and external reviewers. Finally, educate your teams. Proposal managers and writers should understand not just how to use the tools, but when to flag content for additional review, especially when dealing with sensitive inputs.
As 2025 continues, the pace of both AI adoption and regulation will only accelerate. Waiting for formal mandates before taking action may put your team behind the curve. Now is the moment to treat AI in government contracting not just as a tactical tool, but as a strategic priority—one that demands the same rigor and foresight you bring to capture strategy and pricing.
By getting ahead of policy, not chasing it, you ensure that your use of AI enhances—not hinders—your ability to compete, comply, and win in a more scrutinized, data-driven federal marketplace.