The integration of Artificial Intelligence (AI) into higher education institutions presents both significant opportunities and complex challenges. To effectively harness AI's potential for transforming teaching, learning, research, and administration, universities require a strategic approach that goes beyond technological implementation. This paper proposes a strategic framework emphasizing the critical roles of distributed leadership and robust knowledge management practices in facilitating successful AI adoption within higher education. By fostering collaborative leadership across the institution and cultivating dynamic knowledge ecosystems, universities can better navigate the technical, ethical, pedagogical, and organizational complexities associated with AI integration. Drawing upon existing literature, the framework highlights the synergistic relationship between these elements and provides a conceptual blueprint for higher education leaders aiming to strategically embed AI into their institutional fabric.