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Consultants have traditionally spent a large portion of their time reading, analyzing, writing and presenting data. Now, artificial intelligence is doing all of that faster.
That doesn’t take away from the value consultants offer, though it may require the industry to reevaluate longstanding compensation structures, change their workforce makeup and prioritize new skills and abilities.
“It’s probably the biggest tech shift in our lifetimes,” says KPMG’s director of AI innovation and ventures, Ryan MacDonald. “Personally, it’s moved me from spending a lot of time producing artifacts – like slides, reports, status updates, notes – to spending more time on judgment and action.”
Even developing a piece of software, which previously required teams working for weeks or months, can be produced by an individual for a fraction of the time and cost using AI.
“Previously if I wanted a custom piece of software, I’d be making a big business case to go and ask for investment,” Mr. MacDonald says. “Now, I can build a solution that helps me accelerate my work day-to-day.”
As consultants offload more of that production work to technology, they’re able to spend more time on critical thinking, problem solving, client relationship building and other quintessentially human services.
The significant reduction in the cost, time and manpower needed to deliver that value, however, does disrupt many of the industry’s longstanding operational models. For example, consulting firms have historically charged clients based on hours worked, but AI is dramatically reducing the number of hours required to complete a project.
But leveraging technology to get the same work done faster doesn’t necessarily change the value of the services they provide; in fact, the added speed and efficiency could increase it.
“The concept of hours-times-rate is still a core part of what it looks like today, but I do think you’re starting to see more of a conversation around value-based pricing,” Mr. MacDonald says. “It’s less about preparing prettier slide decks, more about faster learning, better decisions and the value that we can support our clients in achieving.”
Many of those lower-level tasks that are being offloaded to AI, however, were previously given to junior staff, causing some concern over the disappearance of entry-level positions. Historically, consulting firms, like many enterprises, featured a pyramid-shaped workforce, with the number of positions decreasing at each level of seniority.
“You’re seeing this shift from the pyramid shape to sort of a diamond shape,” says Murray Lei, an associate professor of management analytics and academic director of the Master of Management in Artificial Intelligence program for the Smith School of Business at Queen’s University in Kingston, Ont. “The number of entry-level analysts is getting smaller and smaller and, at the same time, you need more and more middle managers to manage not only human analysts, but AI agents.”
Rather than eliminating entry-level roles, however, Prof. Lei is optimistic that junior consultants will enter the industry in what was once a more middle layer. “That becomes the new entry-level” he says.
That transition also changes the kinds of skills consultants offer, reducing the need for those who can draft reports and slide decks and putting a higher premium on skills such as communication, process design and creative problem solving.
“One of the skills that’s very important is the skill of defining a problem,” says Prof. Lei. “What these AI models are very good at is solving very well-defined problems, but they’re not very good at translating business situations into a sequence of tangible problems, so this skill is becoming very important.”
As AI forces a reframing of the value consultants offer – from the tangible reports that can now be generated by AI to the less tangible advisory and insights that can’t – it’s creating new opportunities for smaller players to have a big impact.
“I see a parallel path where large firms are going to be able to rely more on an AI workforce and smaller firms are going to be able to compete – through AI and globalization – with the larger firms,” says Suzanne Knight, the chief executive officer of Toronto-based boutique management consulting firm mBolden. “There is an opportunity for smaller firms to carve out their niche.”
Ms. Knight founded mBolden in 2023, leveraging the post-pandemic increase in remote work to access niche freelance and fractional skills from around the world.
“The structure that I’ve designed allows me to have flexibility around a human workforce and a machine-led workforce; I’m able to create the right composition at any moment in time,” she says.
Even if consultants can do more in less time by leveraging AI, those quintessentially human skills are only going to be more valued – and accessible – in an increasingly complex business environment.
According to Ms. Knight, AI can help create the playbook, but businesses will still need consultants to help them put it into action. “There’s a messy middle,” she says. “That’s where consultants of the future can add exceptional, uniquely human value.”