Happy Christmas! The Consulting model is totally collapsing! Well, perhaps it is just the traditional consulting pyramid business model that is being disrupted. Check out this episode for 5 things you need to know about it...

We Discuss:

• Can AI do all the consulting work, making consultants obsolete?
• What happens to the consulting pyramid structure when AI eliminates junior analyst roles?
• How can consulting firms maintain revenue when they need fewer billable bodies?
• Where will future consultants get their experience if there are no entry-level positions?
• Is this disruption happening now or is it still years away?

5 Takeaways:

1. AI is fundamentally disrupting the traditional consulting pyramid model where one person can now output what previously required five people, forcing firms to reconsider their staffing structures and revenue models that have relied on billable bodies for over a century (00:02:03 - 00:08:15).
2. The consulting industry is shifting from task specialization to end-to-end problem-solving, where consultants must now handle everything from analytics to implementation and training, rather than just creating plans and recommendations then walking away (00:12:16 - 00:12:59).
3. Firms will need to pivot from time-and-materials billing to outcomes-based pricing models because clients won't accept invoices for AI agents processing data for hours, forcing a fundamental change in how consulting services are valued and sold (00:14:40 - 00:15:21).
4. The traditional entry-level analyst role is disappearing, creating a career pipeline problem where firms can't sustain the pyramid structure if they have no junior intake, potentially making industry experience the new entry point rather than coming straight from college (00:23:41 - 00:25:18).
5. AI may actually save consulting by eliminating the burnout-inducing grind work, allowing the industry to focus on what consultants should truly do—provide human judgment, industry expertise, and strategic thinking—while AI handles data processing and analytical tasks (00:25:18 - 00:29:27).

Article referenced in this episode: https://www.linkedin.com/pulse/not-so-quiet-collapse-consulting-pyramid-dave-clark-icg5e