The call, in full

AI is already causing mayhem across multiple industries. Software and SaaS companies are under pressure as AI agents replace expensive software stacks. Media agencies are losing ground as AI automates planning, optimization, and content production. Now the same force is moving toward consulting.

The global consulting industry is dominated by 5 firms: McKinsey, BCG, Bain, Accenture, and Deloitte. For decades, their business model ran on the analyst pyramid. Junior consultants built financial models, synthesized research, benchmarked competitors, and turned insights into slide decks. Clients paid $350 to $500 an hour for that work. AI now performs much of it faster and cheaper. That changes the economics of consulting. Plain and simple: staff is the heaviest line in a consulting P&L, and billable hours are the revenue. AI cuts the analyst layer, so staff costs fall. But those analysts were the hours clients paid for, so revenue falls with them. Fewer people, fewer hours, smaller firms.

The pressure point is the client bypass problem. A CFO with well-configured AI connected to internal data can now answer questions that previously needed a consulting engagement. Enough routine advisory work to reduce recurring consulting spend. The Big 5 are investing billions in AI, but announcing AI investments does not solve the structural challenge.

The firms that adapt will shift the model. Fewer junior analysts. More AI-directed work. More implementation and transformation. Consulting will not disappear. AI will not kill consulting firms. It will kill the analyst pyramid.