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by Phil Stott | July 25, 2017


Woman with light display on skin

The rise of artificial intelligence in recent years has been accompanied by headlines about a huge coming wave of technological unemployment—no longer will people be needed for anything that involves data processing, pattern recognition, and so on.

At the leading edge of this revolution: the consulting industry, which thrives on its ability to identify trends and technologies that will reshape its clients' businesses—often selling these very technologies as solutions.

But, as a recent piece in the Harvard Business Review notes, the advent of ever-more-sophisticated AI may be coming for the consultants themselves:

"One might argue that corporate clients prefer speaking to their strategy consultants to get high priced, custom-tailored advice that is based on small teams doing expensive and time-consuming work. And we agree that consultants provide insightful advice and guidance. However, a great deal of what is paid for with consulting services is data analysis and presentation. Consultants gather, clean, process, and interpret data from disparate parts of organizations. They are very good at this, but AI is even better. For example, the processing power of four smart consultants with excel spreadsheets is miniscule in comparison to a single smart computer using AI running for an hour, based on continuous, non-stop machine learning."

The rest of the article makes equally grim reading for those in the consulting industry—especially if the advances the authors expect to see in AI actually come to fruition. Noting that products such as Apple's Siri, Google Home, and Amazon Alexa can already interpret many of our daily needs—and that they're learning from us all the time—the authors conclude that:

"It is likely only a matter of time until all leaders and management teams can ask Alexa things like, “Who is the biggest risk to me in our key market?”, “How should we allocate our capital to compete with Amazon?” or “How should I restructure my board?”

I'm going to stick my neck out a little here and admit to feeling somewhat skeptical about this utopic vision of a world where corporate leaders just ask their watch or cellphone a couple of questions and base their answers on the outcome. Firstly, as the article notes, data quality is a huge concern—as is privacy and security. It's one thing to imagine a future where I ask Alexa where my company's biggest risk lies. It's quite another to imagine that future when I include a bunch of competitors who will be doing everything possible to hide and obfuscate their own data while trying to learn mine.

Sure, when it comes to internal data—especially in large, complicated companies—being able to call up a comparison of YOY marketing spend at a moment's notice is a definite improvement over the current process of hiring a consulting firm. But, in addition to the aforementioned data security risk, this scenario also assumes that consultants won't simply harness this ability and build it out as part of their suite of services—something that is, in fact, already happening at several leading firms in the industry. 

When previously considering the possibility of technical disruption in other industries, I've made the point that we don't have to be looking at an either/or scenario: the purpose of most technological advances is to be able to do more, better, and cheaper than you could without the technology. So, yes: a decade from now, consulting firms will likely have fewer first-year associates pulling long hours turning data into charts for presentations. But the idea that executives will stop relying on expert outside counsel—which, despite the characterization of consultants in that first excerpt above remains the overriding purpose of strategy consultants—seems far-fetched, especially when those experts will also be able to utilize these technologies in their analyses.

So, yes, this technology is all but certain to continue to change the way that businesses operate—and, with it, the tasks that consultants perform to serve their clients. But unless you take the view that consultants are no more than the sum of their tasks, then it's hard to see the demand for their services disappearing in an environment that is almost certain to be orders of magnitude more complex (because of this technology) than the one we operate in today.