AI Automation Pressures Consulting Firms to Shift From Time-Based Pricing
· Business · CNBC
Artificial intelligence is challenging traditional time-based pricing models in the consulting industry as clients increasingly demand measurable outcomes. Automation is absorbing research, analysis, and presentation tasks usually handled by junior consultants, creating challenges for how entry-level staff build experience. KPMG global head of consulting Svilena Tzekova said that basic advisory work is now largely obsolete because clients can quickly generate similar insights independently. However, firms are struggling to establish commercially viable outcome-based pricing models while procurement departments continue to track hourly rates and staff headcount. Meanwhile, smaller AI-native consultancies are attempting to gain a competitive advantage while traditional firms modernize their operations.
Why it matters
Professional services firms and their graduate employees face a fundamental restructuring of business models as AI automates junior tasks and forces a shift from billable hours to outcome-based fees.
Read the original report — CNBC
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