IS AI THE FUTURE CATALYST FOR CONSULTING?

In an era where machines can learn, reason, and even create, the future of consulting is under the microscope. Amidst the rapid advancements of the Fourth Industrial Revolution, AI has woven its way into the fabric of business operations - creating efficient solutions and delivering insights. However, as businesses increasingly embrace technological solutions, one question looms large over the consulting landscape: Can artificial intelligence truly revolutionize the consulting industry? Within this edition of Blueprint, we will delve deeper into the essence of consulting, and explore if advancements in AI technology pose as a threat or catalyst to reshaping the industry as a whole.

THE USE OF AI WITHIN THE INDUSTRY

As a cornerstone of business success, consulting has been essential in ensuring smooth business processes. Consultants possess knowledge that can help companies identify inefficiencies, optimize operations, and implement suitable practices. However, the rise of AI has sparked fervent debates, bringing into question whether this technological advancement will present industry challenges such as job displacement and heavy reliance upon tech, or if it will lead to fresh opportunities for growth.

Undeniably, the emergence of artificial intelligence has made its mark across a myriad of industries. As AI continues to grow and expand to various sectors, its capabilities for growth become evident; the enhanced productivity that follows through the use of AI has propelled the consulting industry into an era of innovation and growth.

The majority of consultancies follow the same pattern: data collection, analysis, insights, and recommendations. Leveraging narrow AI, a specialized form of artificial intelligence tailored to perform specific tasks within a confined domain, has proven notably effective in streamlining the data collection process. Narrow AI encompasses digital assistants and software adept at analyzing data to optimize specific business functions. Using AI-driven tools, consultants can rapidly identify patterns, trends, and correlations in data to derive actionable insights.

Utilizing AI internally within business processes frees consultants of mundane tasks. Deloitte, for instance, has successfully implemented specific automation tools to perform all administrative tasks related to contract management (Alexandre et al, 2020, p. 38). As a result of streamlining these repetitive tasks, consultants are able to dedicate more expertise towards strategic endeavours that deliver greater value to clients.

The potential of AI implementation expands even further with the adoption of generative AI. In contrast to narrow AI, generative AI exhibits the ability to comprehend, learn, and perform tasks at a human-like level across a wide range of domains. Deloitte harnesses the power of generative AI to assist consultants in identifying solutions to bring to their clients’ businesses.

Other consulting firms, including PwC and Accenture, have recognized the power of AI automation within consulting processes. For instance, PwC has pioneered an internal program called Dragon Step, whose purpose is to gather propositions from employees concerning either internal or external innovations (Alexandre et al, 2020, p. 39). New automation products are often developed as a result of this collaborative approach.

For Accenture, AI implementation is crucial and has led to greater automations, robotics, and chatbot solutions (Alexandre et al, 2020, p. 39). Particularly with the introduction of machine and deep learning, embracing the digital transformation has bestowed a myriad of advantages for the consulting industry, as AI enables personalization, reduces the risk of errors, and brings more rational decisions in a shorter period of time.

DOES AI HAVE THE ABILITY TO REPLACE THE CONSULTING INDUSTRY?

As previously mentioned, consultants are hired by companies for their depth of knowledge on particular topics, expert skills, and experience. Due to their interactions with diverse businesses, consultants possess a significantly wider and more profound understanding of business trends, industry obstacles, as well as emerging technologies and processes, surpassing that of their client firms. The value of hiring a consultant extends beyond their capacity to create profitable solutions; it lies in their competence to offer comprehensive advice and guidance throughout the entire process of change while involving all stakeholders- traits that an artificial intelligence machine cannot replace. AI-based tools excel in enhancing data collection for drawing conclusions, yet they lack essential human characteristics that clients seek when searching for solutions to their problem. Ultimately, the need for consultants should not be affected, as there will always be problems that companies come across that AI systems will not have the abilities to solve due to lack of human characteristics such as creativity, intuition, and previous project experience (Eder, 2018).

Creativity, specifically, is at the forefront of a successful consultant. ​​Creativity enables out of the box thinking, helps identify unconventional solutions and come up with new approaches to tackle issues that might not have been previously considered. Although AI can generate outputs from attributes of pre-existing works, human creativity is unique as ideas arise from a blend of real-life experiences and emotions that artificial intelligence systems lack. Rather than being fearful of AI, top consulting firms such as McKinsey utilise these systems in conjunction with employees’ creativity to provide an unparalleled service (Davenport & Mittal, 2022).

QuantumBlack, an AI system by McKinsey, uses the power of hybrid intelligence - an approach that employs the power of AI combined with human insight (The art of AI, n.d). This method uses AI, strategic thinking, and expertise from McKinsey employees to help solve client projects. The hybrid intelligence technique synergizes the “world-class” firm employees (possessing technical expertise) and industry leading tech (industry-specific AI products) to create cutting edge solutions. Employing deep machine-learning accelerates the comprehension of intricate data, identifies areas of greatest value, and facilitates the scalability of the solution.

In 2019, Emirates Team New Zealand collaborated with McKinsey to introduce a new sailing technique in pursuit of victory in the America’s Cup; the oldest trophy in international sport (The art of AI, n.d). McKinsey was tasked with developing an AI bot, serving as a new crew member for the sailing boat. The work developing this bot was described as “highly technical”, according to QuantumBlack’s chief scientist Jacomo Corbo, and “required extensive innovation around the bot’s learning program”. Corbo elaborated saying that this project required immense creative thinking to “figure out the right learning models, how best to coach the bot, and the right guard rails and rewards to put into place.” This case study exemplifies how coupling AI with human creativity and innovation yields optimal results. While AI accelerates processes, human ingenuity remains indispensable for completing projects.

Although interest in utilzing AI is growing due to its ability in increasing efficiency of operations and reducing labour costs for employees, businesses should remain cognizant of addressing risks and ethical constraints of artificial intelligence platforms (Gînguță, Andrea et al., 2023 ). Potential hazards throughout the entire lifecycle of an AI solution, from its inception to when it’s used, have the potential to trigger unforeseen outcomes. Such risks include using incomplete or inaccurate data, biased or discriminatory model outcomes, implementation errors, cybersecurity threats, etc (Cheatham, Javanmardian et al., 2019). Thus, while AI can contribute to streamlining operations, its inability to fully comprehend and address the intricacies of privacy breaches and cybersecurity underscores the indispensable role that management consultants play in preserving the integrity and security of client data.

CONCLUSION

In conclusion, the role of management consultants remains indispensable in the ever-evolving landscape of business challenges and technological advancements. As businesses continue to navigate multifaceted obstacles, consultants provide a unique blend of expertise and innovation that is crucial for overcoming these challenges. While the integration of AI is on the rise, the irreplaceable human touch that consultants bring to the table cannot be overlooked. The future of consulting involves harnessing AI's potential while recognizing that human attributes like creativity, empathy, and strategic thinking remain invaluable. In an ever-changing technological landscape, consultants bridge the gap between AI capabilities and the multifaceted demands of businesses, ensuring ethical and effective solutions.

References:

Alexandre, C., & Blanckaert, L. (1970, January 1). The influence of artificial intelligence on the consulting industry. The Influence of Artificial Intelligence on The Consulting Industry, Mémoire UCL. https://dial.uclouvain.be/memoire/ucl/object/thesis:24659

Cheatham, B., Javanmardian, K., & Samandari, H. (2019, April 26). Confronting the risks of Artificial Intelligence. McKinsey & Company. https://www.mckinsey.com/capabilities/quantumblack/our-insights/confronting-the-risks-of-artificial-intelligence

Davenport, T., & Mittal , N. (2023, August 15). How generative AI is changing creative work. Harvard Business Review. https://hbr.org/2022/11/how-generative-ai-is-changing-creative-work

Eder, S. (2018, August 14). Council post: Can AI give better advice than management consultants? Forbes. https://www.forbes.com/sites/theyec/2018/08/14/can-ai-give-better-advice-than-management-consultants/?sh=1c0339a52255

Gînguță, A., Ștefea, P., Noja, G. G., & Munteanu, V. P. (2023). Ethical Impacts, Risks and Challenges of Artificial Intelligence Technologies in Business Consulting: A New Modelling Approach Based on Structural Equations. http://dx.doi.org/10.3390/electronics12061462

The art of AI. McKinsey & Company. (n.d.). https://www.mckinsey.com/capabilities/quantumblack/our-approach