The consulting industry is being impacted by two major forces: government cuts to consulting contracts and advancements in artificial intelligence. The Trump administration's decisions are leading to job losses at firms like Deloitte and Booz Allen, while companies like Accenture report revenue drops due to federal contract issues. AI is changing the efficiency dynamics of consulting, urging firms to adapt their fee structures. Traditional consulting work is diminishing as companies increasingly turn to AI technology for solutions. Notably, McKinsey has laid off over 10% of its workforce, indicating significant industry shifts.
AI is creating greater efficiencies for doing consulting, but it's not driving demand for more consulting. Ultimately, they're going to run out of work.
You charge for time, and when time goes away, you have to change the commercial model.
If the consulting business was a stock, I'd be shorting it right now, said billionaire Peter Thiel.
McKinsey recently shed more than 10% of staff - among the largest cuts in its 100-year history.
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