The Death of Consultants

You hire a consulting firm. They send three twenty-six-year-olds with MBAs.

The twenty-six-year-olds spend two weeks interviewing your staff, asking questions your staff have been answering in internal meetings for years. They build a 90-slide PowerPoint. The slides look identical to the ones the same firm built for a competitor last quarter. The recommendations are obvious. The price is $1.2 million.

You implement 30% of it. It doesn't really work. The firm offers to come back next year to "refine the rollout."

This is not a caricature. This is the industry.

Big consulting firms charge a billion-dollar premium for what is essentially a templating service. They build a deck once, refine it across thousands of engagements, and resell it to every new client with the variable names changed. The actual thinking happened at scale, in a partner's head five years ago.

The associate isn't paid to think. They plug your numbers into the template, polish the slides, and translate the partner's hand-waving into bullet points.

You don't pay $500 an hour for a template. You pay $500 an hour because the template is invisible. The illusion is that someone smart spent months tailoring a custom solution to your unique problem. The reality is the solution was custom in 1998, and you're buying its 800th iteration.

Companies pay this premium for two reasons that have nothing to do with the advice. To defer risk (if the strategy fails, "well, McKinsey said to do it"). And for deductibility (consulting is an operating expense; a senior hire would be a long-term commitment with severance, benefits, social charges, and a real legal relationship). The advice is incidental. The firm is renting you cover.

The global management consulting industry generates somewhere between $370 billion and $1 trillion a year, depending on how you count it. Roughly 3 million businesses are involved. North America alone accounts for over $150 billion.

For perspective: that's larger than the global music industry, the global film industry, and the global video game industry combined.

For a service whose primary deliverable is a PowerPoint.

McKinsey, BCG, and their peers publish research on how often corporate transformations succeed. Their own answer: 70% fail.

Out of 100 transformation projects:

• ~70 fail outright
• ~30 succeed
• Of those 30, only ~25% (~7-8) sustain the gains
• Final tally: roughly 7 out of 100 actually work.

McKinsey, BCG, and others publish these numbers themselves. Seventy percent of transformations fail. Of the thirty that succeed, only a quarter sustain the gains. Out of 100 projects, roughly seven actually work.

The firms whose entire business is selling transformation projects publicly state that 70-95% of those projects don't work. And they continue charging seven-figure fees for them.

If a surgeon failed 70% of their operations, they'd be in prison. If a contractor's houses collapsed 70% of the time, they'd be bankrupt. In consulting, you publish the failure rate as a research insight and use it to sell the next engagement.

The selling point is: "Most transformations fail. That's why you need us." A bit like a roofer telling you most roofs leak, which is why you should hire him to install another one.

Most consulting failures are boring. The deck collects dust on a shared drive, the company quietly pivots, the consultants move on. But occasionally a project lands somewhere catastrophic.

Not a complete inventory. Just the cases big enough to make the news.

Arthur Andersen and Enron (2001). Andersen was one of the Big Five, serving as Enron's auditor and consultant simultaneously, billing about $1 million a week split nearly evenly between the two. They didn't just miss the irregularities, they helped engineer them. When the SEC came knocking, Andersen ordered staff to shred documents. The firm collapsed. Enron went bankrupt with over $60 billion in assets gone, taking pensions and savings with it. The consequence for the consulting industry as a whole? Roughly zero. The Big Five became the Big Four. Business continued.

McKinsey and the opioid epidemic. Between 2004 and 2019, McKinsey advised Purdue Pharma on how to "turbocharge" the sales of OxyContin. They built playbooks for targeting high-prescribing doctors. They proposed rebate programs to pharmacies for overdoses. When the federal investigation began, a senior McKinsey partner personally deleted relevant documents. McKinsey eventually paid $650 million to the US Department of Justice in 2024, on top of nearly $900 million in earlier state settlements. The opioid epidemic has killed over 600,000 Americans since 1999. No McKinsey partner has gone to prison. The firm continues to operate, including on government contracts.

McKinsey and South Africa's state capture. McKinsey partnered with a shell company linked to the Gupta family to win a $120 million contract with Eskom, South Africa's state-owned power utility. The Zondo Commission later found "rampant corruption" tied to the transactions. McKinsey eventually returned about $74 million in fees and apologized publicly. The damage to South Africa's energy infrastructure and public finances is still being calculated, years later.

These aren't bad apples. These are systemic patterns: when a consulting firm's incentive is to win the next engagement, oversight becomes optional. The client is whoever pays. The ethics are negotiable.

Consulting isn't entirely worthless. Operational turnarounds in distressed companies sometimes need an outside hand, because internal leadership is too compromised by politics to make hard cuts. Specialized expertise, things like pricing strategy, supply chain optimization, regulatory compliance in a new market, is real value when the firm has actual deep knowledge. M and A integration occasionally benefits from a dispassionate third party. And the original wave of strategy consulting (think Bruce Henderson at BCG inventing the growth-share matrix in the 1970s) really did introduce frameworks that didn't exist before.

But those cases are a small fraction of what gets sold. The bulk of the industry is selling generic "transformation" decks to companies that already know what's wrong and don't have the political will to fix it. The cleaner version exists: small boutique firms with real domain experts, independent advisors who built and sold companies, specialists who actually do the work. None of them charge $500K for a 90-slide deck made by people fresh out of school.

Here's where the industry actually dies.

The McKinsey model depends on three things: the templates, the polish, and the gravitas of the brand. AI demolishes the first two and exposes the third.

A mid-level executive with access to a good language model can now produce a strategy deck in three days that's structurally indistinguishable from a McKinsey deliverable. The frameworks are public. The "proprietary methodologies" were always just rebranded Porter, Drucker, and Christensen. AI compresses what an associate took six weeks to do into an afternoon, and increasingly does it better, because it doesn't make formatting errors at 2 AM.

The consulting firms know this. McKinsey deployed an internal AI tool called Lilli that, by mid-2025, was being used by 70% of their consultants to automate proposals and presentations. The people you're paying $500 an hour are themselves using AI to do the work you're paying them to do.

Companies are catching on. Boards are receiving million-dollar strategy presentations that turn out to be lightly edited LLM output. Once you've seen it, you can't unsee it. The premium evaporates. A company with fifty years of operational experience does not need a twenty-six-year-old to tell it what to do based on a ChatGPT prompt. The information asymmetry that justified the price is gone.

Hire people. Pay them well. Trust them for five years.

Same money. Different outcomes. The math isn't close. The reason companies still pick the consulting deck has nothing to do with results, it's the deniability that comes with it.

The reason companies don't do this isn't economic. It's psychological. Hiring requires the executive making the hire to take responsibility for the outcome. Consulting is rented expertise: a contract, a deliverable, a clean exit. When the strategy fails, no one gets fired. The deck goes in a drawer. Everyone moves on.

This is the actual product consulting sells. Not strategy. Not insight. Plausible deniability for executives who don't want to make decisions themselves.

It's a $500 billion business that fails 70% of the time by its own measurement. It funded the opioid epidemic. It helped engineer the Enron collapse. It enabled state capture in South Africa. It has been quietly extracting fees from companies that needed coaches, not consultants, for fifty years.

And now AI can do most of what they sell, faster, cheaper, and without the conflicts of interest.

The death of consultants isn't a prediction. It's a phase transition. The firms that survive will be the small specialists who actually know something. The rest will quietly shrink into legacy brands selling nostalgia to executives who haven't realized the joke is on them.

Pay your people. Hire experts. Take responsibility for your own decisions.

The age of the deck is over.