![\"Consultancy](\"https:\/\/www.europesays.com\/uk\/wp-content\/uploads\/2026\/05\/pexels-shtefutsa-18218364-e1714566231877.jpg\")
\t\tClients expect more bang for their buck as AI changes the game\t<\/p>\n\t\t\tWednesday 27 May 2026 2:42 pm
\n\t\t\t\t\t\u00a0|\u00a0\u00a0Updated:\u00a0<\/p>\n
\t\t\tWednesday 27 May 2026 3:01 pm\n\t<\/p>\n
\t\tClients expect more bang for their buck as AI changes the game\t<\/p>\n
For years, the consultancy sector has relied on a traditional model and profitable formula: retained clients, billing time and upselling clients. Another crucial element has been the blend of \u2018senior counsel\u2019 supported by a team of juniors carrying out research and compiling reports.<\/p>\n
But the rug is being pulled from under this model and a once dependable blueprint is under threat as clients rewrite their expectations while the sector faces AI disruption<\/a> and a wave of competition from nimble boutiques.<\/p>\n Above all, clients want more for their money and many are choosing to either move operations in-house or hire smaller, often private equity-backed boutique firms while the rise of AI throws much of the traditional \u2018strategic communications\u2019 or management consultancy model into doubt.<\/p>\n The sector is \u2018at a crossroads\u2019<\/p>\n One source with high-level experience in agencies but who now leads a team in-house told City AM <\/strong>that to stand out amid the disruption, advisory firms need to do something radically new \u2013 but much of the industry is peddling \u201can outdated model\u201d where \u201cno one is doing anything differently.\u201d\u00a0<\/p>\n They said there \u201cisn\u2019t much between the big firms\u201d, which sets them apart.\u00a0<\/p>\n \u201cThe sector is at a crossroads. It\u2019s no longer based on who you know and lunch with, but what you\u2019re offering,\u201d they said. Adding that trust, and a relationship with someone who is essentially \u201cpart of your extended team\u201d is more important than a barrage of strategy decks or coverage reports.<\/p>\n \u201cYou\u2019d need to be someone I can call at the lowest point, and who gets the brand and business,\u201d they said.\u00a0<\/p>\n They said that consultancy firms \u201cshould be worried\u201d, as they are all \u201csaying the same things they\u2019ve always said\u201d, especially agencies offering advisory services to corporate clients, in which they have long relied on historical relationships in the media and the City.<\/p>\n According to research<\/a> released in September by Soba: Private Label, many UK professional services firms are struggling to stand out because they lean too much on regurgitated cookie cutter messaging.\u00a0<\/p>\n The research reveals that firms suffer from an \u2018echo chamber\u2019 effect where they use nearly identical messaging, talk too much about themselves and not enough about clients, and drown in generic \u2018consulting speak\u2019.\u00a0<\/p>\n AI is reshaping client expectations\u00a0<\/p>\n AI is wreaking havoc across the sector, but particularly in changing the meaning of the billable hour (or its time-sheet driven cousin) as clients expect that the technology is used being firms to automate much of the most time-consuming tasks.\u00a0<\/p>\n High-paying retained clients have been the lifeblood of consulting for decades, with clients willing to reach into their pockets in exchange for time, expertise and knowledge. Alongside this, project work is often charged based on how long it takes to deliver and \u2013 crucially \u2013 how many people are on the team.<\/p>\n With consulting firms<\/a> jumping aboard the AI ship to keep up, clients are shunning the services firms have on offer as they believe they aren\u2019t worth the price tag, with many turning in-house and automating much of what an agency used to deliver.<\/p>\n Another source with experience overseeing agency work told City AM <\/strong>that \u201cit is surprising how many client teams are using AI in-house as they are further ahead than agencies\u201d when it comes to deploying bespoke AI.<\/p>\n \u201cClients can\u2019t justify spending money on agencies when they can do those things internally,\u201d they said.\u00a0<\/p>\n The source added that they believe AI will \u201cchange the back end of the model dramatically, but the client-facing end will stay the same\u201d, with human judgement a necessary and irreplaceable part of that.\u00a0<\/p>\n Tom Rodenhauser, managing partner of K2 Consulting Research, told City AM <\/strong>that clients are often turning to consultants for help with how to use AI before rolling out the technology themselves as it \u201cdoesn\u2019t necessarily require a cast of consultants for implementation.\u201d\u00a0<\/p>\n \u201cFor the most part, clients are doing a lot of the actual AI rollouts themselves,\u201d he said.<\/p>\n He added that many firms are scrambling to invest in AI tools to \u201ccreate more internal efficiencies for the actual process of consulting.\u201d\u00a0<\/p>\n Junior jobs on the line<\/p>\n Rosenhauser said he is increasingly hearing \u201cmany stories\u201d which \u201cfocus on replacing junior staff with AI\u201d.\u00a0<\/p>\n \u201cConversely, you also see firms like McKinsey <\/a>doubling down on the people side. I think firms are still feeling their way through this and trying to figure out the optimal people-to-bot ratio,\u201d he added.\u00a0<\/p>\n \t\t\t\t\tRead more<\/p>\n \t\t\tAI is driving McKinsey\u2019s business model and talent overhaul<\/a><\/p>\n Another source with knowledge of the sector told City<\/strong> AM<\/strong> that bigger agencies \u201care both trying to invest in AI and are held back by it\u201d as they grapple with attracting clients.\u00a0<\/p>\n They added that they believe advisory is \u201cgoing to be eroded\u201d by the technology, particularly with the hiring squeeze with many firms increasingly automating work junior recruits would traditionally have done.\u00a0<\/p>\n There have been thousands of jobs lost in professional services <\/a>over the last few years, with a market slowdown one of the main reasons, but juniors are finding themselves more on the line.<\/p>\n Alex Hamilton-Baily, a partner at executive recruitment firm Odgers, told City AM <\/strong>that amid AI disrupting the consulting business model, clients are looking instead to pay a premium for a genuinely experienced consult who knows their sector.\u00a0<\/p>\n \u201cThe number one thing people buy in consulting is experience, which leads to improved judgement,\u201d he said.\u00a0<\/p>\n \u201cClients want the tough reps, they want people who have been in the room when deals are going wrong, or a crisis is hitting, or high value contracts negotiated, in person, by human beings they trust. AI can model scenarios, but can\u2019t bear accountability for prior consulting successes and failures,\u201d Hamilton-Baily said.\u00a0<\/p>\n He added that the hiring process is shifting for many consulting firms that are increasingly looking to cut junior roles as they embed AI process into their workstream in areas such as research.<\/p>\n \u201cJust last week I was with a group of consulting leaders who collectively thought that next year they would reduce their early-career intake. We hear similar things across consulting, law and accounting,\u201d Hamilton-Baily said.\u00a0<\/p>\n For the cohort of juniors dreaming of carving a name for themselves in the industry, joining the large legacy companies is no longer the most desirable option.\u00a0<\/p>\n Many are now tossing the coin between staying at the more bureaucratic big players or fleeing to more agile boutique firms. The safer bet seems to be jumping the fence and moving in-house, which Hamilton-baily said \u201cprovides the same long-term stability without some of the financial fluctuations of consulting.\u201d<\/p>\n