Artificial intelligence is beginning to reshape one of the corporate world’s most influential industries, with entrepreneur and investor Kevin O’Leary arguing that many consulting services are already being displaced by AI tools that can perform similar analytical work at a fraction of the cost.
Speaking on The Founder’s Mindset Podcast, the “Shark Tank” investor said companies in his portfolio are increasingly turning to AI systems before seeking advice from traditional consulting firms, a shift he believes could threaten the industry’s long-term business model.
O’Leary’s comments come as major consulting firms face mounting pressure from the very technology they are helping clients adopt. For decades, firms such as McKinsey & Company, Boston Consulting Group, and Accenture have generated billions of dollars advising corporations on strategy, operations, restructuring, and technology transformation. Now, AI systems are increasingly capable of performing parts of that work in minutes rather than weeks.
“Even the companies that I invest in that used to use a lot of consultants for very specific vertical situations, like changing retail distribution, or should they keep two tiers of distribution versus three, are first going to AI,” O’Leary said.
According to him, management teams are increasingly using AI-generated recommendations as a starting point for internal decision-making, reducing their dependence on outside advisers.
The trend highlights a growing challenge facing the consulting industry. Traditionally, consultants have been hired to gather data, analyze markets, benchmark competitors, and develop strategic recommendations. Generative AI can now automate many of those functions, rapidly producing reports, conducting scenario analyses, and synthesizing large amounts of information at a cost that is dramatically lower than traditional consulting engagements.
The disruption is already forcing consulting firms to reinvent themselves. Rather than resisting AI, many of the industry’s largest players are attempting to position themselves as beneficiaries of the technology boom. McKinsey has said roughly 40% of its work now involves AI-related projects. Boston Consulting Group has reported that AI accounted for about 20% of its engagements in 2024. Accenture has gone even further, restructuring major parts of its business around artificial intelligence through its “reinvention services” model.
This shows that while AI threatens traditional consulting revenue streams, it is simultaneously creating one of the largest advisory opportunities in decades.
Companies around the world are spending billions of dollars trying to determine how to deploy AI safely, integrate it into operations, retrain employees, and redesign workflows. Many executives still require external expertise to manage those transformations, particularly as AI systems become more sophisticated and regulation becomes more complex.
The challenge for consulting firms is that the nature of their value proposition is changing.
Historically, clients often paid consultants for access to specialized knowledge and analytical capabilities. Increasingly, those capabilities are becoming widely available through AI platforms from companies such as OpenAI, Anthropic, and Google DeepMind. As a result, consulting firms may find themselves competing less on information gathering and more on implementation, execution, and industry-specific expertise.
O’Leary’s criticism extended beyond the industry’s business prospects to career development. He argued that consulting can serve as a useful early-career training ground but suggested that remaining too long in the profession may limit leadership development.
“When I see a resume where someone wants to be a CEO of one of my companies, and has been at a consulting firm for seven years, I just tear that up,” he said.
He said a short stint can help young professionals explore different sectors of the economy and identify where they fit best. However, he expressed skepticism about executives who spend many years in consulting before seeking operational leadership roles.
“One of the things that you could argue is good about consulting is, if you spend less than two years there, and you’re going to search all 11 sectors of the economy to find out where you fit, that makes sense to me,” he said.
His remarks are likely to generate debate, particularly because many prominent business leaders emerged from consulting backgrounds. Among them are Sundar Pichai, who previously worked at McKinsey, and Sheryl Sandberg, whose career also included time at the consulting giant.
The broader question raised by O’Leary’s comments is whether AI will eliminate consulting jobs or simply transform them.
Most industry observers expect the latter. The consulting sector has historically adapted to major technological shifts, from enterprise software implementation to cloud computing and digital transformation. AI may prove to be another evolution rather than an extinction event.
Yet the economics are changing rapidly. Industry experts believe that if clients can use AI to perform preliminary analysis internally, consulting firms may face growing pressure to justify premium fees. Engagements that once required large teams of junior consultants could increasingly be completed by smaller groups augmented by AI tools.
That dynamic could compress margins, reduce hiring at the entry level, and force firms to focus on higher-value advisory services.
For investors, the development is another example of how AI is beginning to move beyond the technology sector and reshape traditional professional services industries. Much of the attention surrounding artificial intelligence has focused on chipmakers, cloud providers, and model developers. The discussion about the consulting industry shows that the technology’s impact may ultimately be far broader, reaching sectors that have historically relied on human expertise as their primary product.
