If you study something long enough, apply your knowledge to real life use cases, amplify that knowledge, and be flexible enough to adapt to dramatic changes (Anthropic trying to take over all of the knowledge based work in the world), you continue to find layers that others do not see naturally.
AI is not something that rides alongside or within your traditional consulting, advisory, or professional service business models. It is something that requires a new look at the best practices for creating a new and improved business model in these related fields. It forces you to answer some extremely important questions about how the new will function.
Have we defined who we serve with absolute precision?
What is the core problem that we are solving?
Is our solution clear, differentiated, and provable?
Is our revenue predictable, high margin, and scalable?
Are you decreasing our cost structure each year and compounding those savings with shrewd investments?
How are you finding your customers and how are they finding you?
How should you grow and retain your client base?
Are you building proprietary IP, systems, processes, talent, and brand?
How do you continually innovate so that you are Netflix instead of Blockbuster?
How can you grow margin, operate without the owner or a key employee, and attract a buyer at a life changing number?
Your business strategy and AI strategy needs to support your desired model. Proper use of sequential and contextual AI directly reshapes the traditional service models in the following ways.
AI creates new value due to the sheer speed, depth of analysis, and the framing of strategic choices that is a much better fit for a value billing model.
Facilitates the move from cost intensive custom services to system based services.
AI opens up revenue models that have not typically been used in advisory such as subscription models, usage models, and outcome based models that allow revenue to scale.
The antiquated billable hour is no longer the proper unit of measurement.
AI can significantly reduce marginal costs by limiting the units of labor required to perform a service and limiting manual processes.
Labor can scale without billing machinations because each person can do more.
AI allows for 24/7 service delivery, far quicker wins, and reduced manual dependencies.
The asset is the system and no longer the person who could walk nout at night.
AI enables instant customer responses, intelligent onboarding, and continuous engagement.
Client communication becomes constant rather than episodic.
Your advantage is now based on assets such as proprietary data, trained models, integrated workflows and predictive history.
You have a brand advantage based on systems and data.
We all read the headlines. Today, Anthropic is boasting that it will reduce 50% of entry level white collar jobs by 2030 with heavy concentrations in consulting, accounting, and law. If these professions do not evolve beyond marketing plans, tax returns, and contracts, that prediction may end up being conservative.
You have a choice as to whether this happens to your firm or you. AI has given you the ability to go from the worst business model in the world to a model based on recurring revenue generated through a systems based approach that is not dependent on your time. You can scale and build a business or you can ride the feast or famine tour into obsolescence. We have built the products that you need. We cannot make the choice for you.