Amazon’s Alexa is now answering economic questions for UBS Group AG’s clients in Switzerland. Alexa accepts queries from clients and then analyzes data from UBS’s chief investment office to provide an answer. This is only the beginning of how AI will get involved in important decisions, perhaps to the concern of consultants. In an article for Harvard Business Review, Barry Libert and Megan Beck discuss what is on the horizon.
Rise of the Machines
Right now, AI is already known to assist in basic tasks like making phone calls, but the corporate strategic applications are right around the horizon, pushing into the wheelhouse of McKinsey, Bain, and the other big consulting entities. The authors say that the market for corporate advice just in the American market is nearly $60 billion, which is not a number consultancies are looking to let get away from them, especially not from non-human rivals:
One might argue that corporate clients prefer speaking to their strategy consultants to get high priced, custom-tailored advice that is based on small teams doing expensive and time-consuming work. And we agree that consultants provide insightful advice and guidance. However, a great deal of what is paid for with consulting services is data analysis and presentation. Consultants gather, clean, process, and interpret data from disparate parts of organizations. They are very good at this, but AI is even better. For example, the processing power of four smart consultants with excel spreadsheets is miniscule in comparison to a single smart computer using AI running for an hour, based on continuous, non-stop machine learning.
Another area where AI might excel is in dispelling bias from assessments. Humans are fallible and prone to biases of all kinds, unconsciously or otherwise. The hope is that AI will be able to make judgements that do not discriminate based on race, gender, economic factors, etc. However, the caveat is well-documented that the people who design algorithms in the first place sometimes insert unconscious biases. So it is a long road ahead still.
AI is further spurring advances in customer engagement and marketing, and it is expected to assist in yearly capital allocation too. What can consultants do about this to protect themselves? Long-term—maybe nothing. But for now, it would behoove consultants to get in front of AI and champion its further development themselves, so that at least consultants are the ones to whom businesses go to access AIs.
For additional thoughts, you can view the original article here: https://hbr.org/2017/07/ai-may-soon-replace-even-the-most-elite-consultants