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From KPMG: AI Challenges Traditional Consulting Models and Fee Structures

How could the AI-driven changes in professional services affect Ernst & Young?

Possible What happens if… A possibility worth considering, not a forecast.

Ernst & Young may need to overhaul services due to AI's impact The rise of accessible artificial intelligence is challenging the core business model of professional services firms, making traditional advice less valuable. As noted by KPMG's global head of consulting, the intellectual property and knowledge that once formed the basis of consulting work are becoming increasingly accessible, meaning clients have higher expectations for outcomes. For Ernst & Young, this translates into operational changes, as the firm is already responding to AI's influence on junior auditor work, such as checking figures against source documents. EY is developing new roles, including data delivery professionals and product managers, to adapt to this evolving landscape.

Reported by 1 independent outlet Written Thursday
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How it reaches Ernst & Young

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The facts so far

As reported. Each one links to where it comes from.

  • Artificial intelligence is challenging the building blocks of the consulting industry, from the fees firms charge clients to the armies of graduates who have traditionally powered its business model.cnbc.com
  • The intellectual property and knowledge that once formed the basis of consulting work are becoming increasingly accessible.cnbc.com
  • Paul Goodhew, EY's London-based global assurance innovation and digital leader, said AI is already changing the work traditionally done by junior auditors, such as checking figures against source documents.cnbc.com
  • EY is also developing new roles, including data delivery professionals who prepare data for audit teams, product managers who help develop technology platforms, and specialists who understand clients' technology strategies and risks.cnbc.com

Why it matters

The structural shift driven by AI threatens the fundamental revenue model of the Big Four. If traditional advice-based work becomes obsolete, firms like Ernst & Young must successfully transition to outcome-based pricing and new service offerings, or risk significant changes to their profitability and operational structure.

This modernization race is not unique to Ernst & Young. Smaller, AI-native consultancies are gaining a competitive advantage because they are nimble and have never billed clients on a time-and-materials basis. The Big Four, including KPMG, Deloitte, and PwC, are all racing to catch up to this new market dynamic.

What we don't know yet

  • How quickly can Big Four firms successfully transition to outcome-based pricing models?
  • Will the development of new roles within firms like Ernst & Young be sufficient to offset the loss of traditional manual work?

What would change this answer

AI adoption accelerates across client industriesThe pressure on traditional consulting revenue for Ernst & Young will increase, forcing faster and more drastic changes to its service offerings.
Regulatory bodies mandate specific AI usage standards in auditingThis could standardize the new roles and processes at Ernst & Young, potentially reducing the risk associated with internal adaptation.

Who else could feel it

Other possible ripples from the same event.

Reporting

Keep going

The full eventKPMG: AI Challenges Traditional Consulting Models and Fee Structures Everything aboutErnst & Young

Brind's analysis is written by AI from the reporting linked above and can be wrong. This explainer is a possibility worth considering, not a forecast: steps marked as Brind's reasoning are not stated in the reporting. It is not investment advice; do your own research.