AI agents and the future of professional services
“Associates used to just gather information, but now an AI agent backed by o1 can do that—and the quality is much more consistent using these AI tools versus 22-year-olds.” - Chief Information Officer, global strategy consulting firm
The promise of AI agents is to move beyond tools that amplify the work done by humans, often referred to as a "copilot" or "assistant" modality, towards AI replacing entire workstreams that would otherwise be done by humans. Lots of the attention here has been on functions like engineering, QA, and back office finance, but we are keeping an eye out on professional services as well.
After years of theorizing that much of that work can be automated, in the last few months we have seen tools that really do solve whole research problems with human-level accuracy. What does it mean if the junior ranks of investment banks, consulting firms, and IT service providers can be replaced by AI agents, for both the development pipeline for those firms, and the clients they serve?
We’re witnessing a significant shift in the professional services industry. The implications of AI agents replacing junior-level tasks traditionally performed by entry-level associates are profound and far-reaching. Let's look a bit deeper.
What happens when AI replaces junior associates?
The entry-level workforce in professional services firms has long been structured around a simple premise: hire a lot of smart, ambitious people to do the grunt work, train them up, and promote the best to senior roles. But what happens when AI can handle research, modeling, and data analysis with human-level accuracy?
As a first-order effect, we’re likely to see slower hiring into the bottom rung of these organizations. Rather than a pyramid-shaped org chart, the number of more junior associates may be close to the number of directors and VPs who lead the daily work, and even the number of senior partners responsible for relationship management and selling new work. Individual project teams may shrink, as the scope of work for a project grows more slowly than the bandwidth of a team, and so three full-time employees can do what would have previously taken five or six.
If hiring younger employees directly out of schools falls in volume, it’s possible that these firms reallocate their recruiting efforts to bring in more senior executives as “expert partners.” These people may offer a totally separate, not-replaceable-with-AI set of capabilities, including deep networks of relevant industry peers, and experience with the types of challenges the firms are aiming to solve.
But it also breaks the traditional career path in these industries. If fewer junior roles exist, how do firms develop talent? How do young professionals gain the experience necessary to credibly advance into client-facing partner roles? Assuming some firms will lose junior employees to other employers, the talent pipeline for mid-level and senior roles may start to look dry very quickly. If AI eliminates the entry-level stepping stones, the entire professional services model will need to adjust.
The economic and competitive impact of AI taking the place of junior associates
For firms, the economics of this transition could be a major advantage. AI agents do not require a salary or benefits, and are always available, so there is no need to over-staff to allow for some subset of your workforce being unavailable at any given time. AI-driven workflows could mean higher profit margins for selling the same work with a much lower cost structure.
Alternatively, that value capture might pass on the client side, as there’s a downward pressure on pricing for a given unit of work. Maybe projects dramatically expand in scope for the same overall bill that has been established as standard, or more likely, projects are shrunk in budget and scope now that accomplishing them is faster and cheaper than ever.
Clients, however, may rethink what they’re actually paying for. If AI can generate reports and insights at a fraction of the cost, will they still pay consulting firms top dollar for research? The value proposition may shift toward high-level strategic advice—interpreting AI outputs, making judgment calls, and solving problems that AI alone can't. Some clients may even start bringing more of these capabilities in-house, relying on AI tools to replace outsourced functions. We might see a rise in hybrid approaches, where clients use a combination of in-house AI tools and external consultants for validation and strategic input.
Broader industry shifts caused by AI
These changes won’t just affect firms and their clients—they’ll reshape education, training, and hiring pipelines. Universities and business schools may have to rethink their curricula, focusing less on technical execution and more on critical thinking, strategic decision-making, and AI oversight. Hybrid skill sets—combining business knowledge with AI fluency—will become essential.
We could also see a rise in AI-native professional services firms that are built entirely around AI capabilities, competing aggressively with traditional players. Others might specialize in the areas where humans still hold a clear advantage: complex problem-solving, high-touch client interactions, and emotional intelligence.
The bottom line
AI’s potential to partially replace junior associates in professional services is a fundamental shift, not just an efficiency gain. It challenges the traditional firm structure, disrupts career paths, and forces both companies and professionals to rethink their roles.
That said, many of these firms are somewhere between stubbornly resistant and remarkably adaptive to industry change. In an earlier chapter of my career at Bain & Company, I saw how well-equipped major strategy consulting firms like them are to adopt new technology to enhance their offerings while using their existing client relationships to position themselves as a partner in innovation. And while slides are no longer made with transparency film and X-ACTO knives, there is still no shortage of need for talented young associates to do tiring work.
Will this AI transformation be different, and finally knock the professional services sector into a new paradigm? I believe it will be. And if you’re building something that’s going to make that a reality, I’d love to hear about it and chat about how we can help.
