AI Disrupting Consulting Industry - McKinsey

Artificial intelligence is rapidly transforming the consulting industry, with top firms like McKinsey integrating AI tools into their workflows to enhance productivity and deliver faster insights, while simultaneously developing new service offerings around AI implementation and strategy for clients.

McKinsey's AI Transformation Journey

McKinsey's AI journey is exemplified by their flagship AI tool "Lilli," named after Lillian Dombrowski, the first female specialist at the firm. Lilli serves as a centralized knowledge repository that consolidates McKinsey's extensive expertise, dramatically reducing research time from weeks to hours and sometimes from hours to minutes. The system is integrated into nearly every aspect of consultant-client collaboration, from gathering competitive intelligence to formulating implementation plans.

As the AI consulting arm of McKinsey, QuantumBlack blends powerful AI solutions with strategic thinking and domain expertise. This approach has evolved from QuantumBlack's origins in Formula 1 racing, where data-driven decision making is paramount. McKinsey is also addressing the organizational challenges of AI adoption, with their Global Survey on AI revealing that companies are increasingly redesigning workflows, establishing governance structures, and retraining employees to maximize AI's potential. This strategic integration of AI capabilities positions McKinsey at the forefront of the consulting industry's technological transformation.

Lilli, McKinsey's proprietary AI assistant, was developed by the firm's "ClienTech" team to revolutionize how consultants access and leverage institutional knowledge. Built on large language models from partners like Cohere and OpenAI and hosted on Microsoft's Azure cloud platform, Lilli can scan over 100,000 internal documents and transcripts in seconds, delivering tailored insights based on consultants' prompts. The tool features a user-friendly interface with unique elements including an expandable sidebar for saved prompts, cited sources for all data, contextual responses that remember previous interactions, and secure collaboration capabilities for team members working on engagements.

During its beta testing with 7,000 employees, Lilli fielded 50,000 inquiries in just two weeks, demonstrating its effectiveness in reducing research time and expanding the scope of problem-solving approaches. The platform operates in two modes: one for searching McKinsey's knowledge reserves and another for external sources, allowing users to compare internal expertise with publicly available information. While automating tasks once handled by junior analysts, Lilli isn't designed to replace human consultants but rather to augment their capabilities, freeing them to focus on higher-value activities like client interaction, problem-solving, and implementation support.

AI tools have revolutionized how consultants create client deliverables, automating what was once a time-intensive process. Consulting firms can now generate reports, presentations, and business plans in a fraction of the time, with AI-powered platforms like ProAI's Business Plans, Google Duet, and Notion AI compiling research data, market analyses, and strategic insights into polished documents. This automation reduces documentation time by approximately 44% according to MIT studies, allowing consultants to focus on high-value client interactions rather than administrative tasks.

The deliverable creation process has evolved into a human-AI collaboration where consultants can:

• Generate first drafts of proposals, outlines, and document summaries
• Automate data visualization and presentation creation
• Cross-reference deliverables with initial contracts to ensure alignment
• Enhance quality assurance by identifying discrepancies or gaps in final reports
• Scale operations by handling more clients and complex projects without sacrificing quality