Where McKinsey—and Consulting—Go From Here - HBR IdeaCast Recap

Podcast: HBR IdeaCast

Published: 2026-01-06

Duration: 31 min

Summary

In this episode, McKinsey's global managing partner Bob Sternfels discusses the firm's evolution as it adapts to the AI-driven landscape, emphasizing the need for organizational change alongside technological implementation. He highlights McKinsey's dual role in co-creating innovative solutions with clients while also reshaping its internal structure to leverage AI effectively.

What Happened

Hosts Adi Ignatius and Alison Beard kick off the episode by reflecting on their educational backgrounds, noting how traditional consulting firms have often recruited from economics and engineering disciplines. However, as the landscape shifts with the rise of AI, consulting firms like McKinsey are beginning to rethink their talent needs, suggesting that diverse backgrounds, such as journalism and politics, may become increasingly valuable.

Bob Sternfels, McKinsey's global managing partner, provides insights into the firm's century-long legacy, highlighting a balance between creating novel ideas and identifying best practices. He explains that McKinsey's approach involves co-creating solutions with clients, leveraging a vast investment in innovation. Sternfels emphasizes that the impact of AI on the consulting industry is significant, with McKinsey now employing a workforce that includes 20,000 AI agents, showcasing a rapid shift from just 3,000 agents a year and a half ago. This transformation aims to align McKinsey's internal structure with the changing demands of clients in an AI-driven world.

Key Insights

• AI is a game-changer for consulting, driving the need for new talent and skills.
• McKinsey's approach focuses on co-creation with clients to develop innovative solutions.
• Organizational change is crucial for leveraging AI effectively in businesses.
• The balance between novel ideas and best practices defines McKinsey's operational model.

Key Questions Answered

How is AI changing the consulting industry?

Bob Sternfels highlights that AI is reshaping the consulting landscape in significant ways. Clients are eager to explore AI's potential for enhancing productivity across various sectors, from customer care to drug discovery. However, there's a duality in client perspectives, with CFOs often questioning the immediate value of tech investments while CIOs advocate for staying ahead in the AI race.

What does McKinsey's workforce look like today?

Sternfels recently shared that McKinsey's workforce comprises around 60,000 individuals, with 40,000 being human employees and 20,000 AI agents. This represents a significant increase from just 3,000 agents a year and a half ago, indicating McKinsey's rapid integration of AI into its operations.

What is McKinsey's approach to client collaboration?

McKinsey's model is centered on co-creating with clients, helping them reach solutions they might not achieve independently. Sternfels notes the company's investment in proprietary intellectual property and innovation, which supports this collaborative approach and emphasizes the importance of integrating best practices with novel ideas.

What are the internal conversations at McKinsey regarding AI?

Internally, McKinsey is engaged in discussions about how AI will impact their operations and the consulting industry at large. Sternfels points out that while clients recognize the potential of AI, many are grappling with how to implement these changes organizationally, indicating a significant focus on aligning technology with structural transformation.

What are the challenges organizations face with AI adoption?

Sternfels highlights that a significant part of successfully leveraging AI lies in organizational change rather than just technology implementation. He mentions that restructuring organizations to eliminate unnecessary layers can enhance efficiency, but achieving this alignment takes longer and is more complex than initially anticipated.