Cutting off your nose? McKinsey deploys 12,000 AI agents while slashing 5,000 jobs

McKinsey, a global consulting firm, is confronting an existential threat as artificial intelligence agents prove capable of performing the same consulting work that has generated billions in revenue for the firm. The company has deployed 12,000 AI agents across its operations while simultaneously reducing its workforce from 45,000 to 40,000 employees over the past 18 months, highlighting the tension between embracing automation and maintaining human expertise.

What you should know: McKinsey’s leadership acknowledges AI poses fundamental challenges to the consulting industry’s traditional model.

• “Do I think that this is existential for our profession? Yes, I do,” said Kate Smaje, a senior partner leading McKinsey’s AI efforts, though she called it “an existential good for us.”
• Global managing partner Bob Sternfels envisions having an AI agent for every human employee in the near future, with AI now dominating every board meeting discussion.
• The firm generates approximately 40% of its revenue—roughly $6.4 billion based on 2023 figures exceeding $16 billion—from AI consulting services.

How the AI agents work: McKinsey has implemented various AI tools to automate core consulting functions traditionally performed by human analysts.

• The most popular agent writes documents in the firm’s signature house style, while others summarize documents and interviews.
• Additional tools create PowerPoint presentations and one even “checks the logic of a consultant’s arguments, verifying the flow of reasoning makes sense.”
• These implementations come as the firm positions itself to match the pace of experimentation among its clients.

The reliability problem: McKinsey’s aggressive AI adoption faces significant skepticism given well-documented issues with AI accuracy and hallucination.

• Advanced language models routinely fabricate facts that can easily go undetected, creating potential risks for client work.
• Legal professionals have already experienced catastrophic blunders by trusting AI tools to write documents or cite case law that turned out to be completely fabricated.
• Recent lackluster performance of OpenAI’s GPT-5 model after two years of development suggests AI capabilities may not continue improving at expected rates.

What competitors are saying: Other consulting firms view McKinsey’s approach as a signal to emphasize human-centered services.

• “The age of arrogance of the management consultant is over now,” said Nick Studer, CEO of consulting firm Oliver Wyman. “They want someone who is willing to get in the trenches and help them align their team and cocreate with their team.”
• Smaje acknowledged that while “you can get to a pretty good, average answer using the technology now,” basic expertise becomes commoditized while “distinctive expertise becomes even more valuable.”

Why this matters: McKinsey’s transformation reflects broader questions about which professional services can be automated and which require irreplaceable human judgment.

• Sternfels emphasized McKinsey’s reputation as a “leadership factory” as something “I don’t think will be disrupted by AI.”
• The firm’s approach of simultaneously cutting staff while deploying thousands of AI agents suggests a fundamental shift in how consulting work will be structured and delivered.