The pyramid isn’t collapsing in isolation. Its breakdown is being accelerated by three deeper macro-dynamics that are reshaping incentives, talent markets, and the perception of value across the entire consulting ecosystem. Together, they explain why firms are moving faster than the economics fully justify, and why the shift is structural rather than cyclical.
Firms cut now based on anticipated gains, not realized ones.
Consulting firms are acting on a projected future rather than a measured present. The result is a forward-leaning restructuring that begins before AI has delivered the full promised productivity.
The Mechanism
Cut graduate hiring + freeze salaries A preemptive reduction in headcount costs
AI must now maintain capacity Once junior inflow collapses, automation becomes a necessity rather than an experiment
The loop becomes a self-fulfilling prophecy Fewer juniors → more pressure to adopt AI → more automation → further justification for cutting juniors
As a Big Four executive put it: “Some of that is anticipation of the impact of AI… you might be in a better place investing in AI than in people.”
Implication
Firms are betting their business model before proving the model. This dynamic accelerates adoption independent of results — reinforcing the structural collapse of the pyramid’s base.
Dynamic 2: The Credentialization Shift
The status game has changed. Clients now pay premiums for different signals.
Historically, consulting prestige was defined by academic pedigree. The hierarchy was powered by “the smartest MBAs” from elite institutions. AI has rewritten the credential hierarchy.
The Shift
Old Credential: “We have the smartest MBAs.” Harvard, Stanford, Wharton pedigree
New Credential: “We have the best AI integration.” Proprietary tools, orchestrated workflows, proven efficiencies
Clients no longer ask “Who’s on the team?” They ask “What does your AI stack actually do?”
Rob Hornby, AlixPartners Co-CEO, observed: “Clients are legitimately asking, what are you doing? That’s become a new credentialisation.”
Implication
AI sophistication has become a competitive moat. Firms that build credible AI integration — not slogans — gain positional advantage.
AI flattens broad generalist skill sets. What remains scarce — and valuable — is domain depth that AI cannot simulate without guidance.
The Shift
From T-shaped (generalist, wide + shallow) To I-shaped (domain expert, narrow + deep)
The old value proposition: “Smart generalists who can figure out any problem.”
The new value proposition: “Domain experts + AI who go deep on specifics.”
As Namaan Mian (Management Consulted) notes: “It is harder to staff a 23-year-old on those kinds of projects versus someone with experience.”
Implication
Mid-career specialists now outperform fresh graduates. The talent market shifts toward technical, operational, and domain-specific depth — not raw analytical horsepower.
Summary: The Deeper Forces Behind the Collapse
The consulting pyramid isn’t just being disrupted by technology. It’s being pulled apart by the economics of anticipation, reshaped by new symbols of credibility, and redirected by a market that now rewards depth over breadth.
These forces compound one another — accelerating the decline of the old model and pushing firms into new organizational architectures.
Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
