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From billable hours to AI efficiency: A double-edged sword
Advancements in artificial intelligence have been polarizing, to say the least. A quick scan through editorials of the past year reveals a range of opinions on the topic: AI will save the world, kill everyone, or do everything in between. For lawyers, consultants and other professional service providers, the more immediate question is: am I going to have a job in five years?
This publication (spoiler alert) isn’t exactly neutral on this question. As high-stakes public affairs advisors, we believe in the resilience of our business model, with large language models augmenting, rather than competing with our approach to problem solving. But we don’t yet know the extent to which our practice, and the practices of our legal colleagues, will change in the next year, or over the next two to five years.
As we prepare for multiple scenarios, we asked two colleagues to stress test our positioning by writing competing perspectives on the following statement: professional services, as we know them, are dead.
Professional services, as we know them, ARE dead.
By Mitchell Stein
When OpenAI released an early version of ChatGPT on Nov. 30, 2022, our eyes were opened not just to AI chatbots, but to the promise of the technology that these chatbots are built on: generative AI.
Professional services, such as law, accounting, communications and management consulting, were called out as particularly ripe for disruption. Legal opinions, news releases, accounting spreadsheets and business models would all be developed by generative AI technologies. It was inevitable, and it would happen sooner than any of us could imagine.
While we may not be there yet, we’re not far off. AI has already had a tremendous impact on the nature of professional services as we know them and will continue to do so as it advances over time.
AI has bolstered efficiency by relieving accountants, lawyers and all types of consultants from conducting tasks such as entering data, summarizing documents, distributing news releases, conducting research and more. In fact, according to a study conducted by the USC Annenberg Center for Public Relations, 88 per cent of PR leaders say AI will have a positive impact on the speed and efficiency of certain tasks, and 72 per cent say it will help reduce workloads.
For professional services firms, increased efficiency is a double-edged sword. In one sense, it allows employees to focus on work that is more strategic and relationship-based and less administrative. In another, it poses a threat to firms that rely on billable hours to make money. Some firms have started moving from a billable-hour model to a project or value-based model, where clients pay for the output of the hours versus the hours themselves. AI will likely accelerate this trend.
Another way AI is changing professional services is by balancing the scales between firms and independent consultants. Historically, independent consultants lacked the resources and scale of larger firms, putting them at a competitive disadvantage. While this remains true, AI offers independent consultants greater access to many of the capabilities historically offered by firms, such as research, back-end support and analytics, allowing them to focus on high-value work that requires more critical thinking, client management and relationship building. As employees at professional services firms witness their colleagues go out on their own and succeed with the help of AI, more and more will ask themselves, why not me?
That said, the current and eventual impact of AI on professional services is widely debated. Skeptics point to mistakes AI technologies have made as evidence they are not ready for prime time.
We should not be so quick to judge. Remember, Facebook was a “hot or not” knock-off for Harvard students in 2003 before receiving millions in investments from venture capital firms and private backers (thus growing to the global behemoth it became). Recent improvements to GPT-4 over its predecessor, ChatGPT, show that the platform may be following a similar trajectory, adding user photos, storyboarding and game creation to its capabilities while dramatically improving its capabilities on professional and academic tests.
But even if OpenAI and its competitors defy the odds and never make the advancements that have been projected, artificial intelligence is changing the workforce today. According to a survey from McKinsey & Company, nearly one-quarter of C-suite executives are personally using AI, with more than three-quarters of respondents in the business, legal and professional services reporting having used AI tools at least once.
In other words, the train has already left the station. We just don’t know how far it’s going.
Professional services, as we know them, ARE not dead.
By Clare Michaels
The idea of an AI doctor, lawyer or management consultant is a quaint notion — and only that, a notion. In spite of a global pandemic, human interaction and relationship building remain crucial to the success of professions in every society. Such human qualities are necessary for everything from business deals to patient-doctor consultations, from solicitor-client privilege to lobbying governments. Put simply, it’s about trust and it’s hard for an AI bot to fabricate something as elusive as trust.
AI will only ever be as smart as its humans. The human brain is more advanced and efficient than the average computer by orders of magnitude. Even now, it’s hard for professionals to trust a technology that cannot distinguish between a school bus and a snow plow, details how to take the train from New York to London, and generates images of buttered salmon in a river when you wanted the live fish. If anything, the bozo eruptions of AI in these early days only prove that AI needs us as much as we need it.
Like email and mobile apps, AI should be viewed as another tool that enhances the ability of professionals to do their work. Think how much faster a company could respond to reporters and customers with an AI engine drawing on its database of public press releases and press conferences to produce a first draft of messaging. Think of a portfolio manager’s use of AI analysis of live and historic market data and economic indicators to make better investment decisions, and therefore better returns, for the families or seniors she advises. Think of the accuracy of a doctor’s diagnosis when he is able to rely on an AI database of extensive medical records to assess a patient’s symptoms.
AI becomes especially valuable in situations where there is a high degree of uncertainty and unpredictability, such as picking stocks or predicting election outcomes. As they say, past performance is not an indicator of future success. Renowned psychologist and economist Daniel Kahneman showed in his book Thinking, Fast and Slow that when it comes to decision-making, algorithms beat people at predictions every time. Professionals can make better predictions with the help of AI. But whatever the algorithm generates is meaningless without an interpreter. An AI press release may be better than what Steve in accounting could write, but it is the professional who knows how to truly refine what the AI engine generates to make sense in the real human world.
The last reason AI will never kill professional services is perhaps the saddest of all. We humans are our own worst enemy. Venture capital whiz Marc Andreessen points out that regulators and modern Luddites are already working to stifle and limit AI innovation. Governments making rules about a technology they hardly understand could become a recipe for disaster. Fear-mongering and doomsday warnings could deter whole societies from mass adoption. Productivity could stagnate. AI could become just a blip in the history of humanity, a fad that went the way of Furbies and Tamagotchis.
Whether or not AI survives, professional services will remain. But it is up to us to decide whether we want to take that historic step on the moon of possibilities with an AI partner by our side.