BCG says AI consulting will supply 20% of revenues this year
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The chief executive of BCG has said the $12bn consulting firm expects to generate a fifth of its revenues in 2024 from helping corporations integrate artificial intelligence into their businesses, a share it projects will reach 40 per cent by 2026.
Christoph Schweizer told the Financial Times that AI and generative AI were “a huge boost” to revenues in the past year as companies move from experimenting with the technology to “at-scale deployment”.
BCG is working with global tech giants and AI companies — from Microsoft and Google to OpenAI and Anthropic — to integrate their technology into company operations and processes. It is also training board directors and executive teams who increasingly see it as a business priority.
“We have never seen a topic become relevant as rapidly as Gen AI,” said Schweizer, who added that he personally uses large language models to take minutes for meetings, write emails and summarise documents.
The significant share of BCG’s revenues coming from AI advisory work, which has not been previously disclosed, highlights how consulting firms are seeking to cash in on the generative AI boom.
A jump in sales at BCG’s AI division also partly offset a slowdown in other parts of the business last year amid a tougher economic backdrop. BCG’s total revenues climbed just 5 per cent in 2023 to $12.3bn, the firm’s weakest growth in at least seven years.
However, Schweizer said the consulting market “feels more positive” this year, adding that BCG’s sales were growing “in the teens again” percentage-wise, during the first quarter of 2024.
From customer service chatbots to data migration and overhauling research and development in healthcare, Schweizer said BCG is helping companies use AI to cut costs and increase productivity. “We are seeing an amazing uptake of use cases,” he added.
Schweizer claimed rivals were behind BCG on AI advisory work because the firm identified it early as a potential driver of growth. BCG, which started investing in its AI business in 2015, has about 3,000 employees in its BCG X technology and design division. It has also rolled out AI tools to its 33,000 employees, helping them manage company data, write text, summarise information and produce slides.
“I am the most vocal, and I would say also ruthless leaders, when it comes to telling my team that it’s nice to go to our clients and tell them they have to change, but we have to change BCG just as much,” said Schweizer. “We are taking our own medicine.”
The firm was part of a Harvard Business School study that monitored the impact OpenAI’s GPT-4 model had on its employees. Consultants who were assigned the AI tool were more productive than those who were not. They worked quicker and work was of a higher quality.
Schweizer said advising on climate change and sustainability projects was still the firm’s fastest-growing practice in 2023, even as business leaders were less vocal on environmental, social and governance issues compared with a few years ago, referring to the backlash in some countries, including the US, against stakeholder capitalism.
“Are there parts of the world where CEOs would rather take a lower profile on their ESG . . . and climate agendas? Absolutely, yes,” he said. “But that doesn’t mean that they are not committed to it . . . The rhetoric is a lot more cautious.”
