The Inevitable Obsolescence of Consulting Firms
- Rich Washburn
- Oct 26
- 3 min read
Let me tell you something strange: We don’t know how to build the Space Shuttle anymore.
NASA had the plans. The blueprints. The specs.What they didn’t have was the team—the network of minds, habits, and shared mental models that made it all work. That knowledge didn’t live in one document. It lived in hallway conversations. In hand gestures. In intuition built through repetition and failure.
When those engineers retired or moved on, the Shuttle didn’t just become obsolete. It became unbuildable.
And that’s not just a NASA story. It’s a warning.
It’s Happening Again—Everywhere
Right now, the same thing is playing out in tax firms. In management consultancies. In law. In chip design. In any field where expertise is the product.
Let’s take semiconductors.
China has the machinery. The money. The motivation. So why can’t it build chips as advanced as Taiwan’s?
Because they don’t have the tribal knowledge.The “why we do it this way” that never made it into the manuals. The tweaks. The intuition. The engineering culture that evolved layer by layer—generation by generation—until it could push electrons faster than anyone else.
That knowledge? It’s not in a textbook. It’s in people.And once those people are gone, the system forgets how to think.
Most Firms Are Still Labor Systems. That Has to Change.
Consultancies, tax firms, law firms—they’ve all built their business models on one thing: billed time. You sell access to experts. You scale by hiring more humans.
But here’s the problem: human expertise doesn’t scale. It retires. It gets poached. It walks out the door with a laptop full of undocumented brilliance.
And now? AI is changing the terrain.The value is shifting—from effort to insight. From hours to outcomes. From labor to leverage.
If your firm still operates like a labor engine, you’re already behind.
The Future Belongs to Knowledge Systems
Here’s the shift:If you’re in a business that trades on expertise, your survival depends on turning that expertise into a machine-usable knowledge system.
Because the real risk isn’t that AI will replace you.
It’s that AI will outlast you.
Here’s What That Looks Like in the Real World
Let’s talk tax firms.
They're sitting on a goldmine of distributed cognition—decades of complex reasoning, creative structuring, and risk calibration that doesn’t live in any one document. It lives in:
hallway conversations
email threads
whiteboard sketches
client war stories
and “that one time we solved it for a biotech client in Singapore”
But if firms don’t turn that tribal knowledge into teachable, reusable, AI-ready intelligence, it’s gone the moment someone leaves.
That’s the real vulnerability.
Not automation. Not disruption. Amnesia.
The New Mandate: Codify or Die
If you’re running a firm, here’s the new strategic imperative:
Extract tribal knowledge like it’s the most valuable asset you own—because it is.
Train systems, not just staff. Teach AI how your firm thinks, not just what it does.
Move from people-powered to knowledge-powered. Scale insight, not just headcount.
Design for transfer, not tenure. If your best person gets hit by a bus, your firm shouldn’t forget how to solve international withholding tax structures.
AI Isn’t the Threat. It’s the Ark.
AI is how you preserve what your firm knows. How you take 40 years of client nuance, tax strategy, legal positioning, and consulting frameworks—and make it usable, repeatable, and scalable.
It’s how you stop knowledge from dying in a partner’s inbox.Or in a retirement party slideshow.
This isn’t about robots replacing consultants. It’s about machines remembering what humans forget.
If you want your firm to survive the next five years, forget the buzzwords.
Ask one question:
“What do we know that nobody else does—and how do we make sure we never lose it?”
Answer that, and you won’t just adapt. You’ll lead.
Comments