> Deloitte consultant: “We’re basically getting replaced by robots.”

A Deloitte executive unveiled a chart at a town hall last month showing that traditional labor-based, hourly-rate consulting work is expected to shrink significantly as a proportion of the total market over the next decade.

One Deloitte consultant’s takeaway from the town hall: “They heavily implied our model is toast. We’re basically getting replaced by robots.” A Deloitte spokesman said the firm is “making significant investments to lead this human-led, AI-powered shift for our industry.”

As they wake up to the idea that the traditional model of billing for human time may no longer work as AI grows, consulting firms are seeking to operate more like software or product businesses, selling fixed-fee subscriptions or packaged solutions rather than essentially renting out human labor.

Pure-consulting giants such as McKinsey and Boston Consulting Group are making a push to shift more of their services to outcome-based pricing. More than 30% of McKinsey’s global fees come from pricing tied directly to client outcomes, a percentage that has been growing for years, Shelley Stewart III, a senior partner at the firm, said in a letter to the Financial Times this month.

“Outcome-based pricing acknowledges that judgment belongs to people, while adding a level of accountability that professional services have traditionally eschewed,” Stewart said in the letter. “That’s a bet on consulting’s future rather than a sign of its demise.”

This is not a progressive philosophical choice, but rather an “existential scramble” to find a new way to make money as AI upends traditional revenue streams, said Pat Petitti, CEO of Catalant, an AI-based consulting platform. “AI is destroying their business model,” he said.