McKinsey’s global managing partner Bob Sternfels has revealed unprecedented details about how artificial intelligence is fundamentally transforming the consulting giant’s workforce structure. Speaking at the Consumer Electronics Show (CES) in Las Vegas during a live taping of the “All-In” podcast, Sternfels outlined what he calls the “25 squared” approach—a radical restructuring that sees the firm simultaneously growing and shrinking different parts of its organization.
The transformation is stark: McKinsey is expanding its client-facing consulting roles by 25% while cutting non-client-facing positions by approximately 25%. Remarkably, despite the reduction in back-office staff, output from those functions has actually grown by 10%. This represents a fundamental shift in how one of the world’s most prestigious consulting firms operates, breaking the traditional model where growth was synonymous with total headcount expansion.
The productivity gains have been massive. Sternfels disclosed that McKinsey saved 1.5 million hours in search and synthesis work last year alone through AI implementation. This has allowed human consultants to “move up the stack” and focus on more complex, strategic problems rather than the research and analysis tasks typically assigned to junior employees.
Perhaps most striking is McKinsey’s deployment of AI agents—autonomous digital workers that can handle entire job functions independently. As of last week, the firm employed 40,000 human workers alongside 25,000 personalized AI agents. Sternfels expects the number of AI agents to match human employees by the end of 2025, creating a nearly 1:1 ratio of digital to human workers.
For young professionals entering the workforce, Sternfels offered clear guidance: focus on developing skills that AI cannot replicate, including human judgment, setting appropriate aspirations, and genuine creativity. The changes at McKinsey reflect broader challenges facing established enterprises as AI disrupts traditional business models. As Sternfels bluntly stated, large companies face a stark choice: “transform or die.” He emphasized that the pace of change is accelerating, with CEOs universally focused on organizational speed rather than strategy alone. McKinsey itself has adapted by shifting to outcome-based pricing models rather than traditional billable hours.
Key Quotes
Our model has always been synonymous that growth only occurs with total head count growth. Now it’s actually splitting. We can grow in this part, the client-facing side, and we can shrink in this part and have aggregate growth in total. That’s a new paradigm and a new dynamic.
Bob Sternfels, McKinsey’s global managing partner, explained how AI is breaking the traditional consulting model where business growth required proportional increases in total employees. This represents a fundamental shift in how professional services firms can scale.
This is about how do you transform incumbent entities into something different. You have a choice — transform or die.
Sternfels issued a stark warning to established companies about the urgency of AI transformation. His comments reflect the existential pressure facing traditional businesses as AI disrupts long-standing operational models.
I haven’t met a CEO yet that isn’t talking about ‘how do I get my organization moving faster.’ It’s quite frankly less about strategy, it’s more about organizational speed.
The McKinsey chief highlighted a critical shift in executive priorities, where the ability to implement change quickly has become more important than strategic planning itself. This reflects the accelerating pace of AI-driven business transformation.
Our Take
McKinsey’s transformation offers a preview of the future of professional work. The firm’s willingness to share specific numbers—25,000 AI agents, 1.5 million hours saved, 25% workforce reductions—provides rare transparency into AI’s real-world impact. What’s particularly significant is the simultaneous expansion and contraction: this isn’t about wholesale job elimination, but rather a fundamental restructuring of how work gets done. The shift from billable hours to outcome-based pricing also signals how AI forces business model innovation, not just operational efficiency. For workers, the implications are sobering: routine cognitive tasks are increasingly automated, making uniquely human skills like judgment and creativity essential. McKinsey’s trajectory suggests that within years, major professional services firms may operate with equal numbers of human and AI workers—a hybrid workforce model that seemed like science fiction just a few years ago.
Why This Matters
This announcement from McKinsey represents one of the most concrete examples yet of AI’s transformative impact on white-collar professional services. As one of the world’s most influential consulting firms, McKinsey’s workforce restructuring serves as a bellwether for how AI will reshape knowledge work across industries. The “25 squared” model demonstrates that AI isn’t simply augmenting workers—it’s fundamentally changing organizational structures and enabling companies to achieve growth without proportional headcount increases.
The deployment of 25,000 AI agents alongside 40,000 humans, with plans to reach parity by year-end, signals we’re entering a new era of human-AI collaboration at scale. This has profound implications for employment, particularly for entry-level and mid-level professionals who traditionally performed research, analysis, and synthesis work. The 1.5 million hours saved in just one year illustrates the magnitude of productivity gains possible with AI implementation. For businesses watching McKinsey’s transformation, the message is clear: AI adoption is no longer optional for competitive survival, and the pace of change demands immediate action rather than cautious strategy development.
Related Stories
- PwC Hosts ‘Prompting Parties’ to Train Employees on AI Usage
- Business Leaders Share Top 3 AI Workforce Predictions for 2025
- The Future of Work in an AI World
- AI’s Role in Tech Hiring Freeze: White-Collar Job Market Slump
- CEOs Express Insecurity About AI Strategy and Implementation
Source: https://www.businessinsider.com/mckinsey-chief-ai-cutting-adding-jobs-growth-ai-agents-2026-1