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Here’s what I see every day:
I work with founder-led agencies between $1M and $10M. The pattern is almost always the same:
Too many people are doing work that no longer requires human involvement. Bloated project teams. Junior staff running research that AI handles in minutes. Account managers are buried in status updates instead of strategy. Founders are spending 80% of their time managing the machine instead of selling the next engagement.
The pyramid model worked when labor was the only means of scaling output. That world no longer exists.
Harvard Business Review recently published a piece called "AI Is Changing the Structure of Consulting Firms." The thesis is simple: the traditional consulting pyramid, built on a large base of junior staff doing research and analysis while seniors manage relationships, is collapsing. AI does the junior work now. Faster. Cheaper. Better.
The firms that get this are restructuring into what HBR calls an "obelisk." Tall. Narrow. Senior-led. AI-augmented. Small teams are doing the work that used to require departments.
McKinsey's internal AI tool (Lilli, named after Lillian Dombrowski, one of McKinsey's first female employees, as a nod to the firm's history) is already cutting research and synthesis time by 30%. Unity Advisory, a $300M-backed firm, stopped hiring traditional analysts entirely. Boutique firms are now delivering enterprise-level strategy without a single analyst on payroll.
This is not just a problem with consulting; it is a problem with the agency itself.
The winners will be the ones who restructure now.
Not next year.
Now.
Here's what that looks like in practice:
1. Kill the bloat, keep the brains
Your senior people are your product. Your juniors were your delivery mechanism. AI is the new delivery mechanism. That doesn't mean you fire everyone tomorrow. It means you stop hiring for roles that AI already performs better, and you should start training your best employees to work with AI rather than around it.
2. BD before everything
Most agencies I walk into have the same problem: they're operationally busy but strategically starving. They are completing tasks but not actively seeking new opportunities. The obelisk model only works if senior people are selling, not just delivering. Business development isn't a department. It's a discipline that every senior person owns.
3. Fix your revenue mix
I break agency revenue into three buckets: New Money, Current Money, and Old Money.
“New Money” is a new logo.
“Current Money” is expanding existing accounts.
“Old Money” is re-engaging with past clients.
Most agencies put 90% of their energy into New Money and ignore the other two. That's backward. If your existing client retention is below 70%, you don't have a sales problem. You have a delivery problem. Fix that first.
4. Senior-led, AI-augmented pods
The HBR piece describes three roles in the new model: AI Facilitators, Engagement Architects, and Client Leaders. In agency terms, that translates to:
- A technically fluent operator who builds AI workflows and automates the repetitive stuff
- A senior strategist who interprets data, shapes the engagement, and makes the hard calls
- A relationship builder who owns the client, understands their business, and finds the next opportunity
That pod of three people is doing the work of a team of ten. And the margins are a lot better.
5. Stop selling hours. Start selling outcomes
The pyramid model was designed to sell time. More juniors meant more billable hours. The obelisk model sells results. When AI handles the grunt work, you don't add value by logging hours. It's in the problems that are solved.
This means rethinking your pricing. Retainers plus performance incentives. Skin in the game. When your compensation is tied to outcomes, you stop padding timelines and start delivering impact.
The Hard Truth
The agencies that resist this shift will get smaller. Not because the market is shrinking, but because leaner competitors will deliver better work, faster, at higher margins. The founder who restructures now, builds a senior-led team augmented by AI, and makes business development a core discipline instead of an afterthought is the one who will acquire the agencies that failed to adapt.
This is what we do at Agency Focus. We don't come in with a slide deck and leave you with a binder. We sit next to you, rebuild your revenue engine, fix operations, and help you transition from a pyramid to an obelisk. Not theoretically. Practically. With our hands on the wheel.
The pyramid is dead. Build the obelisk or become someone else's acquisition target.