The Science of Consulting - How IBM is Redefining Value in the AI Era

In today's business landscape, characterized by economic volatility, geopolitical conflicts, and an unrelenting pace of technological change, CEOs feel immense pressure. They are tasked with the challenging duality of funding existing operations while simultaneously investing in innovation and driving growth. These were the themes laid out by Mohamad Ali, SVP and Head of IBM Consulting, during his keynote at their annual Think conference. Technology, particularly AI, is no longer just a tool; it has become the source of competitive advantage. Yet, navigating this new era is complex, and many organizations are struggling to move beyond AI experimentation to realize tangible business value. This is where consulting plays a crucial role, and IBM Consulting is positioning itself uniquely with an approach it calls the "Science of Consulting".

Defining the 'Science of Consulting

At its core, the "Science of Consulting" is about combining science and technology, including AI, with IBM's deep pool of human talent – its consultants, engineers, and designers – to deliver "outsized results" for clients. This represents an evolution of the traditional consulting model, acknowledging that in the age of AI, human expertise must be augmented and accelerated by technology.

Augmenting Expertise with Digital Labor

Mohamad Ali articulates this shift by noting that while always retaining a human element, the consulting business model is transforming from primarily human-based to "human experts augmented with a large force of digital labor.” The vision is ambitious: to leverage a force of up to 1.6 million digital workers supporting IBM's 160,000 consultants globally.

The Power of Digital Workers

What are these digital workers, and how do they function? They are essentially software agents trained on IBM’s knowledge and methodologies and designed to perform tasks, augmenting the capabilities of human consultants. The goal is to have these agents readily available, acting as a personal digital workforce that consultants can deploy to execute specific actions. This augmentation enables IBM Consulting to deliver faster and at lower costs. The economic model is evolving, with potential for margin expansion as the delivery incorporates more software-based digital labor. IBM is even exploring value-splitting models with clients, such as the 50/50 benefit split with Heineken, reflecting confidence in the ROI delivered by this approach.

The IBM Consulting Advantage Platform

A critical enabler for this strategy is the IBM Consulting Advantage platform. Described as a "first of its kind AI-powered delivery platform," IBM Consulting Advantage is designed to "supercharge" consulting expertise with leading-edge software assets and methods that include agents and applications. It provides the necessary architecture to manage a large force of digital workers efficiently and cost-effectively, addressing the concern that running such a platform could otherwise be prohibitively expensive.

An Open, AI-Powered Delivery Engine

IBM Consulting Advantage is built on IBM Technology, leveraging watsonx capabilities, but it crucially incorporates a "coexistence with strategic partners" and an "open architecture". This means it integrates technologies from a wide range of leading enterprise tech providers, including IBM, Microsoft, AWS, Salesforce, Oracle, Adobe, and Palo Alto Networks. The platform supports multi-model, multi-modal, multi-cloud, and multi-partner environments, providing flexibility and the ability to use the best available tools for a given task. Features include AI-powered assistants trained on IBM Consulting's proprietary IP, the ability to use various models (IBM, open source, or client-provided), integration with other data sources (like search engines), capability to chat with client documents for summarization or insight extraction, and the ability to embed assistants in common business tools like VSCode, Jira, and MS Teams.

Leveraging IBM's Unique Technology Foundation

A key differentiator for IBM Consulting is its unique position as "the only global consultancy at scale within a technology company." This affiliation provides distinct advantages. IBM Consulting benefits from early access to IBM technologies and works closely with product teams. For instance, they provide feedback to the Granite model team to help improve the model. Furthermore, IBM is doing significant work on industry-specific models, such as those for banking and telco, which utilize the InstructLab approach to fine-tuning models. This results in smaller, more cost-efficient models that deliver better performance and accuracy in specific domains – technology that IBM Consulting is uniquely positioned to leverage.

This deep collaboration allows IBM Consulting to tackle problems that might be beyond the capabilities of a typical consulting company. Furthermore, this access isn't limited to IBM technology; IBM Consulting has special arrangements with strategic partners like Microsoft and AWS for early access, enabling them to build integrations and co-create solutions, as seen with the GitHub Copilot integration. This early and deep access across the technology landscape allows IBM Consulting to build a digital worker platform that is potentially "more efficient than anything anybody else could build."

Positioning Beyond Traditional GSIs

This positioning also allows IBM Consulting to operate in a space distinct from the core focus of many Global System Integrators (GSIs). While GSIs often excel at large-scale, human-capital-intensive system implementation, integration, and managed services, IBM Consulting's strategy appears centered on leveraging its AI-augmented platform and digital workforce to redefine the consulting process itself. They focus on the strategy, transformation blueprinting, and achieving faster, de-risked adoption powered by AI-driven insights and automation. The open architecture of the IBM Consulting Advantage platform, designed for coexistence with other technology providers and ecosystems, suggests a model where IBM Consulting provides unique AI-powered advisory and transformation design capabilities that can complement, rather than directly compete with, the implementation strengths of traditional GSIs, positioning them higher up the value chain in defining how technology, particularly AI, can fundamentally change a company.

IBM's commitment to demonstrating value is exemplified by its "Client Zero" approach. IBM applies its own methods and technologies, including AI and automation, to transform its internal operations before offering these solutions to clients. This internal transformation has yielded extraordinary results, including publicly reported operational efficiencies of $3.5 billion saved over the last two years. By being its own first client, IBM Consulting develops a proven "playbook for transforming the processes in our company and in your company with AI". This experience provides demonstrated capabilities and builds confidence, allowing them to have more relevant conversations with clients about next-generation cloud platforms and AI adoption.

The Client Value Proposition in the AI Era

The value proposition for clients working with IBM Consulting in this AI era is multifaceted:

1. Improved Operational Efficiency: AI and automation are directly applied to streamline processes and reduce costs. IBM Consulting can walk clients through detailed process changes based on their own Client Zero experience. Client stories like Heineken leveraging AI for their digital backbone to save money and move faster, and Cencora undertaking significant transformations, underscore this capability.
2. Accelerated Innovation and Growth: By freeing up capital through efficiency gains, companies can reinvest in innovation. IBM Consulting also helps clients leverage AI for revenue expansion, such as using AI in call centers for cross-sell/upsell opportunities. The ability to help clients build their own AI platforms, like the Gen X platform built for Pepsi, further illustrates this focus on enabling client innovation.
3. Faster Time to Value: The AI-augmented delivery model and the IBM Consulting Advantage platform enable quicker solution delivery. Specific examples from internal use cases show dramatic reductions in effort and time for tasks like summarizing meeting transcripts, creating Salesforce user stories, analyzing marketing briefs, conducting customer research, and ensuring AI governance compliance.
4. De-risked Adoption: Moving from experimentation to value requires successful adoption. IBM Consulting focuses heavily on this critical element, having many AI-augmented projects in production at scale. They provide structured support through teams and squads to ensure successful adoption, contrasting their approach with simply providing tools and hoping clients figure it out, like giving workers at a car factory a toolbox instead of task-specific tools. The platform ensures production deployment is handled uniformly.
5. Access to Leading Technologies and Expertise: Clients benefit from IBM Consulting's access to and integration of leading technologies from IBM (watsonx, Granite models, infrastructure) and its strategic partners. With certified consultants (e.g., 33,000 Microsoft Certified professionals) and decades of industry expertise, IBM Consulting is well-positioned to solve complex problems.

Conclusion

Unlike competitors who may excel solely at strategy consulting or act primarily as "body shops," IBM Consulting is keenly focused on leveraging technology to drive fundamental change within companies. Its unique combination of being embedded within a technology company, offering a platform-driven AI-augmented delivery model, employing a proven Client Zero methodology, and maintaining a strong commitment to successful client adoption positions them as a distinct player in the evolving consulting market. Their ultimate goal is to empower clients to scale their AI value creation and become AI-first companies, recognizing that technology-powered innovation is the key to significant advantage at this critical inflection point.

Many consulting firms utilize AI merely as an analytical tool or recommend AI solutions; however, IBM is actively building a new consulting delivery mechanism. This approach significantly augments human consultants with a "large force of digital workers" – software agents designed to perform tasks faster and at lower costs. This platform-centric, AI-augmented approach to consulting delivery, coupled with IBM's unique position as a global consultancy embedded within a major technology company, provides unparalleled early access to cutting-edge technologies (both IBM's and strategic partners'). Combined with their proven "Client Zero" methodology based on internal transformation success, it can offer a distinct value proposition focused on accelerating time to value and de-risking AI adoption.