In the early 2000s, Blockbuster was on top of the world and so were the shareholders. With thousands of stores, millions of loyal customers, and a business model that seemed impenetrable, it was the titan in the entertainment industry. Renting DVDs and VHS tapes was the norm, and Blockbuster had mastered the process of delivering that service efficiently and profitably. But as we all know, that story took a sudden and dramatic turn.
By 2010, Blockbuster was bankrupt. The reason wasn’t that people stopped watching movies. Far from it. The demand for entertainment had skyrocketed. But Blockbuster, rooted in its legacy system of physical rentals, failed to recognize how rapidly customer expectations were shifting. Their processes, once state-of-the-art, became outdated. Meanwhile, Netflix, which started as a simple mail-order DVD service, embraced digital transformation and became a streaming giant, completely reshaping the industry.
This isn’t just a cautionary tale—it’s a mirror for industries that rely heavily on legacy systems; industries like consulting. While your firm might not be renting DVDs, you’re likely clinging to outdated workflows and processes that could be quietly holding back your growth.
Legacy Systems: A Double-Edged Sword
In management consulting, stability is essential. Clients expect reliability, precision, and the confidence that their consultants are working with the best information available. Legacy systems—those processes and workflows that have worked well for years—can feel like a rock-solid foundation. After all, if they’ve always delivered results, why change them?
The problem is that those same systems can also become a straitjacket, preventing your firm from adapting to new technologies and client expectations. Legacy systems were built to solve the problems of yesterday—problems that may no longer exist in today’s AI driven world.
In Blockbuster’s case, their business model worked flawlessly for a world of physical media, so much so that it made them a household name. But as streaming became viable, they didn’t pivot fast enough. The legacy processes they had optimized over decades, once the key to their success, became the chains that bound them to irrelevance.
Your consulting firm may be facing a similar challenge. If you’re relying on manual client reporting, time-consuming data analysis, or traditional business models that don’t embrace AI-driven solutions, you’re already losing valuable ground to competitors who are moving faster and delivering more for less.
The Comfort of the Known vs. The Power of Transformation
Like Blockbuster, many consulting firms are comfortable with the status quo. There’s a sense of security in knowing your team can crank out reports in a specific way, or that certain processes are proven to work. But while you’re focusing on efficiency, are you missing out on agility?
Efficiency in consulting is no longer just about sticking to a familiar process; it’s about making processes more dynamic. Legacy systems, by their nature, are resistant to change. They were designed to maintain a steady state, not to evolve. Yet, evolution is the norm and it’s getting faster by the second.
Netflix didn’t set out to kill Blockbuster—they simply saw a more efficient way to meet customer demand. The firms that are now rising to the top of the consulting world are doing the same. They’re leveraging AI, not just to do the same work faster, but to unlock new levels of insight and free up their human talent for higher-order strategic thinking.
AI isn’t just a tool for operational efficiency—it’s a growth enabler. The firms using AI to automate repetitive processes like client reporting are also the ones using the time saved to explore new service offerings, expand into new markets, and build stronger relationships with clients through tailored, data-driven insights.
Growth is Found in Flexibility, Not Rigidity
One of the core reasons Blockbuster failed was its inability to shift mindsets. They weren’t a victim of bad luck—they were a victim of comfortable inertia. As consultants, your greatest asset is your ability to solve problems and anticipate change. But are you applying that same principle to your own firm?
Systems are built on the assumption that clients want the same things they always did. The problem is our industry—like our society—is built on growth. More, better, faster. Today’s clients expect never before seen speed and agility, as well as the ability to act on real-time insights. Firms that aren’t equipped to deliver those expectations—because they’re not anticipating the incoming demands of their clients—are going to struggle.
By contrast, the firms that are using AI to automate and streamline are finding new ways to serve more clients faster, and better. Automating mundane tasks like data gathering and reporting doesn’t just save time—it creates a pathway for consultants to focus on what really matters: solving complex problems, building innovative strategies, and leading their clients through transformation.
The Human Advantage in a Digital World
At its core, management consulting is about people. No machine can replace the intuition, empathy, and creativity that consultants bring to the table. But in a world where data and insights are critical to making the best decisions, how you gather, analyze, and present that information is becoming just as important as the human touch.
AI is not a replacement for your human expertise—it’s a force multiplier. It enables you to do more with your skills, focus on the bigger picture, and drive the kind of innovation that sets your firm apart from competitors. In the same way that Netflix used technology to better serve customers, consultants who embrace AI will find they can better serve their clients while expanding their reach and capability. Let machines do machine work.
Is Your Firm Ready for Growth?
The processes you’ve optimized over the years may no longer be sufficient to meet the demands of today’s clients. The good news? Transformation doesn’t have to be disruptive. You don’t need to overhaul everything at once, but you do need to start asking the right questions, today.
Where is your firm stuck in the past?
Which processes are ripe for automation?
How can AI free your team to focus on what they do best?
Although it’s easy to point at Blockbuster as the cautionary tale of the century, it’s just as important to realize that stakeholders were acting with what they thought was the best information at the time; something all of us are always looking to do.
So what’s your view? What’s stopping you from picking a process and starting to explore what it would look like done by AI? What’s keeping you where you are?