Hourly Billing Is Dead. AI Killed It. So How the Hell Are You Gonna Get Paid?

Why Boutique Consultants Must Ditch the Clock, Embrace the Bot, and Charge for Results Like a Boss.

When AI automation squeezes hourly billing rates and commoditizes expertise, what's left for boutique consultants to earn? With the eroding perception of human value, is there still relevance to the knowledge of human consultants?

I've heard similar questions in 1997, when machine translation was poised to disrupt the industry I was working in, called localization. Spoiler alert: None of that happened. It did disrupt the industry, but it also drove its exponential growth.

Lessons from Machine Translation

At the time, I was the Managing Director of Berlitz in Germany, overseeing their translation services. The business had lost millions of dollars in the five consecutive years preceding my arrival. So, what was I supposed to do? Competing with technology and all?

I did what every sane leader would do: Grab the enemy by the balls. We placed a button on our website called "Berlitz It," allowing visitors to get translations instantly and for free from a machine. Unsurprisingly, the reception was mindblowing. Web visitors would use the service as if there were no tomorrow. But instead of the business going down, we turned the company profitable in just under five months.

How did that happen?

For one, the results from machine translation highlighted the value our translators delivered. For example, the "machine" wasn't able to put terms into context. Should it translate the English word "drugs" into Spanish as "drogas" (as in illegal drugs) or "medicamentos" (as in medication)?

To Be Or Not His

In a funny experiment, we translated Shakespeare's "to be or not to be" into German and then back into English. The result was: "To be or not his." Because, based on context, the German word "sein" can either be translated as "his" or as "to be."

Something tells me that AI is just as stupid. LLMs still fail at basic logical reasoning. These models don’t really think. Never mind OpenAI CEO Sam Altman. He recently suggested we are nearing a time when artificial intelligence could improve itself. It may invent new technologies on its own and greatly exceed human intelligence. We are not even close.

The capabilities of LLMs are reaching saturation. Even though techniques, such as chain-of-thought reasoning before answering, have temporarily provided relief. There is still a lack of innovation to change the basic concept and enable something truly new.

I am not alone in this belief. Winner of the Nobel Prize in computer science, Yann LeCun, calls LLMs “stochastic parrots." Machines that babble meaninglessly and merely memorize patterns instead of understanding things.

LLMs learn by rote. If the internet were filled with people who think the Earth is flat, LLMs would adopt this view. No genuine reflection occurs during the training process.

The inability to learn new things during use shows that a model lacks true intelligence. It's not surprising that individual questions can cause an LLM to fail. It might produce gibberish if it sees input it doesn’t understand.

Does that remind you of "to be or not his?"

The Pre-COVID Era of AI

Machine translation has, of course, greatly improved since. Most translators now use it in some way. The localization industry has also changed a lot. It originally served as a niche industry primarily for software and tech firms. Now, it is expected to reach $75.7 billion by 2025. And that's despite ChatGPT being able to render excellent translations.

I predict the same will happen to AI and boutique consulting.

It's just a matter of time. Translators had some security because their work was always in demand, even if it changed rapidly. However, consultants don't have that luxury. They need to take immediate action.

If you think you have time to adopt, you're like those in February 2020 who didn’t believe COVID would affect them. Then, just two weeks later, they were in lockdown. Their businesses changed forever or died.

Boutique and solo consultants need to act quickly. They should adopt strategies like an “AI-first” mindset for their services. They must also rethink pricing, using value-based or equity-based fees. Additionally, offering hybrid human+AI deliverables is essential.

The AI Threat Is The Consulting Opportunity

Boutique and solo consultants need to discover new income opportunities and business models. These should set them apart from big consulting firms. It will be imperative not just to survive the AI revolution, but to thrive by leveraging it to enhance their value.

As the world fears AGI, or "the singularity," boutique consultants are stepping up. They prioritize being human-first, AI-fluent, and focused on client outcomes. Their value is growing.

Clients don’t want “GPT-5.” They want:

• “How do we cut onboarding time in half?”
• “How do we stop losing deals to cheaper vendors?”
• “How do we NOT get fired for making the wrong AI bet?”

Boutique consultants can be key partners. They bring strategic certainty, especially when AI gives odd suggestions. This recent incident will always serve as my reminder of the opportunities consultants have in front of them right now: Google's AI recommended adding glue to pizza to improve the stickiness of its cheese. 'Nough said.

Only in business, it could mean citing made-up references to support research; publishing hate speech, conspiracies, and Nazi slogans in marketing material; sending a teenage girl coupons for baby products before she had told her parents she is pregnant; giving drastically higher credit limits to men than women; overestimating property values listing website; producing disturbing and offensive images during user prompts.

All of this happened, y'all. For reelz. Chat GPT told me so. Don't quote me.

Let me break this down for you:

My Irish family and friends have tried to drink me under the table more than once. In all cases, I ended up carrying them home.

When everyone is so stoned they know all the universe's secrets but forget them in 15 seconds, you must stop them from microwaving cheesecake.

Hallucinations are good news for boutique consultants. They make them essential.

Cheap Butts vs. Owners.

Your client can copy-paste prompts all day long. But only YOU can keep them from getting slapped with a lawsuit, issuing incorrect refunds, fabricating legal cases, and revealing their affairs to their spouse.

You are the interpreter, integrator, and accelerator of AI-powered results.

However, this also means that traditional pricing models are under pressure. Finally! It's about time.

I never understood the reasoning behind billing by the hour. The more experience a consultant has, the better they get, the faster they deliver.

So the better and faster you work, the less you get paid? In what universe did that ever make sense?

Unless, of course, you run a large consulting firm and rely heavily on labor from India. I can see how filling expensive seats with cheap butts can be a lucrative business model.

However, many of these consultants often aren’t positioned, empowered, or trained to think beyond execution. They’ll likely miss the emotional, relational, or systemic layers that matter most to clients in places like the U.S., Europe, or Japan.

Meanwhile, the small boutique consultant would deliver tens of times the value for a quarter of the hourly rate. They bring context, creativity, and courageous questions. Because they’re owners, not order-takers. They're not clocking hours. They’re solving the damn problem.

Clients are not paying them for their time. They're paying for speed of insight, precision of diagnosis, boldness of recommendations, and the ability to execute without drama.

That's not new? My clients told me that already back in 2009. They felt they got more value out of me than from the big ones.

Only, I charged $135 an hour and created a tangible return on investment within the next quarter. In one example we shared with the White House, my team helped a life sciences company earn $9.6 million in China. This came from a $150,000 investment.

Imagine I would have waived my hourly rate for 10% of revenue. I would have made $960,000 for the same amount of work.

Who cares how much time you spend on a project? The important thing is the value your work delivers.

What the hell are you going to bill for?

When AI agents can gather market data, scour academic literature, or analyze financials in a fraction of the time it takes you...

When GPT generates first drafts of proposals, reports, and slide decks in seconds...

When AI-powered software can run financial models, supply chain simulations, or statistical analysis with minimal human input...

The question is: What the hell are you going to bill for? Or is it?

It's obviously not 10 hours for something that took an AI a few minutes to complete.

But when you ask yourself how you retrofit your business with an AI-first approach, reinvent pricing, and create new value for clients...

... you must avoid the scarcity mindset that killed the translator clinging to the dictaphone.

The AI Abundance Is Here

Could it be possible that embracing an AI-First mindset and infusing AI into the core of your service offerings leads to more growth?

Similar to what machine translation did to the localization industry?

It created new roles. For example, there are engineers who blend localization into software development. There are also transcreators who ensure marketing messages resonate in various markets. Quality assurance managers check for language, culture, and functionality in localized products or services.

Likewise, the AI revolution needs engineers who augment business processes with AI and build a library of AI agents for various tasks. It depends on data interpreters who offer AI-enhanced reports that include interactive dashboards or predictive models. It must employ quality assurance managers who ensure the quality of insights. They also create simulations or analyze large datasets to provide faster and more accurate recommendations.

This is just scratching the surface. I am pretty sure that in 20 years, someone in Generation Beta or Gamma will wonder: "Wait… he used his fingers to type? On a keyboard? He probably also manually scheduled meetings. Like with his actual brain?! Go figure, he didn't see this coming."

Meanwhile, it begins with incorporating AI into your client-facing deliverables. Create hybrid solutions that blend AI's strengths with the unique qualities of human skill.

Show Me The Money

The future is for AI-native consulting firms. Here, human creativity is key to staying competitive. In this model, AI and humans work in tandem. They deliver projects with AI insights, plus consultant workshops to implement them.

Sometimes, it can be as straightforward as an AI analysis followed by a session that turns it into a strategic action plan with the client’s team.

Offering hybrid deliverables protects your business from competing with AI-only solutions. Clients realize they need your expertise for real results. AI output alone isn’t enough.

"But still, Andrew," you might think, "show me the mullah."

The industry at large is moving in the direction of outcome-based pricing and gain-share models. Here, you charge for the true value delivered. Some forward-thinking consultancies are trying out “deliverable-led pricing.” They are also using equity-in-profit models instead of charging per hour.

Boutique firms can quickly adopt these innovative pricing schemes. They safeguard their income from AI efficiency gains and attract clients who like a pay-for-results approach.

They shift a possible problem (cutting billable hours) into a benefit. AI helps them achieve great results quickly. They earn rewards through value pricing for this efficiency.

But that's just the first step.

I try to hear you, Generation Gamma, I really do.

I feel like I'm at a turning point with AI, much like when DEC launched the first mini-computers. Back then, being a typist for a translator actually became a real job.

And it's highly likely that my "creative ideas for new income streams" will be put in that category one day. But today, there are only so many ways to build a consulting practice:

Productize Your Knowledge and IP

Consider packaging your knowledge and intellectual property into a product that can reach a broader customer base. This could be an online course, a paid research report, a toolkit or template, or even a software-as-a-service if you’re technically inclined.

Fractional AI Officer or Advisor Roles

Join client organizations in a part-time leadership role, like a fractional Chief AI Officer or strategic advisor. Many mid-sized companies are unsure about how to utilize AI. In this role, you don't just consult on projects. You also guide the client’s AI or strategic initiatives over time. This usually involves a retainer or equity.

Micro-Niche Specialization

Address niche problems effectively. This lets you focus on specific areas and lead those markets worldwide. AI can enhance your insights. For instance, you might consult on AI ethics for healthcare startups. Alternatively, you could focus on pricing strategies for SaaS companies that use AI analytics. Because delivery can be largely virtual and AI-assisted, even a solo expert can serve clients worldwide in a narrow niche.

The Ecosystem Orchestrator

AI makes it easier to collaborate remotely and integrate outputs. Join a few boutique consultants with different skills, like a data scientist, a domain expert, and a change management expert. Together, you can create complete AI-enabled transformation frameworks that no one can achieve alone. Such collaborations can be project-based and don’t require forming a formal firm, but allow small players to punch above their weight.

Educational and Coaching Services

Many companies need to upskill their workforce for AI. So, consultants can provide training workshops, coaching, and courses as services. A technical consultant could lead an “AI Bootcamp” for non-technical managers. Additionally, a management consultant may help client teams adapt their processes for the AI era. This can be a repeatable offering and tap into training budgets rather than consulting budgets. It’s also a way to stay engaged with clients between major projects, creating a continuous revenue stream.

Keep in mind that six out of ten consulting firms expect to see higher profits after they successfully implement AI. Adapt, innovate, and partner with AI. The future of boutique consulting lies in those who combine human skills with AI. This combination creates value that neither can achieve alone.

After that?

Ask Generation Gamma.