One in Three Clients Question Agency Fees as AI Adoption Rises

A new industry report finds that one in three senior business leaders now believe AI tools allow clients to bring professional services work in-house, creating direct pricing pressure on agencies and consultancies globally.

The finding comes from the Teamwork.com Client Work Report, which surveyed more than 1,000 senior business leaders. Exactly 33% of respondents said they expect clients to adopt a do-it-yourself approach using AI tools, challenging fee structures that professional services firms have built over decades.

The Gap Between Client Perception and AI Reality

The report highlights a significant disconnect between what clients believe AI can do and what it actually delivers. A study by Scale AI and the Center for AI Safety found that advanced AI systems can independently complete only 2.5% of projects.

That gap, between a 33% client belief in AI replacement and a 2.5% actual autonomous completion rate, represents the core commercial challenge for agencies and consultancies today.

Daniel Mackey, CEO of Teamwork.com, said the distinction is critical. "Access to AI isn't the same as delivering results," Mackey said. "Clients now have powerful tools at their fingertips, and that's shifting expectations around speed and cost."

Mackey also pointed to capabilities that AI cannot replicate, including "reading a room during a boardroom presentation and adjusting approach on the fly, or knowing from market experience that a strategy needs to change before clients even notice the shift."

Global Firms Restructure Around Outcomes, Not Hours

The pricing pressure documented in the report is already reshaping the largest professional services firms. Accenture exited 11,000 employees in 2025 as part of a US$865 million restructuring, signaling a shift away from traditional billable-hour models toward measurable outcomes.

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RSM committed US$1 billion over three years to build AI skills across its workforce, explicitly moving from junior staffing to strategic roles where human professionals apply judgment to AI outputs. The investment is a direct response to client perceptions that AI reduces the need for external experts.

McKinsey's internal AI platform saves 50,000 hours per month across the firm's knowledge work. Rather than passing those efficiency gains to clients as fee reductions, the firm has used the tool to reposition AI as an amplifier of consultant expertise.

Client-Side AI Spending Accelerates the Pressure

Client investment in AI is growing rapidly, reinforcing the perception that external expertise is less necessary. Enterprise AI spending reached an average of US$85,521 per month in 2025, up 36% year-over-year. 45% of enterprises plan to spend more than US$100,000 per month on AI.

Gartner projects that 33% of enterprise software will incorporate AI agents by 2028, meaning client-side AI capability will become significantly more embedded over the next two years.

57% of CFOs report heightened client price sensitivity. 73% are adjusting pricing strategies in response to AI and cost pressure.

The Risk of Competing on Price Alone

Mackey warned against agencies cutting fees to stay competitive, saying it "chips away at the very foundations that make their work valuable" and creates a race to the bottom that is difficult to reverse.

Early-adopting law firms using AI for document review illustrate the alternative outcome. Firms that used AI to handle volume work while redirecting human expertise to higher-value matters generated an estimated US$6.4 million in additional billing per 100 lawyers, rather than conceding lower fees.

The Teamwork.com report suggests that service firms which invest in demonstrating irreplaceable human judgment, rather than competing on cost, are better positioned to protect margins as client AI capabilities continue to grow.