What do consultants get paid for? - by Luis Garicano

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What do consultants get paid for?<br>The analysis is the easy part

Luis Garicano<br>Jul 30, 2026

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A consultant I had lunch with recently is redesigning the loyalty program of a large airline. His team finished the analysis in two weeks. Months later the program still does not exist. This is because the purpose of the assignment is not to solve an analytical case study, but to figure out which redesign the parties will accept, and to get the people with authority to commit to implementing it.<br>I was not surprised to hear the story. In our just-published book Messy Jobs: The Work That AI Cannot Reach, Jin Li, Yanhui Wu, and I argue that a job is not a collection of independent tasks but a bundle of tasks and a position inside an organization. While many of the constituent tasks are clean, the job is messy because they must be combined under incomplete knowledge, conflicting objectives among the different parties and binding constraints on who has the authority to make decisions.<br>Hence we argue that automating the clean parts does not necessarily eliminate the job, because the remaining activities, tightly bundled with the rest, can remain the constraint. We argue that the bundle is strongest where separating the analytical/cognitive parts that can be automated would destroy local knowledge, trust, accountability or continuity.<br>Two objections<br>Critics of our argument raise two concerns. The first one has to do with advances in AI capabilities: models do some tasks extremely well and others badly. As they gain memory, use tools and acquire multimodal perception, critics would say, AI will get better at many other tasks like persuading, anticipating the objections raised in a meeting and adapting the tone. Hence even the interpersonal part by itself may not be a sanctuary for long. Just wait a bit for AI to get better, say the critics: Messy Jobs (in their view) describes the transition rather than the long run.<br>The second objection to our thesis is more radical. Maybe as long as we have humans in the loop, we need organizations. But if organizations really are a mess, slow, political, resistant to change, with a large role for humans precisely because someone has to hold meetings, build coalitions and learn the internal politics, why not get rid of the entire organization? What is the point of preserving the existing obsolete structures?<br>We believe that both objections fail, because some of the mess is substantive and necessary.<br>Where the “implementation” months go<br>To an outsider, my friend’s consulting project looks purely analytical.1 The team receives all the data, including all passenger records, redemption rates, customer-retention data, and so on. The team works out the key economic and financial trade-offs of the possible redesigns to figure out which redesign maximizes profits.<br>If doing this, given all the available data and the current AI tools, took two weeks, why has the project taken many months?<br>First, inside the airline, different parts of the business worry about different things. For instance, the salespeople have relationships with the hotel chains and do not want to disturb them, while the operations team worries about the staff at the airport counters who will have to deal with angry passengers who have grown used to certain privileges.<br>Second, there are the outside parties, from hotel chains to credit-card companies to the retailers that accept miles. Anything that improves the airline’s economics may reduce the value of the program to the hotels or to the card issuers. Each has a view on how card spending should count relative to flying, or how hotel nights should count relative to flying. There are winners and losers everywhere, and a reform that benefits the airline as a whole can hurt a particular business unit or a particular partner.<br>So the consultants spend weeks doing an enormous amount of work that looks peripheral to the problem. They repeatedly meet the head of the loyalty program, then the CFO, then the CEO. They also meet the commercial partners, and that means meeting the head of loyalty, then the finance team, then the chief executive. They revise the proposal. They redo the presentation.<br>And all of these people speak different languages. Organizations have different internal codes because they care about different things and deal with different problems. What the consultants are doing is a mix of analysis, translation and intermediation. The assignment of the consultants is to design a program that is an agreement that the relevant parties will authorize and implement.<br>Once the analysis is cheap, what remains is to learn what each party will actually accept, and to obtain commitments from those who are authorized to make them.<br>The real knowledge problem<br>An advocate of highly capable AI systems (“AGI-pilled”) would probably say this is a problem ready for AI. Have an agent...