Since becoming the global managing partner of McKinsey & Company in 2021, Bob Sternfels has had to navigate a series of thorny challenges. He has taken steps to restore the consulting firm’s reputation after several high-profile scandals, most notably its role in the U.S. opioid crisis. He’s trying to tighten the rules on client selection and governance without alienating the firm’s partners. And he’s driving an organizational transformation to set McKinsey up for the AI era. In this wide-ranging conversation with HBR’s editor at large, Sternfels reflects on McKinsey’s 100-year history and how the role of consultants is changing: “We’re moving away from an advisory model. Today about a third of our revenue comes from underwriting outcomes.” He talks about the impact of AI, what McKinsey looks for in new hires, and which issues are top of mind for CEOs these days.

A testbed built around one of management education’s most enduring simulations, the MIT Beer Distribution Game, has shown that the latest generation of generative AI models can now autonomously manage supply chains. Systems using advanced reasoning models like GPT-5 and Llama 4 adapted to changing conditions, minimized costs, and overcame the bullwhip effect. But managers should be aware that success depends on model selection, guardrails, curated data sharing, and prompt design. Such autonomous AI agents will allow human managers to focus on higher-value functions.