Michael Kempe on How AI Is Reinventing the Professional Services Business Model

0:00With everything that we do, humans are in the loop, right? And it's incredibly important that we have AI do the work, right? But ultimately, the judgments, the oversight, right, is done by humans.

0:15Peter High: Welcome to Technovation. I'm Peter High, president of Metastrategy. My guest today is Mike Kempe. Mike is the chief information officer of Grant Thornton, one of the largest accounting, tax and advisory firms in the U.S., which includes a global network with member firms and more than 150 markets and a combined revenue exceeding$8.5 billion. As CIO, Mike leads the firm's technology strategy and operations with responsibility for modernizing the technology landscape, advancing data and AI capabilities, strengthening cybersecurity, and enabling the firm's broader business transformation. He joined the firm in November of 2024 at a pivotal time as the firm embarked on a new multinational strategy designed to accelerate innovation and deliver greater value to clients around the world.

0:59Peter High: Prior to joining Grant Thornton, Mike spent more than two decades in senior technology leadership roles across financial services and professional services, including a tenure as Chief Information Officer at KPMG. In today's conversation, we'll discuss how AI is reshaping professional services, Grant Thornton's technology and business transformation, and Mike's perspective on leading organizations through periods of rapid technological change, among other topics we'll cover. Mike, welcome to Technovation. It's great to speak with you today. Nice to be here. Today's episode is brought to you by Eleven Labs.

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2:14Peter High: And now on to the interview. Take a moment, if you would, Mike, and describe Grant Thornton's business for those who may be less familiar with it. Yeah, I'm happy to do so. So Grant Thornton is one of the leading professional services firms globally, providing audit tax advisory services to our clients. And our clients span from smaller firms, privately held to large global multinational companies. And that's our target base. We're expanding heavily internationally and in the U.S. So we're currently in about 22 countries. And like I said, expanding quickly. So we're in an interesting journey to go from kind of a domestic, smaller professional services firm to very much a large global firm.

3:04And, you know, our strategy is really around clients, helping clients navigate complexity and accelerate growth. So we're investing heavily in technology and data, AI, and of course, in lots of M &A. and we believe that the future of professional services is very much about combining human experience and intelligent technology, which is my role, which is why I'm here. So really our goal in serving our clients isn't just to kind of work more efficiently, it's really to help our clients make better decisions and move faster and create more value.

3:41Peter High: Excellent. Talk about your role as Chief Information Officer, if you would, Mike. Yeah, so I joined about a year and a half ago at this point in November 2024. And what I do is I oversee all things technology for the Grant Thornton Advisors Platform, our multinational platform. So not just the U.S. entity, but really the entire Advisors Platform spanning Autotech's advisory and our support functions. So it's really much broader than sort of a classic, if you will, technology role that maybe focused a little bit more on infrastructure and kind of back office support. You know, I really spent the majority of my time, you know, working with our audit tax advisory leaders and looking at the technology that we need to be able to grow the firm, expand the firm and execute on our business strategy.

4:34And again, not just in the U.S., but really globally for the entire platform.

4:38Peter High: And I wonder, Mike, as someone you mentioned, you joined your current post in November 2024. That follows a long tenure at KPMG, joining that firm, I believe, back in 2012 and concluding your time there as the chief information officer for global business process groups. groups. I wonder, as someone who's been involved with services businesses for such a considerable tenure, how you see the evolution of these roles in light of some of the dramatic changes that have happened in the more strategic nature of how technology could be applied? Yeah, look, I think that the role of the CIO or the technology leader, I mean, there's so many different terms for that role.

5:21You could be CIO, the chief technology officer, chief digital officer, chief AI officer, they're all technology-related roles, right? And I think technology has advanced so much over the years that the role of the technology leader has become so much more important than it was in the past. And one of my mentors, actually, who was at KPMG at the time, he used to say, and he still says, every company is becoming a technology company, right? And I firmly believe that too. You know, technology plays such a fundamental part in our business, not just our firm, Grant Thornton, but like I said, in most companies these days, that it's critically important for the CIO to, you know, to be at the table and really work side by side with, you know, in this case, auto tax advisory for Grant Thornton, but really with the business, right?

6:13and really elevate from a past role where technology and the CIO was typically focused more on infrastructure, back office, data centers, cybersecurity, things like that. It's really become an elevated role leading the implementation of technology to really help grow the firm. And especially now with AI coming into the picture, Gen AI over the last three years or so since JetGPT came out, So, you know, being that central person to really harness all this technology and make it available, you know, for the right business cases, you know, and put it in the hands of the right people in the right way is critically important.

6:53And so I think the role of the technologist has really, really evolved over especially the last five years, but even before then. And to me, it is one of the most critical roles in the firm.

7:06Peter High: You mentioned artificial intelligence. I certainly want to get your thoughts, Mike, on the impact it's having more specifically within your firm, professional services or among the industries that have been most impacted, certainly one might argue. Talk a bit about how you see it reshaping the work your colleagues perform on a day-to-day basis. Yeah, I think AI in the knowledge worker field is massively disruptive, right? And we've seen that from the beginning. This is honestly one of the reasons I've joined Grant Thornton is because, you know, the firm was willing to make big investments in AI and in technology.

7:43It's massively disruptive, but we see this as a massive opportunity for us. I think with the support that we have and the investments that we can make in AI and in technology, and we've publicly come out and said, you know, we're investing about a billion dollars over three years in technology and AI. and with that investment, we're really reimagining professional services for our clients. And there's a couple of great examples of that that we've already completed. One example, in our audit business, we recently deployed a solution that we named GTAP, which is part of our audit platform. And what it does, if you think about an audit, the first step typically in an audit is working with your clients, and extracting data from the clients to be able to do our analysis and ultimately do the audit work.

8:37That work to extract the data, understand it, load it. There's typically a number of back and forth with the clients to make sure that we get all the data, that we understand what it is, and then we do a piece of work in the background to get it into our platform. It used to be highly manual in nature, time-consuming on our part, time-consuming on the client's part. And what we've done with GTAP is we built an AI solution that automates that entire process, connecting to all the major ERP systems to extract that data and load it and basically do that work for us. And so this is significantly reducing the amount of time for us to go through that part of the process.

9:17It significantly reduces the amount of interaction required with the client. And obviously, that helps the client as well to kind of focus on more value-added capabilities. right and it allows us to do the audit much faster so this is just step one of the audit process right we're automating and we're looking at ai solutions in the rest of the audit process similarly you know we're looking at at you know we're implementing ai solutions in tax and advisory as well as well as in our back office so this is just one example but you know this is significantly you know reimagining you know an audit and what an audit could look like and i think that's the the real value of AI, right?

9:58And I think you probably heard, and I think there's a lot of noise out there around looking at AI and looking at the benefit of AI and how many companies are actually achieving an ROI on their AI investment, right? And I think what a lot of companies do, and we've done some of this ourselves as well, is kind of looking at an existing process and saying, okay, here's 15 steps in this process, right? Whether it's a service offering to our client or an internal back office process, but there's 15 steps in this process. I'm going to put an AI solution, step number three, five, and seven. And now I've made this process 10, 15 % better.

10:36There's value to that. Don't get me wrong. But I think the bigger value is to sort of take a look at the entire process and say, let's reimagine this whole process from the ground up. Like in an AI world, what would this process look like? And that's the exercise that we've been through with various of our service offerings for our clients. And this is how we designed the GTAP solution as well. And I think that's really where the value is. Because now you're not talking about incremental improvements to a process. You're really sort of reimagining this process completely. And that's super powerful.

11:09And that's where we've seen the most success.

11:11Peter High: How do you think of the balance between automation and human expertise, Mike, as you contemplate some of the changes you've been describing? Yeah, I mean, that's a great question. You know, with everything that we do, humans are in the loop, right? And it's incredibly important that, you know, we have AI do the work, right? But ultimately, the judgments, the oversight, right, is done by humans. And that's, you know, that's the position that we have. AI is very good at processing information and looking at patterns and looking at accelerating tasks. But our human professionals, our people, they're at the heart of everything that we do.

11:53And they're there to assign judgments, to understand the context, to look at risk and ultimately make decisions. We're not letting AI do that work. And there's many examples of this. I was just earlier today reviewing a solution that we built for creating proposals. right typically when when we send a proposal to a client it's it's you know it's typically a PowerPoint presentation we put together the way we built the agents is that it does not create a PowerPoint presentation actually creates a PDF so that we force our people to still look at you know the PDF and not just send it off to the clients but actually you know do the judgment work right to then take it to the client so human in the loop looking at risk looking at judgment understanding the context and then looking at risk and ultimately making decisions is at the heart of our AI strategy.

12:45Peter High: And how do you ensure trust and quality and governance are maintained? You talked about, of course, the human in the loop, but the extent to which, as you think about the application of this to client work, and it's probably no mystery to clients that AI is being used in the workflows internally. In the explanation of how the work is undertaken and the enactment of that work itself, how do you think about trust especially, but the other topics as well? Yeah, look, I mean, trust is the outcome that we're looking for, right? I mean, clients trust us, which is why they engage with us, right? And they ask us to do the work for them.

13:24So they trust us that we can do the work. So we need to respect that trust, right? And we have the governance in place and the risk management and overall the quality, you know, processes in place to make sure that, you know, that we do this right. So for us, like governance is not something that we added on, right? I mean, everything at the heart of what we do, we have governance in place, we have a risk framework in place, we have, you know, strong processes in place to make sure that, you know, as we roll out AI solutions, as we're building AI solutions, as we operationalize them, you know, get them into the hands of our people, that we do so, you know, with the right context, with the right people understanding they're a part of it and the fact that they're using AI responsibly.

14:09So very, very important because, you know, that trust is at the heart of our relationship with our clients and our clients need the confidence that we use AI responsibly, transparently, and in a way that enhances the quality of our work.

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15:41Peter High: And now back to the interview.

15:46Peter High: And I also wonder, how do you think about building a culture that encourages experimentation while also maintaining the discipline expected in a highly regulated profession like your own? A lot of what you're describing clearly suggests an orientation to leaning into the change, to embracing the innovation. But I'd love to understand how you think about that balance, which is sometimes easier said than done. Yeah, I think, I mean, we highly encourage our people to experiment, right? And we've built safeguards and sandboxes for our people so that they can build their agents and experiment with AI.

16:25And we have a process in place for them to submit ideas to us. So if somebody created a great local agent, and we have some great examples of that, actually. We just recently in Ireland, which is one of the acquisitions that we've done, Ireland is part of our Grant Thornton Advisors platform. we ran a week-long campaign where our people were encouraged to create agents to solve business problems. And we had a contest and a number of great agents came out of that. And we're now working to productionize, if you will, some of these agents to make them available to everybody. So lots of innovations happening and we very much believe in democratizing access to AI.

17:07And we don't believe that there's one central team that has all the good ideas, right? We think the ideas are everywhere. So we're focused on enabling our people, putting our processes in place, right? So they can build these things. And then if they really work and they're really great, we can elevate them and we can deploy them throughout the entire firm in a way that, again, has the governance, has the risk management, has security controls in place, has the oversight in place. So we can do everything responsibly.

17:36Peter High: You've mentioned a number of compelling ways in which the organization is contemplating improving customer experience. And I wonder how do you work with your colleagues and perhaps work directly with those customers as well to help identify the ways or the best means of doing that. Talk a bit about your collaboration with the rest of the organization as you think about continued improvements to customer experience. Yeah, we're investing heavily in this area. So we're working very closely with our audit tech advisory service line leaders and their leadership teams and our service offering leaders, if you will, the people that are actually performing these services for our clients, to really understand the details of the services they provide on a daily basis and working to enhance that.

18:27And like I said, we're taking this reimagined approach and we actually have a program called Grant Thornton Reimagined, which is really, let's take a service offering end-to-end and really sort of reimagine this And that's been extremely successful. And, you know, these things are not just going to be in the hands of our people to be able to provide better services to our clients, you know, more timely, more consistent, et cetera. But some of these are also going to be made available to our clients themselves. And this is going to be a little bit further out, but our clients will at some point in the future, you know, have access to our AI capabilities, right, for them to provide, to get self-service access to them and be able to, you know, use those services themselves.

19:07So very exciting future for us in terms of, you know, getting AI in the hands of not just our people, but eventually our clients as well.

19:16Peter High: You mentioned that the organization has grown tremendously through M &A. And I wonder what role your team plays every time there's an acquisition that's made that accentuates that growth, an exciting thing, but obviously adding complexity to the overall business as well. Talk a bit about the way in which you and your team engage. Yeah, so we have a number of people that are dedicated to just working on the integration of these acquisitions. As you can imagine, it's not easy to do an integration and get everybody together onto one or set of platforms. But for us, it's really important that we bring everybody together as quickly as we can so that we have access to the same information, the same data across our entire platform.

19:59and we're trying to do so in a very sort of consistent way and have a sort of, you know, 60, 90-day plan to complete some of these, or at least to progress some of these integrations up to a certain point so we can start collaborating closely, right? And then completing the rest of the integration over the next six to nine months, typically. So those are the timelines that we're looking at from a technology perspective. Everything that we're building, whether it's AI solutions, you know, other products that we're building, you know, SaaS, the enterprise systems that we're rolling out across the firm.

20:32The whole idea is that this is available to everybody that's joining our platform. So, you know, we're building a state-of-the-art technology stack, again, across data, across enterprise systems, and across AI products and solutions that we're building or buying, right? And that's available to everybody. So the beauty of this is it doesn't matter if you're servicing a client in France, in Ireland, in the US, in the Netherlands, in UAE, right? Everybody will be working together on one set of systems, one set of data, and that makes collaboration really, really easy across borders.

21:10Peter High: Yeah, fascinating. fascinating. As somebody, again, who has broad expertise and experience in multiple behemoths within professional services, I'm curious, you know, this is an industry that's traditionally been built on billable hours, human expertise. We're talking about throughout this conversation, the ways in which AI is weaving itself into research activities, analysis, various elements of judgment, obviously with humans in the loop, as you point out, not completely disintermediating the work of people. But I wonder how you think about the value proposition evolving in light of this as you look, let's say, a half decade or a decade from now?

21:49Yeah, look, I think, you know, the idea of, hey, you engage with us or any other professional services firm for a time and engagement, a time and material engagement is the old ways of working, right? I think we're clearly moving to much more of an outcome-based future, right? Where, you know, our clients are expecting an outcome, right? They're not expecting, you know, us to just build forever and ever for time and expenses, right? They're expecting an outcome, right? And our clients at the end of the day, they don't want to buy hours, right? What they want to buy is confidence. They want to buy insight.

22:24They want to buy results. And, you know, as we think about AI, right, it reduces the time required for certain activities, And the differentiator becomes the ability for us to combine the technology, the expertise, and the industry knowledge to solve complex problems. So that's where we're going. I think we're leading the professional services world in this because I think what we're doing is slightly different than what some of the other firms are doing. And for us, the future really belongs to the firm that can amplify that human expertise through technology while maintaining the trust and the relationships that clients value most.

23:03Peter High: Fascinating. Very interesting. Thank you for sharing that. I wanted to, before I let you go, Mike, ask you, given the pace of change that you're describing and certainly is what all of us are living, what do you read or listen to in order to stay current that you'd recommend to others?

23:21I listen and read and watch a lot to stay current. I think from a technology leader perspective, you know, again, like I said at the beginning of this conversation, I think the role of the CIO or the technology leader has evolved so much where in the past it was all about infrastructure and that core sort of tech stuff. Right. And I think the technology leader of 2026 and beyond, you know, has to be somebody that is also a business leader. So I think what I focus on a lot is not just on technology articles, newsletters, podcasts, and things like that, but also business, professional services, topics, economics in general, et cetera, et cetera.

24:05So I focus a lot on newsletters. I get a number of newsletters every day, TLDR, Harvard Business Review, anything from CIO.com. A lot of books that I focus on. Co-intelligence is a great book that I read recently. Reshuffle is actually a book that's specifically about the virtual services industry and the impact of AI. So that's been a really good book that I've read. and from a podcast perspective, I have the, I guess, the luxury of having an hour plus commute. So I spend a bit of time in my car every day and I usually listen to the daily podcast by the New York Times. Of course, Diary of the CEO is one of my favorite because I think it does a great job combining, you know, current topics but that focuses on technology aspects of it as well as leadership aspects and, you know, geopolitical aspects of it.

24:59So that's been a really good podcast that I listen to. And then some Gardner, of course, ThinkCast I listen to as well. And some other podcasts that are a little bit more focused on technology like Acquired and the All In podcast. So those are some of the things I listen and read to in between many meetings and a personal life.

25:19Peter High: Well, Mike, thank you for those suggestions. And thank you more generally speaking for a great conversation, emblematic of the significant transformation and growth that the organization has gone through. I appreciate you sharing some perspectives with me today. Great, Peter. It was great to be here. Thank you so much. Thanks for listening to Technovation. If you enjoyed this conversation, subscribe and leave a rating. It helps more leaders find our podcast. Thank you and I look forward to seeing you next time.