Written by Kurt Schmidt, Agency Business Consultant, Schmidt Consulting Group

If your agency’s basically just winging it with duct tape and good vibes, and projects keep slipping past deadlines, people tend to treat budgets like they’re just suggestions. Your team ends up spending more time putting out fires than actually building stuff.

And your solution is to add AI to this chaos?

I get the appeal. AI sounds like magic. Wave the automation wand and suddenly your disasters become predictable, your scope creep gets contained, and clients stop sending those passive-aggressive “just wondering where things are at” emails.

But here’s what OpenAI and the like don’t want you to know: AI doesn’t fix broken operations. It amplifies them.

The Real Problem

Think of AI as a really powerful magnifying glass. If your processes are solid, AI makes them incredible. If they’re a mess, AI just helps you create disasters at superhuman speed.

I’ve watched agencies implement AI project management while their basic delivery was still held together with Slack messages and hope. Three months later? They were creating confused deliverables twice as fast and missing deadlines with algorithmic precision.

The problem isn’t the AI. It’s the foundation.

What You Actually Need First

Before you even think about AI, you need clarity on three things:

Predictable delivery timelines. Not optimistic estimates or “it depends” ranges. Actual, reliable predictions. If you can’t confidently tell a client their project will take six weeks, you’re not ready for AI to manage that timeline.

Clear profit margins by service type. You need to know exactly which work makes money and which doesn’t. AI can optimize profitable processes beautifully. It can also help you lose money more efficiently.

Standardized communication. Your clients need to understand what’s happening and why it matters. AI can enhance good communication, but it can’t fix communication that was unclear to begin with.

The Truth About Agencies Getting It Right

The agencies actually succeeding with AI didn’t start with the robot stuff. They spent months getting their delivery locked down first. They built what I call “operational confidence” – the ability to make promises and keep them consistently.

Then they layered in AI to make their smooth processes even better.

Most agencies are skipping that boring foundation work and jumping straight to automation. It’s like putting a Ferrari engine in a shopping cart. Sure, it’ll go fast (and be super fun to watch), but it’s gonna fall apart.

The Real Question

Before you invest in another AI tool, ask yourself this: If you had to guarantee the timeline and budget for your next project, would you feel confident or terrified?

If it’s terrified, you’ve got foundational work to do first. And honestly, that’s probably the best investment you can make right now.

Because when AI does become part of your operations, you want it amplifying excellence, not chaos.

I’m joining Grant Hultgren, VP of Customer Success at Parallax on July 17th for a live event where we’ll dive even deeper into this topic. Sharing stories, advice, and the truth about the new age of agency operations. Register here.