Partner at McKinsey & Company | Head of Data Science Guild in North America
Many companies are diving into AI agents without a clear framework for when they are appropriate or how to assess their effectiveness. Several recent benchmarks offer a more structured view of where LLM agents are effective and where they are not. LLM agents consistently perform well in short, structured tasks involving tool use. A March 2025 survey on evaluation methods highlights their ability to decompose problems into tool calls, maintain state across multiple steps, and apply reflection to self-correct. Architectures like PLAN-and-ACT and AgentGen, which incorporate Monte Carlo Tree Search, improve task completion rates by 8 to 15 percent across domains such as information retrieval, scripting, and constrained planning. Structured hybrid pipelines are another area where agents perform reliably. Benchmarks like ThinkGeo and ToolQA show that when paired with stable interfaces and clearly defined tool actions, LLMs can handle classification, data extraction, and logic operations at production-grade accuracy. The performance drops sharply in more complex settings. In Vending-Bench, agents tasked with managing a vending operation over extended interactions failed after roughly 20 million tokens. They lost track of inventory, misordered events, or repeated actions indefinitely. These breakdowns occurred even when the full context was available, pointing to fundamental limitations in long-horizon planning and execution logic. SOP-Bench further illustrates this boundary. Across 1,800 real-world industrial procedures, Function-Calling agents completed only 27 percent of tasks. When exposed to larger tool registries, performance degraded significantly. Agents frequently selected incorrect tools, despite having structured metadata and step-by-step guidance. These findings suggest that LLM agents work best when the task is tightly scoped, repeatable, and structured around deterministic APIs. They consistently underperform when the workflow requires extended decision-making, coordination, or procedural nuance. To formalize this distinction, I use the SMART framework to assess agent fit: • 𝗦𝗰𝗼𝗽𝗲 & 𝗦𝘁𝗿𝘂𝗰𝘁𝘂𝗿𝗲 – Is the process linear and clearly defined? • 𝗠𝗲𝘁𝗿𝗶𝗰𝘀 & 𝗠𝗲𝗮𝘀𝘂𝗿𝗲𝗺𝗲𝗻𝘁 – Is there sufficient volume and quantifiable ROI? • 𝗔𝗰𝗰𝗲𝘀𝘀 & 𝗔𝗰𝘁𝗶𝗼𝗻𝗮𝗯𝗶𝗹𝗶𝘁𝘆 – Are tools and APIs integrated and callable? • 𝗥𝗶𝘀𝗸 & 𝗥𝗲𝗹𝗶𝗮𝗯𝗶𝗹𝗶𝘁𝘆 – Can failures be logged, audited, and contained? • 𝗧𝗲𝗺𝗽𝗼𝗿𝗮𝗹 𝗟𝗲𝗻𝗴𝘁𝗵 – Is the task short, self-contained, and episodic? When all five criteria are met, agentic automation is likely to succeed. When even one is missing, the use case may require redesign before introducing LLM agents. The strongest agent implementations I’ve seen start with ruthless scoping, not ambitious scale. What filters do you use before greenlighting an AI agent?