Claude Shifts Legal Conversations From Productivity to Justification
Anthropic's Claude Cowork For Legal announcement last week was the latest reminder of what in-house teams are already feeling: AI tools are now capable enough that CFOs are asking different questions.
Not "Can we do this work faster?"
But "If AI is this capable (and cheap), why are we still sending so much work out to law firms? And if we are, why does it still cost so much?"
Those aren't productivity questions. They're justification questions. And they are the questions I hear in every CFO conversation I have.
The shift is real: whether justified or not, there is a universal expectation that AI is (and should be) disrupting the legal industry, and that part of that disruption is bringing legal costs down because more work can now be done in-house. So scrutiny moves away from how something was done and toward why this decision made business sense. Why was this work sent externally? Why this firm? Why this price? What alternatives were considered?
Most legal teams are underestimating this tectonic shift. The market is flush with tools that make lawyers faster. Speed is no longer the bottleneck. The bottleneck is decision discipline - the ability to defend trade-offs before work starts and after it ends.
As in-house departments get stronger with AI, work that still goes outside becomes more exposed, and every external dollar now needs a business explanation, not just a legal one.
The legal teams that feel least defensive with their CFOs won't be the ones with the best pedigree, the longest tenure, or from the best law schools. At the other extreme, nor will they be the cheapest. They'll be the most predictable - operating within tight ranges between expected and actual fees, relying on data-backed pricing and informed firm selection instead of bespoke negotiations every time pressure hits.
That changes the entire posture of legal and will actually be a relief for its leaders. Instead of defending spend after the fact, you manage trade-offs in advance. Instead of explaining exceptions, you demonstrate control. Instead of asking for trust, you show the numbers.
The GCs who navigate this moment best won't be the loudest AI adopters. They'll be the ones who can sit across from a CFO and answer the tough questions with confidence: Why was this the right trade-off? What did we get that we couldn't have gotten another way?
And they’ll have those answers before the invoice ever arrives.
Cheers,
-Jim
This article originally appeared in The Value Standard Newsletter. Join the 5,000+ legal leaders who get insights into the innovation shaping the legal landscape delivered to their inbox fortnightly.
