GCs: Beyond Efficiency – The Hidden Costs of Unmeasured Value in the AI Era

The buzz around generative AI in legal departments is reaching a fever pitch, and it’s not just a coastal phenomenon. Here in Chicago, where the legal tech scene is quietly booming alongside the financial district, the implications are already being felt. The recent reports from the Association of Corporate Counsel (ACC) and FTI Consulting paint a clear picture: AI adoption is doubling, and it’s shifting the power dynamics between in-house counsel and outside firms. But beyond the efficiency gains, there’s a deeper question brewing – are we measuring the *right* things as we integrate this technology?

The Efficiency Trap: Beyond Speed and Cost Reduction

The ACC report highlights that 91% of legal professionals cite efficiency as the primary benefit of generative AI, particularly in drafting and legal research. That’s fantastic, and certainly welcome in a city like Chicago where legal costs can be substantial. However, focusing solely on efficiency is a dangerous game. It’s like admiring the horsepower of a new engine without considering the quality of the road. As General Counsel increasingly turn to AI, the temptation to simply reduce billable hours – a pressure already mounting – will be strong. But what gets lost in that equation? What about the nuanced judgment, the strategic thinking, and the client relationships that truly differentiate exceptional legal function?

A Shifting Landscape: In-Sourcing and the Role of Outside Counsel

The data suggests a clear trend towards in-sourcing. With AI handling more of the routine tasks, corporate legal departments are looking to bring work previously outsourced to law firms back in-house. This is particularly relevant in a city like Chicago, home to a large number of both major corporations and prestigious law firms. The report indicates that companies are considering insourcing not just drafting and research, but even elements of higher-level work like M&A and litigation. This shift isn’t necessarily about eliminating outside counsel altogether, but rather redefining the relationship. Firms that can demonstrate a unique ability to provide strategic advice, complex problem-solving, and deep industry expertise will thrive. Those that simply offer commoditized legal services will likely struggle.

The Strategic Value of AI: More Than Just a Tool

The General Counsel Report from FTI Consulting and Relativity reveals that 87% of general counsel now report using AI within their teams, a significant jump from 44% in 2025. Crucially, 39% now view AI as a strategic priority. This isn’t just about automating tasks; it’s about fundamentally changing how legal departments operate. The report also points to a growing emphasis on formalized technology roadmaps, with 53% of departments now having one in place – more than double the previous year. This suggests a move towards a more proactive and strategic approach to AI adoption, rather than simply reacting to the latest trends. In Chicago, where innovation is often driven by the financial and tech sectors, this proactive approach is particularly evident.

What Tasks Are Seeing the Most AI Adoption?

The FTI Consulting report breaks down specific utilize cases. Summarization is leading the charge, with 83% of respondents either using or experimenting with it. This is followed by identifying contract clauses (63%), audio and video transcription (53%), analysis of foreign language materials (40%), and first-pass review (37%). These applications are particularly valuable in a global city like Chicago, which serves as a major hub for international trade and commerce. The ability to quickly and accurately process large volumes of information, regardless of language or format, is a significant competitive advantage.

The Four Plates: A Framework for Holistic AI Value Measurement

To avoid the efficiency trap, legal departments demand to adopt a more holistic approach to measuring the value of AI. I call it the “Four Plates” framework. Think of it like balancing a meal: you need a bit of everything for optimal nourishment. The four plates are:

1. Efficiency: Yes, still important. Track time savings, cost reductions, and increased throughput.
2. Risk Mitigation: How is AI helping you identify and avoid potential legal pitfalls? This is especially crucial in a heavily regulated environment like Illinois.
3. Strategic Alignment: Is AI freeing up your legal team to focus on initiatives that directly support the company’s business goals?
4. Client Satisfaction: Are your clients – both internal stakeholders and external parties – experiencing a better, more responsive legal service as a result of AI?

Navigating the AI Landscape in Chicago: A Local Resource Guide

Given my background in legal technology consulting, if this trend impacts you in the Chicago area, here are three types of local professionals you’ll likely need to engage with:

Boutique Cybersecurity Consultants:

AI introduces new cybersecurity risks. Gaze for firms specializing in AI-specific vulnerabilities and data privacy compliance, particularly those familiar with Illinois’ Biometric Information Privacy Act (BIPA). They should have a proven track record working with legal departments.

AI Ethics & Governance Advisors:

Ensuring responsible AI use is paramount. Seek advisors with expertise in AI ethics frameworks, bias detection, and explainable AI (XAI). They should be able to help you develop internal policies and training programs.

Legal Process Automation (LPA) Specialists:

Implementing AI effectively requires careful process redesign. LPA specialists can help you map your existing workflows, identify automation opportunities, and integrate AI tools seamlessly. Look for consultants with experience in legal technology platforms like Relativity and Everlaw.

Ready to uncover trusted professionals? Browse our complete directory of top-rated legal tech experts in the Chicago area today.