The strategic imperative: From cost centre to value driver
In-house legal functions face an unprecedented opportunity disguised as a familiar challenge. According to Thomson Reuters' 2025 Generative AI in Professional Services Report (TR's Report), 57% of them recognise GenAI's transformative potential but most, at best, remain stuck in perpetual pilot mode, unable to secure meaningful investment to move beyond preliminary use cases or surface level training initiatives.
For forward-thinking General Counsels, GenAI represents more than a technology decision. It's the pathway to reposition the function from a necessary cost centre to an indispensable value driver. TR's Report, however, outlines several barriers to realising AI's benefits, including capability gaps, risk aversion, and regulatory uncertainty (to name a few). One of those barriers has inhibited General Counsels time and time again - the inability to articulate ROI. To unlock investment, that must change and General Counsels need to speak the language CFOs and CEOs understand, which involves hard numbers tied to measurable business outcomes.
This article outlines the challenge of the data deficit and what budget holders want to know, before providing the practical steps General Counsels need to take to build clear, data-driven business cases to secure AI investment, ultimately creating a clear path forward to transformation.
In-house legal functions: The data deficit
TR's Report reveals a striking disconnect. Adoption of GenAI for legal has grown from 14% to 26% year-over-year, but in-house legal functions' adoption rates continue to lag. Why is that?
A fundamental reason is that, whilst law firms operate with a built-in measurement infrastructure through billable hours, making ROI calculations straightforward, in-house legal teams are different. They typically operate in a measurement vacuum, frequently lacking tangible data to articulate how their internal resources are deployed when assessing internal costs; as contrasted with often knowing their external legal spend down to the invoice line item. This creates a fundamental asymmetry, with budget holders demanding ROI justification but in-house legal functions lacking the baseline data to provide it. The result? A strategic stalemate where innovation and adoption stalls and competitive advantage erodes.
Answering the right questions: What do budget holders want to know?
Consider the typical General Counsel presentation to the executive committee requesting AI investment. It likely focuses on potential capabilities - document review automation, document summarisation, contract analysis, legal research enhancement - because that's what vendors showcase, peers discuss at conferences and what TR's Report shows as the most frequent use cases.
But budget holders are asking different questions:
- What percentage of your team's effort is currently spent on those activities and what does that cost is?
- Which of those activities represents the highest-cost, lowest-value work and what would we save if we approached them differently?
- How will you measure success and demonstrate ROI post-implementation so I know we invested wisely?
- What's the opportunity cost of not investing and why can’t you just “make do”?
Without baseline data, these questions are almost unanswerable.
Building the data foundation: A practical framework
The most successful General Counsels are flipping the traditional approach. Instead of starting with technology capabilities and working toward business justification, they're beginning with rigorous current-state analysis, gathering baseline data and working toward targeted solutions. This approach transforms the conversation in three fundamental ways:
- From aspiration to evidence: Rather than discussing what AI could do, General Counsels are presenting data on what AI must do to address quantifiable inefficiencies and cost concentrations.
- From generic to specific: Instead of implementing popular use cases, General Counsels are deploying solutions tailored to their organisation's and function's strategic priorities.
- From cost to investment: By establishing baseline data, General Counsels are creating the framework to demonstrate concrete ROI rather than hoping for blanket "productivity gains."
Establishing this baseline data doesn't require a law-firm style time sheet or months of analysis. It requires an honest, systematic assessment of current resource deployment on a percentage of effort basis and it can be done in four easy steps:
