Why AI is a tectonic shift reshaping the legal profession

Like the Academy Award-winning film Everything, Everywhere, All at Once, AI is not one story unfolding in a straight line. It is multiple parallel stories, happening at once. It is not just another technology cycle, it is a tectonic shift, writes Trish Carroll.

In short:

• AI is not a stand-alone ‘thing’ to adopt and leave to lawyers to use at their discretion; it needs to be embedded and integrated into a firm’s operating environment.
• AI will change how legal value is created, measured and priced. It may just be the final nail in the billable-hour coffin.
• Governance models for AI use involving practical policies and appropriate training must be put in place, even if your firm is only just now experimenting with AI.

One of the findings in the 2025 Thomson Reuters’ Future of Professionals Report is that more than one in 3 of the 2275 respondents had not yet tried using AI-powered technologies at work — not even as a starting point.

I have spoken to legal digital transformation leaders, people and culture directors, lawyers in their first five years of working, and a few in-house counsel. None wanted to be identified or quoted. Here is what I heard:

• firms are signing up at pace for Copilot, Microsoft’s AI-powered tool, but few provide training on its use
• AI has not been integrated into firms’ operating environments, except in a growing number of mega firms. They are implementing Legora and/or Harvey and starting to embed AI into their operating systems. [Note: Legora is an AI-enabled operating system for legal work, and Harvey is domain-specific AI for legal and professional services]
• AI training in firms not using Legora or Harvey is mostly left up to individuals to work  out how to use AI
• when work is delegated to young lawyers, they receive no direction about using AI and are not asked about its use when reviewing the work they have produced
• in-house teams have been fast to adopt AI, have AI champions, training and facilitate discussion forums for sharing experiences and experimenting with AI.

Here is my take on how to think about AI.

Not a tool — an operating environment

The mistake many law firms are making is to treat AI as something to be adopted; another system to procure, pilot and roll out. 

AI should not be seen as a discrete tool. It needs to become embedded in an operating environment — the structural change this introduces is profound. Legal output is being partially decoupled from human time. Tasks that once signalled expertise because they took years to master — such as first-cut drafting, issue spotting and comparative analysis — can now be generated in seconds.

That does not eliminate the need for lawyers, but it does permanently alter how legal value is created, measured and priced.

Rethinking pricing of legal work

The billable hour was built on a simple equation: time equals effort, effort equals value. AI breaks that logic. When a task takes minutes, rather than hours, continuing to price work as if nothing has changed does not pass the pub test.

Firms that quietly pocket efficiency gains while charging as if work processes are unchanged invite scrutiny and reputational damage. Those that are transparent — reframing fees around outcomes, judgment, risk and accountability — are more likely to strengthen relationships.

For in-house teams, the shift is equally material. AI changes  how work is done internally, as well as how external spend is evaluated. The conversation is moving from ‘how long did this take?’ to ‘what value did this deliver, and what risk did it manage?’

Expertise, redefined

AI unsettles long-held assumptions about expertise.

Traditionally, legal authority was demonstrated through recall, precedent knowledge and technical fluency. AI systems now replicate aspects of all three. What they cannot replicate — at least not reliably — is judgment, context and accountability.

This is where the profession’s centre of gravity is moving. The value of lawyers increasingly lies in knowing what should be done, not just what can be done and understanding commercial and regulatory context, as well as human context.

For in-house teams, this elevates the role of the lawyer as strategic advisor and risk translator. For private practice, it places renewed emphasis on specialisation, sector insight and trusted counsel — areas where AI assists but does not replace legal effort.

Rethinking delegation, supervision and professional development

AI is stepping into work that was traditionally delegated to junior lawyers: first-cut research, document review, chronology building and so on.

For decades, law firms have relied on delegation to juniors as a leverage model and a training ground. Those tasks were not just about output; they were how young lawyers learned judgment, commercial context and problem-solving by doing, reviewing mistakes, and receiving feedback.

Delegating to AI changes that dynamic. AI does not learn judgment in the human sense, and junior lawyers cannot develop it by supervising a tool they do not yet understand.

The answer is not to preserve inefficient work for training’s sake, nor to shield juniors from technology. Instead, firms need to be deliberate about how learning occurs in an AI-enabled environment. This may mean juniors are trained to interrogate AI outputs, test assumptions, validate sources and understand why an answer is right or wrong. It may also mean bringing juniors into strategic discussions earlier, rather than confining them to mechanical tasks that technology now performs better.

Used thoughtfully, AI can accelerate development by exposing juniors to higher-level thinking sooner.

Used carelessly, it risks creating a capability gap that will only become apparent years later.

Management, not magic

For management, the challenge is less about technology and more about governance. AI raises immediate questions that law firm leaders must answer explicitly:

• What work is appropriate to delegate to AI-assisted processes?
• Where must human review be mandatory?
• How is confidentiality preserved?
• Who is accountable when AI-assisted output is wrong?

Avoiding these questions only ensures they are answered later, under pressure, by someone else — such as a regulator, client, or a judge. A great start to achieving effective management in this space would be having clear policies, training to enable people to become confidently AI-enabled, and sharing learnings inside firms and with clients to help create a collective understanding of how, when and why AI will positively assist.

Professional obligations still apply

AI does not dilute professional obligations — it sharpens them.

Duties of competence, confidentiality, supervision and independence remain firmly in place under Legal Profession Uniform Law regimes and professional conduct rules. If anything, AI raises the bar. Lawyers remain responsible for advice given, regardless of how it is generated.

This places renewed emphasis on judgment. AI can assist with pattern recognition and drafting, but it cannot understand client appetite for risk, regulatory nuance, or the practical realities of Australian courts, regulators and commercial culture.

For in-house teams, this reinforces the lawyer’s role as risk translator and strategic advisor. For private practice, it elevates the value of specialisation, sector insight and trusted counsel.

Choosing the future, deliberately

Every tectonic shift follows a familiar pattern: denial, optimisation of the old model, then reluctant reinvention.

Right now, most firms are in denial, some see AI as an add-on, and others (mostly Big Law) are taking the path to reinvention.

This AI Fluency Framework for Legal Practice from the Open Education Resources Collective

 is a great place to start for firms wanting to begin their AI-enabled future in 2026.

In an Everything, Everywhere, All at Once moment, doing nothing is still a decision — inaction is still action, but it is worth asking how long that will work to your advantage.

Trish Carroll is the principal of Galt Advisory, a business that helps law firms and individual lawyers devise and implement successful marketing and business development strategies. Contact her at trish@galtadvisory.com.au.