A law firm's product is the cognitive capacity of its lawyers. Not its precedent bank, not its software, not its brand. What a client buys is a trained mind giving a matter its full attention.
Julia Montgomery said something on an ILTA panel on 7 August 2026 that I have not been able to put down. Talking about the constant industry chatter about AI, the death of the billable hour, nobody hiring first years any more, she described it as a steady drip feed eroding the cognitive ability of the firm's most valuable asset. Her own hesitation before saying it was audible. She did not want to sound terrible. The cognitive power of our lawyers is our product, she said, and we are eroding that.
I publish this commentary. So does most of my industry. That is why the claim is worth taking seriously rather than admiring.
The mechanism, as Richard describes it
Dr Larry Richard, on the same panel, laid out how he understands it to work.
The prefrontal cortex handles analysis, planning, organising and distinguishing. It is the part of the brain that does most of the practice of law. Like anything else it has limited capacity, and if you overload it, it bottles up and stops being available to you.
It is also the resource the brain's threat circuitry needs. When something registers as a possible threat, the brain has to answer intellectual questions about whether that threat can hurt us, and it draws on the same finite pool.
Richard's phrasing of what happens next is the part that should concern firm leaders: the brain borrows some of our intellectual horsepower, and it doesn't tell us, it just takes it.
Nobody experiences this as impairment. There is no sensation of capacity being redirected. On his account there is only a day that felt harder than it should have.
Insight: If he is right, the tax is invisible to the person paying it, which is why no firm has ever put it on a management report.
Why does the brain treat change as a threat?
The connective tissue between the mechanism and the industry chatter came from Montgomery, and it is uncomfortable enough to sit with.
Our brain perceives change as threat, she said, and has to. So the threat assessment runs, and on Richard's account the threat assessment costs prefrontal capacity.
Which means every headline about the profession being restructured is not received purely as information. Part of it is received as a question the brain processes in the background: should I be nervous about this, am I safe from that. Montgomery's own summary of the cost is that it takes a pause away from the thinking work you are doing.
Do it once and it is nothing. Do it every morning, in the feed, in the trade press, in the partners' meeting, in the supplier webinar, for long enough, and you have a persistent background draw on the one asset the firm sells.
Why is AI hitting lawyers harder than email did?
An attendee asked the obvious question near the end of the session. Why does the AI change seem to be hitting lawyers harder than the changes that came with email, e-filing, e-discovery, or lawyers doing their own typing? Those were substantial changes to how legal work gets done.
Montgomery's answer was immediate. She did not remember anybody talking about email as the death of the billable hour, or saying we would not need lawyers any more.
That is the whole difference, and it is not a difference in the technology.
My own view is that e-filing changed the mechanics of legal work at least as much as a drafting assistant does. It arrived without an accompanying narrative about the obsolescence of the people doing the work, so it was absorbed as a workflow change, which is what it was.
Insight: The anxiety in the profession is not being generated by the capability. It is being generated by the commentary about the capability, and those are separately controllable.
What does this mean for a firm trying to adopt AI?
Here is where it turns from an observation into an operating problem.
A managing partner who wants their firm to use these tools has often spent months raising the salience of AI internally. Sending round articles. Forwarding supplier material. Talking about the pace of change at every partners' meeting. Building urgency, because urgency is what you are told drives adoption. And access to the tools was never the same thing as capability anyway.
On the account above, every one of those actions is a small threat signal delivered to a group of people whose measured resilience is low and whose scepticism Richard puts far above the general public. That profile is often misread, because lawyers are not risk-averse in the way the label suggests.
The urgency campaign and the adoption campaign are the same campaign. The first may be quietly making the second harder, through a mechanism nobody in the room can feel operating.
Insight: Raising the temperature to drive adoption draws down the exact capacity required to learn something new.
This is not an argument for saying nothing. It is an argument that framing is load-bearing in a way firms have not treated it. Montgomery's own conclusion was that how a firm talks about these things internally is what establishes trust, and that trust is what takes the edge off the processes eroding attention to detail and the quality of client work. She is describing message discipline as a management lever, not as public relations.
The management version of the question
Strip the neuroscience out and a practical question remains, and it is one a managing partner can answer this week without believing a word of the mechanism.
How many times in the last month has your firm been told, by you, that its business model is under threat?
Not asked to adopt something. Told that the ground is moving. Every circulated article about the end of the billable hour, every competitor announcement forwarded with a one-line warning, every meeting that opens on the pace of change.
I have yet to meet a firm leader who had counted, because none of it felt like a decision. Each item was just something worth passing on.
Insight: Few firms manage the internal volume on this, because few people have ever been asked to own it.
The tools will probably arrive at broadly similar times across broadly similar firms. It is largely the same market, sold by the same suppliers, on similar terms. What will differ is how much attention the lawyers have left to give them.
The part I have to own
The uncomfortable conclusion is not aimed at law firms. It lands on the people writing about them.
Readers share the strongest version of the claim. Existential framing travels further than proportionate framing. I know this because I can see which of my own posts perform and which do not, and the pattern is not subtle.
Which means the commercial logic of writing about legal AI runs against the interests of the people reading it. Every escalation earns attention by drawing a little more from the cognitive account of the reader, and the bill lands somewhere else entirely, on a Tuesday afternoon, in a matter that gets slightly less than it deserved.
I do not have a clean answer to that. Writing less about it is not obviously better, because the alternative is a profession absorbing a genuine change with no serious commentary at all.
What I can say is that the choice between accurate and dramatic is a choice with a cost attached, and the cost is paid by the reader in the currency the reader sells.
That is worth knowing before writing the next headline. Including mine.
Frequently asked questions
What does a law firm actually sell?
A law firm's product is the cognitive capacity of its lawyers, not its precedent bank, its software or its brand. What a client buys is a trained mind giving a matter its full attention. Anything that draws down that attention, including a steady stream of anxious commentary about the profession's future, is degrading the thing the firm sells.
How does AI commentary reduce a lawyer's cognitive capacity?
On Dr Larry Richard's account, the prefrontal cortex handles the analysis and planning that make up most legal work, and it is also the resource the brain's threat circuitry draws on. Every headline framing AI as a threat to the profession triggers a background threat assessment that borrows from that finite pool. Nobody feels it happening. There is only a day that felt harder than it should have.
Why did email and e-filing not cause the same anxiety?
E-filing and email changed the mechanics of legal work at least as much as a drafting assistant does, but they arrived without a narrative about the obsolescence of lawyers. Nobody described email as the death of the billable hour. They were absorbed as workflow changes because that is how they were framed. The difference is in the commentary, not the technology.
Should managing partners stop talking about AI internally?
No. The argument is not for silence but for message discipline. Framing is load-bearing, and how a firm talks about change internally is what establishes trust. The practical step is to count how many times in the last month the firm was told, by its own leadership, that its business model is under threat, and then to decide who owns that internal volume.
Ex-Microsoft and JPMorgan executive, engineer, and Harvard MBA with 20 years in digital transformation. Founder of ChiefofStaff.pro.
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