For years, outsourcing contracts were treated like procurement paperwork. Negotiate the pricing. Tighten the SLAs. Allocate the risk. Get the signatures. Then move on.
That model no longer works.
AI is changing outsourcing relationships faster than most organizations can adapt, and the lawyers closest to these deals are starting to realize something uncomfortable: the contract is no longer documenting the business relationship. In many ways, it is becoming the operating system for it.
That was one of the central themes in my recent Notes to My (Legal) Self conversation with Irina Beschieriu, senior counsel – deals and operations at ATOS US, who works on complex outsourcing and technology transactions across global vendor ecosystems.
And if you are an in-house lawyer working on technology deals, procurement, legal ops, or vendor governance, this shift matters more than many legal teams currently appreciate.
Outsourcing Stopped Being About Cheap Labor
For years, outsourcing was framed as a cost-reduction exercise. Send work elsewhere. Lower operating costs. Improve margins.
That framing is increasingly outdated.
“Today, outsourcing is much more than lowering your costs,” Irina explained during our conversation. “It’s really gathering capabilities and adding human workforce and AI capabilities now to your organization.”
That distinction matters.
Modern outsourcing agreements are no longer simply vendor contracts. They are strategic operational relationships. Companies are not only purchasing labor anymore. They are purchasing infrastructure, intelligence, automation, AI capabilities, and operational resilience.
And they are doing it on an enormous scale.
Irina pointed out that the U.S. outsourcing market alone is projected to reach roughly $1 trillion, with global IT outsourcing expected to approach $600 billion this year.
That scale changes the stakes for legal because when a vendor sits inside your operational core, the agreement is no longer peripheral to the business. It becomes foundational to how the company functions.
The Real Problem Is Not The Contract
One of the most important observations Irina made during our discussion had nothing to do with indemnities, liability caps, or even AI clauses.
It had to do with governance.
“Most deals now fail because there are bad assumptions,” she said. “There’s due diligence that was not done correctly. There is weak governance. There are poor change mechanisms that don’t keep up with the contract.”
That is a very different framing from how many organizations still approach outsourcing negotiations.
Legal teams often spend enormous energy optimizing contractual language while underinvesting in the operational systems required to make the relationship actually work after signature.
But outsourcing agreements increasingly behave like living systems. The technology changes. The data flows evolve. The AI capabilities improve. The vendor ecosystem expands. The operational dependencies shift.
If the contract cannot adapt alongside the business, the relationship eventually fractures.
That is why governance is no longer an administrative afterthought. It is becoming one of the core architectural features of modern technology deals.
Irina described effective governance as the mechanism that allows parties to evolve the relationship without reopening the entire contract every time the business changes.
“The simplest test,” she said, “is can the parties adapt the relationship through governance or do they have to reopen the whole contract every time and renegotiate every tiny thing?”
That question is becoming central to modern in-house practice.
AI Changed The Negotiation Dynamic
One of the more fascinating parts of our conversation centered on how AI is quietly reshaping the balance of power between buyers and vendors.
Vendors now use AI to generate faster, more polished RFP responses. At the same time, buyers use AI to compare vendors, baseline proposals, analyze capabilities, and evaluate bids at a scale that would have been operationally impossible only a few years ago.
In other words, both sides are increasingly negotiating with machine-assisted intelligence.
But Irina made an important point: AI itself is not the differentiator.
The differentiator is whether organizations know how to operationalize the intelligence AI creates.
“The winner,” she explained, “is the party that knows how to use the data, knows how to use governance, and knows how to use this AI advantage.”
That observation extends far beyond outsourcing.
Across legal departments, the competitive advantage is shifting away from access to information and toward the ability to structure systems around it.
The lawyers who understand data flows, operational realities, governance structures, and technological dependencies will increasingly shape the business itself. The lawyers who remain focused only on document mechanics may struggle to keep pace.
In-House Lawyers Need To Understand The Product
Toward the end of our conversation, I asked Irina what practical advice she would give in-house counsel navigating these increasingly complex technology deals.
Her answer was immediate.
“Really understand the technical offering,” she said. “Ask all the questions. Sit down with your technical teams. Understand what’s being delivered.”
That sounds obvious until you realize how often legal teams negotiate sophisticated technology agreements while operating at a significant operational distance from the actual service model.
AI is making that gap more dangerous.
If lawyers do not understand how the technology works, they cannot meaningfully structure governance around it. They cannot properly allocate risk. They cannot identify operational dependencies. And they cannot anticipate where the relationship will break under pressure.
The outsourcing lawyer of the future is not simply negotiating terms.
They are translating operational systems into contractual systems.
That is a fundamentally different role than many legal departments were designed for.
And it is arriving quickly.
Olga V. Mack is the CEO of TermScout, where she builds legal systems that make contracts faster to understand, easier to operate, and more trustworthy in real business conditions. Her work focuses on how legal rules allocate power, manage risk, and shape decisions under uncertainty. A serial CEO and former General Counsel, Olga previously led a legal technology company through acquisition by LexisNexis. She teaches at Berkeley Law and is a Fellow at CodeX, the Stanford Center for Legal Informatics. She has authored several books on legal innovation and technology, delivered six TEDx talks, and her insights regularly appear in Forbes, Bloomberg Law, VentureBeat, TechCrunch, and Above the Law. Her work treats law as essential infrastructure, designed for how organizations actually operate.
The post Irina Beschieriu On Why AI Is Forcing In-House Lawyers To Rethink Outsourcing Deals appeared first on Above the Law.
For years, outsourcing contracts were treated like procurement paperwork. Negotiate the pricing. Tighten the SLAs. Allocate the risk. Get the signatures. Then move on.
That model no longer works.
AI is changing outsourcing relationships faster than most organizations can adapt, and the lawyers closest to these deals are starting to realize something uncomfortable: the contract is no longer documenting the business relationship. In many ways, it is becoming the operating system for it.
That was one of the central themes in my recent Notes to My (Legal) Self conversation with Irina Beschieriu, senior counsel – deals and operations at ATOS US, who works on complex outsourcing and technology transactions across global vendor ecosystems.
And if you are an in-house lawyer working on technology deals, procurement, legal ops, or vendor governance, this shift matters more than many legal teams currently appreciate.
Outsourcing Stopped Being About Cheap Labor
For years, outsourcing was framed as a cost-reduction exercise. Send work elsewhere. Lower operating costs. Improve margins.
That framing is increasingly outdated.
“Today, outsourcing is much more than lowering your costs,” Irina explained during our conversation. “It’s really gathering capabilities and adding human workforce and AI capabilities now to your organization.”
That distinction matters.
Modern outsourcing agreements are no longer simply vendor contracts. They are strategic operational relationships. Companies are not only purchasing labor anymore. They are purchasing infrastructure, intelligence, automation, AI capabilities, and operational resilience.
And they are doing it on an enormous scale.
Irina pointed out that the U.S. outsourcing market alone is projected to reach roughly $1 trillion, with global IT outsourcing expected to approach $600 billion this year.
That scale changes the stakes for legal because when a vendor sits inside your operational core, the agreement is no longer peripheral to the business. It becomes foundational to how the company functions.
The Real Problem Is Not The Contract
One of the most important observations Irina made during our discussion had nothing to do with indemnities, liability caps, or even AI clauses.
It had to do with governance.
“Most deals now fail because there are bad assumptions,” she said. “There’s due diligence that was not done correctly. There is weak governance. There are poor change mechanisms that don’t keep up with the contract.”
That is a very different framing from how many organizations still approach outsourcing negotiations.
Legal teams often spend enormous energy optimizing contractual language while underinvesting in the operational systems required to make the relationship actually work after signature.
But outsourcing agreements increasingly behave like living systems. The technology changes. The data flows evolve. The AI capabilities improve. The vendor ecosystem expands. The operational dependencies shift.
If the contract cannot adapt alongside the business, the relationship eventually fractures.
That is why governance is no longer an administrative afterthought. It is becoming one of the core architectural features of modern technology deals.
Irina described effective governance as the mechanism that allows parties to evolve the relationship without reopening the entire contract every time the business changes.
“The simplest test,” she said, “is can the parties adapt the relationship through governance or do they have to reopen the whole contract every time and renegotiate every tiny thing?”
That question is becoming central to modern in-house practice.
AI Changed The Negotiation Dynamic
One of the more fascinating parts of our conversation centered on how AI is quietly reshaping the balance of power between buyers and vendors.
Vendors now use AI to generate faster, more polished RFP responses. At the same time, buyers use AI to compare vendors, baseline proposals, analyze capabilities, and evaluate bids at a scale that would have been operationally impossible only a few years ago.
In other words, both sides are increasingly negotiating with machine-assisted intelligence.
But Irina made an important point: AI itself is not the differentiator.
The differentiator is whether organizations know how to operationalize the intelligence AI creates.
“The winner,” she explained, “is the party that knows how to use the data, knows how to use governance, and knows how to use this AI advantage.”
That observation extends far beyond outsourcing.
Across legal departments, the competitive advantage is shifting away from access to information and toward the ability to structure systems around it.
The lawyers who understand data flows, operational realities, governance structures, and technological dependencies will increasingly shape the business itself. The lawyers who remain focused only on document mechanics may struggle to keep pace.
In-House Lawyers Need To Understand The Product
Toward the end of our conversation, I asked Irina what practical advice she would give in-house counsel navigating these increasingly complex technology deals.
Her answer was immediate.
“Really understand the technical offering,” she said. “Ask all the questions. Sit down with your technical teams. Understand what’s being delivered.”
That sounds obvious until you realize how often legal teams negotiate sophisticated technology agreements while operating at a significant operational distance from the actual service model.
AI is making that gap more dangerous.
If lawyers do not understand how the technology works, they cannot meaningfully structure governance around it. They cannot properly allocate risk. They cannot identify operational dependencies. And they cannot anticipate where the relationship will break under pressure.
The outsourcing lawyer of the future is not simply negotiating terms.
They are translating operational systems into contractual systems.
That is a fundamentally different role than many legal departments were designed for.
And it is arriving quickly.
Olga V. Mack is the CEO of TermScout, where she builds legal systems that make contracts faster to understand, easier to operate, and more trustworthy in real business conditions. Her work focuses on how legal rules allocate power, manage risk, and shape decisions under uncertainty. A serial CEO and former General Counsel, Olga previously led a legal technology company through acquisition by LexisNexis. She teaches at Berkeley Law and is a Fellow at CodeX, the Stanford Center for Legal Informatics. She has authored several books on legal innovation and technology, delivered six TEDx talks, and her insights regularly appear in Forbes, Bloomberg Law, VentureBeat, TechCrunch, and Above the Law. Her work treats law as essential infrastructure, designed for how organizations actually operate.
The post Irina Beschieriu On Why AI Is Forcing In-House Lawyers To Rethink Outsourcing Deals appeared first on Above the Law.
