While most choose to celebrate the Christmas holiday in more traditional ways, the LPO industry brings an abundance of holiday cheer via industry surveys.
Not to be outdone, last week we released our annual trending report: Ten for 2011: Top 10 Trends in Legal Outsourcing in 2011. Featured by the ABA Journal - Legal Outsourcing Consultant Predicts More Onshoring - the complete report is available here.
Now on to the cornucopia of industry surveys this month…
1. The European Lawyer: Outsourcing Survey
November and December issue of The European Lawyer features a study of general counsel on their use of legal outsourcing. If you can get your hands on a copy, it’s certainly worth a read. Statistics include how many general counsel currently outsource, which services they use and the jurisdictions in which they feel most comfortable using.
2. State of the Indian LPO Sector
As previously noted on the blog, an Indian outsourcing firm set out to conduct a survey of the Indian LPO sector. After collating the responses from 19 outsourcing firms, the results are out. The full report is available by contacting Ravi Shankar at IndianLPOSurvey@gmail.com
3. The LPO Program
The LPO Program, a UK-based information firm released survey findings projecting growth of LPO in the coming year. According to a recently conducted study, “The main users of LPO continue to be Corporate Law Departments, who are forecasted to add $129m of spending in 2011. Law firms are shaking off traditional caution and are fuelling 41% of the projected growth. On these forecasts, it is expected that at least 9 high profile deals will be announced by law firms in the next 12 months.”
4. ValueNotes: 2010 To 2011 – Changes in the LPO Industry
ValueNotes released a broad overview of industry trends and happenings from the past year – including large deals, outsourcing geographies and the events impacting India as a primary destination for outsourced legal services.
Monday, December 20, 2010
Wednesday, December 15, 2010
Top 10 for 2011 – Annual Trending Release
Today we’re releasing our annual trending report on the legal outsourcing industry - Ten for 2011: Top 10 Trends in Legal Outsourcing in 2011.
The report was featured by the ABA Journal - Legal Outsourcing Consultant Predicts More Onshoring - which highlighted both the onshore developments as well as greater transparency by major US firms.
Today's Fronterion Forefront newsletter features our assessment on our predictions from last year. To sign up for the newsletter email: forefront@fronterion.com
Ten for 2011 Release Details
Fronterion, the leading international consulting firm for outsourced legal services, today has released its second annual report outlining the prospects for the legal process outsourcing (LPO) industry in the coming year.
Following a breakthrough year for LPO in 2010, the Fronterion Ten for 2011: Top 10 Trends in Legal Outsourcing for 2011 reveals the most important trends in legal outsourcing for the next 12 months.
A significant prediction for 2011 is a rise in the use of onshore LPO providers, those who deliver services from low-cost domestic locations in the United States and Europe. Attracted by significant savings in such locations, combined with the benefits of servicing clients within the same time zone, law firms and LPO vendors will continue to invest in onshore services alongside traditional overseas options.
Next year also looks to be the year that local regulators and trade bodies definitively respond to the way outsourcing is changing legal services across the globe. There are significant ethical and regulatory issues attached to legal outsourcing. For example, how do firms demonstrate adequate supervision when work is performed by an LPO vendor? Who is liable for the work done by LPO lawyers? And, how much should law firms charge their clients for work done by LPO providers on their behalf?
The American Bar Association is currently consulting with its professional members concerning changes to its draft rules, while the United Kingdom’s Solicitor’s Regulation Authority is considering a major of review of LPO in response to the growing number of firms sending legal work to outside providers.
Another key trend is greater transparency. The first major US firm will go public with its LPO arrangements next year, something those in the US legal industry have been unwilling to do until now. The increasing application of technology, which allows LPO providers and law firms to work together more closely, will be another growing trend in 2011.
More consolidation is likely, following the example of Thomson Reuters who acquired Pangea3 last month in the largest deal ever seen in the legal outsourcing market.
Using its unrivalled access to LPO firms and their clients, Fronterion again set out its predictions for 2011. Fronterion managing principal Michael Bell said: “This year, we’ve seen many of our 2010 predictions unfold in the industry. For example, we projected LPO would become an increasingly valid career path for young lawyers. Both in low-cost jurisdictions and in parts of the US and Europe, LPO firms have been ramping up their operations to meet increased demand, and at a time when traditional law firms jobs have been harder to find.”
“We see 2011 as a pivotal year for legal outsourcing as it continues to develop from a niche practice to a truly global industry.”
Fronterion’s Top 10 for 2011 are:
1) A Fundamentally Changing Legal Profession. Continued downward pressure on costs and the globalisation of legal services provide a perfect environment for LPO. Those who refuse to engage with LPO will increasingly become a minority - the industry can no longer be ignored.
2) Enterprise Approach. Many firms already outsource legal work at partner or department levels. However, LPO is more effective and efficient when a firm implements a firm-wide or ‘enterprise’ approach, led by senior management.
3) Onshore Expansion. The growth in onshore and hybrid on-offshore delivery solutions will begin in earnest in 2011. This trend will be equally prevalent in the United States and United Kingdom, with LPO providers and firms already building capacity.
4) Expanding Client Geographic/Jurisdictional Reach. Demand for LPO services will spread to new markets. In the US, law firms in Texas, the Midwest and the Pacific Northwest are potential growth markets for LPO. In the UK, regions outside of London are also emerging growth markets. However, continental Europe will remain a challenging environment for LPO.
5) Progressive Value Proposition. LPO providers will have to offer more services and a more progressive value proposition to remain competitive. Alongside traditional litigation support, LPO vendors may also have to offer contract portfolio servicing, compliance, diligence, human resources, medical and broader legal support functions.
6) Increasing Technology Applications. As a result of the growing importance of technology, LPO vendors will use technology as a key selling point. Technology platforms will be used to offer diversified services and as a means for vendors to further embed themselves in client organizations.
7) Dynamic Vendor Landscape. The unprecedented growth and industry consolidation initiated in the fourth quarter of 2010 will continue to shape the dynamic LPO vendor landscape in the coming year. Overall, these consolidation trends are positive for the industry as vendors emerge stronger, more capitalized and, most likely, considerably larger.
8) Public Acknowledgement. The growing acceptance and adoption of onshore and offshore LPO will become more visible in the coming year. This will become increasing prevalent in the US, where in past five to six years, corporations and law firms have remained virtually silent on all LPO related matters.
9) Divergent Vendor Approach. Competition means that LPO vendors will have to differentiate themselves from each other in terms of services offered and delivery models. No dominant model exists (yet) and a range of different approaches will emerge next year.
10) Ethical Guidance. Regulatory bodies start to address the changing legal landscape. In the US, ethical commentary is expected from the ABA’s Commission on Ethics 2020. In the UK, announcements are expected from the SRA and the Law Society. Other jurisdictions that have been silent so far may follow suit, such as Australia, Canada, and South Africa.
For the full Fronterion Top 10 for 2011 report visit www.fronterion.com/tenfor2011/
The report was featured by the ABA Journal - Legal Outsourcing Consultant Predicts More Onshoring - which highlighted both the onshore developments as well as greater transparency by major US firms.
Today's Fronterion Forefront newsletter features our assessment on our predictions from last year. To sign up for the newsletter email: forefront@fronterion.com
Ten for 2011 Release Details
Fronterion, the leading international consulting firm for outsourced legal services, today has released its second annual report outlining the prospects for the legal process outsourcing (LPO) industry in the coming year.
Following a breakthrough year for LPO in 2010, the Fronterion Ten for 2011: Top 10 Trends in Legal Outsourcing for 2011 reveals the most important trends in legal outsourcing for the next 12 months.
A significant prediction for 2011 is a rise in the use of onshore LPO providers, those who deliver services from low-cost domestic locations in the United States and Europe. Attracted by significant savings in such locations, combined with the benefits of servicing clients within the same time zone, law firms and LPO vendors will continue to invest in onshore services alongside traditional overseas options.
Next year also looks to be the year that local regulators and trade bodies definitively respond to the way outsourcing is changing legal services across the globe. There are significant ethical and regulatory issues attached to legal outsourcing. For example, how do firms demonstrate adequate supervision when work is performed by an LPO vendor? Who is liable for the work done by LPO lawyers? And, how much should law firms charge their clients for work done by LPO providers on their behalf?
The American Bar Association is currently consulting with its professional members concerning changes to its draft rules, while the United Kingdom’s Solicitor’s Regulation Authority is considering a major of review of LPO in response to the growing number of firms sending legal work to outside providers.
Another key trend is greater transparency. The first major US firm will go public with its LPO arrangements next year, something those in the US legal industry have been unwilling to do until now. The increasing application of technology, which allows LPO providers and law firms to work together more closely, will be another growing trend in 2011.
More consolidation is likely, following the example of Thomson Reuters who acquired Pangea3 last month in the largest deal ever seen in the legal outsourcing market.
Using its unrivalled access to LPO firms and their clients, Fronterion again set out its predictions for 2011. Fronterion managing principal Michael Bell said: “This year, we’ve seen many of our 2010 predictions unfold in the industry. For example, we projected LPO would become an increasingly valid career path for young lawyers. Both in low-cost jurisdictions and in parts of the US and Europe, LPO firms have been ramping up their operations to meet increased demand, and at a time when traditional law firms jobs have been harder to find.”
“We see 2011 as a pivotal year for legal outsourcing as it continues to develop from a niche practice to a truly global industry.”
Fronterion’s Top 10 for 2011 are:
1) A Fundamentally Changing Legal Profession. Continued downward pressure on costs and the globalisation of legal services provide a perfect environment for LPO. Those who refuse to engage with LPO will increasingly become a minority - the industry can no longer be ignored.
2) Enterprise Approach. Many firms already outsource legal work at partner or department levels. However, LPO is more effective and efficient when a firm implements a firm-wide or ‘enterprise’ approach, led by senior management.
3) Onshore Expansion. The growth in onshore and hybrid on-offshore delivery solutions will begin in earnest in 2011. This trend will be equally prevalent in the United States and United Kingdom, with LPO providers and firms already building capacity.
4) Expanding Client Geographic/Jurisdictional Reach. Demand for LPO services will spread to new markets. In the US, law firms in Texas, the Midwest and the Pacific Northwest are potential growth markets for LPO. In the UK, regions outside of London are also emerging growth markets. However, continental Europe will remain a challenging environment for LPO.
5) Progressive Value Proposition. LPO providers will have to offer more services and a more progressive value proposition to remain competitive. Alongside traditional litigation support, LPO vendors may also have to offer contract portfolio servicing, compliance, diligence, human resources, medical and broader legal support functions.
6) Increasing Technology Applications. As a result of the growing importance of technology, LPO vendors will use technology as a key selling point. Technology platforms will be used to offer diversified services and as a means for vendors to further embed themselves in client organizations.
7) Dynamic Vendor Landscape. The unprecedented growth and industry consolidation initiated in the fourth quarter of 2010 will continue to shape the dynamic LPO vendor landscape in the coming year. Overall, these consolidation trends are positive for the industry as vendors emerge stronger, more capitalized and, most likely, considerably larger.
8) Public Acknowledgement. The growing acceptance and adoption of onshore and offshore LPO will become more visible in the coming year. This will become increasing prevalent in the US, where in past five to six years, corporations and law firms have remained virtually silent on all LPO related matters.
9) Divergent Vendor Approach. Competition means that LPO vendors will have to differentiate themselves from each other in terms of services offered and delivery models. No dominant model exists (yet) and a range of different approaches will emerge next year.
10) Ethical Guidance. Regulatory bodies start to address the changing legal landscape. In the US, ethical commentary is expected from the ABA’s Commission on Ethics 2020. In the UK, announcements are expected from the SRA and the Law Society. Other jurisdictions that have been silent so far may follow suit, such as Australia, Canada, and South Africa.
For the full Fronterion Top 10 for 2011 report visit www.fronterion.com/tenfor2011/
Tuesday, November 30, 2010
Fronterion Forefront Newsletter
I wanted to thank everyone for your interest in the launch of our Fronterion Forefront monthly e-newsletter. Our inaugural launch this past month received quite a positive response.
The second edition of our monthly newsletter is coming out this week covering the wave of M&A activity in the LPO market, announcements by the ABA as well as the Global LPO Conference just held in Delhi. It’s shaping up to be an interesting month for LPO, to say the least.
If you have trouble viewing or receiving the newsletter feel free to drop us a line at forefront@fronterion.com. Likewise, if you have any thoughts, comments or contributions, we would love to hear from you.
The second edition of our monthly newsletter is coming out this week covering the wave of M&A activity in the LPO market, announcements by the ABA as well as the Global LPO Conference just held in Delhi. It’s shaping up to be an interesting month for LPO, to say the least.
If you have trouble viewing or receiving the newsletter feel free to drop us a line at forefront@fronterion.com. Likewise, if you have any thoughts, comments or contributions, we would love to hear from you.
Monday, November 29, 2010
ABA Draft Ethical Amendments Release
Perhaps the most influential announcement on the topic of LPO made by the ABA following the 08-451 Formal Opinion publication in August 2008, the Commission recently proposed minor changes to existing ethical guidance.
The ABA 20/20 Commission recommends modifications to the commentary of the Model Rules 1.1, 5.3 and 5.5.
Basically, this is what we expected, but it does provide some additional clarity about the Commission’s outlook going forward.
These proposed amendments are to be debated over the next 6 to 8 months with a possible final presentation to the ABA House of Delegates during the annual meetings in August 2011.
More details on the announcement are available here
For more background information on the announcement and the ABA 20/20 Commission check out Fronterion’s LPO Ethics Resource Center.
The ABA 20/20 Commission recommends modifications to the commentary of the Model Rules 1.1, 5.3 and 5.5.
Basically, this is what we expected, but it does provide some additional clarity about the Commission’s outlook going forward.
These proposed amendments are to be debated over the next 6 to 8 months with a possible final presentation to the ABA House of Delegates during the annual meetings in August 2011.
More details on the announcement are available here
For more background information on the announcement and the ABA 20/20 Commission check out Fronterion’s LPO Ethics Resource Center.
Friday, November 26, 2010
Reducing Legal Costs
While it may not help you reduce your additional girth from that extra large serving of Thanksgiving turkey covered with mashed potatoes and gravy, this conference will help you trim your legal spend.
ALM is hosting their second annual Controlling Legal Costs conference in New York this December 8th-9th.
I will be moderating a panel on LPO featuring prominent legal counsel from Abbott and CA. Some of the discussion points for the panel include:
1) What are the value-adds and considerations for general counsel when outsourcing and offshoring? Many legal professionals assume that all “outsourcing” is performed offshore and that the only value provided by LPO vendors is low cost labor. What is the value of a “managed review process,” technology integration and expanded capabilities. What is the purchasing decision process of general counsel on the panel. How did they make their decision to outsource on or offshore? What value were they seeking from their LPO engagement and what were they seeking to avoid?
2) What are the trends for LPO and the specific approaches by GC’s in the coming year? Where do the panelists see their work with outsourcing trending in the coming year? What are the panelists' thoughts on industry trends, GC’s LPO strategies and ethics/regulatory changes.
I believe there is still some room at the conference. Contact the organizers if you’re in the area and interested in attending. Additional details available here.
ALM is hosting their second annual Controlling Legal Costs conference in New York this December 8th-9th.
I will be moderating a panel on LPO featuring prominent legal counsel from Abbott and CA. Some of the discussion points for the panel include:
1) What are the value-adds and considerations for general counsel when outsourcing and offshoring? Many legal professionals assume that all “outsourcing” is performed offshore and that the only value provided by LPO vendors is low cost labor. What is the value of a “managed review process,” technology integration and expanded capabilities. What is the purchasing decision process of general counsel on the panel. How did they make their decision to outsource on or offshore? What value were they seeking from their LPO engagement and what were they seeking to avoid?
2) What are the trends for LPO and the specific approaches by GC’s in the coming year? Where do the panelists see their work with outsourcing trending in the coming year? What are the panelists' thoughts on industry trends, GC’s LPO strategies and ethics/regulatory changes.
I believe there is still some room at the conference. Contact the organizers if you’re in the area and interested in attending. Additional details available here.
Industry Survey
I just wanted to make a quick post about an industry survey currently being conducted by Ravi Shankar, a law student at Harvard University.
The survey looks quite thorough and the findings should be interesting.
Ravi asked me to circulate the news that he is currently seeking respondents from LPO vendor firms. He has graciously agreed to share his findings with all participants when survey data is released in December.
To request a survey, contact Ravi at: rshankar@jd10.law.harvard.edu
The survey looks quite thorough and the findings should be interesting.
Ravi asked me to circulate the news that he is currently seeking respondents from LPO vendor firms. He has graciously agreed to share his findings with all participants when survey data is released in December.
To request a survey, contact Ravi at: rshankar@jd10.law.harvard.edu
Thursday, November 25, 2010
News and More News Round Up
This has been quite a week for LPO, from the Pange3-Thompson Reuters deal to the ABA’s release of draft commentary for the Model Rules. Now the Brits want a place in the LPO limelight.
What better way to recapture the world’s attention than to have two UK top firms – CMS Cameron McKenna and Herbert Smith – to make back-to-back announcements?
On Tuesday, CMS Cameron McKenna partners voted in favor of perhaps the most transformational outsourcing initiative by any major law firm. Ever. Hats off to the Camerons team who were in charge of the internal partner (aka cat herding) after some initial skepticism.
Not to be outdone, Herbert Smith “nailed the news agenda in the face” by announcing the launch of a captive document review center in Northern Ireland. The center is set to open with approximately 20 personnel, but Herbert Smith seems to have ambitious plans to expansively scale their Northern Ireland capacity.
The Lawyer reports, “Given that surveys of clients regularly find that they prefer a) paying less for work, as opposed to b) paying more for work, the venture should be a success.”
The importance of an onshore option is something we’ve recognized for quite some time. It’s great to see firms validating the onshore model both Stateside and now in the UK with Herbert Smith.
Apparently after all of the hard work during the last couple of months, firms are ready to get things off their drawing boards to have something to celebrate this holiday season. Who knows what else will happen in the LPO industry before the start of the New Year...
What better way to recapture the world’s attention than to have two UK top firms – CMS Cameron McKenna and Herbert Smith – to make back-to-back announcements?
On Tuesday, CMS Cameron McKenna partners voted in favor of perhaps the most transformational outsourcing initiative by any major law firm. Ever. Hats off to the Camerons team who were in charge of the internal partner (aka cat herding) after some initial skepticism.
Not to be outdone, Herbert Smith “nailed the news agenda in the face” by announcing the launch of a captive document review center in Northern Ireland. The center is set to open with approximately 20 personnel, but Herbert Smith seems to have ambitious plans to expansively scale their Northern Ireland capacity.
The Lawyer reports, “Given that surveys of clients regularly find that they prefer a) paying less for work, as opposed to b) paying more for work, the venture should be a success.”
The importance of an onshore option is something we’ve recognized for quite some time. It’s great to see firms validating the onshore model both Stateside and now in the UK with Herbert Smith.
Apparently after all of the hard work during the last couple of months, firms are ready to get things off their drawing boards to have something to celebrate this holiday season. Who knows what else will happen in the LPO industry before the start of the New Year...
Sunday, November 21, 2010
Industry Consolidation: Part Deux
As I am writing from India, we are riding high on the wave of industry consolidation that continues with the announcement of the acquisition of prominent LPO vendor Pangea3 by Thompson Reuters. No figures on the transaction were released, but speculation pegs the deal around $35-40 million. Not only is it a great step forward for Pangea3, it also signals a weighty validation for the entire legal process outsourcing industry.
This Thompson Reuters-Pangea3 deal follows the recent acquisition of LawScribe by UnitedLex.
The wave of consolidation can be seen as a result of recent trends in the industry: the need for scalability, global delivery capabilities and strong financial backing for requisite investments to drive growth. Pangea3 is reportedly already seeking expanded global delivery opportunities in the US through Thompson Reuters. Additional details here.
Consolidation and growth in onshore delivery is a pattern we’ve been predicting since our annual trending report nearly a year ago. The movement toward larger, more capitalized and truly global LPO vendors reflects the continuing maturation in the industry.
Sanjay , Co-CEO of Pangea3 provides some additional perspective on the transaction in an exclusive Legally India report. Details here.
On a personal note, by coincidence I was visiting the Mumbai Pangea3 headquarters the day of the announcement. Needless to say, it was a lighthearted day in the office.
This Thompson Reuters-Pangea3 deal follows the recent acquisition of LawScribe by UnitedLex.
The wave of consolidation can be seen as a result of recent trends in the industry: the need for scalability, global delivery capabilities and strong financial backing for requisite investments to drive growth. Pangea3 is reportedly already seeking expanded global delivery opportunities in the US through Thompson Reuters. Additional details here.
Consolidation and growth in onshore delivery is a pattern we’ve been predicting since our annual trending report nearly a year ago. The movement toward larger, more capitalized and truly global LPO vendors reflects the continuing maturation in the industry.
Sanjay , Co-CEO of Pangea3 provides some additional perspective on the transaction in an exclusive Legally India report. Details here.
On a personal note, by coincidence I was visiting the Mumbai Pangea3 headquarters the day of the announcement. Needless to say, it was a lighthearted day in the office.
Wednesday, November 17, 2010
Global LPO Conference II
Day Two: Sunday November 14, 2010
Day two of the Global LPO Conference kicked off with a much anticipated panel featuring Lalit Bhasin and Mark Ross of Integreon (the only LPO named in the Writ Petition).
Bhasin started his address by acknowledging that the liberalization of the Indian legal profession was, “critical and controversial.” The primary thrust of his address was that domestic Indian law firms need to be offered a “level playing field” by liberalizing the legal profession (such as lifting restrictions on law firm adverting) in order to effectively compete with large, sophisticated international clients. Until these restrictions are lifted, foreign lawyers have no right to practice,“from the soil of this country.” International law firms need to ensure they are, “staying on the right side of the law.”
As optimistic as one may be about the resolution of the Writ, one should keep in mind that a similar case filed in Mumbai in 1997 was not effectively resolved until 2009.
Ross provided a presentation on the ethics of legal outsourcing. Mark Wyatt, founder of The Lawyer, LegalWeek and the European Lawyer provided an entertaining perspective on the importance of media plays in the creation of transparency in the legal profession.
The most interesting part of the panel session was the question and answer session which followed. Bhasin defended his views on the closed state of the Indian legal profession. Further discussion ensued. One standout comment was made by Ganesh Natarajan, industry veteran CEO of Mindcrest, He said, we [LPO industry] are like “Moses parting the Red Sea” meaning that everyone in the industry is pulling in the same direction, but it takes time to accomplish the goals.
A number of additional speakers addressed a many different issues concerning the LPO industry, more than I possibly have room for, at this point.
More details in the upcoming November issue of our Fronterion Forefront newsletter. To sign-up for the newsletter, email forefront@fronterion.com
Day two of the Global LPO Conference kicked off with a much anticipated panel featuring Lalit Bhasin and Mark Ross of Integreon (the only LPO named in the Writ Petition).
Bhasin started his address by acknowledging that the liberalization of the Indian legal profession was, “critical and controversial.” The primary thrust of his address was that domestic Indian law firms need to be offered a “level playing field” by liberalizing the legal profession (such as lifting restrictions on law firm adverting) in order to effectively compete with large, sophisticated international clients. Until these restrictions are lifted, foreign lawyers have no right to practice,“from the soil of this country.” International law firms need to ensure they are, “staying on the right side of the law.”
As optimistic as one may be about the resolution of the Writ, one should keep in mind that a similar case filed in Mumbai in 1997 was not effectively resolved until 2009.
Ross provided a presentation on the ethics of legal outsourcing. Mark Wyatt, founder of The Lawyer, LegalWeek and the European Lawyer provided an entertaining perspective on the importance of media plays in the creation of transparency in the legal profession.
The most interesting part of the panel session was the question and answer session which followed. Bhasin defended his views on the closed state of the Indian legal profession. Further discussion ensued. One standout comment was made by Ganesh Natarajan, industry veteran CEO of Mindcrest, He said, we [LPO industry] are like “Moses parting the Red Sea” meaning that everyone in the industry is pulling in the same direction, but it takes time to accomplish the goals.
A number of additional speakers addressed a many different issues concerning the LPO industry, more than I possibly have room for, at this point.
More details in the upcoming November issue of our Fronterion Forefront newsletter. To sign-up for the newsletter, email forefront@fronterion.com
Monday, November 15, 2010
Global LPO Conference
This weekend I had the pleasure of attending and speaking at the second Global LPO Conference in Delhi, India. The conference was a unique experience with a diverse collection of LPO industry participants and speakers.
Day One: Saturday November 13, 2010
The conference kicked off with a panel of LPO executives from Pangea3, Bhodi Global, Mindcrest and Integreon. Highlights included Mark Ross, representing Integreon,stating that the conversation with law firms has changed from “why LPO to how.” Sanjay Kamlani, representing Pangea3, noted that since clients have now seen LPO work and have proven it’s an effective concept, new adaptors are more likely to start working with LPOs in a much bigger way. Kamlani went on to state that he was “seeing growth that is different than in the past years.”
Another panel featured Abhi Shah of Clutch, and Nigel Kissack of Pinsent Masons. Abhi extolled the need for LPO vendors with global reach to use a global delivery platform. Kissack shared his experiences establishing a captive document review service in South Africa. Kissack jokingly acknowledged that he, “invented the LPO, but had no idea that the industry had already existed.”
Following lunch, the highlight of the entire two-day event was a panel discussion featuring Alison Hook of the Law Society, Sakth Venkataraman of Cobra and me.
Hook started off by providing an update on the professional bodies who are shaping the ethical and regulatory guidelines regarding LPO. Hook urged delegates to engage with governments and bar counsels about LPO to create better understanding of the LPO industry by those who are regulating the legal profession.
I followed with a session discussion of how selling LPO services to law firms is, “one of the most unique things you have even done.”
The day concluded with a final session lead by Richard Reade of ISS and Antony Alex of Pangea3. Reade provided insightful and entertaining commentary about his work with an Indian-based LPO provider. Reade concluded by urging LPOs to deliver on quality and deadlines so he would not be “spanked” by the members of his board.
Such ended the first day of the conference which was followed by a gala dinner for delegates. More details on day two of the conference to follow…
Day One: Saturday November 13, 2010
The conference kicked off with a panel of LPO executives from Pangea3, Bhodi Global, Mindcrest and Integreon. Highlights included Mark Ross, representing Integreon,stating that the conversation with law firms has changed from “why LPO to how.” Sanjay Kamlani, representing Pangea3, noted that since clients have now seen LPO work and have proven it’s an effective concept, new adaptors are more likely to start working with LPOs in a much bigger way. Kamlani went on to state that he was “seeing growth that is different than in the past years.”
Another panel featured Abhi Shah of Clutch, and Nigel Kissack of Pinsent Masons. Abhi extolled the need for LPO vendors with global reach to use a global delivery platform. Kissack shared his experiences establishing a captive document review service in South Africa. Kissack jokingly acknowledged that he, “invented the LPO, but had no idea that the industry had already existed.”
Following lunch, the highlight of the entire two-day event was a panel discussion featuring Alison Hook of the Law Society, Sakth Venkataraman of Cobra and me.
Hook started off by providing an update on the professional bodies who are shaping the ethical and regulatory guidelines regarding LPO. Hook urged delegates to engage with governments and bar counsels about LPO to create better understanding of the LPO industry by those who are regulating the legal profession.
I followed with a session discussion of how selling LPO services to law firms is, “one of the most unique things you have even done.”
The day concluded with a final session lead by Richard Reade of ISS and Antony Alex of Pangea3. Reade provided insightful and entertaining commentary about his work with an Indian-based LPO provider. Reade concluded by urging LPOs to deliver on quality and deadlines so he would not be “spanked” by the members of his board.
Such ended the first day of the conference which was followed by a gala dinner for delegates. More details on day two of the conference to follow…
Sunday, November 14, 2010
News Round-Up
Check out these interesting bits of LPO news from this past week.
Obama
Following Obama’s visit to India, the debate about India’s stance on opening its legal system to international law firms continues to simmer. Opponents and supporters from both sides of the ocean are making their opinions known. One person speaking out was Lalit Bhasin, the President of Society of Indian Law Firms, who is seen as a leading supporter of the legal action against 31 international law firms (and one LPO) known as the Madras High Court Writ Petition.
At the Global LPO Conference held on the 14th, Bhasin raised some excellent points about the current stringent regulatory requirements. Indian law firms are not permitted to market their services and don’t even have the ability to even set up a basic website, he said. Indian law firms would be crippled if faced with sophisticated international competition.
Many Westerners, including ABA president Stephen Zak, find the lack of reciprocity frustrating, particularly for a country built on a platform of servicing international clients. Additional details here.
I had the pleasure of visiting with Bhasin this weekend at the Global LPO conference in Delhi. More details to come.
UnitedLex Acquisition
Perhaps the first in a trend of consolidations, UnitedLex announced their acquisition of fellow Gurgaon-based LPO vendor, LawScribe.
I spoke with former LawScribe CEO, Kanoor Chopra, recently following the announcement. Chopra was very positive about the acquisition and is looking forward to being part of the UnitedLex team. Additional details here.
Lawyers Demise?
Another alarmist article appeared this week in the Guardian about lawyers and LPO. As previously stated in an earlier post, the legal profession is in not in any danger of disappearing due to the adoption of alternative delivery methods – including, but not limited to LPO. That said, the ABA Journal reported this week that AmLaw firms cut approximately 1400 positions in this past year. Challenges still lie ahead as many major law firms struggle to address the new normal – a sluggish economy, lower levels of legal spend and increasing competitive pressure. But often pruning makes an organization, and profession, stronger.
A Collaborative Model of LPO: An Academic Perspective
I haven’t had a chance to read through the entire paper, but this does look interesting. Cassandra also scores points with us by referencing Fronterion research in the paper.
Make Vs. Buy: Allocation of work in-house
An ancillary trend to the LPO industry is the divergence in strategies by general counsels’ allocation of work. Some in-house legal teams are seeking to pull the majority of work internally, while others are seeking to use outside legal counsel exclusively. An interesting analysis of legal work allocation was covered in a recent piece featuring Robin Saphra at Colt. Read the full article here.
Obama
Following Obama’s visit to India, the debate about India’s stance on opening its legal system to international law firms continues to simmer. Opponents and supporters from both sides of the ocean are making their opinions known. One person speaking out was Lalit Bhasin, the President of Society of Indian Law Firms, who is seen as a leading supporter of the legal action against 31 international law firms (and one LPO) known as the Madras High Court Writ Petition.
At the Global LPO Conference held on the 14th, Bhasin raised some excellent points about the current stringent regulatory requirements. Indian law firms are not permitted to market their services and don’t even have the ability to even set up a basic website, he said. Indian law firms would be crippled if faced with sophisticated international competition.
Many Westerners, including ABA president Stephen Zak, find the lack of reciprocity frustrating, particularly for a country built on a platform of servicing international clients. Additional details here.
I had the pleasure of visiting with Bhasin this weekend at the Global LPO conference in Delhi. More details to come.
UnitedLex Acquisition
Perhaps the first in a trend of consolidations, UnitedLex announced their acquisition of fellow Gurgaon-based LPO vendor, LawScribe.
I spoke with former LawScribe CEO, Kanoor Chopra, recently following the announcement. Chopra was very positive about the acquisition and is looking forward to being part of the UnitedLex team. Additional details here.
Lawyers Demise?
Another alarmist article appeared this week in the Guardian about lawyers and LPO. As previously stated in an earlier post, the legal profession is in not in any danger of disappearing due to the adoption of alternative delivery methods – including, but not limited to LPO. That said, the ABA Journal reported this week that AmLaw firms cut approximately 1400 positions in this past year. Challenges still lie ahead as many major law firms struggle to address the new normal – a sluggish economy, lower levels of legal spend and increasing competitive pressure. But often pruning makes an organization, and profession, stronger.
A Collaborative Model of LPO: An Academic Perspective
I haven’t had a chance to read through the entire paper, but this does look interesting. Cassandra also scores points with us by referencing Fronterion research in the paper.
Make Vs. Buy: Allocation of work in-house
An ancillary trend to the LPO industry is the divergence in strategies by general counsels’ allocation of work. Some in-house legal teams are seeking to pull the majority of work internally, while others are seeking to use outside legal counsel exclusively. An interesting analysis of legal work allocation was covered in a recent piece featuring Robin Saphra at Colt. Read the full article here.
Monday, November 1, 2010
Conference Here, Conference There
Get out your passports, cash in your frequent flier miles and join some of the leading figures in LPO from law firms and corporates.
The Conference There:
I have the pleasure of speaking at the inaugural Global LPO Conference in Nodia, India November 13th-14th.
I will be speaking on how vendors can tailor their approach to law firms whereby engaging firms’ expectations and developing compelling differentiators. As a sneak preview, the points I’ll be hitting include:
• How selling to law firms is different than anything that you’ve ever done before
• The top 5 barriers and misconceptions to overcome
• The 6 primary areas law firm clients really key on
• How the dynamic changes in the LPO market impact how you sell and what you can do going forward
The Conference Here:
I will also have the privilege to speak on a panel at the upcoming Controlling Legal Costs conference in New York City December 8th-9th.
The panel will feature several prominent general counsel detailing their work with LPO, either directly or through their respective law firms. More information is available here. Additional details are coming shortly.
Both conferences look to be very engaging – and both have my recommendation. Conferences are typically a great way to keep your finger on the pulse of the industry. Hope to see you out and about, either here or there…
The Conference There:
I have the pleasure of speaking at the inaugural Global LPO Conference in Nodia, India November 13th-14th.
I will be speaking on how vendors can tailor their approach to law firms whereby engaging firms’ expectations and developing compelling differentiators. As a sneak preview, the points I’ll be hitting include:
• How selling to law firms is different than anything that you’ve ever done before
• The top 5 barriers and misconceptions to overcome
• The 6 primary areas law firm clients really key on
• How the dynamic changes in the LPO market impact how you sell and what you can do going forward
The Conference Here:
I will also have the privilege to speak on a panel at the upcoming Controlling Legal Costs conference in New York City December 8th-9th.
The panel will feature several prominent general counsel detailing their work with LPO, either directly or through their respective law firms. More information is available here. Additional details are coming shortly.
Both conferences look to be very engaging – and both have my recommendation. Conferences are typically a great way to keep your finger on the pulse of the industry. Hope to see you out and about, either here or there…
Friday, October 29, 2010
Essential Newsletter for Breaking LPO News
Despite the significantly growing adoption of outsourced legal services, many legal professionals still find themselves struggling to get their arms around LPO and what it means for their firm.
Time and time again, we see that the most common pitfall of outsourcing legal services is the fundamental lack of understanding and awareness by legal professionals. In such a dynamic market, having current knowledge of breaking industry deals, ethical and regulatory changes, and best practices is a key factor to success.
As part of our continued dedication to leadership the industry, I am excited about the launch of our essential e-newsletter covering all things LPO.
The Fronterion Forefront newsletter is a must-read. To sign-up, go to our website (www.fronterion.com) or email forefront@fronterion.com for your free copy of the online newsletter.
For more details, please see the press release below:
Fronterion Forefront Newsletter Provides Much Needed LPO Insight
Newsletter provides leading insight for legal professionals struggling to make sense of the growing adoption of legal process outsourcing.
Despite the growing adoption of legal process outsourcing (LPO), legal professionals continue to struggle to make sense of the industry and understand all the implications for their firms.
From LPO veterans to its fiercest critics, it has become vital for legal professionals to have a working knowledge of how, and why people send legal work to outsourcing firms at home and abroad.
With this in mind, Fronterion has launched a new monthly e-newsletter featuring unique insights and commentary on the biggest LPO talking points of our day.
The Fronterion Forefront newsletter will keep readers up-to-date with the biggest deals, current industry events and regulatory changes for all things LPO.
From new LPO agreements, like the one recently revealed by elite UK firm Slaughter and May, to announcements by industry bodies, like the American Bar Association’s recent decision on the Model Rules governing outsourcing, Fronterion Forefront is essential reading for anyone with even a passing interest in the subject.
And it is available free every month. To sign up, visit www.fronterion.com or send an email request to forefront@fronterion.com.
“Firms that don’t fully understand or actively address the issue of LPO increasingly place themselves at a competitive disadvantage – not to mention, through lack of a coherent approach, unknowingly open themselves up to risk and ethical exposures.”
“The Fronterion Forefront newsletter is a great way for firms to start getting their arms around the legal outsourcing industry in order to better understand trends that without exception impact their firm,” said Fronterion Managing Principal Michael Bell.
Fronterion, as the leading consultancy specializing in LPO, is in a unique position to monitor the market.
As legal outsourcing continues to generate debate and attract supporters, this newsletter will help readers stay at the forefront of an industry that is changing the way legal services are provided across the globe.
° ° °
For more information about Fronterion contact mediarelations@fronterion.com, +1 (312) 473 – 4887. Additional resources are available at www.fronterion.com
Time and time again, we see that the most common pitfall of outsourcing legal services is the fundamental lack of understanding and awareness by legal professionals. In such a dynamic market, having current knowledge of breaking industry deals, ethical and regulatory changes, and best practices is a key factor to success.
As part of our continued dedication to leadership the industry, I am excited about the launch of our essential e-newsletter covering all things LPO.
The Fronterion Forefront newsletter is a must-read. To sign-up, go to our website (www.fronterion.com) or email forefront@fronterion.com for your free copy of the online newsletter.
For more details, please see the press release below:
Fronterion Forefront Newsletter Provides Much Needed LPO Insight
Newsletter provides leading insight for legal professionals struggling to make sense of the growing adoption of legal process outsourcing.
Despite the growing adoption of legal process outsourcing (LPO), legal professionals continue to struggle to make sense of the industry and understand all the implications for their firms.
From LPO veterans to its fiercest critics, it has become vital for legal professionals to have a working knowledge of how, and why people send legal work to outsourcing firms at home and abroad.
With this in mind, Fronterion has launched a new monthly e-newsletter featuring unique insights and commentary on the biggest LPO talking points of our day.
The Fronterion Forefront newsletter will keep readers up-to-date with the biggest deals, current industry events and regulatory changes for all things LPO.
From new LPO agreements, like the one recently revealed by elite UK firm Slaughter and May, to announcements by industry bodies, like the American Bar Association’s recent decision on the Model Rules governing outsourcing, Fronterion Forefront is essential reading for anyone with even a passing interest in the subject.
And it is available free every month. To sign up, visit www.fronterion.com or send an email request to forefront@fronterion.com.
“Firms that don’t fully understand or actively address the issue of LPO increasingly place themselves at a competitive disadvantage – not to mention, through lack of a coherent approach, unknowingly open themselves up to risk and ethical exposures.”
“The Fronterion Forefront newsletter is a great way for firms to start getting their arms around the legal outsourcing industry in order to better understand trends that without exception impact their firm,” said Fronterion Managing Principal Michael Bell.
Fronterion, as the leading consultancy specializing in LPO, is in a unique position to monitor the market.
As legal outsourcing continues to generate debate and attract supporters, this newsletter will help readers stay at the forefront of an industry that is changing the way legal services are provided across the globe.
° ° °
For more information about Fronterion contact mediarelations@fronterion.com, +1 (312) 473 – 4887. Additional resources are available at www.fronterion.com
Alarmist Intelligencer
This week’s Legal Intelligencer features an interesting and insightful, albeit alarmist, article on the changing competitive pressure created by the rise of LPOs. Much of the piece is well-written and I fully subscribe to the statements about the bolstering prevalence of LPO vendors, the permanence of LPOs’ value proposition, and the increasing disaggregation of legal services, among others.
That said, I may raise a wry eyebrow about these things:
Alarmist projections: We’ve been around long enough to see a number of these pronouncements come and go. True, LPO is a very significant and growing trend. It has profound implications for the relationships between law firms and their clients, but I don’t project the “end of lawyers” or apocalyptical demise of the legal profession. The global legal market is estimated to be approximately $400 billion (roughly 60% of it is located in the US). While projections may vary, the global LPO market is currently pegged at $440 million. Total market penetration of LPO: ~0.1% of the entire global legal sector. These numbers may not fully reflect the impact of legal outsourcing and the shifts in client buying preferences, but it does provide some perspective.
Dramatic schisms between law firms and clients: We certainly don’t view LPO as a wedge between with law firms and clients any more than contract attorneys or e-discovery vendors harm those relationships. While some firms will poo-poo LPO, the majority of top US law firms are working with LPOs in various capacities, even if not stating their involvement publically (see study findings here).
Tidy market position statements: Does profiling the market approach of a single LPO vendor illustrate what’s going on in the entire market? Does the stance of a single law firm say everything about LPO relationships? Personally, I’ve never found neat and tidy statements accurately reflect the reality and complexity of market forces. Not all LPOs are created equal and there is not a homogenous approach to the market, as implied by the article. We have seen vendors evolve to different strategies and services as they support different corporations, and law firms. For a contrasting view of the strategic approach published in the article, see a counter-post by Ron Friedmann of Integreon. Friedmann raises an interesting point that LPOs create diversity in the legal sector and that, “diversity is a key element of a healthy ecosystem.”
Ironically, as Bruce MacEwen (fellow Adam Smith Esq. partner to Janet Stanton quoted in the Intelligencer article) noted in the foreword of my book, “I may disappoint you to report that what I believe is far more parochial: the adoption of outsourcing will be firm by firm, activity by activity, year by year. Like much of the march of progress, change will be less drastic in the short run than many imagine, and more revolutionary in the long run than most can foresee.”
In closing, LPO is an option that law firms can offer to their clients or an alternative resource available to corporate legal departments. In the short run, the legal profession isn’t “falling apart,” but in the long run is the rise of LPO domestically and around the global more revolutionary that most can foresee? I would say yes, but don’t take my word for it.
That said, I may raise a wry eyebrow about these things:
Alarmist projections: We’ve been around long enough to see a number of these pronouncements come and go. True, LPO is a very significant and growing trend. It has profound implications for the relationships between law firms and their clients, but I don’t project the “end of lawyers” or apocalyptical demise of the legal profession. The global legal market is estimated to be approximately $400 billion (roughly 60% of it is located in the US). While projections may vary, the global LPO market is currently pegged at $440 million. Total market penetration of LPO: ~0.1% of the entire global legal sector. These numbers may not fully reflect the impact of legal outsourcing and the shifts in client buying preferences, but it does provide some perspective.
Dramatic schisms between law firms and clients: We certainly don’t view LPO as a wedge between with law firms and clients any more than contract attorneys or e-discovery vendors harm those relationships. While some firms will poo-poo LPO, the majority of top US law firms are working with LPOs in various capacities, even if not stating their involvement publically (see study findings here).
Tidy market position statements: Does profiling the market approach of a single LPO vendor illustrate what’s going on in the entire market? Does the stance of a single law firm say everything about LPO relationships? Personally, I’ve never found neat and tidy statements accurately reflect the reality and complexity of market forces. Not all LPOs are created equal and there is not a homogenous approach to the market, as implied by the article. We have seen vendors evolve to different strategies and services as they support different corporations, and law firms. For a contrasting view of the strategic approach published in the article, see a counter-post by Ron Friedmann of Integreon. Friedmann raises an interesting point that LPOs create diversity in the legal sector and that, “diversity is a key element of a healthy ecosystem.”
Ironically, as Bruce MacEwen (fellow Adam Smith Esq. partner to Janet Stanton quoted in the Intelligencer article) noted in the foreword of my book, “I may disappoint you to report that what I believe is far more parochial: the adoption of outsourcing will be firm by firm, activity by activity, year by year. Like much of the march of progress, change will be less drastic in the short run than many imagine, and more revolutionary in the long run than most can foresee.”
In closing, LPO is an option that law firms can offer to their clients or an alternative resource available to corporate legal departments. In the short run, the legal profession isn’t “falling apart,” but in the long run is the rise of LPO domestically and around the global more revolutionary that most can foresee? I would say yes, but don’t take my word for it.
Monday, October 18, 2010
ABA Favors Less Invasive Approach to LPO
This past week I had the opportunity to address the ABA Commission on Ethics 20/20 during their October 15th meetings. We see the decision to abandon significant rule changes regarding LPO as a very positive development.
More details about the Commission and the meetings are available on our LPOethics.com website. The article, ABA Abandons Significant Rule Changes, includes an insightful summary of the proceedings.
More details about the Commission and the meetings are available on our LPOethics.com website. The article, ABA Abandons Significant Rule Changes, includes an insightful summary of the proceedings.
Industry Projections Gone Rogue… Part Deux
A brief follow-up on my previous post about the misconception of job “shifts” purported in a recent legal industry blog post.
This past week, the Wall Street Journal featured a piece on the topic of protectionist sentiments concerning offshoring. The article included a reference to a study that tracked job creation by 2500 multi-national corporations. The findings are eye-opening. Here is a excerpt of that article:
Most people treat outsourcing as a zero-sum game—one foreign worker replaces one American worker. But this is not how the dynamic global economy works. In 2007, Matthew Slaughter, an economist at Dartmouth's Tuck School of Business, published a comprehensive study of the hiring practices of 2,500 U.S.-based multinational companies.
He found that when U.S. firms hired lower-cost labor at foreign subsidiaries overseas, their parent companies hired even more people in the U.S. to support expanded operations. Between 1991 and 2001, employment at foreign subsidiaries of U.S. multinationals rose by 2.8 million jobs; during that same period, employment at their parent firms in the U.S. rose by 5.5 million jobs. For every job "outsourced" to India and other foreign countries, nearly two new jobs were generated here in the U.S.
Those new U.S. jobs were higher-skilled and better-paying—filled by scientists, engineers, marketing professionals and others hired to meet the new demand created by their foreign subsidiaries.
The article turns on its head the notion of outsourcing as a job drain. Contrarily, it’s actually a demand generator for domestic-based personnel.
While I would venture to say that the study referenced in the article is far from being entirely conclusive (I’m sure there are a number of factors impacting the recruitment practices of the respective firms), it is a very interesting to have a documented account of this phenomena.
Just one more thing to think about in the increasingly globalized legal profession.
This past week, the Wall Street Journal featured a piece on the topic of protectionist sentiments concerning offshoring. The article included a reference to a study that tracked job creation by 2500 multi-national corporations. The findings are eye-opening. Here is a excerpt of that article:
Most people treat outsourcing as a zero-sum game—one foreign worker replaces one American worker. But this is not how the dynamic global economy works. In 2007, Matthew Slaughter, an economist at Dartmouth's Tuck School of Business, published a comprehensive study of the hiring practices of 2,500 U.S.-based multinational companies.
He found that when U.S. firms hired lower-cost labor at foreign subsidiaries overseas, their parent companies hired even more people in the U.S. to support expanded operations. Between 1991 and 2001, employment at foreign subsidiaries of U.S. multinationals rose by 2.8 million jobs; during that same period, employment at their parent firms in the U.S. rose by 5.5 million jobs. For every job "outsourced" to India and other foreign countries, nearly two new jobs were generated here in the U.S.
Those new U.S. jobs were higher-skilled and better-paying—filled by scientists, engineers, marketing professionals and others hired to meet the new demand created by their foreign subsidiaries.
The article turns on its head the notion of outsourcing as a job drain. Contrarily, it’s actually a demand generator for domestic-based personnel.
While I would venture to say that the study referenced in the article is far from being entirely conclusive (I’m sure there are a number of factors impacting the recruitment practices of the respective firms), it is a very interesting to have a documented account of this phenomena.
Just one more thing to think about in the increasingly globalized legal profession.
Monday, October 11, 2010
Industry Projections Gone Rogue…
A consultant to the legal industry posted a slightly abrasive, but seemingly unexceptional blog post about the various industry trends “chipping away” at the traditional law firm staffing model. The post cites legal outsourcing as a one of several triggers for massive job losses at the top 200 US law firms:
“Legal process outsourcers are gaining traction, especially with clients. For sake of argument let’s say there are currently the equivalent of 1,000 outsourced lawyers (there are probably more than that just at Pangea3, Integreon and CPA Global right now). If this number increases five-fold, which is slower than the growth rate over the last few years, that will result in a shift of 5,000 lawyer jobs.”
The seemingly unexceptional blog post took some heat for the validity and rigor of the employment projections including criticism by industry blog Above the Law as reported by the ABA Journal. For an industry as dynamic as LPO, estimates are notoriously difficult to peg without highly detailed knowledge of the industry. I take less issue with the projections suggested as I do with the misconceptions of the projected job “shift.”
Are the projected 5000 new jobs in the LPO industry directly correlated to a 5000 job “shift” (read lost, redundant, right-sized, etc.) at top US law firms? Is it economically sound reasoning to assume that economic interactions are tit-for-tat? In short, no.
Does the increase of LPO mean that there may be marginally less demand for legal support staff for certain low-value service areas? Perhaps. Alternatively, doesn’t allowing firms to offer new services so clients can economically litigate and conduct transactions also increase the demand for the services of law firms, and thus the demand for lawyers? Absolutely.
The blog comment also contains underlying connotations that all LPO is performed offshore, but onshore LPO is positioned to be one of the most significant developments in the legal profession during the suggested 5-7 year timeframe.
In short, we recognize that industry projections can be challenging, but underlying economics of competitive commerce in any industry should never be seen as tit-for-tat.
“Legal process outsourcers are gaining traction, especially with clients. For sake of argument let’s say there are currently the equivalent of 1,000 outsourced lawyers (there are probably more than that just at Pangea3, Integreon and CPA Global right now). If this number increases five-fold, which is slower than the growth rate over the last few years, that will result in a shift of 5,000 lawyer jobs.”
The seemingly unexceptional blog post took some heat for the validity and rigor of the employment projections including criticism by industry blog Above the Law as reported by the ABA Journal. For an industry as dynamic as LPO, estimates are notoriously difficult to peg without highly detailed knowledge of the industry. I take less issue with the projections suggested as I do with the misconceptions of the projected job “shift.”
Are the projected 5000 new jobs in the LPO industry directly correlated to a 5000 job “shift” (read lost, redundant, right-sized, etc.) at top US law firms? Is it economically sound reasoning to assume that economic interactions are tit-for-tat? In short, no.
Does the increase of LPO mean that there may be marginally less demand for legal support staff for certain low-value service areas? Perhaps. Alternatively, doesn’t allowing firms to offer new services so clients can economically litigate and conduct transactions also increase the demand for the services of law firms, and thus the demand for lawyers? Absolutely.
The blog comment also contains underlying connotations that all LPO is performed offshore, but onshore LPO is positioned to be one of the most significant developments in the legal profession during the suggested 5-7 year timeframe.
In short, we recognize that industry projections can be challenging, but underlying economics of competitive commerce in any industry should never be seen as tit-for-tat.
Friday, September 17, 2010
Work It Out: Tri-party Line
Conversations between general counsel and their law firm counsel regarding LPO are increasingly important. These discussions should include when and if to utilize an outside LPO vendor. That topic is the central theme of my recent article in Berwin Leighton Paisner’s “Work It Out” journal.
The article is entitled, Tri-party Line: The integration of outside vendors into the delivery of legal and support services is one of the most significant developments affecting the legal profession...
The piece highlights issues that in-house legal teams should address and pitfalls to avoid when working within the tri-party relationship. As noted in the article, “The two primary challenges are managing the tri-party relationship – between in- house team, the law firm and the legal outsourcing vendor – and ensuring ethical compliance and adherence to professional standards by all parties.”
Attorneys in law firms and in-house counsels need to anticipate and prepare for these types of relationships which will be increasing in number in the future at LPO becomes a more common practice.
The article is entitled, Tri-party Line: The integration of outside vendors into the delivery of legal and support services is one of the most significant developments affecting the legal profession...
The piece highlights issues that in-house legal teams should address and pitfalls to avoid when working within the tri-party relationship. As noted in the article, “The two primary challenges are managing the tri-party relationship – between in- house team, the law firm and the legal outsourcing vendor – and ensuring ethical compliance and adherence to professional standards by all parties.”
Attorneys in law firms and in-house counsels need to anticipate and prepare for these types of relationships which will be increasing in number in the future at LPO becomes a more common practice.
Friday, September 10, 2010
LPO and Outcomes-Focused Regulation
As part of the Law Society’s continuing exploration of the ethical issues surrounding LPO ethics, this week I was invited to speak on LPO ethics and implications for the forthcoming regulatory changes for UK law firms. As a result of the Legal Services Act and allowance for alternative business structures (ABS), the UK regulatory regime is taking a new tack.
The new regulatory approach seeks to provide greater flexibility by basing regulatory obligations on broad “outcomes” giving this regulatory approach the name outcomes-focused regulation (OFR).
It will be some time before this approach is implemented, but it does pose some interesting implications for the ethics of legal outsourcing, including work done by outside legal vendors.
OFR is another thing for UK-based firms exploring or expanding their LPO options to keep an eye on.
The new regulatory approach seeks to provide greater flexibility by basing regulatory obligations on broad “outcomes” giving this regulatory approach the name outcomes-focused regulation (OFR).
It will be some time before this approach is implemented, but it does pose some interesting implications for the ethics of legal outsourcing, including work done by outside legal vendors.
OFR is another thing for UK-based firms exploring or expanding their LPO options to keep an eye on.
Tuesday, September 7, 2010
Imminent Ethics?
As the regulatory focus on the ethics of LPO heats up in the US and UK, a growing body of knowledge about LPO ethics is emerging.
Most recently, an article featured in the UK-focused publication Outsource, Mark Ross of Integreon provides a summary of ethical guidance on legal outsourcing currently available and a glimpse of what we may expect in the future.
In the article Ross said, “I expect there will be more to report on the ethics of legal outsourcing over the coming months from both sides of the Atlantic as the relevant bodies continue to study this rapidly growing industry. Whether in the form of amendments to the model rules of professional conduct (in the U.S.), or to the Solicitor’s Code of Conduct (UK), lawyers will welcome more detailed guidance. Watch this space!”
I will be speaking on LPO ethics this week at an event hosted by The Law Society. More on that shortly.
Most recently, an article featured in the UK-focused publication Outsource, Mark Ross of Integreon provides a summary of ethical guidance on legal outsourcing currently available and a glimpse of what we may expect in the future.
In the article Ross said, “I expect there will be more to report on the ethics of legal outsourcing over the coming months from both sides of the Atlantic as the relevant bodies continue to study this rapidly growing industry. Whether in the form of amendments to the model rules of professional conduct (in the U.S.), or to the Solicitor’s Code of Conduct (UK), lawyers will welcome more detailed guidance. Watch this space!”
I will be speaking on LPO ethics this week at an event hosted by The Law Society. More on that shortly.
Saturday, September 4, 2010
Ante Up: Law firms and the “Fortunate Few”
One of the concerns of law firms that we see at Fronterion involving the integration of legal process outsourcing vendors into their practice is the real or perceived disruption of partner-track associates. The work which first and second year law firm associates previously “cut their teeth on” (read document review) is slowly diminishing with the increased use of outside legal vendors based domestically in the US and UK, as well as abroad.
The comments in several recent publications highlight the growing focus, and also acceptance, of the changing nature of the legal profession with the use of outside legal vendors to perform “routine, repetitious work.”
William Michael Treanor, newly appointed dean of the Georgetown University Law Center, made several interesting comments on the topic of recent law graduate career opportunities in the Washington Post’s Capital Business.
As reported by the ABA Journal, Treanor said, “Grads who opt for law firm jobs are likely to see the nature of their work change as clients refuse to pay associates for routine, repetitious work... As a result, ‘we'll see more outsourcing and contract employment. So associates will be doing more work that is truly lawyerly work.’”
We’ve seen Georgetown take some very positive, pro-active stances as the legal profession changes, for which we applaud them.
In a related article featured in AM Law Daily, Steven Harper echoes Treanor’s remarks regarding the advancement of the “fortunate few”, those law firm associates who will work on more substantive legal matters as a result of legal outsourcing.
“Instead of the mind-numbing tasks that are the bane of so many young lawyers' lives, associates will find themselves doing work that more closely resembles what they thought being a lawyer meant when they first decided to attend law school.”
More succinctly stated in my book, a senior litigation partner at a large UK-based law firm said this about routine tasks increasingly delegated to outside legal vendors, “Our attorneys didn’t go to law school for that.”
The caveat for this potential advancement for associates to perform more interesting and engaging projects is that law firms may require fewer associates to work through their large, document-heavy matters. Reading between the lines, it looks like law students, with the help of law schools, will have to be more entrepreneurial and seek to develop niche skill sets to make themselves more valuable in the changing legal profession.
The comments in several recent publications highlight the growing focus, and also acceptance, of the changing nature of the legal profession with the use of outside legal vendors to perform “routine, repetitious work.”
William Michael Treanor, newly appointed dean of the Georgetown University Law Center, made several interesting comments on the topic of recent law graduate career opportunities in the Washington Post’s Capital Business.
As reported by the ABA Journal, Treanor said, “Grads who opt for law firm jobs are likely to see the nature of their work change as clients refuse to pay associates for routine, repetitious work... As a result, ‘we'll see more outsourcing and contract employment. So associates will be doing more work that is truly lawyerly work.’”
We’ve seen Georgetown take some very positive, pro-active stances as the legal profession changes, for which we applaud them.
In a related article featured in AM Law Daily, Steven Harper echoes Treanor’s remarks regarding the advancement of the “fortunate few”, those law firm associates who will work on more substantive legal matters as a result of legal outsourcing.
“Instead of the mind-numbing tasks that are the bane of so many young lawyers' lives, associates will find themselves doing work that more closely resembles what they thought being a lawyer meant when they first decided to attend law school.”
More succinctly stated in my book, a senior litigation partner at a large UK-based law firm said this about routine tasks increasingly delegated to outside legal vendors, “Our attorneys didn’t go to law school for that.”
The caveat for this potential advancement for associates to perform more interesting and engaging projects is that law firms may require fewer associates to work through their large, document-heavy matters. Reading between the lines, it looks like law students, with the help of law schools, will have to be more entrepreneurial and seek to develop niche skill sets to make themselves more valuable in the changing legal profession.
Tuesday, August 17, 2010
Good News Growth
The ABA Journal reports law firm summer associates are being retained at a high rate this year. That is great news for lawyers and clients.
While many practice groups are beefing up their staffing, legal outsourcing is also a way for firms and general counsel to expand legal capacity without becoming over-extended. Everyone hopes the economy is on the upswing for good, but no one knows at what the pace of expansion will be or how long it will last. LPO has a unique value-add in comparison to contract attorneys and it provides variability to an otherwise, very fixed cost business model of law firms.
While many practice groups are beefing up their staffing, legal outsourcing is also a way for firms and general counsel to expand legal capacity without becoming over-extended. Everyone hopes the economy is on the upswing for good, but no one knows at what the pace of expansion will be or how long it will last. LPO has a unique value-add in comparison to contract attorneys and it provides variability to an otherwise, very fixed cost business model of law firms.
Monday, August 16, 2010
Great Expectations: Follow the money
Where private equity funding is going is a good indicator of where change is happening. The Law Society Gazette and The Lawyer report that private equity firms are increasingly interested in investing in the LPO industry.
Despite the great expectations for the industry, profitability is may be a quest for a number of LPOs and some financial models are currently under scrutiny. Withstanding these challenges legal outsourcing is here to stay. These growth dynamics represent a broader industry change of the integration of outside vendors into the practice of law.
Despite the great expectations for the industry, profitability is may be a quest for a number of LPOs and some financial models are currently under scrutiny. Withstanding these challenges legal outsourcing is here to stay. These growth dynamics represent a broader industry change of the integration of outside vendors into the practice of law.
Tuesday, August 10, 2010
India-focus in NY Times
According to the New York Times and several following articles on the links below, legal outsourcing vendors are upping their recruitment of talent on and offshore. Specifically, Indian firms are recruiting in the US and UK. According to the article, eager and adventurous legal professionals are making the move.
Theses findings clearly reflect our trending projections in the report Ten for 2010: Top 10 Trends for Legal Outsourcing in 2010.
“Client confidence in the outsourcing legal services market is translating into a rising talent pool, both on and offshore. Positions at outsourcing vendors will increasingly become an attractive alternative career path for entrepreneurial and global-minded legal professionals as pay, positions and prestige increase.”
Combined with the increased trending of onshore legal outsourcing, these developments exemplify increasingly global nature of the legal profession. It will be interesting the watch and see how the trend accelerates and expands. To read more, to go:
New York Times: Outsourcing to India Draws Western Lawyers
Wall Street Journal: Go East, Young Lawyer . . . Way East
Above the Law: Outsourcing: Here Come the Expats
Bar and Bench: Re-upped Round up: August 5
Theses findings clearly reflect our trending projections in the report Ten for 2010: Top 10 Trends for Legal Outsourcing in 2010.
“Client confidence in the outsourcing legal services market is translating into a rising talent pool, both on and offshore. Positions at outsourcing vendors will increasingly become an attractive alternative career path for entrepreneurial and global-minded legal professionals as pay, positions and prestige increase.”
Combined with the increased trending of onshore legal outsourcing, these developments exemplify increasingly global nature of the legal profession. It will be interesting the watch and see how the trend accelerates and expands. To read more, to go:
New York Times: Outsourcing to India Draws Western Lawyers
Wall Street Journal: Go East, Young Lawyer . . . Way East
Above the Law: Outsourcing: Here Come the Expats
Bar and Bench: Re-upped Round up: August 5
Friday, August 6, 2010
Friday, August 6, 2010 ABA Commission on Ethics: Day 2 and Public Hearing
Today has been the second day of meetings for ABA Commission on Ethics 20/20.
The event of most interest to me was the public hearing concerning the legal outsourcing industry. Michael Ford of UnitedLex and Mark Ross of Integreon, two thought leaders in the legal outsourcing industry, spoke.
I commend the Commission for soliciting outside perspectives as they shape their recommendations for their members concerning the ethical implications of outsourcing. The Commission made an important distinction between outsourcing and offshoring, which is key in all discussions about LPO.
The extent to which law can be practiced reciprocally between international jurisdictions drew quite a bit of discussion. India was the main focus. The issue is examined further in a recent Economist article.
I was glad I attended this year’s meeting. It was encouraging that the ABA, and more legal firms and educational institutions as well, are recognizing and discussing seriously the role of legal outsourcing as part of the ever-changing legal profession.
The event of most interest to me was the public hearing concerning the legal outsourcing industry. Michael Ford of UnitedLex and Mark Ross of Integreon, two thought leaders in the legal outsourcing industry, spoke.
I commend the Commission for soliciting outside perspectives as they shape their recommendations for their members concerning the ethical implications of outsourcing. The Commission made an important distinction between outsourcing and offshoring, which is key in all discussions about LPO.
The extent to which law can be practiced reciprocally between international jurisdictions drew quite a bit of discussion. India was the main focus. The issue is examined further in a recent Economist article.
I was glad I attended this year’s meeting. It was encouraging that the ABA, and more legal firms and educational institutions as well, are recognizing and discussing seriously the role of legal outsourcing as part of the ever-changing legal profession.
Thursday, August 5, 2010
Thursday, August 5, 2010 ABA Commission on Ethics: Day 1
The ABA annual meetings are being held at the Palace Hotel in downtown San Francisco today and tomorrow. (And, yes, I have escaped hot, humid Chicago for a cooler climate for a few days.)
Today’s proceedings commenced at 9:00 am with introductory remarks given by the Commission chairs, followed by updates from the heads of various working groups. Short speeches were also given by outgoing president Carolyn Lamm and incoming president Stephen Zack.
When reports touched on outsourcing, the Commission leadership recognized that it is a “complex topic” – something we’ve understood since Fronterion was founded.
Discussions included the ethical obligations law firms face when they work with outside vendors, especially, the relationship dynamics in a tri-party engagement when law firms, their clients and outside vendors collaborate.
Relating to legal process outsourcing, the Commission discussed different approaches to the current rules model and the implications of each of those various approaches.
A list of the prominent members of the he ABA Commission on Ethics 20/20 in available here. I anticipate that this week’s – and future – dialogs on LPO by the Commission will be fruitful because capable people are working hard to create more understanding of ethical challenges of outsourced legal services domestically and abroad.
More on the meetings tomorrow.
Today’s proceedings commenced at 9:00 am with introductory remarks given by the Commission chairs, followed by updates from the heads of various working groups. Short speeches were also given by outgoing president Carolyn Lamm and incoming president Stephen Zack.
When reports touched on outsourcing, the Commission leadership recognized that it is a “complex topic” – something we’ve understood since Fronterion was founded.
Discussions included the ethical obligations law firms face when they work with outside vendors, especially, the relationship dynamics in a tri-party engagement when law firms, their clients and outside vendors collaborate.
Relating to legal process outsourcing, the Commission discussed different approaches to the current rules model and the implications of each of those various approaches.
A list of the prominent members of the he ABA Commission on Ethics 20/20 in available here. I anticipate that this week’s – and future – dialogs on LPO by the Commission will be fruitful because capable people are working hard to create more understanding of ethical challenges of outsourced legal services domestically and abroad.
More on the meetings tomorrow.
Monday, August 2, 2010
ABA Annual Meetings: LPO Ethics
The American Bar Association (ABA) is holding its annual meeting this week in San Fransciso. The main focus for my visit will be the ABA’s Commission on Ethics 20/20 with sessions that will include public hearings on several topics of interest, specifically ethical considerations of legal outsourcing.
I am looking forward to attending the meetings to survey the lay of the land, according to the Commission and its members.
The more we at Fronterion are aware of the concerns of the ABA, the 20/20 Commission, it’s lawyers and their clients, the better off we will be as we advise our clients on all outsourcing ethical issues.
An added plus – I will be able to get away from the hot and humid weather that engulfs Chicago in August!
I am looking forward to attending the meetings to survey the lay of the land, according to the Commission and its members.
The more we at Fronterion are aware of the concerns of the ABA, the 20/20 Commission, it’s lawyers and their clients, the better off we will be as we advise our clients on all outsourcing ethical issues.
An added plus – I will be able to get away from the hot and humid weather that engulfs Chicago in August!
Monday, July 26, 2010
Advancing Innovation and Ronald Coase
Bruce MacEwen at Adam Smith, Esq. provides a unique perspective on the changes happening in the broader legal profession as a result of “low cost rivals” due to ~onshore and offshore legal outsourcing.
MacEwen ties together some interesting themes including low cost rivals, stages of innovation and The Nature of the Firm as they all relate to legal outsourcing. MacEwen also scores big points with me by citing my favorite economist, Ronald Coase.
As one of the named vendors in the post, Ron Friedmann of Integreon provides further commentary on MacEwen’s post, Both are worth a read. Friedmann says pushing work down the value chain as the true paterfamilias of the LPO industry.
MacEwen's Innovators at the Barricades post is available here.
MacEwen ties together some interesting themes including low cost rivals, stages of innovation and The Nature of the Firm as they all relate to legal outsourcing. MacEwen also scores big points with me by citing my favorite economist, Ronald Coase.
As one of the named vendors in the post, Ron Friedmann of Integreon provides further commentary on MacEwen’s post, Both are worth a read. Friedmann says pushing work down the value chain as the true paterfamilias of the LPO industry.
MacEwen's Innovators at the Barricades post is available here.
Monday, July 19, 2010
Blog Post: Identifying and Mitigating Gaps
The conference website also features a blog post, LPO ~ Identifying and Mitigating Gaps: The General Counsel Perspective, which references Fronterion’s trending release on the LPO industry. The blog post provides interesting commentary on the potential “gaps” in supply and demand in the LPO industry.
Fronterion is cited for our quote regarding the importance of the adoption rate in the LPO sector this year.
Fronterion LLC’s Top Ten Trends for Legal Outsourcing in 2010 report predicts “2010 will be the proving year for legal outsourcing. Law firms and corporate legal teams will learn from their peers, resulting in make‐or‐break peer referrals, which will be strong indicators of the success and maturity of the outsourced legal services segment.Supporting – not supplanting – firm operations with an outside legal services vendor has emerged as a successful strategy and will gain momentum in 2010.”
More details on the post are available at the following.
Fronterion is cited for our quote regarding the importance of the adoption rate in the LPO sector this year.
Fronterion LLC’s Top Ten Trends for Legal Outsourcing in 2010 report predicts “2010 will be the proving year for legal outsourcing. Law firms and corporate legal teams will learn from their peers, resulting in make‐or‐break peer referrals, which will be strong indicators of the success and maturity of the outsourced legal services segment.Supporting – not supplanting – firm operations with an outside legal services vendor has emerged as a successful strategy and will gain momentum in 2010.”
More details on the post are available at the following.
Sunday, July 18, 2010
Forthcoming Global LPO Conference
One of the first global-focused conferences on outsourced legal services has been announced by KPO Consultants.
It’s an honor for me to be invited to speak at this inaugural conference. Other prominent industry leaders scheduled to speak include:
• Sanjay Kamlani, Co-CEO, Pangea3
• Rahul Shah, AVP & Head – LPO Practice, Infosys
• Abhi Shah, CEO, Clutch Group
• Anand Sharma, CFO and Head – Management Services, CPA Global
• Patrick Burke, Senior Director and Assistant General Counsel, Guidance Software, Inc
• Richard Reade, UK General Counsel, ISS World
The conference will be held just outside of Delhi, India in Nodia on November 13th and 14th.
The Global Conference website states that the conference, “aims to bring together key executives with extensive interests in the legal outsourcing industry. The attending buyer segment includes Law Firm Partners, General Counsels and other senior In-house Counsels from leading US, UK and Canada based companies; while the vendor community is represented by senior most executives from leading LPO vendors from countries like India, Bangladesh, Philippines, Sri Lanka, Israel, Kenya, Mauritius, and South Africa.
Thus, it is our endeavor to bring the most significant executives from both the buyer and vendor communities together on a common platform to enable them to engage in meaningful and strategic dialogues to further their business interests.”
Further details are available at the conference website (www.globallpoconference.com) and will be updated on the LPO Source blog, as well.
It’s an honor for me to be invited to speak at this inaugural conference. Other prominent industry leaders scheduled to speak include:
• Sanjay Kamlani, Co-CEO, Pangea3
• Rahul Shah, AVP & Head – LPO Practice, Infosys
• Abhi Shah, CEO, Clutch Group
• Anand Sharma, CFO and Head – Management Services, CPA Global
• Patrick Burke, Senior Director and Assistant General Counsel, Guidance Software, Inc
• Richard Reade, UK General Counsel, ISS World
The conference will be held just outside of Delhi, India in Nodia on November 13th and 14th.
The Global Conference website states that the conference, “aims to bring together key executives with extensive interests in the legal outsourcing industry. The attending buyer segment includes Law Firm Partners, General Counsels and other senior In-house Counsels from leading US, UK and Canada based companies; while the vendor community is represented by senior most executives from leading LPO vendors from countries like India, Bangladesh, Philippines, Sri Lanka, Israel, Kenya, Mauritius, and South Africa.
Thus, it is our endeavor to bring the most significant executives from both the buyer and vendor communities together on a common platform to enable them to engage in meaningful and strategic dialogues to further their business interests.”
Further details are available at the conference website (www.globallpoconference.com) and will be updated on the LPO Source blog, as well.
Friday, July 16, 2010
Fronterion “Wall of Silence” Survey Round-up
Our survey findings released this past week have captured the attention of a number of online publications and blogs. The survey results seem to have number of people hypothesizing why US firms are so hesitant to acknowledge or deny their use of LPO vendors, even on a confidential basis. Based on our experiences, we would purport that uncertainty with ethical guidelines is one of the key drivers to this silence. Worries of negative press may be another.
Below is a short news round-up.
ABA Journal
Above the Law
About.com
Below is a short news round-up.
ABA Journal
Above the Law
About.com
Wednesday, July 14, 2010
India Writ Petition: Update
As earlier reported on the blog, a petition was filed in the Madras High Court by the Association of Indian Lawyers against an array of international law firms and one LPO vendor, Integreon. The bases for the petition being that the named firms were practicing law in Indian jurisdictions.
Because of what many consider a notoriously slow legal system, is comes with little surprise that the next hearing on the issue has been pushed back to August 4th, as reported by Bloomberg.
The wider implication for the LPO market is yet to be seen. Many industry participants don’t feel that the position taken by the Association of Indian Lawyers is merited nor will influence the use LPOs, but it may raise more concerns for potential clients.
As aptly stated by a partner at the US-based Fulbright & Jaworski, “That’s not what a globalizing country and corporate sector needs.”
Additional commentary was also released by Legally India.
Because of what many consider a notoriously slow legal system, is comes with little surprise that the next hearing on the issue has been pushed back to August 4th, as reported by Bloomberg.
The wider implication for the LPO market is yet to be seen. Many industry participants don’t feel that the position taken by the Association of Indian Lawyers is merited nor will influence the use LPOs, but it may raise more concerns for potential clients.
As aptly stated by a partner at the US-based Fulbright & Jaworski, “That’s not what a globalizing country and corporate sector needs.”
Additional commentary was also released by Legally India.
Thursday, July 8, 2010
SRA Public Announcement
The Solicitors Regulation Authority (SRA) has released their first public statement on the application of outsourced legal services for solicitors practicing in England and Wales.
As originally reported by our LPO Ethics Resource Center (www.LPOethics.com), the SRA release states, “Where law firms are outsourcing some of their legal or administrative work to other law firms or non law firms, the SRA's guidance is that this is allowed on the basis that all relevant rules are complied with (Solicitors’ Code of Conduct 2007) and that the arrangement is made transparent and is agreed with the client.”
The statement continues with the SRA citing existing ethical guidelines deeming them applicable to outsourced legal services.
In conclusion, the SRA notes, “In accepting work from a client, the firm must always consider whether the work should be outsourced at all as they should have the necessary resources and competency to undertake the task. In summary a firm must act in the best interests of their client and comply with their core duties.”
It’s been reported the Law Society is currently exploring these issues, but has yet to formally comment on the topic of LPO.
The recent announcement to UK solicitors by the SRA stands in contrast to lawyers in US jurisdictions who have been able to rely on ethical guidance provided as early as 2006 in some jurisdictions. The most notable guidance in the United States is Opinion 08-451 issued by the American Bar Association Standing Committee on Ethics and Professional Responsibility in 2008.
Additional details on the complete SRA legal outsourcing statement are available on our recently launched LPO Ethics Resource Center (www.LPOethics.com).
The LPO Ethics Resource Center is a free resource that allows legal professionals to keep abreast on up-to-date information on the ethical policies and opinions relevant to outsourced legal services. This site compiles all of the latest information and breaking news regarding legal process outsourcing into one convenient resource.
As originally reported by our LPO Ethics Resource Center (www.LPOethics.com), the SRA release states, “Where law firms are outsourcing some of their legal or administrative work to other law firms or non law firms, the SRA's guidance is that this is allowed on the basis that all relevant rules are complied with (Solicitors’ Code of Conduct 2007) and that the arrangement is made transparent and is agreed with the client.”
The statement continues with the SRA citing existing ethical guidelines deeming them applicable to outsourced legal services.
In conclusion, the SRA notes, “In accepting work from a client, the firm must always consider whether the work should be outsourced at all as they should have the necessary resources and competency to undertake the task. In summary a firm must act in the best interests of their client and comply with their core duties.”
It’s been reported the Law Society is currently exploring these issues, but has yet to formally comment on the topic of LPO.
The recent announcement to UK solicitors by the SRA stands in contrast to lawyers in US jurisdictions who have been able to rely on ethical guidance provided as early as 2006 in some jurisdictions. The most notable guidance in the United States is Opinion 08-451 issued by the American Bar Association Standing Committee on Ethics and Professional Responsibility in 2008.
Additional details on the complete SRA legal outsourcing statement are available on our recently launched LPO Ethics Resource Center (www.LPOethics.com).
The LPO Ethics Resource Center is a free resource that allows legal professionals to keep abreast on up-to-date information on the ethical policies and opinions relevant to outsourced legal services. This site compiles all of the latest information and breaking news regarding legal process outsourcing into one convenient resource.
Wednesday, July 7, 2010
Fronterion Announcements: Study findings and LPOethics.com launch
We are proud to announce two very exciting developments at Fronterion this week.
The first is the 2010 Global Sourcing Study: AM Law 50, which polled 30 of the top 50 US law firms concerning their positions on legal outsourcing. The findings were reported on in today's ABA Journal, Are Top US Law Firms Outsourcing Some Legal Work? 83% Won’t Say.
Complete findings and analyses are available in the 2010 Global Sourcing Study: AM Law 50 report. Contact GlobalSourcing@fronterion.com for additional details. The press release - WALL OF SILENCE SURROUNDS NASCENT LEGAL OUTSOURCING INDUSTRY – highlights the findings from the study. As reported in the press release, “while many US law firms are using outsourcing providers for the first time, few are willing to admit it in public, leading to a culture of secrecy around an increasingly important development within the legal services industry.”
Our second announcement is the launch of the LPO Ethics Resource Center at www.LPOethics.com. As reported on the website, “The LPO Ethics Resource Center is a free resource that allows legal professionals to keep abreast with up-to-date information on the ethical policies and opinions relevant to outsourced legal services. This site compiles all of the latest information and breaking news regarding legal process outsourcing into one convenient resource.”
The resource is targeted for legal professionals in both the US and the UK.
We are very excited about making Resource Center available due to the expected number of developments in legal outsourcing ethics in the forthcoming 12 months.
More details on both announcements will be provided later this week.
The first is the 2010 Global Sourcing Study: AM Law 50, which polled 30 of the top 50 US law firms concerning their positions on legal outsourcing. The findings were reported on in today's ABA Journal, Are Top US Law Firms Outsourcing Some Legal Work? 83% Won’t Say.
Complete findings and analyses are available in the 2010 Global Sourcing Study: AM Law 50 report. Contact GlobalSourcing@fronterion.com for additional details. The press release - WALL OF SILENCE SURROUNDS NASCENT LEGAL OUTSOURCING INDUSTRY – highlights the findings from the study. As reported in the press release, “while many US law firms are using outsourcing providers for the first time, few are willing to admit it in public, leading to a culture of secrecy around an increasingly important development within the legal services industry.”
Our second announcement is the launch of the LPO Ethics Resource Center at www.LPOethics.com. As reported on the website, “The LPO Ethics Resource Center is a free resource that allows legal professionals to keep abreast with up-to-date information on the ethical policies and opinions relevant to outsourced legal services. This site compiles all of the latest information and breaking news regarding legal process outsourcing into one convenient resource.”
The resource is targeted for legal professionals in both the US and the UK.
We are very excited about making Resource Center available due to the expected number of developments in legal outsourcing ethics in the forthcoming 12 months.
More details on both announcements will be provided later this week.
Tuesday, July 6, 2010
C5 Conference Wrap-up
While a bit thinly attended in comparison to previous events in London, the C5 Legal Process Outsourcing conference was certainly a success in terms of discussion and speaker caliber.
One high point was the discussion on captive delivery centers led by three very knowledgeable men who are involved in the field of outsourcing. These included Evangelos Apostolou (BT Vice President and Chief Counsel APAC who established and managed the BT legal outsourcing captive in Delhi – including the recent transfer to UnitedLex), Mark Ford (director of the Clifford Chance Knowledge Centre), and Paul Rawlinson (Global Chair of Baker & McKenzie’s IP Practice who oversees Baker & McKenzie’s global delivery of IP services).
A key theme arising from the discussions was the perspective that LPO is one of a suite of cost saving measures available to general counsel. Of the conferences that I have attended, the C5 conference provided the most insight into the in-house legal teams’ outsourcing perspective (both to LPO’s and their outside counsel). Prominent general counsel speaking at the event included Richard Reade of ISS, Richard Tapp of Carillion, David Symonds of Tyco, Stephan Regius of Borealis AG, Pavel Klimov of Unisys, and previously mentioned Apostolou of BT.
The smaller event size allowed for some highly interactive and insightful discussions on issues ranging from pricing, oversight responsibilities, day-to-day challenges of managing global service delivery and ethical issues surrounding outsourced legal services.
My thanks go out to all of the speakers at the event for sharing their insights, to C5 for the privilege of chairing the conference proceedings, and to all participated who made the event a fruitful one.
One high point was the discussion on captive delivery centers led by three very knowledgeable men who are involved in the field of outsourcing. These included Evangelos Apostolou (BT Vice President and Chief Counsel APAC who established and managed the BT legal outsourcing captive in Delhi – including the recent transfer to UnitedLex), Mark Ford (director of the Clifford Chance Knowledge Centre), and Paul Rawlinson (Global Chair of Baker & McKenzie’s IP Practice who oversees Baker & McKenzie’s global delivery of IP services).
A key theme arising from the discussions was the perspective that LPO is one of a suite of cost saving measures available to general counsel. Of the conferences that I have attended, the C5 conference provided the most insight into the in-house legal teams’ outsourcing perspective (both to LPO’s and their outside counsel). Prominent general counsel speaking at the event included Richard Reade of ISS, Richard Tapp of Carillion, David Symonds of Tyco, Stephan Regius of Borealis AG, Pavel Klimov of Unisys, and previously mentioned Apostolou of BT.
The smaller event size allowed for some highly interactive and insightful discussions on issues ranging from pricing, oversight responsibilities, day-to-day challenges of managing global service delivery and ethical issues surrounding outsourced legal services.
My thanks go out to all of the speakers at the event for sharing their insights, to C5 for the privilege of chairing the conference proceedings, and to all participated who made the event a fruitful one.
Tuesday, June 29, 2010
Economic Recipricality
In an increasingly globalized economy and legal profession, many continue to express concerns on domestic job loss as a result of “foreigners.” While the debate continues to be ongoing, we have always been adamant about the reciprocally of economic opportunities. Work performed in one destination creates a market for services in another. That is basic Adam Smith economics of competitive and comparative advantages. This principle is most clearly visible in practice in the unencumbered inter-state trade in the United States.
A recent report, “How America Benefits from Economic Engagement with India,” confirms these principles. “Although India has become synonymous with outsourcing, Indian companies created nearly 60,000 jobs in the US between 2004-09 through nearly 500 investment and acquisition deals worth $26.5 billion.”
The 60,000 jobs noted in the report are the direct number of job created by overseas countries. If calculated, the number of domestic jobs created to service the rapidly growing emerging market economies would be a significant source of domestic job growth.
Further, he types of jobs performed by overseas workers should also be considered, particularly as it relates to outsourced legal services. As aptly stated by the outsourcing figurehead at Pinsent Masons Nigel Kissack, "Opening e-mails does not train anyone to be a good lawyer. Our attorneys didn’t go to law school for that.”
Additional details on the report are available here.
A recent report, “How America Benefits from Economic Engagement with India,” confirms these principles. “Although India has become synonymous with outsourcing, Indian companies created nearly 60,000 jobs in the US between 2004-09 through nearly 500 investment and acquisition deals worth $26.5 billion.”
The 60,000 jobs noted in the report are the direct number of job created by overseas countries. If calculated, the number of domestic jobs created to service the rapidly growing emerging market economies would be a significant source of domestic job growth.
Further, he types of jobs performed by overseas workers should also be considered, particularly as it relates to outsourced legal services. As aptly stated by the outsourcing figurehead at Pinsent Masons Nigel Kissack, "Opening e-mails does not train anyone to be a good lawyer. Our attorneys didn’t go to law school for that.”
Additional details on the report are available here.
Monday, June 28, 2010
LPO Conference: London
This week the London-based event organizer C5 is hosting one of the few, if not only, two-day events on legal outsourcing. The conference – C5 Legal Process Outsourcing – is to be held in London at the St. James Sofitel Hotel.
In addition to presenting on legal outsourcing oversight and the outlook for legal outsourcing ethics, I am also invited to chair the two-day conference. Of that, I am quite honored (or rather “honoured” per the jurisdictional locale of the event).
The conference agenda includes quite an assembly of prominent and familiar faces in the field of legal outsourcing including:
Mark Ross, Integreon
Richard Reade, ISS
Neil Mirchandani, Hogan Lovells
Mark Ford, Clifford Chance
Nigel Kissack, Pinsent Masons
Peter Brudenall, Hunton & Williams
Professor Mari Sako, University of Oxford
Vince Neicho, Allen & Overy
Richard Tapp, Carillion
And a number of others…
More details on the proceedings will be posted later this week.
In addition to presenting on legal outsourcing oversight and the outlook for legal outsourcing ethics, I am also invited to chair the two-day conference. Of that, I am quite honored (or rather “honoured” per the jurisdictional locale of the event).
The conference agenda includes quite an assembly of prominent and familiar faces in the field of legal outsourcing including:
Mark Ross, Integreon
Richard Reade, ISS
Neil Mirchandani, Hogan Lovells
Mark Ford, Clifford Chance
Nigel Kissack, Pinsent Masons
Peter Brudenall, Hunton & Williams
Professor Mari Sako, University of Oxford
Vince Neicho, Allen & Overy
Richard Tapp, Carillion
And a number of others…
More details on the proceedings will be posted later this week.
Thursday, June 24, 2010
Law Society Exploration
Recently, The Lawyer broke the story highlighting the first public reporting of the Law Society’s activity to address the changing legal profession, with a specific aim on outsourced legal services.
As reported, the Law Society expert panel appears to mirror a similar initiative launched by the ABA named the “ABA Commission on Ethics 20/20”.
More details on the LPO ethical developments in the UK as reported by The Lawyer are available here.
As reported, the Law Society expert panel appears to mirror a similar initiative launched by the ABA named the “ABA Commission on Ethics 20/20”.
More details on the LPO ethical developments in the UK as reported by The Lawyer are available here.
Thursday, June 17, 2010
LPO Encore
Law 21 author Jordan Furlong outlined some good thoughts on the legal outsourcing industry in his recent post, The Evolution of Outsourcing. In particular, I appreciated his points about what he described as the LPO “encore” – innovation. More details are available on Law 21.
The post was met with the predictable Above the Law blog snub – complete with apocalyptic tidal wave picture in the event the ominous commentary was not entirely clear. For a more complete perspective on the Furlong piece, the Above the Law commentary is an interesting read.
The post was met with the predictable Above the Law blog snub – complete with apocalyptic tidal wave picture in the event the ominous commentary was not entirely clear. For a more complete perspective on the Furlong piece, the Above the Law commentary is an interesting read.
Tuesday, June 15, 2010
Growth of Onshore Legal In-Sourcing? You Decide.
The announcement by Taylor Wessing to establish a commoditized service delivery center in Cambridge reflects similar recent onshoring moves by American firms Orrick and WilmerHale, as well as Bristol-based Osborne Clarke.
The unique aspect of the announcement, making it the first of its kind in contrast to its American counter-parts, is that Taylor Wessing is actively marketing these services to clients.
Does this mark the start of the growth of onshore legal insouricng?
Should LPO’s be concerned if law firms become more efficient on their own?
The unique aspect of the announcement, making it the first of its kind in contrast to its American counter-parts, is that Taylor Wessing is actively marketing these services to clients.
Does this mark the start of the growth of onshore legal insouricng?
Should LPO’s be concerned if law firms become more efficient on their own?
Thursday, June 10, 2010
Lone Star Sourcing
In addition to the number of other ethical organizations looking into the implications of legal outsourcing, it appears that Texans are studying these issues, as well. As reported by the Fort Worth Business Press, the State Bar of Texas’ 2010 annual meeting being held this week in Fort Worth will address legal outsourcing, among other issues impacting legal professionals.
More information is available through the Fort Worth Business Press.
More information is available through the Fort Worth Business Press.
Tuesday, June 8, 2010
Help Wanted
Another sign of expanding career opportunities for legal professions is exemplified by Pinsent Masons’ decision to create a new enterprise outsourcing role as they expand their outsourcing presence.
As noted in the 2010 Global Sourcing Study and the Fronterion 2010 trending report, the roles of legal professionals and opportunities are expanding considerably as a result of increased integration of outside vendors, both domestically and abroad.
More on the article is available through The Lawyer.
As noted in the 2010 Global Sourcing Study and the Fronterion 2010 trending report, the roles of legal professionals and opportunities are expanding considerably as a result of increased integration of outside vendors, both domestically and abroad.
More on the article is available through The Lawyer.
Monday, May 31, 2010
Leveraging Outside Vendors
Featured in the Spring 2010 International In-house Counsel Journal is an article titled “Leveraging Outside Vendors in a Changing Legal Landscape” authored by Richard Reade, UK General Council of ISS and me. The ten page article covers many key topics regarding the current state of the LPO industry. It’s a good read for those just getting familiar with the LPO industry or those who are already involved and need to gather more information.
The article covers these topics:
• Setting the stage (background information)
• Cost pressures
• Risk management
• Outsourcing profiles
• A structured approach to LPO
• Sourcing opportunities
• Offshoring opportunities and challenges
• ISS UK sourcing innovations
• Tips and best practices
It was my pleasure to work with Richard Reade on this article. He has been involved in legal outsourcing since early 2008 when he established an innovative outsourcing solution with a team based in India and London. Richard is also a frequent speaker on the topic and nominee for in-house legal innovation awards.
The article will be published in it’s entirety in the June addition of the International In-house Counsel Journal.
The article covers these topics:
• Setting the stage (background information)
• Cost pressures
• Risk management
• Outsourcing profiles
• A structured approach to LPO
• Sourcing opportunities
• Offshoring opportunities and challenges
• ISS UK sourcing innovations
• Tips and best practices
It was my pleasure to work with Richard Reade on this article. He has been involved in legal outsourcing since early 2008 when he established an innovative outsourcing solution with a team based in India and London. Richard is also a frequent speaker on the topic and nominee for in-house legal innovation awards.
The article will be published in it’s entirety in the June addition of the International In-house Counsel Journal.
Thursday, May 27, 2010
Legal Futures: A Shore Thing
I had the pleasure of contributing a piece for Legal Futures website. The site focuses on the leading news and trends impacting the UK legal landscape.
My piece, A Shore Thing, comments on the impact of the onshore legal outsourcing trend and how it will potentially impact the roles of legal professionals both within and outside of the traditional legal model.
The ascent of the onshore legal outsourcing industry may change the shape and structure of traditional law firms from High Street to major City firms. The onshore component also raises questions regarding the relationship dynamics between general counsel, their respective law firm(s) and outsourcing vendors.
I also noted the changing roles of legal professionals: The 2010 Global Sourcing Study also revealed that legal outsourcing has changed the roles and dynamics of domestic lawyers and legal professionals. General counsel and lawyers who remain within the traditional legal structure of law firms and corporations will increasingly find themselves acting as aggregators, aggregating and integrating legal matters delivered from sources within and outside of their organisations. Services sourced outside of the organisation can be delivered both on and offshore. This shift to the aggregation of legal services is a sharp departure from the traditional legal services model in which attorneys offer bespoke legal advice within a discrete function area.
The recent deal announcements by WilmerHale and CMS Cameron McKenna exhibit prime examples of how these trends are being integrated in landmark deals and the legal landscape.
More information is available on the Legal Futures website.
My piece, A Shore Thing, comments on the impact of the onshore legal outsourcing trend and how it will potentially impact the roles of legal professionals both within and outside of the traditional legal model.
The ascent of the onshore legal outsourcing industry may change the shape and structure of traditional law firms from High Street to major City firms. The onshore component also raises questions regarding the relationship dynamics between general counsel, their respective law firm(s) and outsourcing vendors.
I also noted the changing roles of legal professionals: The 2010 Global Sourcing Study also revealed that legal outsourcing has changed the roles and dynamics of domestic lawyers and legal professionals. General counsel and lawyers who remain within the traditional legal structure of law firms and corporations will increasingly find themselves acting as aggregators, aggregating and integrating legal matters delivered from sources within and outside of their organisations. Services sourced outside of the organisation can be delivered both on and offshore. This shift to the aggregation of legal services is a sharp departure from the traditional legal services model in which attorneys offer bespoke legal advice within a discrete function area.
The recent deal announcements by WilmerHale and CMS Cameron McKenna exhibit prime examples of how these trends are being integrated in landmark deals and the legal landscape.
More information is available on the Legal Futures website.
Wednesday, May 26, 2010
Tempered Outlook Turns Into Upswing?
In the Business Standard, the article Legal Process Outsourcing on Firm Footing highlights some of the increased activity in the Indian legal outsourcing sector. After several years of chimera-like growth in Indian LPO markets, work capacity never truly lived up to expectations. Recently tempered, the market is now poised for growth and the current outlook appears to be more closely aligned with the state of the industry.
Further, the multi-shore and onshore components of legal outsourcing noted in the article directly parallel the observations made in the Fronterion 2010 Global Sourcing Study. As reported in the Global Sourcing Study, approximately 8% of delivery personnel for the top 17 LPO firms are based in the UK and 10%, on average, are based in the US.
According to the study: Some 75 per cent of outsourcing vendor executives surveyed by Fronterion said at least some of their clients had expressed an interest in onshore delivery, while 24 per cent of vendor respondents reported a significant number of their clients were interested in onshore delivery. A further 82 per cent of outsourcers said their clients were interested in hybrid solutions – a combination of onshore and offshore outsourcing – with over 41 per cent of outsourcers reporting a significant interest in the hybrid-shore delivery model.
For more information, Legal process outsourcing on firm footing is available online.
Further, the multi-shore and onshore components of legal outsourcing noted in the article directly parallel the observations made in the Fronterion 2010 Global Sourcing Study. As reported in the Global Sourcing Study, approximately 8% of delivery personnel for the top 17 LPO firms are based in the UK and 10%, on average, are based in the US.
According to the study: Some 75 per cent of outsourcing vendor executives surveyed by Fronterion said at least some of their clients had expressed an interest in onshore delivery, while 24 per cent of vendor respondents reported a significant number of their clients were interested in onshore delivery. A further 82 per cent of outsourcers said their clients were interested in hybrid solutions – a combination of onshore and offshore outsourcing – with over 41 per cent of outsourcers reporting a significant interest in the hybrid-shore delivery model.
For more information, Legal process outsourcing on firm footing is available online.
Tuesday, May 25, 2010
More on Minter
The Lawyer also reported additional details on the Minter Ellison outsourcing offering. It’s been announced Lewis Silken is a prominent client.
The interesting aspect to note is the high-level nature of the services performed – including the reported hands-on approach by Minter’s senior litigation partners. Perhaps it may be better to classify this as a “delegation,” such as the delegation to a regional firm opposed to a proper LPO engagement. Law firm delegation is very common for major City firms and popularized by the Lovells “Mexican Wave” approach.
LPOs work, act and perform services in a fundamentally different way than traditional law firms and thus legal outsourcing vendors create a unique value proposition.
The interesting aspect to note is the high-level nature of the services performed – including the reported hands-on approach by Minter’s senior litigation partners. Perhaps it may be better to classify this as a “delegation,” such as the delegation to a regional firm opposed to a proper LPO engagement. Law firm delegation is very common for major City firms and popularized by the Lovells “Mexican Wave” approach.
LPOs work, act and perform services in a fundamentally different way than traditional law firms and thus legal outsourcing vendors create a unique value proposition.
CMS Camerons: Act II
The Lawyer reported additional details on the CMS Cameron McKenna outsourcing arrangement with Integreon. The piece reported on some of the internal issues that are arising with such a massive outsourcing initiative that will potentially touch all aspects of Cameron’s support functions.
The article highlights the importance of change management, which is a critical component of a successful legal outsourcing engagement. While most LPO deals do not constitute such a monolithic decision and to date all LPO deals have been supporting legal professionals and rather than transferring law firm staff to an LPO vendor, proper change management functions are a must.
Key issues include engaging an appropriate number of stakeholders both within and outside of the organization as well as designating a champion role in the initiative. We do applaud Camerons, and more specifically Tony Wright, for positioning himself as a senior, respected figure within the firm to champion the engagement.
We will continue to watch this deal with interest as it goes forward through the due diligence phase. The ability to discern core from the non-core and strategic from the non-strategic issues is at the heart of every outsourcing engagement. As noted in the article, Osborne Clarke found certain functions to be better retained internally. More details are available in my book Implementing a Successful Legal Outsourcing Engagement where Osborne Clarke is featured as a case study. The core vs. non-core decisions will be unique for every organization and, undoubtedly, Camerons will come to their own conclusions.
One thing is certain, you can’t outsource change management and you can’t outsource effective governance.
The article highlights the importance of change management, which is a critical component of a successful legal outsourcing engagement. While most LPO deals do not constitute such a monolithic decision and to date all LPO deals have been supporting legal professionals and rather than transferring law firm staff to an LPO vendor, proper change management functions are a must.
Key issues include engaging an appropriate number of stakeholders both within and outside of the organization as well as designating a champion role in the initiative. We do applaud Camerons, and more specifically Tony Wright, for positioning himself as a senior, respected figure within the firm to champion the engagement.
We will continue to watch this deal with interest as it goes forward through the due diligence phase. The ability to discern core from the non-core and strategic from the non-strategic issues is at the heart of every outsourcing engagement. As noted in the article, Osborne Clarke found certain functions to be better retained internally. More details are available in my book Implementing a Successful Legal Outsourcing Engagement where Osborne Clarke is featured as a case study. The core vs. non-core decisions will be unique for every organization and, undoubtedly, Camerons will come to their own conclusions.
One thing is certain, you can’t outsource change management and you can’t outsource effective governance.
Monday, May 17, 2010
Minter Ellison's Kiwi Offering
Another significant LPO story broken by The Lawyer this week is the front-page coverage of the new offering of outsourced legal services by the Australian Minter Ellison from their New Zealand offices.
It will be interesting to follow this announcement and the uptake by UK law firms. According to people familiar with the matter, Minter has several prominent UK law firms signed up for their services.
I was also quoted in the piece about the advantages and disadvantages of law firms offering LPO services.
Michael Bell, managing principal at outsourcing consultancy Fronterion, said the firm might experience issues around the “scaleability of resources”, adding: “The unique thing about LPO specialists is that they’re process-based. Private practice has the advantage that it understands how firms work and can recruit better talent.”
More details are available at The Lawyer.
It will be interesting to follow this announcement and the uptake by UK law firms. According to people familiar with the matter, Minter has several prominent UK law firms signed up for their services.
I was also quoted in the piece about the advantages and disadvantages of law firms offering LPO services.
Michael Bell, managing principal at outsourcing consultancy Fronterion, said the firm might experience issues around the “scaleability of resources”, adding: “The unique thing about LPO specialists is that they’re process-based. Private practice has the advantage that it understands how firms work and can recruit better talent.”
More details are available at The Lawyer.
Orrick and the Death of PPP?
The firm Orrick Herrington & Sutcliffe recently announced that they are no longer publically providing their annual profit per partner numbers used in industry rankings such as those performed by the American Lawyer.
While firms’ reporting mechanisms are not major differentiators, we do applaud firms that are now starting to take a longer-term perspective of their organization than the annual profit per partner rankings. A longer-term perspective allows for more strategic planning and market innovation (which may include, but is not limited to, further investment in longer-term investments like outsourced legal services initiatives).
More details are available in an article featured in ABA Journal.
While firms’ reporting mechanisms are not major differentiators, we do applaud firms that are now starting to take a longer-term perspective of their organization than the annual profit per partner rankings. A longer-term perspective allows for more strategic planning and market innovation (which may include, but is not limited to, further investment in longer-term investments like outsourced legal services initiatives).
More details are available in an article featured in ABA Journal.
CMS Camerons News Round-up
This past Friday, The Lawyer broke the story of the largest outsourcing deal for legal support services to date with UK 20 firm CMS Camerons. While the Camerons deal is more focused on the legal support services than traditional LPO services, the deal is significant for two reasons.
The first notable aspect is the sheer size and duration of the arrangement. The details reported by The Lawyer state the contract size to be £600 million for the duration of 10 years. The scope of the outsourcing arrangement includes nearly all legal support services for the firm including “IT, HR, finance, business development, communications, knowledge management, facilities management and administration services.” It’s also reported that close to 200 current Camerons personnel will be transferred to Integreon. While Osborne Clarke made headlines with a similar deal with Integreon in early 2009, the Camerons deal is a “whole other kettle of fish” according to persons knowledgeable of the matter.
The second significant aspect of the Camerons deal is that it illustrates that when an onshore arrangement helps to clarify the outsourcing decision. When orgaizations remove the offshore component (including ethical and jurisdictional issues), firms are able to see more clearly what they are proficient in performing and what, in fact, is better performed by a third-party. Once these determinations are made, the on/offshore component is simply another step in the solution development process.
For more details on the release please see the following news round-up:
The Lawyer
LegalWeek
Bar & Bench
The first notable aspect is the sheer size and duration of the arrangement. The details reported by The Lawyer state the contract size to be £600 million for the duration of 10 years. The scope of the outsourcing arrangement includes nearly all legal support services for the firm including “IT, HR, finance, business development, communications, knowledge management, facilities management and administration services.” It’s also reported that close to 200 current Camerons personnel will be transferred to Integreon. While Osborne Clarke made headlines with a similar deal with Integreon in early 2009, the Camerons deal is a “whole other kettle of fish” according to persons knowledgeable of the matter.
The second significant aspect of the Camerons deal is that it illustrates that when an onshore arrangement helps to clarify the outsourcing decision. When orgaizations remove the offshore component (including ethical and jurisdictional issues), firms are able to see more clearly what they are proficient in performing and what, in fact, is better performed by a third-party. Once these determinations are made, the on/offshore component is simply another step in the solution development process.
For more details on the release please see the following news round-up:
The Lawyer
LegalWeek
Bar & Bench
Thursday, May 13, 2010
Recession sends onshoring up the agenda
Fronterion was also noted recently by Managing Partner magazine regarding the implications of our 2010 Global Sourcing Study. The article highlights a number of issues including the alternative career path available to UK lawyers at onshore legal outsourcing centers as well as the piqued interest in UK firms for onshore and on/offshore hybrid legal outsourcing engagements.
I was also quoted in the piece regarding the average savings differential between on and offshore legal outsourcing solutions. Here is the quote from the article:
Fronterion managing principal Michael Bell said that onshoring could reduce legal spend by up to a fifth (21 per cent) per outsourced head, compared to an average of 50 per cent in destinations such as India. However, onshoring as an alternative could effectively sidestep “many of the problems associated with sending legal week overseas”, including different regulations and negotiating time zones, he explained.
I was also quoted in the piece regarding the average savings differential between on and offshore legal outsourcing solutions. Here is the quote from the article:
Fronterion managing principal Michael Bell said that onshoring could reduce legal spend by up to a fifth (21 per cent) per outsourced head, compared to an average of 50 per cent in destinations such as India. However, onshoring as an alternative could effectively sidestep “many of the problems associated with sending legal week overseas”, including different regulations and negotiating time zones, he explained.
Wednesday, May 12, 2010
Novak Druce Centre Newsletter
Serveral articles in the Novak Druce Centre Spring 2010 newsletter are worth reading. Christopher McKenna, the director for the center, commented on strategies firms should consider as they become part of the global market. This article addresses the broad view of globalization rather than detailed “how-to” strategies. Determining a personal and firm philosophy about “professional service firms” (legal outsourcing providers, in particular) comes before designing working relationships with them. One thing is clear, though, as we’ve been saying at Fronterion all along, status quo is not satisfactory in a global marketplace any longer.
Another article titled “Run With The Gazelles But Eat With The Lions” by a leading academic expert on the topic of legal outsourcing, Mari Sako predicts the upcoming influences on international law firms. Here are several key quotes:
“Innovation in legal services is also about discontinuous changes. What the economist Joseph Schumpeter wrote a century ago is still relevant today: discontinuous change happens as a result of five things: the introduction of a new product or process, the opening of a new market or source of supply of intermediate goods, or a new organization design. For law firms, discontinuous change is happening as a result of his last two factors - new sources of supply and new organizational design.”
“But remember the old adage: ‘Run with the gazelles but eat with the lions’. That combination of the abilities to move fast and at the same time to identify where the value chain will be protein-richest will be key. Law firms take note.”
Another article titled “Run With The Gazelles But Eat With The Lions” by a leading academic expert on the topic of legal outsourcing, Mari Sako predicts the upcoming influences on international law firms. Here are several key quotes:
“Innovation in legal services is also about discontinuous changes. What the economist Joseph Schumpeter wrote a century ago is still relevant today: discontinuous change happens as a result of five things: the introduction of a new product or process, the opening of a new market or source of supply of intermediate goods, or a new organization design. For law firms, discontinuous change is happening as a result of his last two factors - new sources of supply and new organizational design.”
“But remember the old adage: ‘Run with the gazelles but eat with the lions’. That combination of the abilities to move fast and at the same time to identify where the value chain will be protein-richest will be key. Law firms take note.”
Saturday, May 8, 2010
Revised, Albeit Tempered Outlook
A recent article published in IP Frontline authored by Evalueserve co-CEO Alok Aggarwal details a revised, albeit tempered market outlook for the burgeoning LPO industry.
Due to mixed service lines, varied geographical delivery, lack of official reporting and general transparency the legal outsourcing market; it is hard for many people to get their arms around the LPO market. Compounded by the challenges of projecting market growth for a previously non-exist marketplace understanding legal outsourcing can be daunting.
I believe that hesitant adoption (relative to the early fantastic growth projections) onshoring and offshoring does not reflect the lack of potential in the industry for corporate legal teams and law firms alike. Rather, there are many legal, ethical and firm-integration issues that make LPO adoption slower than comparable forms of outsourced services. Furthermore, the legal profession and related industries were often the hardest hit in the recent economic volatility.
However, forward-thinking firms are now taking a serious look at legal outsourcing as they recognize the value-add (read profitable for law firms) aspect of outsourced legal services.
It is Fronterion’s goal to educate, inform and guide law firms and general counsel so they can take told of the many advantages of legal process outsourcing, while still maintaining a tempered view of the marketplace as reflected by the recent market outlook published by IP Marketline.
Due to mixed service lines, varied geographical delivery, lack of official reporting and general transparency the legal outsourcing market; it is hard for many people to get their arms around the LPO market. Compounded by the challenges of projecting market growth for a previously non-exist marketplace understanding legal outsourcing can be daunting.
I believe that hesitant adoption (relative to the early fantastic growth projections) onshoring and offshoring does not reflect the lack of potential in the industry for corporate legal teams and law firms alike. Rather, there are many legal, ethical and firm-integration issues that make LPO adoption slower than comparable forms of outsourced services. Furthermore, the legal profession and related industries were often the hardest hit in the recent economic volatility.
However, forward-thinking firms are now taking a serious look at legal outsourcing as they recognize the value-add (read profitable for law firms) aspect of outsourced legal services.
It is Fronterion’s goal to educate, inform and guide law firms and general counsel so they can take told of the many advantages of legal process outsourcing, while still maintaining a tempered view of the marketplace as reflected by the recent market outlook published by IP Marketline.
Monday, May 3, 2010
WilmerHale: Washington Post
Firms are leveraging new ways of working to be more efficient. So, it’s no surprise WilmerHale's plan to move organizational support services to a less expensive location was further reported by the Washington Post today. WilmerHale plans to open a “business services center” in Dayton, Ohio. Initially, the center will handle technical support services, but the article states on-site document review capabilities are expected to be offered in the near future. Will other large law firms choose onshoring over offshoring their lower level legal and legal support services? We’ll have to watch and see.
Note that I was quoted in the Washington Post article which is now available online.
Note that I was quoted in the Washington Post article which is now available online.
Friday, April 30, 2010
Possible New Entrant?
We recently saw a possible new entrant into the legal outsourcing sector. Thompson Reuters announced what appears to be a quasi-legal outsourcing center in Taguig City, Philippines. It’s not clear if this is for internal purposes only or if they will be directly competing in the LPO space. As an information service organization, Thompson Reuters potentially comes into the LPO market with a unique angle and vast connections with legal professionals around the world.
It will be interesting to see how this will make an impact in several of areas. How will this change the relationship between Reuters and their clients? Will firms coming into the market find it more attractive to pick up a company rather than grow their own? Will this continue to blur the lines in the legal outsourcing industry, in this case, library sciences?
More discussion is also available at 3 Geeks and a Law Blog.
It will be interesting to see how this will make an impact in several of areas. How will this change the relationship between Reuters and their clients? Will firms coming into the market find it more attractive to pick up a company rather than grow their own? Will this continue to blur the lines in the legal outsourcing industry, in this case, library sciences?
More discussion is also available at 3 Geeks and a Law Blog.
Wednesday, April 28, 2010
WilmerHale Insourcing
Some interesting new insourcing developments occurred this week with the D.C.-based law firm WilmerHale. The firm is launching an onshore delivery center in Dayton, Ohio which will provide a host of support services.
According to the official press release posted on the WilmerHale website, services to be performed include traditional back office services such as “finance, human resources, information technology services, [and] operations.” Additional services to be performed also include traditional legal outsourcing services such as document review and management.
The stated goal of the initiative is to “provide improved efficiencies for administrative teams and the firm, and reduce significant operational expenses.”
This announcement directly affirms the findings and projections of our 2010 Global Sourcing Study, which is currently available online at: www.fronterion.com/globalsourcing2010/
As noted in the Global Sourcing Study, legal outsourcing vendors will face increased indirect competition if law firms do indeed become more efficient on their own. It will be interesting to see if similarly positioned firms in high-cost jurisdictions seek to improve the competitiveness of their firm through consolidation and domestic cost arbitrage.
According to the official press release posted on the WilmerHale website, services to be performed include traditional back office services such as “finance, human resources, information technology services, [and] operations.” Additional services to be performed also include traditional legal outsourcing services such as document review and management.
The stated goal of the initiative is to “provide improved efficiencies for administrative teams and the firm, and reduce significant operational expenses.”
This announcement directly affirms the findings and projections of our 2010 Global Sourcing Study, which is currently available online at: www.fronterion.com/globalsourcing2010/
As noted in the Global Sourcing Study, legal outsourcing vendors will face increased indirect competition if law firms do indeed become more efficient on their own. It will be interesting to see if similarly positioned firms in high-cost jurisdictions seek to improve the competitiveness of their firm through consolidation and domestic cost arbitrage.
Monday, April 19, 2010
Two’s Company, Three’s a Crowd
The last several weeks, we’ve seen a number of press releases regarding the vendor relationships with the software giant Microsoft.
The announcement-spree was kicked off with a release by CPA Global reporting that Microsoft is currently employing a “team of between three and five qualified lawyers at CPA [that] are handling multi-jurisdictional legal support work, including legal research… in CPA's offices in Gurgaon.” This was the second major public release by CPA after the Rio Tinto engagement in June 2009.
Coming quickly on the heels of the CPA release was a separate release from Integreon. The details of the release reported Integreon to be the “exclusive provider of offshore managed document review” on behalf of Microsoft. This was one of the first major corporate engagements publically announced by Integreon.
The contract management portion of the Integreon-Microsoft engagement is reported to be handled primarily by Intgreon’s onshore delivery facilities in Fargo, North Dakota with “eight full-time contract specialists.” This is reflective of the importance of onshore-offshore engagement structures for legal outsourcing engagements as reported in the recently released Fronterion 2010 Global Sourcing Study and also featured in The Lawyer.
While not a legal service engagement, the third and most recent vendor announcement came from Infosys. It is reported that Infosys is servicing Microsoft to “manage internal IT services for Microsoft worldwide” including “IT help desk, desk-side services, and infrastructure and application support from multiple global centers.”
Who knows who will be next in the Microsoft vendor release bonanza?
The announcement-spree was kicked off with a release by CPA Global reporting that Microsoft is currently employing a “team of between three and five qualified lawyers at CPA [that] are handling multi-jurisdictional legal support work, including legal research… in CPA's offices in Gurgaon.” This was the second major public release by CPA after the Rio Tinto engagement in June 2009.
Coming quickly on the heels of the CPA release was a separate release from Integreon. The details of the release reported Integreon to be the “exclusive provider of offshore managed document review” on behalf of Microsoft. This was one of the first major corporate engagements publically announced by Integreon.
The contract management portion of the Integreon-Microsoft engagement is reported to be handled primarily by Intgreon’s onshore delivery facilities in Fargo, North Dakota with “eight full-time contract specialists.” This is reflective of the importance of onshore-offshore engagement structures for legal outsourcing engagements as reported in the recently released Fronterion 2010 Global Sourcing Study and also featured in The Lawyer.
While not a legal service engagement, the third and most recent vendor announcement came from Infosys. It is reported that Infosys is servicing Microsoft to “manage internal IT services for Microsoft worldwide” including “IT help desk, desk-side services, and infrastructure and application support from multiple global centers.”
Who knows who will be next in the Microsoft vendor release bonanza?
Monday, April 12, 2010
Chicago Entrepreneurship Conference
This coming week I have the pleasure of speaking at the Chicago Entrepreneurship Conference hosted by Minogi and iFoundry. I will be speaking on global business and entrepreneurship through my experiences at Fronterion. Other prominent speakers and event details include:
In a globalizing and challenging economy, the next generation of creative entrepreneurs will be reinventing the business world. Join featured speaker Laura Hollis of the Univeristy of Illinois, Carl Nordgren of Minogi, Zach Kaplan of Inventables, Phil Tadros of Doejo, Loran Nordgren of Kellogg, James Interlandi of Virtual General Counsel, Michael Bell of Fronterion, Nate Kontny of Inkling Markets, Vishu Ramanathan of ThinkLink, Jonathan Naber of the Illini Prosthetics Team, Darren Marshall of Doejo, and Jason Tillery of ThinkLink at the Creative Entrepreneurship Workshop that will guide you through the creative processes of founding your startup, avoiding startup pitfalls, and connecting with creative entrepreneurs in the midwest and abroad.
The event will be held at the University of Illinois Chicago campus Saturday April 17th. More information is available online.
In a globalizing and challenging economy, the next generation of creative entrepreneurs will be reinventing the business world. Join featured speaker Laura Hollis of the Univeristy of Illinois, Carl Nordgren of Minogi, Zach Kaplan of Inventables, Phil Tadros of Doejo, Loran Nordgren of Kellogg, James Interlandi of Virtual General Counsel, Michael Bell of Fronterion, Nate Kontny of Inkling Markets, Vishu Ramanathan of ThinkLink, Jonathan Naber of the Illini Prosthetics Team, Darren Marshall of Doejo, and Jason Tillery of ThinkLink at the Creative Entrepreneurship Workshop that will guide you through the creative processes of founding your startup, avoiding startup pitfalls, and connecting with creative entrepreneurs in the midwest and abroad.
The event will be held at the University of Illinois Chicago campus Saturday April 17th. More information is available online.
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