UK law firms open its door to legal process outsourcing

A survey has been carried out by Legal Week which has come up with some surprising results. The following observations are noted in the survey:

• Steep rise in the LPO penetration in the UK legal market: The survey showcases the amazing results related to the usage of LPO by the UK law firms. According to the survey, about 5% of the UK law firms had used LPO services in 2009 and this figure significantly rose to 15% in 2011.This is a very encouraging fact for the LPO industry which now envisions tapping the unexplored market in the UK. The survey also indicates that the UK clients are more inclined towards the LPOs which are supervised by a law firm. This guarantees the best quality of work product to be delivered to the clients.

• LPO expands its practice areas: The survey further indicates that litigation document review, e-discovery (e-disclosure), and contract management are the major areas of work dealt by the LPO in general. The survey also shows that even the areas like compliance, library/research and know-how, debt recovery, and conveyancing can be comfortably handled by the LPO. Thus, there is a wide expansion in the services line of the LPO.

• LPO usage does not hamper the Law Firm brands: The main cause of worry for some of the law firms is that they may be wrongly interpreted by the clients for the usage of the LPO. But, this stands incorrect, if the results of the survey are to be believed. The results demonstrate that a huge chunk of lawyers believe that the usage of the LPO for a law firm does not diminish its brand but create a competitive advantage over other law firms. This is supported by the fact that, the largest and best-known law firms of UK use LPO to assist them and they are satisfied with the services provided by them. ‘LPO 2.0’ comes into picture here which involves a close alliance between a law firm and a LPO provider. The LPO providers’ solutions are so closely incorporated into the law firm’s overall value proposition that they just become a part of the various solutions provided by the law firm to its clients. This finally enhances the law firm’s brand.

• Major concern – Low cost, not LPO: The major concern which prevails now is not with regards to outsourcing but to find out the best possible way to centralize non- core support functions in a low cost location. Legal Week concludes that outsourcing is often seen as the relocation of repetitive work to a low cost off shore country. But, there is a different approach to the previous statement. LPOs can have different forms; they are being developed by the law firms in the UK or some of the law firms outsource their routine work to the regional offices to cut down their cost. Some big international firms take a different stand. They outsource those work from the regional offices on which they can mark up the price to their clients.

These results finally confirm our view that UK lawyers are now becoming comfortable with the usage of LPO and prevailing market pressure plays a significant role in their LPO adoptions.

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