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by Mary Saldago

Updated:

Aug 6, 2020

The Impact Of Offshore Legal Process Outsourcing To Law Firms

Sit down and really think about it for a minute – what would be the best way to attract new clients to your company?

In the legal industry, and maybe even in any other industry out there, offering top of the line services for an affordable price is one of the guaranteed methods of increasing market reach. However, if you’re working in a niche where competency is critical, legal firms and other business entities often have difficulty when it comes to meeting a particular demand because of the skyrocketing rates that are attached to legal processionals.

As consumers are busy trying to shove the prices down, there are legal firms that are trying to find strategic options that would help them keep all of their expenditures down while ensuring that they will still be able to put out high quality work. This results in law firms discovering offshoring and reaping the benefits that are attached to it. For this reason, many law firms have turned to offshoring some of their legal functions to legal process outsourcing (LPO) providers.

The Impact Of Offshore Legal Process Outsourcing To Law Firms

How Does Legal Offshoring have an Impact on Market Growth?

Due to law firms’ having an increased need to offer standard services, while making sure they keep their expenses at bay, the legal process outsourcing market has been experiencing a nice and steady growth. In fact, it has been predicted that by the year 2024, it will grow up to $27.19 billion – this projection is provided to us from the business consulting firm Grand View Research, Inc.

In what way can this contribute to the market growth – in terms of client reach – of legal institutions?

When it comes to acquiring, attracting, and retaining both current and new clients, positive image and trust is important. It goes without saying that legal matters are very sensitive, and this should be taken into consideration. Clients are keen when choosing whom they are going to trust with their case.  LPO offshoring aids law firms in providing quality service by increasing their productivity and operational efficiency. This also gives them the capacity to supplement unanticipated legal needs.

The high-level experience and competency of an offshore LPO reflects on the services a firm is going to provide. In return, there will be an improved relationship with clients. When a client is happy with a service he or she has received, chances are high that he or she would recommend the same firm to people they know. Word of recommendations, combined with a positive image, are great due to the fact that it testifies the effectiveness of the legal firm in handling complex to simple cases.

Would Offshoring be a Feasible Option?

Offshoring is a term that is used when referring to the practice of relocating services to countries that offer inexpensive labor pools – this includes the Philippines as well as India. The salary is different from the income of their Western counterparts, which is usually what costs legal firms a large amount of money.

But while offshoring LPO outputs have been a practice for quite some time now, there are still firms that are hesitant in getting some of their jobs done outside their geographical location. Their skepticism is often attributed to confidentiality and security issues, difference in legal systems and regulatory policies, and diversity of language being used. They believe that on shoring and nearshoring is still the better choice. It gives them better control over operations and data security. However, those options contribute less in reducing costs since the wage of employees working for those service providers is almost similar to their in-house personnel. This means that onshore outsourcing is a lucrative option. It only gives firms additional time and not the ultimate capability to cut their expenses. Offshoring, on the other hand, allows organizations to cut costs through labor arbitrage — the wage differential between an in-house legal personnel and a staff from a low-wage country.

As long as law firms are meticulous in choosing a legal process outsourcing provider, offshoring is a viable option that they can use to their advantage.

Benefits of Offshoring Legal Services

Apart from the cost, by offshoring legal, there are numerous benefits, as mentioned below:

1. Offshoring enhances a law firm’s efficiency and reduces turnaround time – If you’re looking for a great way to boost employee performance, then legal process outsourcing is exactly what you’re needing. By offshoring those repeatable tasks that don’t require a large amount of legal experience and knowledge, your in-house staff will be able to put more focus on those high-value tasks that deserve more attention.  Through strategically using in-house and offshore resources that are at your fingertips, organizations are able to complete a project in a shorter period of time.

2. Offshoring gives global expertise a tap. Firms are able to gain access to niche expertise and high level talent through legal process outsourcing in offshore location. This is talent and niche expertise that is hard to find elsewhere at a price that is so affordable. Offshore locations such as the Philippines is the home of high-trained, large, motivated, and qualified people that allows law firms to be able to fill gaps in internal competencies.  For those small boutique firms, this is particularly helpful, especially if they offer a specific service and don’t have an in-house that is capable of doing it.

3. Offshoring will guarantee continuous operations by following a 24/7 work model. Some law firms may be under the impression that it isn’t a great idea to outsource services to LPO providers that are operating in a time zone outside of their own. However, believe it or not, this time difference can be an advantage because this means that they may be able to provide continuous workforce. Many legal process outsourcing companies offshore are known for following the standard 24-hour work cycles. This guarantees that time-consuming work will be accomplished quickly and in an efficient manner.

4.  Offshoring offers greater flexibility.  Offshoring allows organizations to be able to tailor their capabilities according to the demands and workload of their clients. This means that they will be able to focus on those more important tasks that should be handled, while the offshore legal service can do those not-so-important tasks that still need to be done. In return, the small law firms are able to scale up and level with those larger firms when it comes to offering quality legal service. Apart from the service, offshoring makes it so that staffing in an organization is flexible, which is helpful in the terms of reducing overhead. Through this, law firms aren’t required to pay the fixed cost of benefits and salaries like they would a full-time, permanent employee.

As we have mentioned, the offshore LPO offer legal solutions that are qualitative in nature. These can be used to supplement more high value and complex tasks that the in-house legal practitioners handle. This means that the legal firm is still going to have control over the final outputs, so there’s no need to worry about this.

Choosing the right offshore LPO provider is crucial to the overall success of this initiative. Here are some considerations that law firms should consider before going offshore:

1.      Choose a legal process outsourcing company where individuals work in a style identical to in-house lawyers.

2.      Weigh the overall legal needs to determine which among the services are suitable for offshoring.

3.      Consider the inherent risks, especially one that involves confidentiality. Make sure that the LPO provider follows the required security and risk management protocols. There should also have a proper training and screening of personnel in place. It is also important that the LPO is not doing other administrative services to clients that can cause legal conflicts.

4.      The cost should be tailored to the size and type of a specific legal arrangement. This should allow the firm to save while ensuring that the quality is not compromised. Moreover, the LPO provider should also be capable and flexible enough to handle services a law firm needs.

To keep up with the pace of the global legal market, law firms should always strive to innovate. Providing services to their growing clientele may not be enough when they handle it all alone. Sometimes, they need the help of other professionals working in the same field, be it onshore or offshore — whatever would work for them. Through this, they can meet what their market demands — a key in thriving in the industry.

Do you have any legal service needs? Offshore some of your legal services with us now! Contact us for more details.

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