Monday, December 10, 2007

LPO: Transactional versus FTE Model

A reader of this blog, David, had the following comments on preferring a transactional model over an FTE model for a legal process outsourcing contract with Williams Lea, he refers to this previous post:

"Interested reading your article LPO: A Primer for Solo Attorneys.

To be honest much of what you say is very true for medium size and even the larger silver/magic circle firms.

However, I would like to add a rider under your section Legal BodyShopping: we are actually trying with Williams Lea LPO to move to a transactional model and away from an FTE model. This gives us greater flexibility and allows us to build without the FTEs sitting waiting for our work. Maybe this model is easier for larger firms to work and still get dedicated focused staff, but it certainly is the way to go on anything that can be transcationalised (if there is such a word.) We will be trying it on various areas, basic stuff like document production and volume legal services - conveyancing and even research.

I think it goes without saying that it is what works best for each individual or individual firm but certainly don't rule out the transactional model as the way forward for law firms.

I think the transaction model works well for the long term too. The FTE model is so fixed and rigid, it does not allow for a lot of flexibility and is the reason many people leave outsourcing contracts. In addition many of our corporate clients are wanting transactional pricing and therefore we are building with Williams Lea more of a partnership (without sounding too much of a cliche). We work with WL in legal process outsourcing areas to define the best areas for us to transactionalise."

Being an operations person, I will favor an FTE model, whenever feasible for my client, but as they say, the customer is the king!