Monday, March 16, 2009

LPO: The new survival kit for the law firms

Martin L. Sandel, formerly a trial lawyer of more than 25 years experience, is President and CEO of He in his article “Legal outsourcing-Politically correct? Or Politically Incorrect?” cites the example of three law firms that had to shut down because of exorbitant fees they demanded from their clients. As a result, a lot of attorneys were laid off as the companies couldn’t afford such high fees and eventually the law firms had to shut down some with a history of 118 years in the business.

The lawyers are generally perceived to be the custodians of traditions. And one of the age-old traditions appears to be making the clients pay heavily for services they offer. In this time of recession, cost-effectiveness is the mantra that people in the boardroom seem to be chanting. There isn’t evidence of Heller Ehrman, Thelen LLP and Thatcher, Proffitt & Wood LLP, three of the firms that had to close down, using legal offshoring. Compare this to some of the Magic Circle firms such as Clifford Chance that have gone ahead in embracing outsourcing, it is surprising to see that some legal firms harbor prejudices against the LPO industry.

Charles Darwin said “It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.” Legal process outsourcing as Martin correctly points out is “another tool (like computers, word processing software, voice recognition technology, e-mail) to enhance efficiencies and improve the bottom line for law firms and their clients alike”. It is time that course of winds of change is understood and a serious objective analysis is undertaken to comprehend the benefits of the LPO industry and to make the best decision so that (sadly) the end result doesn’t come out to be a closure.