Apparently the National Security Agency can potentially provide an independent, albeit unsolicited, review of work done by LPO firms!
I first read about a federal suit filed by a Bethesda, MD firm against a legal offshoring firm at this post on legaltimes blog. This is where it gets interesting: a co-defendent in the lawsuit is President George W. Bush (yay, yay, yay!).
Joseph Hennessey, name partner at Newman McIntosh & Hennessey, turned to the U.S. District Court for the District of Columbia on May 7 seeking a ruling on the outsourcing of privileged client data that may be subject to eavesdropping by the U.S. government.
Quick on the facts of the case is here. A blog response by Pangea3 is here.
A potential implication of the potential shortcoming of the Fourth Amendment as applicable to attorney-client confidentiality in any cross border transaction, not just outsourcing, is available as a comment here:
If the DC and MD bar follow Hennessey's recommendations, we should expect to see major fallout throughout the entire legal industry - not just the outsourcing industry. And given that the amount of money at stake in cross border transactions and in enforcing contractual rights or U.S. judgments overseas dwarfs the amount of money at stake with outsourcing, it will not just be outsourcing companies that lose out. It will be any law firm with a foreign office and any business in the U.S. that engages in foreign commerce.
Now, some fun facts:
Fact: US Elections are here and it is not necessary that everyone (in Bethesda, MD) likes President Bush.
Fact: Benford's law of controversy, that states "Passion is inversely proportional to the amount of real information available."
Fact: The lawsuit is wonderful free marketing for the firm and the defendent(s).
Tip for LPOs: Bid for Hennessey's work on this case!
Simple recommendation: Obtain your clients' consent if you are considering using outsourcing on their matters. "Caveat Emptor" the client if they ask you to use outsourcing.
Finally, if the NSA does review offshored legal work, that can't be too bad!
Saturday, May 31, 2008
Tuesday, May 20, 2008
GIIP Press Release: Dual Certification Program in International Patents & Intellectual Property Services
MAY 12, 2008: Professional courses have turned out to be a very popular choice in the present times, with students' opting for various courses of their preference. These courses provide a well-defined career in terms of the industry to be pursued like medicine, engineering, management, law, mass media, hospitality etc. Keeping such eagerness in mind, the Government has put in a lot of effort to promote professional education at various levels.
Great news for the students aspiring to empower their career, Global Institute of Intellectual Property (GIIP) in Collaboration with University of Washington, CASRIP, USA, the fifth largest university of the world is coming up with its courses in Intellectual Property and International Patents, which enables professionals from various technical backgrounds to undertake world-wide IP assignments in MNCs, Corporate firms, Government research labs, law firms and KPOs/LPOs.
With an increasing awareness about Intellectual Property (IP) rights in India and across the world, this is your chance to make hay while the sunshine. GIIP’s program focus on practical aspects of patents and their legal, technical and business with an objective to understand international patent systems and criticalities involved before US Patents & Trade Marks Office (USPTO), European and Indian PTO. The course content is global and taught by international faculty.
GIIP’s aim is to train the large talent pool of science and technical graduates, post graduates and PhDs and to build a team of Indian professionals that can cater to the needs of global customers in the field of IP and patent.
ELIGIBILITY
Graduates/Post-Graduates/PhDs in the field of Science, Engineering Pharma, IT, Electronics, Bio-technology, Telecom, Chemical, Mechanical and other technical fields.
Domain Experts, Research Scholars, Teachers and Professors in the above disciplines
Professionals engaged with Legal Outsourcing firms, MNCs and Indian corporates
Legal professionals (LL.B. & LL.M.) with a technical background
Participants appearing for their final year exam are also eligible to apply
International Patents and IP training program are available at Delhi, Mumbai, Bangalore and Chennai. GIIP’s placement system helps participants find career opportunities in renowned organizations, with improved roles and responsibilities, world-class remuneration. "Students from GIIP’s past programs (in collaboration with IIT Delhi and first batch of full-time Post Graduate Diploma program) have been successfully placed with companies, like CSIR, Panacea Biotech, Biocon, Ranbaxy, Cisco, Evalueserve, Intellevate, Inventurus, Anand and Anand, Remfry & Sagar etc."
Students willing to do the course can visit the site for further detail and can also apply online for the same. Education loans and Scholarship program details available on the website (http://www.giipinfo.com)
Filled in applications should reach on or before June 2nd , 2008. The forms and information brochure can also be downloaded from the website (http://www.giipinfo.com/)
Session starts: June 9, 2008
Address for all communication:
Contact details: Global Institute of Intellectual Property
45, First Floor, Okhla Industrial Area Phase III, New Delhi – 110 020
Phone number : +91 11 3088 4000/ 01
Sunday, May 11, 2008
PRESS RELEASE FROM SDD GLOBAL: COMPANY ADDS LONDON, BANGALORE OFFICES, EXPANDS CAPABILITIES:
LONDON, May 11, 2008—SDD Global Solutions, the leader in high-end legal services outsourcing to India, has expanded from Mysore and New York into London and Bangalore. Already a “go-to” legal provider for Fortune 100 media, entertainment and other companies in Hollywood and elsewhere in the United States, SDD Global has added not only new offices, but also new service capabilities, including transactional work and patent services.
London Office Opened
Alex Hannell, one of the world’s leading specialists in international media, intellectual property and entertainment transactions, heads SDD Global’s new London office, and its new service division, The Business and Legal Affairs Group. Led and trained by Hannell, with outstanding attorneys working in Mysore, this new department handles the transactions and commercial legal affairs of film and television companies, and it can do the same for all other kinds of companies, which (a) are no longer willing to tolerate the usual outside counsel rates in the West, and/or (b) want another alternative to hiring in-house lawyers.
Before joining SDD Global, Mr. Hannell served as Head of Commercial Affairs for Granada International, the worldwide arm of what is now the U.K.’s largest commercial television company, ITV. He is also a veteran of the pre-eminent London-based law firm, Herbert Smith LLP. From 2002 until 2008, Hannell developed his own roster of film and television clients, including a “who’s who” list of such companies as Warner Brothers and countless others.
Bangalore Patent Office Added
Simultaneously, SDD Global has opened a patent legal services operation in Bangalore, led by IP experts with an extensive track record in the field. SDD Global’s multidisciplinary team of patent agents, scientists, and patent attorneys provides in-depth experience, combined with up-to-date technical knowledge. The team handles IP portfolio creation and management, prior art searches, patentability consulting, infringement analysis, patent drafting and prosecution, valuation and licensing, and a host of other IP services.
New Parent Law Firm, SmithDehn LLP
In other news, SDD Global Solutions is now managed by SmithDehn LLP, the New York and London-based international law firm created by the intellectual property, media, and entertainment attorneys of the former Smith Dornan Dehn PC. Joining these former SDD attorneys at SmithDehn LLP are Alex Hannell in London, former NBC and CBS television in-house counsel Benton Levy, former Chicago Mercantile Exchange Director and Associate General Counsel Patricia Holland, veteran New York trial attorney Kwarma Vanderpuye, U.S. immigration law specialist Priya Kumar, and others.
Says Frank Dehn, a Harvard Law School graduate and managing attorney of SmithDehn’s New York office: “Every modern U.S. law firm is now struggling to figure out its ‘India Strategy.’ We're the only Western law firm that not only has one, but already has been implementing it on the ground.”
Another SmithDehn founder, Columbia Law School graduate Russell Smith, who spends most of his time in Mysore, managing SDD Global Solutions, says: “With its new offices, new practice areas, and new parent law firm, SDD Global is poised to achieve its dream. We want to revolutionize the way legal services are delivered to companies and individuals all over the world.”
More About SDD Global
SDD Global Solutions, the only legal services provider in India managed by a U.S. law firm, offers high-quality legal research, analysis and drafting at a fraction of the traditional cost. Headquartered in the city of Mysore, India, two hours from Bangalore, and with other offices in New York, London, and Bangalore, the company maintains quality and security controls that meet or exceed those of top-tier law firms in the West. In order to maintain the highest standards, SDD Global hires only one out of every 900 job applicants, from a growing talent pool that includes 80,000 English-speaking law graduates in India entering the market each year. Due to the dramatically low cost of living and doing business in Mysore, where SDD Global has its own state-of-the-art office building, the company can significantly reduce costs for its corporate and law firm clients.
As noted in a press release from Columbia Law School (“Is the Future of U.S. Law in India?”), SDD Global Solutions is actively dispelling the stereotype linked to outsourcing, by (a) hiring lawyers in the United States and the United Kingdom to further improve its quality control, supervision and onshore presence, and (b) providing more legal services opportunities for U.S. law firm clients, since the lower costs of those services create a demand for legal work that in many cases would not have otherwise existed.
SDD Global is on the path to becoming in many ways the functional equivalent of the world’s largest and most affordable global law firm. SDD Global is solving one of the most urgent problems of today's businesses, namely, the inefficiencies of having most legal work done in locations that often are among the most expensive, and the least productive.
For more information, please visit www.sddglobal.com For a cover story featuring SDD Global in the latest legal magazine from LexisNexis, please click here.
London Office Opened
Alex Hannell, one of the world’s leading specialists in international media, intellectual property and entertainment transactions, heads SDD Global’s new London office, and its new service division, The Business and Legal Affairs Group. Led and trained by Hannell, with outstanding attorneys working in Mysore, this new department handles the transactions and commercial legal affairs of film and television companies, and it can do the same for all other kinds of companies, which (a) are no longer willing to tolerate the usual outside counsel rates in the West, and/or (b) want another alternative to hiring in-house lawyers.
Before joining SDD Global, Mr. Hannell served as Head of Commercial Affairs for Granada International, the worldwide arm of what is now the U.K.’s largest commercial television company, ITV. He is also a veteran of the pre-eminent London-based law firm, Herbert Smith LLP. From 2002 until 2008, Hannell developed his own roster of film and television clients, including a “who’s who” list of such companies as Warner Brothers and countless others.
Bangalore Patent Office Added
Simultaneously, SDD Global has opened a patent legal services operation in Bangalore, led by IP experts with an extensive track record in the field. SDD Global’s multidisciplinary team of patent agents, scientists, and patent attorneys provides in-depth experience, combined with up-to-date technical knowledge. The team handles IP portfolio creation and management, prior art searches, patentability consulting, infringement analysis, patent drafting and prosecution, valuation and licensing, and a host of other IP services.
New Parent Law Firm, SmithDehn LLP
In other news, SDD Global Solutions is now managed by SmithDehn LLP, the New York and London-based international law firm created by the intellectual property, media, and entertainment attorneys of the former Smith Dornan Dehn PC. Joining these former SDD attorneys at SmithDehn LLP are Alex Hannell in London, former NBC and CBS television in-house counsel Benton Levy, former Chicago Mercantile Exchange Director and Associate General Counsel Patricia Holland, veteran New York trial attorney Kwarma Vanderpuye, U.S. immigration law specialist Priya Kumar, and others.
Says Frank Dehn, a Harvard Law School graduate and managing attorney of SmithDehn’s New York office: “Every modern U.S. law firm is now struggling to figure out its ‘India Strategy.’ We're the only Western law firm that not only has one, but already has been implementing it on the ground.”
Another SmithDehn founder, Columbia Law School graduate Russell Smith, who spends most of his time in Mysore, managing SDD Global Solutions, says: “With its new offices, new practice areas, and new parent law firm, SDD Global is poised to achieve its dream. We want to revolutionize the way legal services are delivered to companies and individuals all over the world.”
More About SDD Global
SDD Global Solutions, the only legal services provider in India managed by a U.S. law firm, offers high-quality legal research, analysis and drafting at a fraction of the traditional cost. Headquartered in the city of Mysore, India, two hours from Bangalore, and with other offices in New York, London, and Bangalore, the company maintains quality and security controls that meet or exceed those of top-tier law firms in the West. In order to maintain the highest standards, SDD Global hires only one out of every 900 job applicants, from a growing talent pool that includes 80,000 English-speaking law graduates in India entering the market each year. Due to the dramatically low cost of living and doing business in Mysore, where SDD Global has its own state-of-the-art office building, the company can significantly reduce costs for its corporate and law firm clients.
As noted in a press release from Columbia Law School (“Is the Future of U.S. Law in India?”), SDD Global Solutions is actively dispelling the stereotype linked to outsourcing, by (a) hiring lawyers in the United States and the United Kingdom to further improve its quality control, supervision and onshore presence, and (b) providing more legal services opportunities for U.S. law firm clients, since the lower costs of those services create a demand for legal work that in many cases would not have otherwise existed.
SDD Global is on the path to becoming in many ways the functional equivalent of the world’s largest and most affordable global law firm. SDD Global is solving one of the most urgent problems of today's businesses, namely, the inefficiencies of having most legal work done in locations that often are among the most expensive, and the least productive.
For more information, please visit www.sddglobal.com For a cover story featuring SDD Global in the latest legal magazine from LexisNexis, please click here.
Washington Post says Legal Outsourcing "The next big thing in Indian business"
Legal outsourcing in India made a big splash in the U.S. media today. In an article in The Washington Post, arguably the most influential newspaper in the United States, the headline reads, “U.S. Legal Work Booms in India – New Outsourcing Industry Is Growing 60 Percent Annually.” As reported in the article -- already spreading like wildfire through the media and the blogosphere --“legal process outsourcing is being called the next big thing in Indian business. It marks India's climb up the chain of outsourcing jobs -- from low-end, back-office service functions in call centers to high-value, skilled legal work.” The article reports on lawyers from such legal outsourcing firms as Quattro and SDD Global Solutions, referring to them as “part of a booming, new outsourcing industry in India that employs thousands of English-speaking lawyers… to do legal work at a small fraction of the cost of hiring American lawyers.” Here’s a quote in the article from Ashish Sharma, a recent LPO recruit whose father “had visions of seeing him argue in an Indian court and eventually become an honorable judge”:
"It is much better than going to court in India and dealing with all kinds of rough people. Working in legal outsourcing is a happy career move for me, although my father does not fully understand what I am doing here after my education in Indian law," said Sharma, who began working in February for an outsourcing company called Quatrro. "I am getting valuable exposure to the American judicial system, corporate law and their way of working."
Also featured is SDD Global Solutions. The article reports that SDD Global “handled much of the legal work for the film ‘Borat,’" that “other clients include the Washington-based law firm Appleton & Associates and U.S. movie studios and television networks,” and that lawyers at the Mysore-based company “recently researched and drafted the motion papers for the dismissal of a libel case against the producers of HBO's ‘Da Ali G Show.’” The article points out, regarding the libel suit against HBO, that “if it had not been for the cheaper option of outsourcing, the producers would have settled.” The article quotes SDD Global’s Chairman in Mysore as follows: "people in India can do everything from here, except sign an opinion letter and appear in an American court." As for court appearances and legal opinions, no problem. They can be handled by the company’s U.S. parent law firm, SmithDehn LLP. A good press day for legal outsourcing!
"It is much better than going to court in India and dealing with all kinds of rough people. Working in legal outsourcing is a happy career move for me, although my father does not fully understand what I am doing here after my education in Indian law," said Sharma, who began working in February for an outsourcing company called Quatrro. "I am getting valuable exposure to the American judicial system, corporate law and their way of working."
Also featured is SDD Global Solutions. The article reports that SDD Global “handled much of the legal work for the film ‘Borat,’" that “other clients include the Washington-based law firm Appleton & Associates and U.S. movie studios and television networks,” and that lawyers at the Mysore-based company “recently researched and drafted the motion papers for the dismissal of a libel case against the producers of HBO's ‘Da Ali G Show.’” The article points out, regarding the libel suit against HBO, that “if it had not been for the cheaper option of outsourcing, the producers would have settled.” The article quotes SDD Global’s Chairman in Mysore as follows: "people in India can do everything from here, except sign an opinion letter and appear in an American court." As for court appearances and legal opinions, no problem. They can be handled by the company’s U.S. parent law firm, SmithDehn LLP. A good press day for legal outsourcing!
Thursday, May 01, 2008
Legal Outsourcing: Considerations and Experiences of Outsourcing Legal Aid and Paralegal Work
Can I take that off your hands?
The emergence of the outsourcing industry has provided a much-needed support network for busy companies seeking to retain their competitive edge. The question is now is no longer whether to outsource, but what to outsource and to whom. CPA’s Rob Stichbury examines the options
Although outsourcing is not a new concept, the industry has experienced a period of phenomenal growth in recent years, as busy companies increasingly turn to external providers to fulfil highly administrative or poorly served functions of their business. And, as the industry has evolved in size and expertise, so too has the nature of the tasks that are being outsourced. Today’s companies are not just looking to outsource business processes, such as back-office functions, call centres, human resources and IT (Business Process Outsourcing or BPO). Based on its success, they’re also turning to off-shore providers for Knowledge Process Outsourcing (KPO) and Legal Process Outsourcing (LPO) like paralegal work, as the race for cost savings has given way to the race for top skills.
A helping hand
So, does LPO work and is it suitable for the IP industry? The simple answer is yes. In our fast-paced industries, businesses need to strive for continual innovation in order to ensure competitive advantage. Without back-end support, such progress would not be possible. The hunt for competitive advantage translates into greater legal, particularly IP, activity. That’s not just in the number of patents that companies seek to register and protect, but also in the trend to actively ‘farm’ patent estates. Without external help managing the administrative side of the IP work, few corporations would be able to keep up with or afford to properly develop their IP portfolios.
IP currently accounts for over 45% of the LPO market and is expected to lead the growth in this sector in the next three to five years. The service mix already includes basic IP services, such as proofreading and paralegal support, but as low-end IP administrative tasks are outsourced with success, companies are electing to off-shore more complex tasks to trusted suppliers. They are leveraging the experience and talent off-shore to improve processes, and apply the benefits of scale and technology.
An increased emphasis on merger and acquisition (M&A) activity since 2004, has provided part of the reason for this growth. IP due diligence is fundamentally important in all M&A activity, and increasingly in private equity and venture capital deals. This has big implications for IP departments as it also generates large volumes of work in tight timeframes, distracting staff from otherwise core activities. If forced to manage the work internally, companies are faced with increasing costs, backlogs and delays in work, and compromises in the quality of the work being produced.
The rising cost of office space, the scarcity of skilled staffing in the developed world and the challenge to manage the peaks in workload all put pressure on a company’s bottom line. LPO has enabled companies to increase productivity and capacity, to achieve scale and bandwidth to operations. It also satisfies board pressure to leverage IP and keep costs down, while still maintaining (or even improving) quality of work.
The growth in worldwide patenting activity over the past decade has also meant that national patent and trademark offices are struggling to keep up with the speed of innovation. In 2005 (the most recent data available), the European Patent Office (EPO) had 119,800 patent searches pending, and this figure is due to grow by 24% each year. Similarly, in 2006, the US Patent Office (USPTO) revealed details of a backlog exceeding 700,000 patent applications and the situation looked all too familiar at the Japanese Patent Office (JPO) in 2005, when its backlog hit 790,000. At that point the JPO took action and outsourced 25% of its prior art searches to help get back on top of the escalating workload. The move to outsource and increase capacity at the JPO was welcomed by industry, too, since application delays can mean that precious patent licensing opportunities are lost.
In such an aggressive environment, outsourcing is no longer a choice – the question is not whether a business should outsource, but instead, how best to do it: ‘We all know that outsourcing is not just about cost take-out any more. Done right, outsourcing will make your organisation more nimble, more agile, and more competitive.’ (Kevin Campbell, 2007 group chief executive – Outsourcing, Accenture.)
Choosing the right partner
Ultimately, it is the importance of quality, not cost, that is driving growth in the LPO marketplace. That’s why companies looking to off-shore or outsource key tasks should be looking for an experienced partner that is able to assure quality of work, as well as manage risk, guarantee data security, export control, interoperability of data and smooth transfer of work.
In the IP industry in particular, there is now also a growing trend towards multi-sourcing and multi-shoring, where corporations and law firms select not to outsource a variety of in-house tasks to one expert supplier or global jurisdiction, but instead select the best (or most innovative) supplier or the best jurisdiction for each task. Better still they find a supplier that has the breadth and scope to provide the appropriate specialist multi-discipline expertise and a multi-shore option. IP service providers work on a variety of levels, but aside from CPA, there are only a few companies that can actually provide the global multi-faceted approach to LPO that most businesses need.
At the very basic level, businesses should be outsourcing non-core and lower-value activities, leaving in-house staff to focus on their core value and added-value activities to drive earnings growth. Working on the concept that highly trained, outsourced IP specialists can lift the burden of managing the IP prosecution process, many law firms are also now choosing to off-shore more key IP tasks. Clifford Chance is just one example of a global law firm that has chosen to partner with an India-based outsourcing company to manage its key financial services. US-based Schwegman, Lundberg, Woessner & Kluth (SLWK) is another, but it chose to establish its own captive IP-outsourcing company in 1999 to achieve this.
There were practical reasons for setting it up in India, explains Steve W Lundberg, founding partner: ‘In the late 1990s, there was a labour shortage in Minneapolis (home to SLWK’s first office) of qualified personnel to do certain functions like proofing and lower level case management.’ Tapping into the bank of talent in India allowed the firm to increase capacity, improve cycle time and retain complete control, all without sacrificing quality or security. And, as corporations become more wary of the hourly charge of legal counsel, IP outsourcing also provided SLWK with the opportunity to pass on cost savings to its clients – a benefit that few competitors could provide at the time.
Sidestepping the pitfalls
Be sure to use an already existing and experienced supplier, the same rules apply to outsourcing as they do to any key business task: focus on quality, implement robust processes, certification, security and risk management practices, and apply good governance practices. Outsourcing is no stroll in the park and there have been several high-profile failures where the wrong processes have been outsourced to the wrong areas. A good supplier will eliminate these difficulties and the chances are if they are a global service provider, they will be able to select the best talent at the best locations for the required tasks. Companies shouldn’t be afraid to scrutinise the security and confidentiality provisions when choosing a supplier. They should also be looking for a proven track record of quality service delivery, guaranteed service level agreements, highly-trained staff and state-of-the-art facilities.
The key is to outsource, but to be able to manage and track the progress of your outsourced work. Many service providers have procedures in place that guarantee the highest levels of client confidentiality and professional delivery. These will also enable real-time workflow delivery, enabling executives to monitor the quality of their services for a fraction of the usual time.
What does this mean for your business?
Setting up an outsourcing programme takes time, but compared to hiring a new department or multiple numbers of specialist legal staff, the process is quicker and easier to manage. It’s also more economical and makes you more agile in the market, enabling you to upscale or downscale as required. For the IP world it holds real advantages as volumes increase and skilled professionals become harder to source. Businesses should look at their current set-up, check their financial position and choose a provider with strong sector experience and a reliable reputation.
The emergence of the outsourcing industry has provided a much-needed support network for busy companies seeking to retain their competitive edge. The question is now is no longer whether to outsource, but what to outsource and to whom. CPA’s Rob Stichbury examines the options
Although outsourcing is not a new concept, the industry has experienced a period of phenomenal growth in recent years, as busy companies increasingly turn to external providers to fulfil highly administrative or poorly served functions of their business. And, as the industry has evolved in size and expertise, so too has the nature of the tasks that are being outsourced. Today’s companies are not just looking to outsource business processes, such as back-office functions, call centres, human resources and IT (Business Process Outsourcing or BPO). Based on its success, they’re also turning to off-shore providers for Knowledge Process Outsourcing (KPO) and Legal Process Outsourcing (LPO) like paralegal work, as the race for cost savings has given way to the race for top skills.
A helping hand
So, does LPO work and is it suitable for the IP industry? The simple answer is yes. In our fast-paced industries, businesses need to strive for continual innovation in order to ensure competitive advantage. Without back-end support, such progress would not be possible. The hunt for competitive advantage translates into greater legal, particularly IP, activity. That’s not just in the number of patents that companies seek to register and protect, but also in the trend to actively ‘farm’ patent estates. Without external help managing the administrative side of the IP work, few corporations would be able to keep up with or afford to properly develop their IP portfolios.
IP currently accounts for over 45% of the LPO market and is expected to lead the growth in this sector in the next three to five years. The service mix already includes basic IP services, such as proofreading and paralegal support, but as low-end IP administrative tasks are outsourced with success, companies are electing to off-shore more complex tasks to trusted suppliers. They are leveraging the experience and talent off-shore to improve processes, and apply the benefits of scale and technology.
An increased emphasis on merger and acquisition (M&A) activity since 2004, has provided part of the reason for this growth. IP due diligence is fundamentally important in all M&A activity, and increasingly in private equity and venture capital deals. This has big implications for IP departments as it also generates large volumes of work in tight timeframes, distracting staff from otherwise core activities. If forced to manage the work internally, companies are faced with increasing costs, backlogs and delays in work, and compromises in the quality of the work being produced.
The rising cost of office space, the scarcity of skilled staffing in the developed world and the challenge to manage the peaks in workload all put pressure on a company’s bottom line. LPO has enabled companies to increase productivity and capacity, to achieve scale and bandwidth to operations. It also satisfies board pressure to leverage IP and keep costs down, while still maintaining (or even improving) quality of work.
The growth in worldwide patenting activity over the past decade has also meant that national patent and trademark offices are struggling to keep up with the speed of innovation. In 2005 (the most recent data available), the European Patent Office (EPO) had 119,800 patent searches pending, and this figure is due to grow by 24% each year. Similarly, in 2006, the US Patent Office (USPTO) revealed details of a backlog exceeding 700,000 patent applications and the situation looked all too familiar at the Japanese Patent Office (JPO) in 2005, when its backlog hit 790,000. At that point the JPO took action and outsourced 25% of its prior art searches to help get back on top of the escalating workload. The move to outsource and increase capacity at the JPO was welcomed by industry, too, since application delays can mean that precious patent licensing opportunities are lost.
In such an aggressive environment, outsourcing is no longer a choice – the question is not whether a business should outsource, but instead, how best to do it: ‘We all know that outsourcing is not just about cost take-out any more. Done right, outsourcing will make your organisation more nimble, more agile, and more competitive.’ (Kevin Campbell, 2007 group chief executive – Outsourcing, Accenture.)
Choosing the right partner
Ultimately, it is the importance of quality, not cost, that is driving growth in the LPO marketplace. That’s why companies looking to off-shore or outsource key tasks should be looking for an experienced partner that is able to assure quality of work, as well as manage risk, guarantee data security, export control, interoperability of data and smooth transfer of work.
In the IP industry in particular, there is now also a growing trend towards multi-sourcing and multi-shoring, where corporations and law firms select not to outsource a variety of in-house tasks to one expert supplier or global jurisdiction, but instead select the best (or most innovative) supplier or the best jurisdiction for each task. Better still they find a supplier that has the breadth and scope to provide the appropriate specialist multi-discipline expertise and a multi-shore option. IP service providers work on a variety of levels, but aside from CPA, there are only a few companies that can actually provide the global multi-faceted approach to LPO that most businesses need.
At the very basic level, businesses should be outsourcing non-core and lower-value activities, leaving in-house staff to focus on their core value and added-value activities to drive earnings growth. Working on the concept that highly trained, outsourced IP specialists can lift the burden of managing the IP prosecution process, many law firms are also now choosing to off-shore more key IP tasks. Clifford Chance is just one example of a global law firm that has chosen to partner with an India-based outsourcing company to manage its key financial services. US-based Schwegman, Lundberg, Woessner & Kluth (SLWK) is another, but it chose to establish its own captive IP-outsourcing company in 1999 to achieve this.
There were practical reasons for setting it up in India, explains Steve W Lundberg, founding partner: ‘In the late 1990s, there was a labour shortage in Minneapolis (home to SLWK’s first office) of qualified personnel to do certain functions like proofing and lower level case management.’ Tapping into the bank of talent in India allowed the firm to increase capacity, improve cycle time and retain complete control, all without sacrificing quality or security. And, as corporations become more wary of the hourly charge of legal counsel, IP outsourcing also provided SLWK with the opportunity to pass on cost savings to its clients – a benefit that few competitors could provide at the time.
Sidestepping the pitfalls
Be sure to use an already existing and experienced supplier, the same rules apply to outsourcing as they do to any key business task: focus on quality, implement robust processes, certification, security and risk management practices, and apply good governance practices. Outsourcing is no stroll in the park and there have been several high-profile failures where the wrong processes have been outsourced to the wrong areas. A good supplier will eliminate these difficulties and the chances are if they are a global service provider, they will be able to select the best talent at the best locations for the required tasks. Companies shouldn’t be afraid to scrutinise the security and confidentiality provisions when choosing a supplier. They should also be looking for a proven track record of quality service delivery, guaranteed service level agreements, highly-trained staff and state-of-the-art facilities.
The key is to outsource, but to be able to manage and track the progress of your outsourced work. Many service providers have procedures in place that guarantee the highest levels of client confidentiality and professional delivery. These will also enable real-time workflow delivery, enabling executives to monitor the quality of their services for a fraction of the usual time.
What does this mean for your business?
Setting up an outsourcing programme takes time, but compared to hiring a new department or multiple numbers of specialist legal staff, the process is quicker and easier to manage. It’s also more economical and makes you more agile in the market, enabling you to upscale or downscale as required. For the IP world it holds real advantages as volumes increase and skilled professionals become harder to source. Businesses should look at their current set-up, check their financial position and choose a provider with strong sector experience and a reliable reputation.
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