The State of Sourcing

Having done a report earlier on e-discovery and document review, which is by far the most outsourced service in the legal services outsourcing domain, our next stop was most definitely going to be outsourcing of contract management – the next big thing in outsourcing of legal services. As we started speaking with the people who deal with contracts, some of the variations and facts that came out were mind boggling. Here are some examples –

• Contracts may need up to 5-10 drafts by conservative estimates
• Contracts may need up to a year to finalize
• Contract values range from USD 10 – 1,000 million
• Hundreds of types of contracts
• Legal team sizes ranging from 6 – 1000+
• More than 40 countries across which contracts are managed by a single firm

Continue reading ‘Contract outsourcing – outsource to manage better’ »

Early last week, as I put the finishing touches on my report, “Obamacare: Outsourcing opportunities in revenue cycle management”, a social media group member put out a request for recommendations on medical coding certification programs’.  On checking out, the member came highly recommended and worked in the US healthcare industry for several years, but had been recently laid off. The post echoes the sentiment among experienced healthcare professionals who have either lost their jobs (due to medical technology) or are looking to move into the highly lucrative coding and billing industry.

Continue reading ‘Obamacare does not result in job cuts!’ »

At the recent Global LPO conference 2010, held in New Delhi, the idea was to facilitate closer contact between buyers and vendors in the industry. The buyers spoke about their experiences and put forth their concerns. The vendors building upon experiences, offered advice to the potential buyers on how to approach, what to look out for, the value offered, etc. Among many other issues discussed, one that received attention from various speakers was – what do buyers and vendors need to do to facilitate a smooth and mutually beneficial relationship? 

The need to change and develop is something that cannot be stressed enough. For an industry as young as the LPO, and with the potential that it offers, the mantra is going beyond understanding customer needs. LPOs must stay ahead of the articulated needs. With most companies looking at outsourcing as a strategic move, they want it to contribute to their overall business performance. Outsourcing by and large has moved beyond the cost and labor arbitrage, and the same stands true for LPO industry. The idea is to move away from the tag of service providers to partners. Here we discuss just some of the many initiatives that LPOs need to take to start thinking and taking on the role of partners. 

Continue reading ‘LPOs need to think like partners’ »

- WNS was one of the early BPO entrants in the LPO industry.
- Infosys entered the LPO industry about two years back and currently has a team of 500+ employees in their LPO division.
- Wipro BPO made its presence in the industry around the same time as Infosys and has more than 100 employees in its LPO division.

In addition to these companies, several others such as OfficeTiger (one the early entrants), EXL, Caliber Point have entered the LPO industry. More recently, Accentia Technologies Limited, a BPO provider announced its decision to jump into the LPO industry. The company is scouting for acquisitions to enter the LPO industry.

Continue reading ‘BPOs in the LPO industry?’ »

This week, Integreon bagged a 10-year contract worth £582 million from CMS Cameron McKenna. This is a huge gain for the LPO industry. Not only has the industry started seeing larger contracts but also longer term contracts.

Law firms and corporations have mostly restricted their outsourcing contracts to smaller and short-term contracts/assignments. However, lately the legal offshore market is witnessing a gradual change in terms of the size and tenure of contracts.

Established service providers such as Integreon, CPA Global, Pangea3, and UnitedLex have reported longer-term contracts in the last six to eight months. British Telecom shifted work from its captive legal services center (located in India) to UnitedLex. Microsoft signed a contract with Integreon for legal support services. Integreon will provide contract review and offshore document review services to the software giant from its India and Fargo centers. Integreon won a seven year contract worth £50 million from UK based law firm Osborne Clarke. Rio Tinto, a leading international mining group based in the UK awarded a contract to CPA Global.

Continue reading ‘Larger and longer term contracts for the LPO industry?’ »

The year 2006-07 saw large BPOs jumping into the LPO business. Now, its Indian law firms! There has been a visible increase in the interest level of Indian law firms in the LPO industry, over the last few years. Interestingly, over the last two years, about 15+ such LPOs joined the industry. Established players like Bodhi Global, Klexserve are some of the law firm backed service providers serving international law firms and corporations. Relatively newer companies like Lexplosion, Lexedge, Legal Circle, are attaining size and expanding their client base.

LPOs backed by law firms have the advantage of domain expertise from their parent company. These service providers are not only eyeing the international clientele (of their law firm), but also looking to leverage on the domain knowledge of their parent firm to serve the domestic (India) market.

Continue reading ‘Indian law firms eye LPO business’ »

British Telecom (BT) recently announced its decision to shift work from its captive legal services center (located in India) to UnitedLex, a leading LPO. Another gain for the LPO industry! According to a press release issued by UnitedLex, a team of 15 professionals from UnitedLex will provide commercial contracting and antitrust regulation services to BT legal teams in UK, US, India, Singapore and Hong Kong. Founded four years ago, UnitedLex employs 550 lawyers globally, with a majority located in India and the some based out of the US and Israel.

Five years back, BT decided to withdraw their legal services work from outside counsel and start an in-house unit. Currently, they have about 500 people spread across the globe offering legal support services to the BT operations along with a 15-20 man team operating from Gurgaon, India.

Continue reading ‘Captive no more…’ »

How do you handle data privacy issues in India? In the absence of data privacy/protection laws, isn’t this a huge risk associated with offshoring? – These were some of the concerns raised by the attendees at a recent conference organized by the India Chapter of New York State Bar Association (NYSBA) in Mumbai.

Clearly, there were apprehensions on the part of most of the attendees with respect to data privacy. The level of confidence was understandably quite low. The reason it is understandable is because data privacy is a valid concern, given the lack of stringent data security and privacy protection laws in India. The Indian legal system does not offer privacy protection similar to other countries.

Continue reading ‘Data privacy: are we addressing this concern?’ »

“Some of the service providers that I have visited have invested a lot of time, effort and money in data security. However, there is still a factor of risk associated with offshoring that will be overcome only with time”, according to a Managing Attorney from a New York based law firm in response to a query on whether buyers have adequate confidence in data security initiatives of offshore service providers.

In spite of the fact that India has enacted legislations such as the Information Technology Act, data may not always be tamper-proof. This is an area of concern for the buyers of outsourcing services as well as for service providers. With significant increase in offshoring, clients as well as service providers are realizing the need for security/privacy around data that is being processed at the offshore location.

Continue reading ‘Is Your Data Safe with the Offshore Service Providers?’ »

Hiring contract review attorneys, temp staffing companies, litigation support companies – these are the various options available for procuring LPO services within US.

Over the last one year, the legal market in the US witnessed dramatic changes. A large number of attorneys, associates and support staff from the law firms and corporations lost their jobs. While this has impacted the legal market, it has also increased competition for the offshore LPO industry. Some of the lawyers, associates and paralegals (who lost their jobs) are seeking work as contract attorneys (with reduced billing rates!). A contract review attorney is billed at a much lower rate as compared to a law associate. The average billing rates for contract attorneys range from $35 to $80 per hour and onshore service providers rates range from $50 to $180 per hour.

While billing rates vary depending on the services offered, volume and their complexity level, marginal pressure on billing rates (for certain services) in the offshore industry was visible. Of course, the billing rates of onshore lawyers will not be comparable to rates of the offshore service providers; however the increasing competition for offshore LPO service providers cannot be dismissed.

Continue reading ‘Competition from onshore?’ »