Saturday, July 3, 2010
In case of offshoring the services cross border the organisation do not directly earn. However, the cost of those services in-house looks expensive which encourages its outsourcing. Offshoring can be a symbolic way of export when we consider the savings as also forming part of earning. In this services are off-shored to get the same being delivered at low prices. I am not trying to show the offshoring of jobs but the offshoring of services which technocrat offers to one’s clients.
A very simple hypothetical situation can be used to understand the balance of exchequer between two countries. Country ‘A’ exports various high profile and expensive goods to country ‘B’. In terms country ‘A’ needs to settle the balance of payment with country ‘B’ but the same always remain tilted towards country ‘A’. Country ‘B’ has got an excellent pool of people who can deliver good number of services to country ‘A’. This can be the best way to make up balance of payments as far as country ‘A’ & country ‘B’ are concern. Logically the export of goods from country ‘A’ to country ‘B’ can be matched up by export of services by country ‘B’ to country ‘A’.
Is it the way to conclude that export of services is also near to export of goods.
a) The benefit completely passes to the person directly offshoring the services.
b) Sharing the benefits between the person offshoring the services & whose work is being offshore.
c) Intelligent offshoring:
The offshoring industry has been passing through turbulent times as far as Legal Process Outsourcing (LPO) is concerned. As far as offshoring of calling is concerned, there were no hindrances in its growth. The Business Process Outsourcing (BPO) could grow as the benefit of cost cutting passed only to the organization directly outsourcing the same. There were no constraints on the organization except the primary concerns.
As we talk about Knowledge Process Outsourcing (KPO), its growth was not many folds yet it grew. The reason of outsourcing had been the benefit of cost but constraint came from various angles like lack of growth in the said industry, difficulty in transferring & sharing knowledge based activities. The only part of the KPO industry which could develop consisted of IT offshoring which included developing, maintaining & repairing the software & hardware systems. In a way the growth of IT offshoring catalyzed the birth & growth of Legal Process Outsourcing (LPO).
It can well be understood that the offshoring of Legal & Paralegal services consists of:-
I Offshoring Paralegal Services including Legal Transcription, Filling of Forms etc.
II Offshoring Secretarial Services including maintaining relations with clients, writing letters to them, raising bills etc.
II Offshoring Projects of services like document review etc.
IV Offshoring provisional working of attorneys.
V Offshoring the monotonous part of core Legal working.
All the time the main cause of concern for the law firms & attorneys have been that the offshoring in a way reduces their own billing. The most frequent Question asked to me by attorneys & partners of the law firms from UK & US have been, “CAN I OFFSHORE WITHOUT EFFECTING MY BILLING?” My answer had been “YES.”
Thursday, May 27, 2010
How so ever tough the immigration policies had become yet the immigration continued people have always been finding one or the other ways to travel to developed countries like US & UK. This had always put lot of constraints to their economy, security, culture, religion & other aspects of those countries.
I understand the immigration was the first part of balancing the economies. The next step turned out to be off-shoring of services instead of inviting people to the country. The birth of off-shoring is being deep rooted. The debate between immigration versus off-shoring is yet to commence so it may not be ideal to find any opinion on the same but it will developed once there will be interaction & discussions.
Thursday, March 11, 2010
Despite excellent projections it couldn’t come out of its infancy stage. The proximity of clients and vendors could not increase. Many LPO’s were born like bubbles and vanished identically. All the way it was a good signal to show there was a gap between two ends. The said gap could be bridged if some better means were discovered.
The first level of legal Outsourcing consisted of Captive centers and off shoring of the services to LPO’s.
The Captive Centers started closing down not because of the same were un-economical but primarily due to other problems connected with the working. The stress taken by a company in running the Captive Unit had started becoming a nuisance to them. The very purpose of setting up Captive Unit came under attack whereby its future was sluggish. Though a good number of captive centers have been efficiently working yet most of them could not prove to be economical. Factors like investment, employee attrition rate, changes in Government Policies and day to day running problems discouraged companies to open their Captive Unit.
The mushrooming of LPO’s had put the clients into a saga of disbelief. It had become very tough to settle down with third party vendors. It was inevitable that confidentiality would be bridged and exit policy was tough.
There was a need to find better ways for offshoring legal and paralegal services. The important key points of offshoring decisions include: - The reputation of the company, the non compromising attitude towards confidentiality, keeping control on the working and having cost savings. Law firms of UK / US were divided on off shoring and subsequently about the nature of services to be offshore. The mist had become so heavy whereby the answers could not be found for off shoring while keeping in mind the key points. There came the need of 2nd level outsourcing. The solution to these problems lies in attaining the benefits of Captive Unit at the price of Third Party vendors and this is required to be dealt with “aptly”.
Monday, January 18, 2010
Traditionally, there are two popular modules of outsourcing the legal processes: first through Third Party Service Providers/Vendors (TPSP’s) and/or second by owning one’s Captive Unit in offshore locations. Though both are popular but one cannot rule out the risks and impediments associated with either.
Perceptions on outsourcing legal work to vendors (TPSP’s)
1. No huge capital investments required.
2. Customized solutions.
3. Competitive pricing.
4. Flexibility to scale up and down business relationship.
5. Retains decision-making, therefore relationship with TPSP is clear (fee-based, quality-based).
6. As it is a contract based mutual agreement thereby there is more business commitment.
7. Ability to focus on core business issues.
8. No compromise in quality at cost effective rates.
9. Better process maturity, resource flexibility and economies of scale.
10. Flexibility in deploying new technology.
11. No requirement to hire additional personnel.
12. No legal or statutory compliance issues to set up a new unit.
1. Risk of Confidentiality being at stake.
2. Risk of possible drop in quality standards.
3. Absence of processes to monitor metrics and possible timely intervention when issues are escalated.
4. Tight business margins.
Perceptions on owning a Captive unitPerceptions favoring:
1. Maintenance of in-house confidentiality & quality.
2. Management and retention of control over risk profile, especially for critical business areas.
3. Development for global delivery models with centralized and standardized processes.
4. All investments made on people and infrastructure is completely retained.
5. Better control over processes, time lines & enhanced quality of operations.
6. Alignment of offshore initiatives with their culture & values.
7. Creation of robust technology infrastructure for greater efficiency and scalability of operations.
1. Huge Capital Investments.
2. Recurring Costs.
3. Hassles of incorporating the captive unit offshore like India.
4. Exit impossible without incurring high costs.
5. Compulsion to keep absolute control over processes.
6. Legal Requirements to set-up captive unit, say in India:
i. Incorporation of the Company as a legal entity.
ii. Local registrations.
iii. Bank Accounts.
iv. Appointment of Company Secretaries & Auditors.
v RBI/Government Approvals.
vi. Ensuring legal and statutory compliances.
vii. Local taxation issues.
7. Human Resources requirements of captive center
i. Staffing .
ii. Training & Talent management.
iii. Hiring of Core Team.
iv. Employee retention.
8. Facilities & Infrastructure
i. Vendor Management & Negotiations.
ii. Hardware & Software Procurement Systems.
iii. Communications & Network Integrations.
iv. Acquisition and operationalizing of facilities.
With the aim to revolutionize the LPO paradigm, Draft n Craft has devised the “apt solution” destined to enrich legal outsourcing experience throughout the industry.
For a long time, a desire was felt throughout the industry to transcend to new levels of Legal Process Outsourcing. Without doubt the AptCaptive™ is at present the lex epitome of the legal outsourcing industry. The module however is so ambitious that, in its initial stages Draft n Craft will be offering this to only a limited selected group of companies and law firms.
For any trade enquiries, contact email@example.com.
Tuesday, December 22, 2009
Among the series of Webinars being hosted by Draft n Craft, Rajni Minhas, Assistant Legal Head, held a Webinar on Legal Research Outsourcing: Our means and your ends.
The purpose of this webinar was to question the paradigm shift in the needs, means and results of Legal Research in wake of integrating world. After holistically looking at the intricacies of the service, the webinar aims to understand and analyse the regulatory and ethical aspects of the same.
Topics Covered in the web cast were:
o Legal Research outsourcing Needs
o Multi jurisdiction research
o Legal Research tools & deliverables
o Memo Writing
o Ethical and Regulatory aspects of Legal Research outsourcing.
o Issues of Confidentiality and Quality
o Process Flow
o Pricing the Legal Research
Wednesday, December 16, 2009
This Webinar on outsourcing of Legal Transcription was conducted by Shweta Saini, Head- Marketing, Draft n Craft, on 20th Day of November 2009. The Webinar holistically looked at legal transcription as an important service and the web cast covered :
· Analysis of the ethical and regulatory aspects of Legal Transcription outsourcing.
· Drivers & Risks of legal transcription outsourcing.
· Errors and Omissions insurance coverage.
· Evaluating if there is actually any labor arbitrage possible given the associated risks and negative externalities?
· Evaluating the importance of Contract Excellence.
· Price considerations.
· Course of the work flow.
· Issues of Confidentiality and Quality
· Less Haste, More Speed
This recording of the webinar is a must view for attorneys, in-house Counsels, paralegals, LPO professionals, law students.
Tuesday, July 7, 2009
The day we landed in London, we heard about the tube strike there, would be a lie if I’d say that the news did not dampen my spirits, but as the D-Day came, things just went on as scheduled and planned.
I am extremely thankful to both my speakers Mr. Dai Davis, Partner at Leeds based Brooke North LLP and Mr.Bharat Vagadia, Chief Executive Officer and Consultant at Op2i Ltd, also a Board Director for the UK National Outsourcing Association (NOA). The event was flagged, after that is, by the inaugural speech by my company’s Legal Head, with a very interactive speech by Dai. I just can’t stop myself from appreciating Dai for the instant connect he developed with the audience. I am sure he got such inspired and involved audiences for himself that actually set the pace for our event further. His speech elaborated on the pros and cons of the outsourcing industry in general and followed on to the legal outsourcing industry in particular. I am sure he had the good rate of converting the cons to the eventual pros in the minds of the audiences, that is. Next was a tea and a coffee break, which more than high tea meant great networking opportunity for all the delegates. Danish pastries were great though. Then the event proceeded with Mr. Bharat Vagadia’s speech. I was extremely delighted to have two such wonderful speakers on my panel, wherein one created such pace for the event and the other actually shared his research report with us. The booklet circulated by
Mr. Vagadia amongst the audience was actually the “Outsourcing Survey Report” 2008, conducted by his company in association with others. The report gave a great insight into the outsourcing industry and I am very sure that it will be well treasured by all receiving it.
The event proceeded with my presentation, though a concise one but I tried to elicit and counter the myths regarding the outsourcing as a concept and the industry as a whole.
The day ended with more networking. This was such a significant, inspiring and positive endeavor that it has given me that zeal to plan yet another such event in the near future.
Thursday, March 19, 2009
An old man has beautifully said the hand on the latch of main door controls the outward and inward flow of technology services, jobs, opportunities etc. the decisions which are warranted due to compulsions are not good howsoever economical they may be. The growth of Legal Process Outsourcing industry had put a big question mark on the quantum of outsourcing by solicitor firms. Critic to the LPO raised the issue backed the law firms involved in outsourcing will end up in outsourcing their lawyers out of the firm. They started projecting that it will create a big unemployment in highly skilled and respectable profession of lawyers. On the other hand, outsourcing professionals viewed it differently and claimed it merely as a part of globalisation and win win situation for the providers and outsourcing people. According to them, Legal Process Outsourcing has become necessary and natural due to the different variables of two places and countries.
The outsourcing can be commoditized and compare with different outlooks. An economist might compare it with the usual role of demand and supply. In thermodynamics we describe the flow of energy from one place to another depending upon the variable temperature. The Legal Process Outsourcing had begun with the outsourcing of transcription work similar work had commenced with medical transcription. Slowly medical transcription had grown beyond outsourcing of audio files. The Legal Process Outsourcing has also starting shattering the thin line of outsourcing legal transcription in the beginning. The service industry of developed countries like UK, US found a big support in the growth of Legal Process Outsourcing.
I personally believe lay offs from the law firms were primarily due to their inability to match up the expenses and receipts. They have been charging good amount from the clients and in turn paying solicitors a good amount. As people chose to get the same services at lower rates, the receipt of the solicitor firms fell down and in turn lay off started. Nobody thought of reducing the salaries instead of preferring lay offs. One can easily view; the solicitors already into outsourcing were more capable to match up the receipts and expenditures. Apparently, lay offs are not the result of outsourcing but the net results of fall in profits. A growing organisation cannot lay off people. The misconception spread amongst people needs to be set right. In case of solicitor firms outsourcing works in no way curb them from taking more work. Statistics are clear if a solicitor firm charges US$300 per hour from its clients for a contract review and accordingly pays US$150 to its in-house solicitor. There is a good margin but the same diminishes if the client is able to get the work done from another solicitor firm in half of the rates. But the truth lies in the fact that in case the solicitor firm outsources the work of contract review and the price of US$50 and the in-house solicitor simply vets the work received from the service provider. The client would be happy to pay the US$150 to the firm. In a way firm will also gain by cutting down the cost and marginally passing the benefit to the client.
Monday, January 5, 2009
The recession has acted like a compelling force to make people save in these prime times. People have tried hard to curtail their expenses. The status of solicitors in UK and USA have always remained unblemished and at a dignified position. Their status has always been alluring and attractive because of the confidentiality and quality of services rendered by them. Many business houses started outsourcing their work but the area of outsourcing in solicitors firms remained aloof. The reason of it being so was simple. One may outsource the physical working but none may outsource the ideas, thoughts, intellect and other tactics involved in the profession of the solicitors.
The business of LPO began with the outsourcing of back office support work which primarily consisted of secretarial work. It was further noticed entering into the second category of outsourcing i.e. in respect of paralegal work. It involved working of lawyers to provide good legal research, document review, document drafting etc. It required lawyers who were trained and conversant with the working on the tools. They have been providing a junior lawyer support to the solicitors in UK and USA.
Clients of solicitors based in UK and USA in order to reduce their expenses sought their services being outsourced to some service providers. In turn, the solicitor firms started outsourcing their work to providers in countries like India. This pace of outsourcing got a major push due to recession. The evil of recession has compelled solicitor firms to cut down their cost so as to provide same services at more competitive prices. Significantly, the focus of outsourcing is now tilting towards the legal services in place of secretarial and paralegal services. Legal Process Outsourcing has attained another dimension with the increase in outsourcing of legal work. The reasons for the beginning of outsourcing may be different but the reason of outsourcing the legal services like contract drafting, document review, deposition summary are the outshoot of recession. Recession has proved to be a reason for outsourcing for bigger services from the office of solicitors. There is no doubt that the LPOs have been benefited by the extraordinary growth of software and tools. The availability of software and competent personnel in countries like India has attracted the outsourcing to greater extent. It can be easily visualized that most of the big solicitor firms will have their extended branch offices in India.