Making outsourcing work
We are a London-based team of barristers, solicitors, finance and management professionals. Recently we ventured into the legal outsourcing space as a service provider ourselves initially with just an onshore team in the UK. As the markets shifted with the rapidly deteriorating economic climate and with changes coming in the legal profession we had to keep up with the reforms and therefore engage a bit of creative thinking on the best ways forward for our existing model.
Our company was set up to capitalise on client demand for low-costs legal services initially as an onshore team of qualified solicitors and paralegals in the UK. We knew from the outset that we would target large international firms and corporations. That meant we needed sizeable capacity, which we did not have.
We also wanted the ability to introduce new services quickly and to diversify into other related areas of legal services online. We knew that our expertise lay in industry knowledge, a core team with substantial years of experience in the UK legal and finance industries, marketing, rather than production capacity for large volume contracts onshore at considerably cheaper costs than could be provided onshore. We also recognised that we would need to devote considerable resources to managing customer relationships, since law firms and corporations expect a high level of involvement from service providers.
Pros and cons
We analysed the pros and cons of handling some or all of the work ourselves. Starting an offshore captive facility is an incredibly expensive and complex business. After multiple trips to India, plenty of dialogues with various service providers and extensive research into setting up our own offshore facility, we decided that for the time being insourcing, utilising "wet seats", with a third-party offshore vendor was the best solution.
However, cost wasn't the only consideration. This model would also allow us to concentrate on our core skills and give us the flexibility to introduce new services quickly as well as react swiftly to customer demands. These are major competitive advantages. On the negative side, there were concerns over how much control we would have. We were also worried about becoming too dependent on one or two service providers.
Finding the right vendors is essential to making legal outsourcing work. As well as relying on our industry knowledge, we attended trade shows and conferences, took part in many webinars both as speakers and participants, trawled the internet and analysed market research data. We spent a lot of time with potential vendors, discussing our requirements and getting to know their operations. It took nearly twelve months of planning before we went into full operation. There's a lot of trial and error involved and law firms need to build that into the schedule.
We currently work with multiple vendors, using their different skills and avoiding over-dependence on any single service provider. The key to ongoing success is knowledge transfer. We help them by passing on our industry expertise by way of client-specific training and they repay us by being proactive and coming to us with new ideas.
What would I have done differently? Most importantly I would have clear Service Level Agreements (SLAs) drafted. In the early months, I wasted a lot of time with service providers through mismatched expectations. Now though, we always provide a 'ways of working' document up front that clearly sets out our goals and expectations.
But in conclusion - offshoring can be a life-saver for firms but do take care when you do by exercising due diligence. Most of our outsourcing partners are based overseas, which has worked well. However, we were a bit naïve to start with and should have been more aware of the cultural differences involved. More research would have helped in identifying right strategic partners sooner.
Priya Mukundhan is a former management professional with extensive experience in the banking industry. She is the one of the co-founders of Gryphon Legal