In a post yesterday on the blog of Hildebrandt International consultants, law firm strategy expert Kristin Stark notes that the resistance of some law firms to legal process outsourcing (LPO) represents "a lost opportunity," when their frustrated clients resort to contracting with LPOs directly. Stark points out that, by contrast, progressive law firms that are "forming active and complementary partnerships with LPOs" are "market leaders" that are "enhancing the range of services offered, securing the closeness of their client relationships, and providing clients more cost effective services." Here's an excerpt from Stark's post:
"Despite client encouragement to pursue and pass along cost savings opportunities by partnering with LPOs, many law firms have avoided developing such relationships. Other law firms have sought to build this capability internally, developing a law firm centric approach to offering discovery, litigation support, and other high volume legal services.
However, as observed in a number of our client interviews with GCs of major corporations, law firms’ unwillingness or inability to successfully partner with LPOs and pass along the associated cost savings has driven increasing levels of client frustration. In the American Lawyer’s March 2010 edition, Irene Plagianos discusses the growing trend of clients taking matters into their own hands - developing direct relationships with outsourcing firms and cutting out the law firm ‘middleman’.
This substitution of outsourcing firms for law firms represents a lost opportunity for law firms. By resisting clients’ interest in pursuing such partnerships, law firms jeopardize client relationships and fail to provide clients with the superior value and service they seek.By contrast, particularly progressive law firms view outsourcing firms as a complementary service offering and a means for proactively addressing client service needs. By forming active and complementary partnerships with LPOs, these market leaders enhance the range of services offered, secure the closeness of their client relationships, and provide clients more cost effective services."
This dovetails with our own legal outsourcing / LPO experience. But we should add that we've seen law firms not only maintain clients, but get many new ones, by partnering with LPOs. These forward-looking law firms increase rather than decrease their revenue, by positioning themselves in the all-important market for enhanced value in the delivery of legal services.