How will law firms offshore? They can't even make it to Darlington...

First, if we follow this logic, then surely India was chosen in the first place because it was cheapest? This simply isn't true. When the offshoring wave took off, India was riding a massive growth spurt off back of the IT boom. There were a number of competing jurisdictions that offered far greater economies. India was chosen because there was an ability to deliver found, and proven, results there as well.

The same is true of the Philippines.

Secondly, the thought that work delivered offshore is possibly of a lower quality is simply not true.

Third, it does take a fair amount of planning to offshore, true. Once achieved, this breeds long-term gains in terms of process standardisation and knowledge/communication management.

Finally, I'd say its unlikely that the Philippines/India would ever became too expensive for firms in the US/UK to outsource to. If salaries increase, staff become more able. If costs increase, delivery infrastructure becomes better. For example - starting salaries for LPO freshers have gone up by roughly 12% in the past year, so have recruiting expectations and standards... possibly by 30%-40%.

To sum up, there will always be a value difference there, unless currency valuations are drastically overhauled.

Suhasini Sakhare -15 May 2009 | 01:00

Offshore outsourcing of legal support services does provide an adequate service at an eventually lower, though not necessarily lowest, cost base.

It is also quite standardised and relatively free from internal politics and bedevilment, something which is prevalent in many law firms and which can be quite costly and distracting but which should be eliminated.

However, its excellence cannot compare with support staff that directly understand, and are part of, the context or culture of the organisation. Whilst such understanding is not required to produce a document or resolve a simple helpdesk call, it becomes vital when support staff are involved in client-facing aspects of work as is increasing becoming the case. In many law firms a certain level of IT staff need to liaise with client IT staff, document production has to be co-ordinated with the client etc, and indeed such seamless joined-up service should be what the client receives.

And of course there is a message beyond that of ‘cost-cutting’ which the client looks for in terms of brand and values, though I acknowledge that this is diluted in the current climate.

As with many things ‘you get what you pay for’, and some firms have outsourced thoughtfully and well, but when support aspects are regarded as mere ‘overheads’ to be shipped overseas (rather than an intrinsically valuable aspect of the operation) then we are seeing the worst kind of short-term knee-jerk reaction of partnerships to suffering PEPs.

I quite agree with Alex (and many banks who changed their minds) in that there is a place for thoughtful ‘outsourcing’, and whilst it is certainly outside London, it’s not necessarily outside the UK.

Andy Stokes -19 May 2009 | 01:00

I agree with you Andy, if both culture and context are lacking, the service delivery will suffer. This is not inevitable in offshore outsourcing, however.

I think culture can be communicated. Most outsourced providers who support manufacturers provide a seamless cultural experience. Outsourced providers can do this for law firms as well.

As far as context goes, this is a two-way battle, being lost two ways. Clear and complete communication creates context, not proximity. Clear and complete communication requires the receiver to understand the nuances of language thoroughly.

Finally, clear and complete communication is possible only if a common, universal nomenclature makes clear and complete communication viable, with every interaction. Here the legal services industry needs a wake-up call.

To the extent that outsourcing is a necessity, in that it gets the law firm to focus on law, the most economic destination, and not the most proximate one, seems the reasonable choice.

Suhasini Sakhare -19 May 2009 | 01:00