Balfour Beatty to press firms on outsourcing in UK adviser review

Balfour Beatty is set to review its roster of UK legal advisers, with the construction giant planning to ramp up its use of legal process outsourcing (LPO).

David Mercer, general counsel of Balfour Beatty’s UK construction services division, is leading the review, with the process being overseen by global general counsel and company secretary Chris Vaughan, who joined in 2007 from SABMiller.

One of the main aims of the review is to reach individual outsourcing agreements with panel firms for low-cost, repetitive work, with firms likely to be free to choose their own outsourcing option rather than being forced to use a specific outsourcer.

The shake-up is also intended to cut costs and increase efficiency, by asking law firms for alternative billing initiatives and value-added services such as training.

Vaughan said: “We are at the start of a process to review the provision of legal services across the group, and outsourcing will be one of the options which we will be considering, in all its guises.”

Balfour Beatty instructs 24 law firms worldwide, with six core firms on its UK roster, including Linklaters, Berwin Leighton Paisner, Pinsent Masons and McGrigors.

One adviser said: “The motivation for the review is to cut costs, and law firms need to respond by developing innovative outsourcing initiatives. LPO is on its way in, and there is nothing we can do about it, but being able to supervise our own outsourcing is the lesser of two evils.”

The news comes after Legal Week’s research arm, Legal Week Intelligence, published a report in association with Integreon, showing in-house lawyers are twice as likely as those in private practice to prefer the use of a single LPO provider, rather than using different approaches with different firms.

Click here to download the report from Legal Week Law.