Bloomsbury Law Online

Articles filed under Outsourcing

Businesswoman in Cubicle

Success in business

The ultimate marker of a successful business is the strength of its bottom line. Profitability is everything if you want to survive and thrive. The route to healthy profits is maximising income and minimising costs.

You don’t necessarily need us to tell you about maximising income. Revenue generation is your forte, achieved by good marketing to create new business opportunities in the first place, and even better legal service provision and client care thereafter to secure a stream of repeat and referral business.

Your legal software provider can assist in this area by offering solutions containing features such as automation to reduce your workload, application availability for greater uptime, intuitive time recording to capture more chargeable activity and advanced analytics to monitor performance, to name a few. But that’s not the main focus here. We’re concentrating on minimising costs.

Julian Bryan, Managing Director Quill Pinpoint

You can’t be an expert in all areas of your business so it’s important to focus on your strengths. And, even if you are an all-rounder, it’s impossible to do everything yourself within the limited hours of the working day.

Whether the issue is lack of direction or lack of time, there’s one easy solution to these age-old problems: outsourcing.

But, just as you wouldn’t employ a new member of staff without rigorous application and interviewing procedures, you shouldn’t engage an outsourcing provider without careful questioning and screening. Otherwise, how else will you know if suppliers possess the requisite skills, knowledge and experience to service your needs properly?

Our self-help guide poses 10 essential questions to ask before you outsource. These questions are intended to allow you to fully evaluate prospective outsourcing providers before you sign any contract(s).

Outsourcing generally makes the media headlines when a multi-million pound government contract hits the buffers, and we all moan when having to deal with an overseas customer contact centre where the quality of the phone line and the quaint accent of the operator combine to leave us frustrated rather than delighted.

In the legal sector, media coverage of outsourcing has mainly focused on the wave of legal business process outsourcing to countries far and near.

As firms have become more confident in the use of outsourcing, they have extended its use to an increasing number of non-core services, ranging from telephone answering to cloud technology services. This article is concerned specifically with the outsourcing of marketing activities.

Julian Bryan represents Quill Pinpoint

Some of the most successfully run practices are introducing outsourcing as a core component of their business strategy. In direct response to regulatory changes in the profession and competitive movements in the legal marketplace, law firms are increasingly adopting a businesslike management approach, resulting in offloading back office functions, such as cashiering and payroll, becoming increasingly popular amongst business-savvy service providers.

Through outsourcing, firms cease to perform the function in house with their own resources. Instead, they instruct an outsourcing company with notable expertise in the business area to perform the task on their behalf. Outsourced support is usually charged on a variable costs model (more on this later) which adjusts to the peaks and troughs in demand for services, which is proven to be the lowest cost option.

Julian Bryan represents Quill Pinpoint

If you’re a partner in a small practice or a sole practitioner, the challenges of business management take many forms.

First, there’s the likelihood that you’re managing all areas of your practice on top of earning fees. The cost of employing dedicated staff for specialised tasks such as legal cashiering can be prohibitive in terms of recruitment, training, salary and office space fees. Continued financial pressures on the economy as a whole, and solicitors in particular, mean that many small firms struggle to meet the ongoing commitment to direct and indirect costs of cashier employment.

Aside from the financial implications of employing cashiers in-house, actually finding qualified bookkeepers is challenging in itself as there’s currently a shortage in supply of quality legal cashiers.

Many law firms outsource functions such as IT and accounting support regularly and have done so for many years. Since the mid 1990s there has been an increase in the outsourcing (including offshoring) of other support functions such as legal secretarial work and paralegal duties. More recently we have seen firms exploring the possibility of outsourcing actual legal work. I shall refer to all these types of work as legal process outsourcing (“LPO”).

The terms “cloud computing”, “hosted systems”, “outsourced systems” and “Software as a Service (SaaS)” are now used almost interchangeably. All Newsletter articles on these topics are now indexed under “Cloud computing“.

Outsourcing and hosted systems are topics we have covered frequently in the Newsletter over recent issues since we consider that these developments will, over the next few years, transform the legal IT world. Quill Pinpoint specialise in supplying software and (since 1995) outsourced services to legal firms and professional companies.

It would be an understatement to say we live in challenging times and no doubt the next 18 months will continue to be difficult. It is at such times that innovation thrives, whether this is through new products and services or new business models or tweaks to old models. It is likely that outsourcing and in particular offshoring will see continued growth, both in terms of the types of activities being outsourced and the companies contemplating such business practice.

I became involved in offshoring in the mid 1990s whilst practising as a solicitor. The aim at that stage was solely to outsource client firms’ typing and transcription requirements to Indian legal secretaries with a view to achieving guaranteed turnaround targets and at the same time reducing costs. The business worked well because it delivered immediate costs savings to client firms. The last five years have seen a significant growth in the number and types of service for legal firms which can be outsourced. Here are some of them.

If I suggested you set up your own power station to generate the electricity needed to run your legal practice, or set up your own satellite to make and receive telephone calls, you would dismiss the suggestions as fanciful. This is because electricity and telecommunications are utilities that you have on demand through a simple monthly or quarterly payment. Is email really any different?

Whether you realise it or not, you are probably already outsourcing at least some of your IT via the Internet and it is likely that you will be outsourcing more and more in the future. In this short article I will show why it makes sense to give serious consideration to this form of outsourcing, as well as looking at a few of the pitfalls to avoid and (in the end) showing why you probably do still need your IT department.