Legal Process Outsourcing: What Options Does Your Firm Have?
Outsourcing legal processes can make your firm more effective and efficient. Learn how to choose the right tasks to hand off.
Outsourcing is becoming increasingly commonplace at U.S. law firms. According to a recent Thomson Reuters survey, roughly two-thirds of firms outsourced at least one role in 2022.
Cost savings are a major driver of this growth in legal process outsourcing, especially with the rise of artificial intelligence (AI) and other automated tools that can save time and conduct legal support work more efficiently. Yet, the decision to outsource demands careful consideration of which tasks to hand off — not to mention the potential risks involved. Involving a third party can unlock productivity for your firm, but only if you choose the right provider and jobs.
Would your firm benefit from offloading key roles or utilizing new technology to streamline workflows? Let’s look at the details of legal outsourcing to find out.
What Is Legal Outsourcing?
Legal process outsourcing (LPO) is the practice of transferring legal tasks or support processes to external vendors or service providers. By doing so, law firms can reduce costs, increase efficiency, and access specialized expertise that may only be available from third-party vendors.
For instance, a small firm might use legal outsourcing services to handle some of its case research or the process of drafting and filing court documents. In addition, new technologies like legal transcription software or client intake services can automate various legal processes that are otherwise time-consuming and expensive.
Outsourcing vs. Offshoring
Outsourcing legal operations is often confused with “offshoring,” but these are distinct concepts. Offshoring involves moving all or a portion of a business’s operation overseas to leverage cheap labor, while outsourcing typically involves hiring crucial support tasks out to external service providers that can handle those jobs more efficiently. These outsourced providers may be located in the same country or overseas — the deciding factor is their ability to do the job effectively.
Offshoring comes with a more extensive list of obstacles and pitfalls, from language barriers to increased data security risks. In general, outsourcing legal processes allows for more control as to which processes stay in-house and what protections are in place.
Legal Service Outsourcing Options
In today’s marketplace, law firms can outsource a range of tasks. Some of the most common legal services examples that are ideal candidates for LPO include:
- Legal research and writing
- Document drafting and filing
- Paralegal services
- Contract drafting, review, and ongoing monitoring
- Meeting and deposition summaries and other legal transcriptions
- Patent and trademark filings
- Automating client intake processes
- Calendar management and scheduling
- Accounting and financial services
- Marketing and lead generation
These tasks (and more) can be outsourced to humans, AI, or a mixture of both. Rev’s VoiceHub, for instance, offers legal transcription services with AI or AI+human options, depending on the level of accuracy and speed required.
How to Determine What to Outsource
On paper, your firm may technically be able to outsource a long list of tasks — but that doesn’t mean it should. The real art of outsourcing is choosing the jobs that will bring the most cost savings or efficiency gains without introducing unnecessary risks.
To decide what legal services to outsource, consider which tasks your team spends too much time on and how that time could be better spent. Routine or repetitive tasks like document review, research, transcription, or client intake may consume large swaths of time without adding much value to your bottom line.
Repetition isn’t the only consideration, though. Some specialized tasks, such as patent filing or dealing with regulatory compliance, may require expertise that’s expensive to keep on your payroll. Perhaps you’ve always had a court reporter on your team, but you could outsource that task to a digital court reporting service, for instance. Look for opportunities to focus on what your firm does best while maintaining essential legal services through LPO.
What to Look for in a Legal Partner
When considering a partner for legal process outsourcing, the most important question is whether the provider has the expertise and/or tools required to do the job effectively and efficiently. How that’s defined will depend on the task(s) you’re looking to outsource.
Offloading compliance-related tasks, for instance, requires a different set of skills and certifications than outsourcing transcription services. For the former, you’d want to ensure your service provider has a deep understanding of any regulations that apply to your firm or your clients. For the latter, you can look to an affordable tech solution like Rev, which boasts some of the highest accuracy automated speech recognition (ASR) in the business.
Regardless of which tasks you’re outsourcing, you need partners that put security first. Client confidentiality is a top priority, and LPO service providers should meet or exceed your own security standards to ensure all data remains safe.
Be sure they’re willing to sign any necessary non-disclosure agreements and have all the required certifications to guarantee top-notch security. Rev’s legal transcription services, for instance, adhere to the highest security standards in the field, including HIPAA, SOC 2 Type II, GDPR, and ISO 27001 compliance.
Benefits and Drawbacks of LPO Outsourcing
Outsourcing legal services offers numerous advantages for legal firms. However, it’s important to consider a few potential disadvantages of delegating critical tasks to third-party vendors or technology. Understanding the pros and cons of LPO can help you choose the right tasks and partners for the job.
- Benefits:
- Cost savings: Offloading specialized or time-consuming tasks can help your firm save time and limit payroll costs.
- Access to expertise: Many LPO service providers focus on legal tasks that require deep expertise or specialized skill sets that aren’t practical for small firms to provide in-house.
- Better time management: Lawyer burnout is always a danger in the legal profession, and outsourcing can keep your attorneys fresh by minimizing the extra hours spent on repetitive and draining tasks.
- Drawbacks:
- Risk exposure: Sharing firm and client data with a third party introduces additional security risks. It’s vital to ensure outsourcing providers have proper protocols and certifications. Learn more about risk mitigation practices on our blog.
- Quality control questions: Not all providers will adhere to your specific quality standards, and this may introduce additional in-house work when you need to correct mistakes. Do your due diligence and probe a vendor’s quality control practices before handing off any tasks.
- Loss of in-house expertise: Moving niche tasks outside your firm may reduce your internal knowledge base, so it’s critical to choose your outsourced tasks carefully. If a specific area of expertise is central to your client base, think twice before shipping it out.
The New Legal Normal
Technology is reshaping the LPO landscape by enhancing efficiency, reducing costs, and increasing the accuracy and scope of outsourced legal services. AI, in particular, can help lawyers accomplish a wide range of tasks more quickly without sacrificing accuracy.
Machine learning algorithms can help predict case outcomes or suggest strategies, while natural language processing enables tools like Rev to produce legal documents and transcriptions faster than ever. Virtual assistants are even available 24/7 to assist with a range of legal tasks.
That’s only scratching the surface of what technology brings to the table with LPO. IT outsourcing for law firms can help with tasks like data backups, cybersecurity, document automation, contract management, and more.
From Outsourcing to Optimization With Rev
Efficiency has never been more central in the legal industry. To meet their clients’ evolving needs and expectations, today’s law firms must be laser-focused on their essential services — and offload the rest to support services that can do the job more effectively.
Rev’s VoiceHub is more than just a legal transcription service. Its built-in AI can quickly summarize your transcripts, provide time-stamped answers, take notes, bookmark important moments in meetings, and more.
Download our latest whitepaper on optimized firms to learn how Rev can help you accelerate and improve your firm’s most important tasks.
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