A new partnership between a US law firm and an LPO provider may provide a solution for law firms in a rapidly changing legal landscape.
The LeClairRyan UnitedLex partnership represents 'out of the box' thinking - especially in the US legal sector. With all the talk about the rise of NewLaw, it is good to see another example of scale emerge that challenges the traditional law firm and LPO models. On the twittersphere, It was very aptly tweeted by Last Honest Lawyer “BigLaw or New Law? The winner may be BetterLaw”.
Some may comment that we are just seeing yet another law firm form a relationship with an LPO provider but it looks like there may be more here than what we have seen before in the US legal sector both in terms of scale and how this relationship is structured. While it is too early to speculate on exactly what the structure of the relationship is or what issues it will trigger it is clear that this is more than just a traditional law firm/LPO outsourcing deal.This announcement comes at a time that there has been a lot of talk about law firms trending towards setting up captives (setting up your own) and the scope for outsourced relationships of scale with law firms being limited.
Drawing parallels with other sectors that have used shared services for years you tend to see an initial trend towards captives that moves to a blend of captive and outsourced models as the sector matures. This is another example that indicates the legal sector appears to be following this trend.We have seen a lot of law firm captive shared services activity in the legal sector globally over the last few years starting with Baker & McKenzie, Orrick and Clifford Chance with a few blended outsource/captive models emerging such as A&O which has setup a captive centre in Northern Ireland but still engage the services of its panel of LPOs primarily for Litigation Support Services. The vast majority of the LPO/Law firm relationships, even the most collaborative of which, have been arms length traditional outsourcing relationships.
In the recently published Legal Outsourcing Guide in the article ‘LPO: Next Generation’ it was noted that "we are seeing signs that the legal sector is starting to move into the next phase of maturity. As an integral part of this sector, LPO is evolving into a service model that combines all the key components of sector focus, experienced client centric and collaborative leadership, analytics, talent, project/process management and technology enablement. The maturing service model will focus on integrated service delivery to drive macro organisational value as opposed to merely a separate entity that executes discrete (disaggregated) workflow components (for example document review or contract abstraction) at a low cost.”
The LeClairRyan and UnitedLex relationship may just prove to be one of the examples of this maturing service model. Rather than traditional legal outsourcing or investing in an in-house centre LeClairRyan has opted for a partnership with UnitedLex. This is a relationship that Legal Process Outsourcers have been trying to convince law firms of the benefit of for many years.
LeClairRyan will use UnitedLex’s technology and existing infrastructure, helping the law firm to improve efficiency and better manage costs while avoiding the risk and uncertainty of having multiple vendors involved in a project. While the bulk of the work to be done by the centre appears initially to be litigation document review the firm has stated that it intends to also use the centre to support transactional work such as due diligence.
Amongst the challenge LeClairRyan and UnitedLex will face in implementing this will be the change this brings to how the LeClairRyan lawyers work and ensuring the relationship remains the partnership they intend it to be and not to degenerate into a vendor supplier relationship.
Time will tell if they overcome this and if this does in fact emerge as a good example of “BetterLaw." However, we can be sure, as our clients look to see how legal service providers help GCs navigate the new reality - with integrated end to end solutions, this is likely to be the first of a number of new innovative relationships. Exciting times are ahead.