General Practice, Solo & Small Firm Division

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Law Trends & News

Practice Area Newsletter

American Bar Association - Defending Liberty, Pursuing Justice

FALL 2009

Vol. 6, No. 1

 

PRACTICE MANAGEMENT

 

Seven Questions You Must Ask When Choosing an LPO Provider

Legal process outsourcing (LPO) can provide exactly the agility a small firm or solo practitioner needs, making it possible to service as many clients as come through the door without paying unnecessary overhead or getting wrapped up in extensive administrative responsibilities. Outsourcing can improve return on investment, eliminate worries about absenteeism and productivity, reduce training and administrative burdens, and shift responsibility for employment taxes, insurance premiums and the like to an outside provider.

Last year, the American Bar Association Standing Committee on Ethics and Professional Responsibility explicitly acknowledged the value of outsourcing in a formal opinion, removing any lingering doubts about whether and how outsourcing could be conducted ethically. But deciding to outsource is only the first step. Whether or not outsourcing is profitable, whether it saves time or creates additional frustrations, whether or not ethical concerns arise—in general, how beneficial outsourcing can be to your law firm—depends on choosing the right provider for your needs. Choosing the right LPO provider means asking the right questions, of prospective providers and of yourself and your staff.

Does the LPO Provider Have the Right Subject-Matter Expertise for Your Practice?

One of the primary purposes of outsourcing is that it takes training and administration off your plate. Of course, you’ll be reviewing the work product of your LPO provider, but if you’ve found the right provider, you won’t have to provide extensive direction in the specifics of your practice. If working with an LPO provider is labor-intensive and requires extensive feedback, much of the benefit of handing off those tasks will be lost. Ask specific questions to ensure that the staff who will be working on your cases have the specific training and experience necessary to work effectively in your practice area.

Who Is Actually Handling Your Work on a Day-to-Day Basis?

When a company is trying to win your business, you’ll see the best and the brightest. But the principals you meet with to close the deal aren’t going to be personally handling your cases. The people you usually don’t meet during the selection process are the most important when it comes to the quality of service you’ll receive, so make sure you know who they are. Before making a decision about the provider, find out what kind of training is provided to the people actually processing your work, where they’re located, what credentials are required and what kind of supervision they receive.

How Does the Process Work, From Beginning to End?

Make sure to establish clear expectations about what you are expected to deliver to the LPO provider, through what channels and in what format. And, of course, know what you can expect in terms of turnaround time and the final product. Further, remember that you have an ethical obligation to ensure that the work is handled competently and professionally, and that your clients’ confidentiality is adequately protected. Know exactly what happens to your file, and who it passes through, between the time it leaves your hands and the time the finished product is returned to you for review.

How Transparent Is the Process?

Find out whether your case file goes in one end of a dark tunnel and comes out the other, or whether you’ll be able to observe the work in progress. Again, consider your ethical obligation to supervise work handled by non-attorneys and make sure that you have access to do so effectively. Some technology-enabled providers offer real-time access to documents and progress notes, so that you can monitor work-in-progress just as you would in your own office. In fact, virtual monitoring can be easier than in-office monitoring, if your provider offers one convenient location where you can track all of your cases.

What, Exactly, Are You Getting for Your Money?

LPO serves many purposes, not the least of which is to allow you to adapt on the fly to fluctuating support needs. In the end, though, the bottom line is your bottom line. Find out exactly what tasks the provider will be taking off your plate, and factor in any added time investment required to work with the provider. Then assess the value of those services in terms of both time and money: know how much staff time you’ll be freeing up, what costs you’ll be saving, and what opportunities those savings open up for you. Outsourcing might increase your profits on a per-case basis. On the other hand, it might lower per-case profits slightly but allow you to handle a higher volume of cases with the same time investment. Either way, know exactly what the return on your investment will be and how to make the most of it before making a decision about which pieces of your process to outsource.

What Is the Range of Services Offered by the Provider?

One of the key benefits of outsourcing should be flexibility; as your needs change, you can increase or decrease your use of outside services, so that you’re not paying for help you don’t need or, alternatively, finding yourself short-handed at critical times. Whether the change in your need for outsourcing is caused by variation in your caseload or changes in your human resources (i.e., staff vacations, extended absenteeism, turnover), you should have the flexibility to shift your reliance on the provider. Make sure that your provider offers a broad enough range of services to adapt to your growing and shifting needs.

How Flexible Is Your Contract?

Once again, the name of the game is adaptability. Outsourcing can save you from unnecessary overhead and allow you to pick up speed quickly when your caseload increases significantly, but only if your provider is prepared to make quick changes to accommodate your changing needs. Not only do you need a flexible agreement, but assurances that your provider has adequate staff and processes in place to keep pace with your workload as it ebbs and flows.

With the right research and planning, outsourcing can improve law firm return-on-investment, free up staff time to handle higher level tasks, and allow easy adaptability as your firm grows or business fluctuates. But, as in any other area of your business, jumping in without complete information can lead to wasted time, wasted money, and unexpected frustrations. Taking the time to gather the right information up front may well determine the value of your LPO experience.

 

Kevin Chern is the president of Total Attorneys, Inc. in Chicago ( http://www.totalattorneys.com/). He can be reached at kevin@totalattorneys.com.

 

 

© Copyright 2009, American Bar Association.