What's Next for LPO?
Five years ago, hardly a day passed without an article extolling the benefits of LPO and predicting this nascent industry’s transformative impact on the legal profession. Perhaps the news mill is simply tiring of the story, but much of what has been written recently in the legal press has been prophesying the demise of LPO, referencing survey results that appear to show law firms now overwhelmingly engaging in captive operations or that advances in technology are obviating the need for LPO services.
However, when those surveyed come from within private practice, asking them whether their clients prefer captive law firm operations or third-party LPO providers is a bit like asking the turkey where it prefers to spend Thanksgiving. And, as discussed above, given that LPO providers have so readily embraced technology over and above all other legal industry players, technology is unlikely to sound the death knell of the LPO industry any time soon.Although LPO might not these days be the darling of the press, its prospects remain as bullish as ever, if not more so. The LPO industry has matured and transformed over the last ten years, but that journey has, in reality, only just begun. Out of all of the different stakeholders providing legal services within the new legal ecosystem, it is the LPO providers that have the deepest experience deconstructing and re-engineering legal processes using Lean and Six Sigma techniques, applying best practices and flexible resources, and optimizing the mix and utilization of technology. It is the LPO providers that have the demonstrated expertise to analyze which aspects of the work done by lawyers, paralegals and support staff add value and which should be eliminated, automated or delivered by alternative resources. As the rollercoaster of legal services innovation and technological advances continues to pick up pace, not only will LPO providers be along for the ride, they’ll have front-row seats.
Liquid Legal Context
by Dr. Dierk Schindler, Dr. Roger Strathausen, Kai Jacob
Ross takes the widely known sore spots of inhouse departments as his point of departure: (1) how can we get rid of some work (at least manually)? and (2) how can we increase efficiency and cost-effectiveness? Adding the rapidly increasing opportunities created by new legal technology, he describes the ecosystem in which the new type of LPO's can blossom.
Is this a threat to law firms, or is it rather an opportunity as a new player has emerged with which law firms can augment their services? My interpretation of Ross' article is that he thinks it is may be both: If law firms embrace the opportunities that a collaboration with LPO's brings to them, both parties will benefit. However, if law firms ignore the new expectations of clients for a much broader range of managed legal services and push their traditional business model, they might find themselves becoming just one arm of a multitude of services of an LPO, as LPO's benefit from a deregulated legal marketplace.
If Ross' is right, we are looking at a converging legal industry: LPO providers, managed legal services providers and alternative legal services providers are one and the same—essentially new legal market entrants providing innovative, efficient, technology-enabled legal services. This seems to resonate with what we have read from Bassli in terms of the changing inhouse expectations, and it also seems to link into the line of thought Markfort and Meents are pursuing.
It is now time for a “double click” on the aspect of (emerging) legal technology! Is it an enabler and a change agent—or the beginning of the end of lawyers who will be replaced by artificial intelligence? In the next article, Bues and Matthaei will kick off the discussion with an insightful definition of LegalTech.
Mark Ross is an authority on the future of the legal profession and the only person to have been invited to address the ABA, Law Societies of England & Wales and South Africa, the Solicitors Regulation Authority and the International Bar Association on the topic of LPO. He developed the first MCLE and CPD courses on the ethical implications of outsourcing legal work.
Mark is on the Advisory Boards of Suffolk Law School's Institute on Law Practice Technology and Innovation, and Northwestern University Law School's Center for Practice Engagement and Innovation. In 2016, Mark was elected as a Fellow in the College of Law Practice Management.