Unlike those more conventional services which often times have easy to validate Key Performance Indicators (completed processes, error rates, accuracy rates and so on) LPO is a bit more tricky to asses.
Depending upon which tasks is being outsourced the validation of Key Performance Indicators is usually not an obvious solution. After all, discovery documents being improperly prepared or reviewed will often times only show up months later as a potential problem.
As such LPO has been existing in a bit of a vacuum..law firms use it more and more but no one really knows much about whether it really works.
The fact that law firms are usually privately owned makes it even more difficult to asses if LPO is one of the methods employed to successfully reduce their expense ratio. Transparency is just not a high priority when it comes to dealing with attorneys.
An interesting insight into the validity of LPO was provided through a survey conducted by Corbin Partners and Taran Virtual Associates. In the survey about 250 Canadian law firms and attorneys were asked if they were using LPO and if so, what their satisfaction rating was with the services provided.
The survey provides a rather interesting viewpoint of the Canadian legal industry. It established that
40 % of respondents said they use LPO currently.
Out of the 40 % who use the service the breakdown of services utilized was (multiple selections were possible):
- 51 % use the service for legal consultations and opinions
- 37 % use it for agency services
- 37 % use it for trial and appellate work
- 36 % use the service for legal research
- 28 % use it for clerk and paralegal support
- 24 % use it for document review and discovery
The most important takeaway from the survey though was the level of overall satisfaction. Of those who were currently using LPO:
45 % reported that they were very satisfied with the service
41 % reported that they were somewhat satisfied
9 % reported they were neither satisfied or dissatisfied
5 % reported that they were somewhat (3%) or very dissatisfied (2%) with the service
Only 5 % of the respondents reported dissatisfaction with the service. This makes it clear that LPO is here to stay.
Considering that 60 % of the respondents in the survey did currently not use the service it seems that the industry as a whole has some room to grow.
If you consider that the providers of LPO services will continue to perfect their processes it seems plausible that they will also work themselves deeper into the law firms over time.
A provider might start out with just discovery as the outsourced process but there should be a good chance that over time more and more functions will be turned over to the LPO provider.
Judging by the results of the survey LPO is here to stay and business should be good for the industry in the years to come.