Future of Legal Process Outsourcing in India (LPO)

Ashish M. Shaji

02 Jan, 2021

LPO industry is where in-house legal department outsource legal work from areas where it is costly to perform to areas where it can be done at reduced cost. Legal Process Outsourcing is something that has begun to grow rapidly in India. In this article we shall discuss the future of Legal Process Outsourcing in India.

What work is covered under LPOs?

LPOs cover the following services:

• Legal research;
• Drafting of documents;
• Legal billing activities;
• Intellectual property research;
• Paralegal services;
• Administrative and secretarial activities.

Why is Legal Process Outsourcing in India more preferred?

The Indian legal system is somewhat similar to the UK, US, Europe and Canada. The Indian litigation and dispute resolution methodologies are founded on the classic constitution of India. Moreover, Indian legal system^[1] is one of those that is most researched and informed legislations to ensure a uniform interpretation of legislation.

There are several factors that work in the favour of India. Some of them include the following:

• Time zone advantage;
• Availability of English speaking Attorneys;
• Indian attorneys with US or UK qualifications;
• Familiarity with doctrines of common law;
• Good quality of work done and speed at which services are delivered;
• Most LPOs in India are reportedly staffed 24*7.

The LPO or the LPO industry is something innovative that has come up and its revenues are expected to sky rocket in the coming years. Considering the litigation costs making a huge hole in companies’ pockets, they are looking for methods to control these costs.

Projects viable to be outsourced to India

Well known projects are outsourced to India. Increased amount of office and administrative functions are considered for offshore servicing. Process that can be outsourced include work performed by the Paralegals, legal assistants, professional support lawyers etc. 

It includes:

• Contract review, amendments, proofing;
• Litigation support, preparation of case laws, compilation of client attendance and document;
• Patent and other IPR services;
• General review and research.

Future of Legal Process Outsourcing in India

A US based research firm is of the opinion that LPOs can bring 4 billion dollars and about 79000 jobs in India in 10 years time. On the other hand, the National Association of Software and Service Companies projected LPO providers in India to rise up to 3 billion dollars.

In the year 2004-05, India had earned 6.7 billion dollars by providing services in software, technology etc. India has automatically become one of the natural choice and five of the 20 odd domestic KPO firms have established themselves.

Growth prospects of LPO

More than 200 of the top US companies are looking for offshore locations for achieve savings of 30 to 70%. About one third of the registered professionals presently are providing patent services to European and American clients. These figures are expected to increase in the coming years.

India is expected to achieve considerable growth from what it has achieved until now in the coming years. The global knowledge process outsourcing is expected to reach billions of dollars in future of which more than half would be outsourced to India. Moreover, KPO sector in India may employ numerous KPO professionals also.

From the above figures one can easily deduce the potential growth rate of Legal Process Outsourcing in India. It can fetch numerous jobs in India. Although the LPO industry is still developing and has also faced a number of challenges, its future is that it’s poised to become a major sector of offshore outsourcing in the following years to come.

Future of Legal Process Outsourcing in India: What changes are expected to take place?

The future of LPOs looks to be in the following manner:

• Law firms to go for cylindrical makeover

Law firms in countries like US, UK etc have a pyramidal set up. The cylindrical structure is expected to enhance the productivity and quality of large law firms. It is also expected to make the clients to reap the benefits of smart work culture.

• Competition for talent

With increasing number of Legal Process Outsourcing in India, it has become difficult to recruit the most efficient talent. The efficient attorney’s are short in demand. The cost cutting advantage could also be complicated due to the software advances. In future, if you desire success, it will depend on how you are gonna embrace new technology and how you approach offshore legal services.

• LPOs to add punch to India

As per industry experts, big players are expected to enter this business in the future. May be BPOs entering the business and it would make sense also because the profit margins are relatively higher in LPOs.

Pros and Cons of Legal Process Outsourcing in India

There are both pros as well as cons of LPO in India. We have discussed both of them below:

Pros-

• Cost savings

This is one of the biggest advantages of LPO in India. Organizations can save costs through labor arbitrage which is a means where the wage difference between in-house legal personnel and outside vendors is done to get significant costs benefits. 

• Fixed working hours

The working hours here are fixed from 8 to 9 hours. The standard set in India is from 9 to 7 pm. 

Cons-

• Lack of respect

LPO is somewhat similar to BPO therefore this filed is looked down upon. Normally the lawyers dislike the tag of LPO.

• Misuse of Information

There are chances of misuse of information of clients. The confidential information that are shared with LPO in India, foreign clients have certain reservations about it.

• Unethical standards

Another criticism faced is that the people performing legal work may not be bound to necessary ethical standards.

Conclusion

Read our article:10 Advantages of Legal Process Outsourcing (LPO)