What is Legal Process Outsourcing?
Legal Process Outsourcing (popularly known as LPO) is a practice in which a law firm or corporation obtains legal services from an external law firm or a legal process outsourcing provider.
Usually, corporate houses situated in the countries of USA, UK and Europe outsource their legal work to countries that are less expensive since the lawyers in these countries are quite expensive. By outsourcing the legal work, these corporates save huge costs that could have been spent on legal work.
India is one of the most sought-after destinations for outsourcing legal work. The LPO sector is growing enormously in India, and many investors desire for entering into this sector.
Why India for Legal Process Outsourcing?
There are many reasons why leading countries choose India for outsourcing legal work:
- Availability of Legal professionals
- Good knowledge of English language
- Exposure to foreign laws
- Supports regional assignments
- Reduction in costs
- Superior IT Infrastructure and Government facilitated schemes for the sector
- 24*7 staffing
- Availability of staff with foreign qualification
Pricing Models used by LPOs
In this model, a fixed price is charged for the entire duration of a project. However, a little flexibility in prices as per market conditions may be allowed.
The cost of the project is dependent on the contemporary market conditions in this kind of pricing model.
Pay per Unit:
In this unit, price is charged at a pre-decided amount for each part of the project. The different parts of the project may be priced differently, as per the amount of work and complications involved.
Cost plus Profit:
The entity outsourcing work has to pay additional charges in the form of a fixed percentage of the project. This model is not very flexible in terms of changing business technologies/objectives.
Profit and Risk Sharing:
In this model, the organization and the firm work like a partnership, and share the profit and loss equally.
Measuring Outsourcing cost
It is vital for the company to see as to whether the outsourcing of legal work will be profitable for it or not. It can check the same via following steps:
Analysis of outsourcing costs:
The total cost of outsourcing can be checked as a total percentage of operations costs of a business. The analysis of cost can be done in the form of pie charts or other analytical tools for making a comparison of the outsourcing cost with all the other business costs.
Return on Investment:
It is vital that the organization outsourcing work keeps checking the market conditions and other firms to ensure that it is getting value for money. The business models and pricing keep changing from time to time and it is necessary that the latest developments be taken care of.
Evaluation of savings:
The Company can check how much money it is saving by outsourcing the legal work. The comparison can be made by evaluating the cost of getting the legal work in the home country with the amount being spent by outsourcing work.
The organization can also decide on outsourcing the legal work in parts rather than the entire assignment. This decision can be taken by making an evaluation on maximum cost savings associated with a project.
Therefore, an organization can outsource that part in which it is going to make maximum cost savings. Later, if it is satisfied with the work of the firm to which the work has been outsourced, bigger projects can be outsourced for making bigger cost savings.
Legal Process Outsourcing to India has become a sought-after option for many organizations in developed nations. This is more for the reason that quality legal work is assured at lower prices in India and the organizations save on the exorbitant fee of the attorneys and law firms in their home country.
Our team of legal experts has years of experience in handling legal work for our foreign clients. They are trained routinely on the developments of the law of the country with which they are dealing.
For more information on various aspects of Legal Process Outsourcing, contact us.