Jane: Legal Process Outsourcing is a brilliant idea whose time has come, Dan. I think we will see a number of high profile firms begin to partner with LPOs in the next few years. Whereas it was once unthinkable for a firm to take on low margin, high-volume work, now they can provide those kinds of services to their clients without making a large investment in specialized technology or increasing headcount. An LPO partnership is that rarest of business opportunities, the win-win-win for the client, the firm, and the third party LPO.
Dan: More like a draw-lose-win, if you ask me. The client’s going to get their high-volume busy work done by some lesser entity whether the firm gets involved or not. Meanwhile, the firm takes on the administrative headaches and expenses for commodity work that, if word got around, would only serve to diminish their reputation as a purveyor of fine legal services. Even worse, the firm loses the margin on work that, if they had done on their own, would have been profitable. In fact, by my reckoning, the only real winner in an LPO/BigLaw partnership is the LPO, who would no longer need to invest in marketing or sales people.
Jane: So, say a client comes to you with a serious problem that involves high-volume work – you would turn them away saying that such work was beneath you?
Dan: You may not have noticed Jane, but the P in LPO stands for “process”; clients just don’t bring “process” work to elite law firms like mine. But for the sake of argument, if they did, we would politely explain that, while we are certainly capable of such work, having us perform such menial tasks would be the artistic and financial equivalent of having Van Gogh and Vermeer paint your bathroom walls.
Jane: Well, maybe if your attorneys all wear White Shoes, you can afford to turn away higher volume, lower value work, but….
Dan: The petty little firms you work with, Jane, may benefit from partnering with LPOs. But our BigLaw attorneys are legal artisans. Process, who cares about process? We recruit only the top tier of law school grads from the tippy-top tier of law schools. The legal counsel we provide our clients is the product of the finest, most creative, and talented legal minds on the planet. That kind of craftsmanship is simply incompatible with the industrial processing of an LPO. Do you think any of the law schools we recruit from even have a clue what process is, much less teach it?
|Some guy working through a process
to build a high performance truck engine.
Image [CC] – Scania Group
Jane: As usual, genius, your ego has been partying with your ignorance leaving you a little too impaired to see the opportunity right in front of you. If you hadn’t cut me off, I was going to say that despite your BigLaw and Top 10 Law School snobbery, you are actually making very good arguments for an LPO partnership. OK, so process work is beneath you, fine; all the more reason to pass it on to someone who specializes in the process. All clients, no matter how elite, have commodity type legal work that needs to be done. Rather than sending your client away to look for another provider, why not partner with an LPO that can do that work for you? The client gets one stop legal shopping, the LPO gets an endorsement from your firm, and your firm gets all the benefits of more staff, specialized technology, and process expertise, without actually investing in any of it. Plus, you get additional billable hours for supervising the LPO! With a formal partnership, you will never have to scramble to do high-volume work when you suddenly wake up one day and realize it’s in your interest!
Dan: Like I said, we are artisans, not engineers or short order cooks.
Jane: Forget about what kind of work you do or don’t do! With an LPO partnership you’ll get a better price for LPO services and you might even make a little profit on the outsourced work. You’ll get to offer your clients a better value than they could get on their own and keep more of their business – maybe even more of that high end work you covet. And, if you’re lucky, some of those industrial processes might just rub off on your firm. Tracking a few metrics, better information governance, productivity monitoring and reporting; these could all improve the efficient delivery of your uber-artisanal legal product.
Dan: In the history of the world, Jane, no high quality custom craftwork has ever been improved through systematized process improvement.
Jane: Have you heard of the Industrial Revolution?
Dan: Were they a hair band in the 80s?
Jane: Um… sure.
Dan: What did they sing again?
Jane: You’re too stupid to live.
Dan: Oh yeah! I loved that song!
[Ed. Thanks to Ron Friedmann for suggesting this D&J topic and for providing the bulk of their arguments this week. Dan and Jane and the rest of us Geeks thank you Ron! If you have a suggestion for a future D&J post, shoot Dan and Jane an email at dandj3geeks (at) gmail (dot) com.]