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We recently considered the nature of Alternative Legal Service Providers (ALSPs) and how they are distinct from traditional legal service providers.
In this latest video, Emma Dickin (Head of Practice Area Group In-House Strategy), Jamie Fraser (CEO & Founder, NineNineSix) and Natalie Salunke (General Counsel, Zilch) chat about the benefits of outsourcing work to an ALSP for in-house legal teams, and what issues they should consider.
We have teamed up with Crafty Counsel and Obelisk Support to provide guidance on the fast-growing and innovative world of ALSPs in a series of videos. You can watch our first video in the series here.
As Natalie Salunke points out, the first step is to clearly define the problem which needs to be solved. Is there a legal resourcing gap which needs to be temporarily filled for a specific project - or does the e-discovery process need to be outsourced to a legal tech specialist?
Spending some time considering the various different aspects of the challenge will help determine how it can be best addressed – whether that’s in house, working with a traditional law firm or outsourcing to an ALSP.
The growing variety of legal services providers is a very positive development for in-house legal departments, as there is more competition for their custom, keeping prices down and widening their choice.
Check out these Practice Notes for further practical guidance:
It’s important to ensure that the legal service provider will be able to work in collaboration with your in-house team i.e. that there is good cultural fit. Although ALSPs will often take a different approach to your business – and this is often a benefit because it can help to spur innovation – they will ideally become a virtual extension of your legal team.
When considering outsourcing work to an ALSP, it’s helpful to find one that excels in the specific area of law, or has experience of the particular task required.
Emma Dickin suggests a list of questions you should ask yourself:
It’s important to be clear on what work needs to stay in house (such as strategic high-value tasks that require deep business knowledge) vs those routine, lower-value, low-risk tasks that are taking up your lawyers’ time but could be outsourced to an ALSP.
The business models of ALSPs also mean that they tend to be leaner and more innovative than traditional law firms. Unlike law firms, they tend to work on fixed cost arrangements rather than billable hours, which can help General Counsel to manage tightened budgets more effectively.
Aside from the fact that ALSPs are generally cheaper compared to traditional law firms, their models are generally designed to focus on specific areas of work and optimise efficiency. This means that they can complete routine legal work faster and are more cost effective.
Just as with any other business decision, you will need to be able to make the case to the CFO or budget holder that the services provided by the ALSP will help achieve the intended goals and provide value for money.
It’s important to be clear about the problems which need to be solved, and how the ALSP will provide a cost-effective solution. Researching the market and comparing different service providers will help to sway any business decision. Emma Dickin offers a list of points to consider when building your business case:
Be clear on the problem you are trying to solve;
Explain the benefits of outsourcing this work and the impact it would have on your team if you didn’t get this support.
You may find these practice notes on evaluating law firm performance and metrics for law firm performance useful in assessing current performance and to find out whether an ALSP could provide a legal solution more efficiently.
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