Survey: UK firms keen to outsource core services

By James Barnes |19 Nov 2012 |Global Legal Post

Top UK law firms are increasingly moving towards outsourcing key services such as litigation support and document drafting, research released today shows.

Legal profession researchers Sweet & Maxwell surveyed finance directors from the jurisdiction’s top 100 firms and discovered that 22 per cent said that using outsourcing was likely in 2012 – up five points from similar research last year.
‘Some legal sector watchers may be surprised at the number of finance directors considering outsourcing M&A due diligence work, as this is usually regarded as a core function,’ commented Teri Hawksworth, managing director of Thomson Reuters Sweet & Maxwell. ‘The fact that firms are more willing to outsource such an important service indicates that the level of trust is rising.’

Cost cutting

Cost-cutting measures were the most frequently cited reason for considering outsourcing work, with 84 per cent of firms claiming reducing service delivery cost as a key factor. Nearly half of the firms involved also said an improvement in service quality was a potential benefit of outsourcing.
While fears over the negative aspects of outsourcing still linger, they appear to be receding. Last year, 94 per cent of firms said losing control over service quality was a key concern. The figure dropped to 79 per cent this year.
‘Where core services are concerned, outsourcing is still a relatively new concept in the legal arena. As more firms gain experience in what outsourcing can offer them, fears about what can go wrong are fading,’ said Ms Hawksworth.

Off-shoring in Belfast

The research came as a leading global law firm announced further internal off-shoring of several functions.
According to a report in The Lawyer newspaper, the recently merged Anglo-Australian global player, Herbert Smith Freehills, is to launch a pilot programme that will send document review matters from the Australian practice to the firm’s Belfast centre.
The firm’s Belfast office director Libby Jackson told the newspaper: ‘It’s early days. We’re continuing to explore the extent to which our offering in Belfast might be able to support our disputes practice in Australia.’