When outsourcing spreads wings for litigation works

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New Delhi: Even as law firms are betting high on the litany of litigation work from the treasury department’s troubled assets relief program (TARP), industry and business watchers are keeping an eye on the legal process outsourcing (LPO) sector. While the United States dominates the $250-billion legal market, generating 80% of the work, the UK generates about 12% of it. Of the $80-million legal work that is outsourced, India seems to have grabbed the majority of it. Traditionally, significant legal work generated in the US has been outsourced within the country itself to regionally renowned staffing firms and project management companies that have the legal capability. In 2005, Nasscom and McKinsey jointly reported that five areas—legal, analytics, research, finance and accounting and animation—would dominate the next generation of outsourcing. It was during this time, Abhi Shah, currently CEO of ClutchGroup, a global legal solutions provider, was pursuing his MBA at the Harvard Business School. Chancing upon the opportunity, Abhi assisted Jerry Rao, former CEO and managing director of BPO major MphasiS, in the company’s sale to EDS in 2005. The LPO opportunity became evident to Abhi and he devoted part of his time at Harvard working on a business plan to build a legal process outsourcing firm, executing it in parallel, sizing the market, raising money and building a reputed board and team.

In its early days, the company (ClutchGroup) made a strategic acquisition in the US that gave it approximately 100 lawyers who have good clientele in Washington DC and New York and are grounded in document review work (work that law firms in the US reportedly prefer to outsource within the US itself).

According to Brown and Wilson’s 2008 Black Book of Outsourcing, which has been annually ranking outsourcing firms since 2005, ranked ClutchGroup among top twenty LPOs, primarily because of the favourable ranking by vendors wherein they ranked the company number one on eight.

Outsourcing is the brainchild of India. “Outsourcing principles such as moving from an individual mindset to a process mindset and from a skill set focus to a replicating ability are all applicable to LPOs as well. There are caveats though. Legal processes, for example, do not necessarily need the same kind of technological or automated output as banks,” says Dinesh Sawant, chief operating officer of ClutchGroup.