Ten for 2012

Legal Process Outsourcing (LPO) firms face the most challenging year in the industry’s short history as the traditional LPO model comes under threat from technology, formidable new competitors and rising wages in emerging markets.

For the third year in a row, Fronterion is releasing its highly anticipated report, Fronterion Ten for 2012: Top 10 Trends in Legal Outsourcing for 2012. Countless hours of research and consulting experience by Fronterion professionals – including direct interactions with vendors and buyers of LPO services – have gone into this year’s trending report.

The result is a vital guide to the trends impacting the LPO landscape in the coming year. Past trending projections have been reported in the ABA Journal, Legal Technology News, Lawyers Weekly and many other publications.

As the LPO industry continues its evolution from a niche practice to game-changer and as numerous challenges lie ahead, 2012 is poised to be another dynamic year.

 

To download the complete 2011 trending report, please click here. The Top 10 Trends for Legal Outsourcing in 2012 are, in brief:

1. Profitability Squeeze for LPO – The shrinking gap between wages in the developing and developed countries and accelerating growth of onshore LPO services will combine to squeeze margins for LPO vendors in 2012.

2. Growth Beyond Litigation Support – The unsustainable concentration of litigation support services presents one of the most fundamental challenges facing the industry in 2012. LPO firms must diversify into other practice areas such as M&A and contract management.

3. Technology and LPO Combine – In the coming year, legal technology platforms will increasingly be bundled together with traditional LPO offerings. This means using software systems, as well as low-cost human labor, to provide cheaper and more efficient legal services.

4. Adoption of LPO Techniques – The broad adoption of LPO techniques in 2012 comes as a supreme validation of the LPO approach and will, more than ever, reshape the practice of law.

5. Law Firm Insurers Target LPO – As outsourcing becomes more common, the unique nature of LPO services creates new risks for legal professionals that will be addressed by law firm insurers in the coming year.

6. Changes in the Executive Ranks – The shifting skill sets required for leading an LPO in this evolving industry, along with growing pressure on existing management to produce results, will drive changes in executive ranks at many LPO vendors in the coming year.

7. LPO Faces Formidable Competition – As LPO achieves greater acceptance in the coming year, LPO vendors face intense competition from more formidable and established mainstream legal vendors including staffing firms and large law firms.

8. Winner-take-all Mentality – As the LPO industry matures in 2012, the industry will continue to coalesce around an inner-circle of LPO vendors. Fronterion does not expect a radical restructuring of the LPO industry in the coming year, but we do expect to see client consolidation as cash flows dry up for LPO vendors not in the inner circle.

9. Changing Professional Guidelines – Professional and regulatory bodies in the U.S. and U.K., which have been slow to address alternative legal services delivery, are due next year to publish the results of studies on the impact of outsourcing.

10 Evolution of the Law Firm-Client Relationship – The injection of third party legal vendors into the law firm-client relation has significant implication for the role of the lawyer.

 

About Fronterion

Fronterion can help you recognize how these emerging trends will impact your organization and discover opportunities to thrive in a changing legal landscape.

Fronterion is the foremost legal consulting firm exclusively focused on advising law firms and corporate counsel on outsourced legal services. Working with some of the largest law firms in the world, Fronterion helps clients structure and implement highly innovative legal outsourcing engagements.

Fronterion provides leading-edge webinars, training workshops, compliance audits, industry research and advisory services to legal professionals seeking to capitalize on the pervasive impact of outsourced legal services.

For more information about Fronterion, contact media@fronterion.com. Additional resources are available at www.fronterion.com and www.fronterion.com/TenFor2012

 

PDF Download

Fronterion Ten for 2012: Top 10 Trends in Legal Outsourcing for 2012