Smaller firms seeing benefits of outsourcing

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By Legal Futures

21 July 2010


Accounts: 39% of small firms outsourcing

Smaller law firms are beginning to see real benefits and savings from outsourcing non-legal services, research has suggested.

A snapshot survey by IRN Research of 36 firms with 10 partners or fewer found that just under half of them are outsourcing some non-legal activities.

IT/software support was the main activity outsourced, with 44% of firms saying they did so. This was followed by accountancy/bookkeeping and recruitment (both 39%), and secretarial support/typing (22%). Some 31% said they outsourced other activities, such as client surveys, marketing, PR, translations, copywriting, training and travel.

The survey suggested that more firms are likely to consider outsourcing activities such as marketing, market research, and PR in the future. Few smaller law firms have so far outsourced all their non-legal tasks.

Of those currently not outsourcing at all, around half said they will consider it in the next year, “so the outsourcing trend is set to increase amongst smaller law firms as they look to cut costs and focus on core activities”, said IRN.

Andrew Woolley, who runs well-known “virtual” law firm Woolley & Co, has outsourced almost all of its non-legal activities. Mr Woolley said: “It is a truism that lawyers are good at law but nothing else. Certainly we tend to be very poor at admin, IT, HR, web, marketing etc. So it seems a clear case to outsource even if only to get it done right – any cost saving is a bonus.”

Mr Woolley argued that the law firms that will survive will be “the ones who get all their lawyers billing four chargeable hours per day minimum at the top rate they can, concentrating on what they do best and leaving the rest to the experts”.

IRN suggested that it might be time for smaller law firms to consider sharing accounts support, IT support, buying equipment, software, online information services and so on. Mr Woolley said: “I think we’d get savings or improvements but probably both.”

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