Tuesday, November 20, 2007

Few law firms in Canada are outsourcing legal work to India

Source: Lawyersweekly

It’s already happened for a variety of manufacturing, accounting and information technology companies who seek cost advantages that Canadian industry can’t match. How easily could legal services follow suit offshore?

Offshoring, a form of outsourcing, initially attracts interest because it’s cost-competitive. Service providers work on different continents where labour costs are substantially lower.
Knowledge process offshoring became practical only recently. According to Thomas Friedman’s tome The World is Flat, a trillion dollars of broadband capacity was strewn all over the globe during the Information Superhighway 1990s.

When the dot-com bubble popped, opportunistic service providers acquired the wires at fire sale prices, and today they deal with far lower overhead than that which plagued their predecessors. Connect highly commoditized computing capacity and advanced workflow software to those fast wires and you have the express lanes that permit internationally dispersed teams to collaboratively drive a project.

The cost advantage Indian knowledge process outsourcers enjoy doesn’t seem set to disappear anytime soon. Consider: widely quoted statistics put the number of lawyers in India at one million, and Indian law schools graduate another 80,000 each year. Economics 101 dictates that wherever supply outstrips demand, prices fall or, at worst, stay stable. All things being equal, India’s legal industry should continue to reap huge crops of talent from which KPOs can pick the cream.