Can LPO learn from ITO?

Everyone’s different. I’m different, you’re different. But, though we don’t always want to admit it, we do have an awful lot in common, and we can learn from each other because of those differences and similarities. So, as seasoned experts in IT Outsourcing (ITO), Orbys has huge amounts of experience that we think is relevant to the burgeoning LPO market – there are enough similarities between the two disciplines that mean that the young whipper-snapper LPO can gain from the learnings of the mature ITO market. The trick, of course, is recognising where the differences are, and adapting the learnings appropriately.

So, here are three key learnings from ITO that we think anyone contemplating LPO should seriously consider:

  1. Develop a good sourcing strategy. It is still sometimes missed out on in the ITO world, but most organisations serious about getting the most value from their outsourcing will develop a sourcing strategy well before they start to engage with the market. Key questions to answer will be: should I outsource? If so, what should I outsource? And how should I outsource it? The LPO market is currently driven by tactical project-based solutions, which means developing an LPO sourcing strategy will be swimming against the tide. But, if you want to avoid: engaging with too many suppliers; having multiple reporting systems; dealing with inconsistent approaches across regions or practices; spending more time sourcing work than delivering it; and, most importantly, not realising the maximum benefits available, then investing time in a sourcing strategy is well worth the effort.
  2. Understand what you are outsourcing. Over the years ITO has developed comprehensive definitions of the services it can provide (a good example is ITIL) – this common IT language allows the clients to understand exactly what they are buying, and the suppliers to be able to define clearly what they are going to do (and not do) for you. When Orbys was developing its LPO capabilities, one of the key things that struck us was the lack of any sort of ‘best practice’ library that was relevant across the whole legal profession. Much of this is due to the specialised nature of law, but the LPO market will be seriously hampered if it can’t come up with a good, standard model (we think we have one in Orbys). So, when you are trying to answer that ‘what should I outsource?’ question, make sure you and the supplier are talking the same language, or you could end up paying for something you don’t want or need.
  3. Build the right Retained Organisation. One of the biggest mistakes made by organisations outsourcing their IT is to think that they can take their best IT people and turn them into IT Supplier Managers. Unfortunately, the skills and character required could not be more different. The realisation that managing an outsourced service is very different from delivering one is a key learning that can be exploited by the LPO sector: lawyers won’t necessarily be the best people to manage your LPO suppliers. Look to build experienced supplier managers into your internal organisation, particularly if you have developed a multi-source strategy – the benefits of both cost savings and quality of service will far outweigh the investment cost.
And that’s just the tip of the iceberg – we’ll bring you more LPO-relevant ITO learnings in subsequent posts.

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