using contract lawyers to scale your law practice
TRANSCRIPT
Using contract attorneys to scale your practice
December 14, 2016
Andy BucklandEmerald City Attorney Network, PLLC
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lawyerist.com Ep. 97 with Lisa Solomon
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Andy Backlund• Attorney• Business Owner• Entrepreneur• Baseball Coach
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What is outsourcing?Definitions: • From Merriam-Webster: To procure
(as some goods or services needed by a business or organization) under contract with an outside supplier.
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What is outsourcing?Definitions: • From BusinessDictionary.com:
[C]ontracting or subcontracting… to free up cash, personnel, time, and facilities… to concentrate on what they do best and thus reduce average unit cost.
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What is outsourcing for a law firm? Common forms of outsourcing for law firms:
• Accounting/Payroll• IT services• Legal Process Servers• Messengers• Cleaning Services• Library services• Research search engines
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Newer Forms of outsourcing:
• Contract Attorneys • Contract Paralegals • Contract LLLT’s • Contract Legal Assistants • Jury consulting• Litigation & trial consulting• Answering services • Intake services
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Outsourcing is becoming more popular
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From Law Practice Magazine, K. William Gibson
• A Time magazine headline screams “Call My Lawyer ... In India.” Legal Affairs asks “Are Your Lawyers in New York or New Delhi?” A recent New York conference offers “Effective Strategies for Managing Offshore Outsourced Relationships.”
• …[I]t appears that the “trend” has morphed into a full-blown phenomenon.
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From Law Practice Magazine, K. William Gibson
• Why is all this work going overseas? Clients are tightening their belts and want their law firms, regardless of their size, to look for cost-saving strategies as well. Whether you want to get in the outsourcing game or not, understanding how the game is played will help you navigate in the times ahead.
• …revenue from legal services outsourcing in India alone is slated to grow by almost a half-billion dollars by the decade’s close.
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Global Market Insights – March 2016 – Report ID: GMI179
Legal process outsourcing (LPO) market size was valued at USD 1.89 billion in 2014 and is anticipated to arrive at USD 13.44 billion till 2022, growing at 27.8% over the forecast period..
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Clients are demanding cost saving measures
• Many clients are demanding cost saving measures.
• In house counsel, insurance companies and individuals.
• Fixed fees, reduced rates, virtual law firms and outsourcing.
• Clients will appreciate giving consent to outsourcing when told about savings.
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Why Outsource?
Three most simple answers?
Money
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Your Additional Revenue Projections
Use contract attorneys for 20 hours a week.• Cost: $100 per hour • Billed to client: $200 per hourProfit of $104,000 per year.
Consider additional costs of associates:– Salary– Benefits– Overhead
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Why Outsource?
Ebbs and Flows of workload
Why pay an associate you can’t keep busy when you can hire a contract attorney and pay as needed?
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Why Outsource?Keep anxious clients happy
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Why Outsource?
ExpandYour
Business
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Why Outsource?Few attorneys are so experienced in:
① every area of practice, ② every type of research and ③ every type of writing, to be as effective and efficient as an
attorney who does that type of work on a more frequent basis.
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Why Outsource?Hiring someone who does one or a few tasks extremely often and extremely well will result in:
① better, ② faster and ③ less expensive work product than someone in house who
is only occasionally faced with those same tasks.
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Why Outsource?Restore Your Work/Life Balance
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Challenges to Outsourcing• Trust• Getting the right information to the
independent contactor.• Going beyond the scope of the project.• Deadlines• Ethical considerations?
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Ethical ConsiderationsABA Formal Opinion 08-451 offers guidelines for outsourcing including:• Law Firms may add a surcharge provided that the total charge
is reasonable.• The firm is not obligated to inform the client about rates.• Similar to a firm billing an associate out at a profit.• Bill as a fee, not as a disbursement.
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Questions or Comments?