The Five Principles of Effective Legal Process Outsourcing
Stewardship Delegation
The Five Principles of Effective Legal Process Outsourcing
Financially successful law firms distinguish themselves not by their commitment to process efficiencies, but by effective delegation. Increased efficiencies – doing many things faster, or doing more with less – are necessary in a competitive environment, but they are not sufficient. Today, law firms are seeking ways to increase efficiencies without sacrificing quality and without increasing capital expenditures. Legal Process Outsourcing is the logical extension of effective delegation for the modern law firm enterprise to achieve these business goals.
Law Firm Delegation to Time and to People
In his seminal business management bestseller, The Seven Habits of Highly Effective People, Dr. Stephen Covey explains that we accomplish all that we do by delegation: either delegation to time, or delegation to people. If we delegate to time, we think “efficiency” and the increased speed of online legal research. For example, our ability to communicate with clients and colleagues in real time at any hour, virtually anywhere on the planet. We can get more done, but each person gets more done for himself. On the other hand, if we delegate to people, we think “effectiveness” because we leverage our team to get better results. An efficient manager can spend one unit of effort but get five or 50 or 500 units of results for the enterprise. Delegation to people, instead of time, creates scale. This is the essence of law firm leverage.
Some attorneys who describe themselves as delegators actually perform “gopher delegation.” Covey describes this form of delegation as “Go for this, go for that” and “Do this, do that.” Such delegation focuses on methods tends to involve one-on-one supervision. Ultimately, the attorney still thinks like a “producer,” generally focusing on speed rather than scale.
By contrast, “stewardship delegation” shifts responsibility and is built on trust. This is the hallmark of effective management. Stewardship delegation focuses on results, not methods. It’s based on an appreciation of others’ talents and core competencies. Responsibility for results shifts to the “steward” – the one to whom the manager is delegating. It requires trust because there is no one-on-one supervision, no focus on doing it “my way.” Instead, the delegating attorney knows the steward can be trusted to use an array of methods to achieve results. There is an accountability component; meetings or feedback reports take place at intervals agreed upon in advance.
Principles of Effective Delegation
1) Measurable business objectives (but not methods) clearly defined with benchmarks.
2) Implementation guidelines and risk management plans that are few, clear, and actionable.
3) Available resources are discussed: financial, human, and technological.
4) Accountability standards are agreed upon in advance, including milestones and deadlines.
5) Consequences include shared risks and rewards.
Delegation to Law Firm Service Providers – LPOs and the Future
The criteria outlined above create the framework for the next wave of organizational effectiveness in law firms. Legal Process Outsource providers (LPOs) continue to attract interest and investment from some of the profession’s most fiscally fit firms. While much of the emphasis for these initiatives is correctly placed on overall cost savings, there are additional benefits of service quality and scale that often go underappreciated. For example, law firms choosing to delegate their IT Service Desk to Intelliteach are often pleasantly surprised that the services exceed their internal call resolution averages, and are available 24/7/365, not just during traditional business hours. The firms receive assurances regarding service level agreements (SLAs), escalations, data security, etc. at the outset of each engagement, and quarterly accountability thereafter. Legal Process Outsource engagements are relationships built on trust, leveraging core competencies. By following these five principles of effective LPO delegation, firms can substantially improve performance while reducing capital expenditures.
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