Origin of Legal Process Outsourcing

Globalisation has revolutionised the way work is accomplished and enabled new collaborations and competitions. In this cut-throat world of competition in business, gaining efficiency and staying profitable have become the corporate mantras.[1] Regardless of their location technology has facilitated the rapid increase of information and given great impetus to the dissemination of tasks to those able to most efficiently accomplish them.[2]  This sort of liberation in the marketplace has brought with it numerous opportunities for professionals who are on the lookout for a better, more efficient, and most importantly, more cost effective means of doing business in the ever-shrinking world we reside in.[3] Business practices develop in an attempt to create sustainable business models, survive in an increasingly competitive environment and enhance profitability through creativity.  Accordingly phenomena like Outsourcing are rapidly becoming a universal and all-encompassing business model.[4] In today's highly competitive global marketplace, outsourcing has become one of the key 'ingredients' for success. [5]The "resource-seeking" twentieth-century multinational enterprise could well have been the set-off point for companies to consider outsourcing. Outsourcing has become one of key ‘ingredient’ in formulating overall corporate strategy for many U.S companies to succeed in today’s emerging and highly competitive global marketplace. It is now being considered as one of “must-do” management practices for companies to excel globally.[6] Outsourcing refers to the business practice of taking a specific function previously performed in-house and having another company perform the operation. Outsourcing and off-shoring are concepts not new to India. After the hugely popular business process outsourcing (BPO), the country is currently witnessing a boom in legal process outsourcing (LPO) with legal firms from around the world turning to India to outsource their legal services.[7] The arrival of corporations such as Texas Instruments and Motorola to Bangalore in the late 1980s began a technology outsourcing boom, which soon moved on to business process outsourcing (BPO).[8] Offshore Outsourcing or "contracting out" to third parties gradually increased in the 1980s.[9] Globalization has brought tremendous changes in the global business arena and the BPOs and later LPOs are the direct offshoot of it. [10]Recently, law firms have begun to outsource legal research and other tasks that would typically be handled in house. [11] Some corporations even create offshore legal departments where international lawyers write patents and perform other tasks at a fraction of the cost an American attorney would demand.[12]  General Electric saved two million dollars by opening such an office in India in 2001 to perform legal work for its plastic and consumer finance divisions. A 2003 study demonstrated that for every dollar of spending sent overseas, an average of fifty eight cents is saved. Studies have shown that for every $1 of cost on services that American companies outsource abroad, a value of at least $1.14 is created for the economy.[13]