‘US slowdown sees more LPO work sent to India’

[OhioChick]

Monday, Jun 09, 2008

Hyderabad, June 8 Slowdown in the US economy and recessionary trends have led to an increase in legal process outsourcing (LPO) work to India and other low cost destinations, according to Mr Sanjay Kamlani, Founder and Co-Chief Executive Officer of LPO firm, Pangea3.

“One would be surprised to note that during recession, people and companies tend to be litigious. They file suits with the objective of making some money or working out a settlement for cash,” Mr Kamlani told Business Line.

Typically, like most professional services in the US, attorneys charge their clients on an hourly basis. During slowdown, when there is pressure on finances, the focus of law firms is to outsource their work to lower cost destinations where India stands out, he said.

Cost arbitrage


The cost arbitrage varies between 70 and 50 per cent depending upon the nature of legal service offered.

Services include providing inputs for a possible law suit, drafting by background discovery work or extending to evidence support.

Pricing varies depending on the service offered, including for patent flings, he said.

From a nascent segment of IT services three years ago, it has now evolved into a distinct business stream and has over 100 small and medium-sized firms employing about 30,000 professionals.

According to Forrester Research findings, about 79,000 legal jobs are expected to be outsourced to low cost countries,

The National Association of Software and Services Companies (Nasscom) sees this segment to be $ billion plus industry.

In expansion mode


Mr Kamlani said Pangea3 is on expansion mode and has handed over appointment letters to about 100 campus recruits; about 45 IIT engineers and the rest law graduates from top 10 law firms. What is interesting is many practising individual lawyers are now keen to join law firms.

Why would IITians join LPO? Mr Kamlani said “many of them do not want to be tied up to one technology firm. They want to work with a firm like ours which will allow them to get engaged with many top global IT companies. This increases costs; but we need to be the best in the business to stay ahead.”

http://www.thehindubusinessline.com/2008/06/09/stories/2008060950660200.htm

[ChrisMatthews]

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