By Jeffrey Teso of CPA Global

An emerging trend in the field of law is the use of Legal Process Outsourcing (LPO). A driving force behind this is the ever-increasing volume of data that needs to be looked at in routine litigations and investigations. The cost of managing this data, in many senses, has gotten out of control.

A lot of corporate legal departments have had their budgets cut, especially over the last two years. Many corporate legal departments and law firms are struggling to find ways to do as much or more with less and many have turned to LPO providers.

We are also seeing a number of midsize boutique firms that historically didn’t have access to certain markets because they didn’t have the resources or scale for very large matters, pairing up with LPO providers to enter new lines of business from which they previously saw themselves precluded.

The biggest driver of that cost savings is the labor arbitrage. The resources that are being deployed to do these legal services that were traditionally being done in the firms are being done at a much lower cost base by LPO. It’s that differential that drives the attractiveness of LPO. The LPO providers can give better rates because they have lower overhead and because they focus on legal services.

It’s important to remember that today’s cost savings are not tomorrow’s cost savings. Clients continually demand greater and greater cost savings. Because the LPO provider is focused on legal services, it can also offer process enhancements, which can drive the LPO provider’s ability to keep offering additional cost efficiencies.

Using an LPO provider can also assist firms and companies in litigation budgeting. Many LPO providers offer fixed pricing, which can assist a client in predicting expenses.

By using an LPO provider, many companies are discovering value-added services that help keep costs predictable and are gaining a lot of benefit for the lower costs they are paying.

Jeffrey Teso is Director of Operations at CPA Global, a leading global provider of outsourced legal services. Mr. Teso oversees CPA Global’s U.S.-based delivery operations, and works with clients to help them manage the risks and costs associated with discovery and document management in connection with complex civil litigations, regulatory investigations and business transactions. Mr. Teso has over 10 years’ experience managing and supervising delivery of multiple litigation and regulatory matters the complex across various industries.

Teso was a featured speaker on the LexisNexis® Webinar: Bensen & Myers’ Best Practices for Litigation Management: Budgeting Tools, Settlement Strategies, and Solving Ethical Dilemmas, on May 12, 2011, along with Eric E. Bensen and Rebecca Kelder Myers, co-authors of Bensen & Myers on Litigation Management.