Table of Contents
Courtrooms, briefcases, and paper stacks come to mind when discussing the legal industry, so much so that you might think the sector still dwells in a traditional setup. But behind this complex world’s walls, digital transformation happens to accelerate regulatory processes.
However, technological advancements become costly when companies handle all technical expenses in-house. Many enterprises thus rely on business process outsourcing (BPO) to meet their legal technology (LegalTech) needs. This practice increases their efficiency while cutting costs.
Perhaps you are wondering: “Are legal process outsourcing (LPO) and LegalTech outsourcing similar?”
Let us find out through this article.
Detailing BPO’s Position in the Legal Technology Sector
LegalTech outsourcing is a subset of LPO. While LPO involves entrusting non-core legal tasks to providers, LegalTech BPO solely focuses on technology. Vendors provide cost-effective digital tools and human resources (HR) to support legal professionals and firms.
Spherical Insights reported that the global legal tech market reached $24.62 billion in 2022. According to the research organization, the sector accounts for about 7% of the legal service industry. The firm expects the LegalTech segment to expand at a compound annual growth rate (CAGR) of nearly 8.7% by 2032.
The increasing demand for streamlined in-house legal processes and remote work settings drives the growth. The COVID-19 pandemic also contributes to the market’s expansion. These factors encourage law firms and LegalTech businesses to seek the following legal technologies and support services from BPO companies:
- Collaborative desktop and mobile applications
- Communication and videoconferencing tools
- Online dispute resolution platforms
- Case and contract management systems
- E-discovery and legal research tools
- Artificial intelligence (AI) and blockchain technologies
- Cloud computing solutions
- Software development and management
- Data entry, collection, and analysis
- Cybersecurity assistance
- System management and maintenance
- Workflow automation
- Digital transformation consulting
- Customer service and marketing
- Compliance auditing and requirement preparation
- Legal research and document review
- Intellectual property support
Exploring the Advantages of Outsourcing LegalTech Services
As the legal sector adapts to modernization, stakeholders encounter the high cost of hiring full-time tech specialists, acquiring new systems, and maintaining infrastructure. This is where outsourcing comes to the rescue.
Are you curious about what BPO’s primary role in the legal technology industry is? Similar to other industries, legal-focused service providers boost cost efficiency. They offer access to skilled professionals and advanced solutions at competitive hourly or monthly pricing.
Aside from cost reduction, resource optimization, and productivity, here are other ways outsourcing LegalTech services supports your enterprise’s growth.
Automate Workflows
LegalTech companies and law firms handle massive amounts of paperwork daily. Hence, they contract with support vendors to automate their workflows. BPO companies help them avoid employee burnout and downtime through the following methods:
- Perform in-depth process mapping and analysis to identify which processes need streamlining.
- Deploy robotic process automation (RPA) tools to speed up repetitive services, including data entry, document processing, and customer service.
- Use AI-powered workflow management systems to automate task distribution, monitoring, and scheduling.
- Leverage cloud solutions for safe data storage, access, and backup.
- Employ data analytics tools to quickly provide actionable insights into legal market trends, competitor movements, and business performance.
- Utilize specialized legal software solutions to boost case and contract management.
Streamline Software Development and Management
Service providers use innovative AI and BPO solutions to ensure seamless software development and management. They also employ professionals with specialized skills and in-depth knowledge in this domain to perform the following services for your business:
- Custom software development. Service providers tailor legal tech systems to your unique operational needs. They build and handle such tools to boost your daily processes and workflows. These solutions include legal accounting and billing software.
- Quality assurance and testing. Third-party vendors perform to guarantee the developed systems meet high-level standards of performance, reliability, and security. They also ensure that the solutions comply with industry-specific regulations.
- Post-development assistance. A software vendor’s job is to provide after-sales services. Their workers deliver timely technical support, system updates, and maintenance to keep legal tech solutions in good condition.
- Technology integration support: BPO companies help integrate third-party legal technology with your proprietary software. The compatibility of these systems improves the overall efficiency of your legal operations.
Enhance LegalTech Cybersecurity
Strengthening cybersecurity is one of the many reasons law firms and LegalTech enterprises hire BPO firms. Given the growing security incidents facing these businesses, having extra protection from outsourcing companies helps them stay competitive while minimizing expenses.
In a recent report, Checkpoint Research noted a 7% year-over-year increase in the global weekly cyberattacks experienced by the sector in the first fiscal quarter of 2023. The cybersecurity firm specified that organizations encountered an average of 1,248 attacks per week.
Because legal firms deal with confidential information, incidents such as data leaks and system hacks have cost millions of dollars. On average, companies worldwide can lose about $4.45 million for a breach alone.
Service providers help prevent and mitigate these risks by implementing robust security measures. They stop unauthorized access through data encryption, multifactor authentication, or biometric identification. Moreover, they conduct regular security audits and update risk management plans and information technology (IT) systems.
Boost LegalTech Market Research and Analysis
Market research and analysis are crucial. This function improves business offerings, identifies industry shifts, and monitors competitive movements. BPO companies help ease this tedious function for the legal technology sector through these cost-efficient services:
- Perform in-depth competitive intelligence analysis to understand key competitors’ strategies, offerings, and market positions. The resulting insights inform efforts to improve and differentiate your products and services.
- Monitor and assess legal technology trends and innovations to identify which transformative solutions and best practices fit your current requirements. This way, your BPO partner assists you in maintaining uninterrupted legal operations.
- Implement target market profiling to categorize your existing potential clients based on their specific needs and preferences. Service providers can then help you tailor your offerings and marketing strategies based on these findings.
- Track regulatory changes to ensure your compliance with various industry and government laws. They prepare actionable insights, reports, and recommendations to help your business meet necessary legal requirements and rules.
Improve Contract and Case Management
BPO organizations use various AI-enabled legal technology solutions to enhance how they handle contracts and cases. They deploy these advanced systems to streamline the contract management lifecycle, from planning and drafting to negotiation and execution.
Furthermore, third-party vendors build and provide access to case management systems customized to your needs and requirements. You can effectively track, record, and analyze legal cases to improve your decision-making processes by paying a monthly or annual subscription.
As part of your BPO deals, support vendors also optimize document automation and standardization tools to quickly and accurately organize legal files, such as contracts and case records. These solutions help avoid the high expense of manual errors and delays.
Protect Intellectual Property (IP)
The LegalTech market handles sensitive proprietary data, personal information, and trade secrets. Service providers help safeguard IP by implementing robust security measures and advanced technologies. They establish trust through these critical approaches:
- Confidentiality and non-disclosure agreements (NDAs). BPO vendors sign these documents with their employees, subcontractors, and clients to prevent data breaches and stolen credentials.
- IP audits. This action helps your in-house and third-party teams assess the effectiveness of existing IP protection measures. The evaluation also identifies potential vulnerabilities in your systems and ways to strengthen your IP security.
- Secure IP solutions. Providers deploy modern tools and strategies to protect IP-related data from cybercriminals. These solutions include robust firewalls, intrusion detection systems, and antivirus features.
The Bottom Line
The LegalTech industry constantly grows as law firms and legal enterprises adapt to the latest market developments. Outsourcing is their gateway to achieving such goals without excessively spending on non-core tasks.
In addition to cost efficiency, providers speed up their clients’ workflows and research efforts using AI and automation solutions. Skilled and well-trained BPO professionals also help streamline legal technology development, management, and protection.
Let’s connect once you decide to boost your legal tech company’s growth. Unity Communications employs the essential tools and capabilities to meet your urgent tech needs for your daily legal operations.
