The outsource trend: It’s not just call centers in India anymore

Gaurav Sood is proud to work as a lawyer for some of Britain’s most prestigious companies.

But he doesn’t live anywhere near London — or Britain for that matter. Sood lives more than a few countries away in one of India’s high-rise satellite cities, Gurgaon, located on the edge of New Delhi. There he works for CPA Global, an outsourcing company.

A decade ago, it would have been unthinkable for important British firms to send their legal work overseas.

But CPA Global typically charges an eighth of what a British or American lawyer with similar experience and expertise might cost. So as law firms and in-house legal departments face growing pressure to cut costs following the global economic downturn, an increasing number are looking east to qualified professionals such as Sood.

ValueNotes, an Indian consulting group, estimates that India’s legal outsourcing revenues will grow from $440 million this year to more than $1.6 billion in 2014 — up from $146 million in 2006.

And the number of Indian firms offering legal services to overseas clients has swelled from 50 in 2005 to more than 140 today, it said.

Developments within India’s outsourcing industry have also made the country a more compelling destination for legal work.

Though most of the outsourcing in India is considered “low-value process outsourcing,” where special skills are not necessary (think: call centers), the fastest growth is in companies offering high-skilled work requiring specialized knowledge. Everything from medicine to engineering — to lawyers — is being outsourced to India now.

Skeptical West
Western lawyers have, until recently, been skeptical about outsourcing work to India, deterred by concerns about confidentiality and quality control. But many of the firms that have experimented with small, low-level jobs, are now commissioning ever larger volumes of work.

They are also beginning to entrust Indian lawyers with more complex jobs. Although relatively simple tasks like document review, research and proofreading still make up the bulk of legal outsourcing work, Indian lawyers — especially those trained in top American and European universities — are capable of a lot more, say Indian analysts.

Caroline Hunter-Yeats, a partner at the British law firm Simmons & Simmons, says concerns are easily allayed, “especially when the Simmons & Simmons India team are working off the same computer systems as the rest of the firm.”

Other reasons to be skeptical
Bavita Rai, a lawyer with the British firm Weightmans, has made several visits to India to explore outsourcing work to India. Though she acknowledges that widespread legal outsourcing to India is inevitable, her firm has yet to join the movement.

She, like other lawyers, points out that outsourcing legal work to India is not as simple as it sounds.

“It’s that element of the unknown — you can’t touch and feel the solution,” she says, adding that that makes it difficult for a lot of companies to turn to outsourcing, despite economic benefits.

Rai says she is also concerned that the kinds of jobs Indian lawyers are taking on for the West are the kinds of job trainee lawyers traditionally cut their teeth on. That, of course, echoes a wider fear overseas that India’s booming outsourcing industry is stealing jobs from Americans and Europeans.

But if it’s cost effective, people’s fears won’t make much difference to U.S. growth, say observers.

Bridging the divide
One way companies and law firms are finding a way to be confident of the quality of work being done overseas is by investing heavily in training and oversight — by retaining Western lawyers in outsourcing companies in India, for example.

Leah Cooper is one of those executives lured to India to bridge the Western-India divide.

She used to be the legal head of Rio Tinto, the mining giant, until she oversaw the move of a tranche of the company’s legal work to a team of lawyers based in India.

Earlier this year, she became CPA Global’s strategic director. “We’re on the cusp of something big,” she says.

“It’s a very obvious way to cut costs, and it’s hard to refute once you’ve seen the good work that is being produced.”

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Comments (1)

  1. Submitted by brad william on 02/08/2011 - 09:30 am.

    India’s BPO industry has evolved and matured to present higher-end services that require judgment-based analysis and domain expertise, rather than function-specific, rules-based performance parameters alone. As service providers strive to offer end-to-end services, we see BPO falling into different segments. At one end of the spectrum is the traditional rules-based transactional outsourcing; while at the other end is judgment-based transaction processing and full-service business process outsourcing.
    India has won its spurs as the world’s outsourcing destination of choice. Currently the country has a commanding share of the global outsourcing market.

    India is undoubtedly the most favored IT/BPO destination of the world. This raises the question why most of the big MNCs are interested in outsourcing their operations to BPOs in India. The answer is very simple- India is home to large and skilled human resources. India has inherent strengths, which have made it a major success as an outsourcing destination. India produces the largest number of graduates in the world. The name of India has become synonymous with that of BPOs and IT industry hence the name BPO India.

    Besides being technically sound, the work force is proficient in English and work at lower wages in comparison to other developed countries of the world. India also has a distinct advantage of being in a different time zone that gives it flexibility in working hours. All these factors make the Indian BPOs more efficient and cost effective. In order to meet the growing international demand for lucrative, customer-interaction centers, many organizations worldwide are looking to BPO India.

    A subset of outsourcing, Business Process Outsourcing (BPO) involves contracting the operations and responsibilities through a third party service provider. From the last couple of years, the BPO industry has evolved as the most substantial sector in the Indian market. India has emerged as the most favored location for all Bpo services across the globe. This has accelerated the Indian economy to the heights, progressively boosting the statistics depicting the growth in the years to come and it has been however forecasted that by 2020, more than 80% of the world of business process outsourcing services will be served by the Indian companies. Marked as the best place to attain superior quality services globally, the BPO industry is strengthening its foundation in India.

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