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Founded in 2006, UnitedLex has become a global leader in the Legal Process Outsoucing sector. Bar & Bench spoke to Pavan Vaish Global Chief Operating Officer, a visionary among BPO industry leaders. In this interview, Pavan talks about the initial years of setting up United Lex, the decision to acquire LawScribe, technology used in the LPO sector, the challenges that they are facing and future trends of the LPO Industry.
Bar & Bench: Initial years of setting up UnitedLex. What were the challenges that were faced?
Pavan Vaish: The Company was set up in 2006 at a time when the industry itself was beginning to develop. As the concept of an LPO was very new at that time, the challenges included convincing clients in the legal industry to consider outsourcing, attracting both senior as well as operational talent and setting up the appropriate delivery/servicing mechanism.
Bar & Bench: How difficult was it to raise funds at the initial stages since the LPO sector was very new at that time?
Pavan Vaish: Linking to the earlier response, the initial phase was filled with lot of skepticism for the LPO industry. The investors had to be convinced about the future growth potential of the sector and the ability to attract clients in the legal industry to embrace the concept of outsourcing. But since outsourcing to India was already a sold concept, we were able to convince investors to invest in the company by relying on the domain expertise and unique business solutions that we had to offer in this area.
Bar & Bench: What is the kind of work that was initially done at UnitedLex and which area of work has seen maximum increase and has turned out to be biggest source of revenue?
Pavan Vaish: UnitedLex began its operations by initially offering services in the Contract Management and Intellectual Property areas. Subsequently, we extended our offerings in the area of Litigation Support Services business. While all segments have grown over the years, the biggest source of revenue is Litigation Support Services.
Bar & Bench: When you were hiring initially, did you do campus recruitments or did you use agencies?
Pavan Vaish: The initial hiring was done mostly through recruitment firms. Our founding team and investors also helped us with referrals for various positions.
Bar & Bench: The decision to acquire LPO LawScribe. How has the journey been thereafter?
Pavan Vaish: UnitedLex’s decision to acquire LawScribe was to sharpen our capabilities in the area eDiscovery and document review, intellectual property, legal research and support. This partnership reinforced our shared commitment to the efficient and advanced delivery of legal solutions in the evolving marketplace and to the mutual objective of ensuring that our clients maximized the operational gains from our offerings. The addition of LawScribe’s capabilities and industry knowledge complemented our success in leveraging innovation to provide sustainable legal and business solutions for our expanding global client base. The integration was effected quickly in a seamless manner.
Bar & Bench: Who are your major clients? Do you see more work coming from law firms?
Pavan Vaish: We cannot disclose all client names due to client confidentiality reasons. One of our major clients is British Telecom whose captive center in India was taken over by us. We are the preferred legal outsourcing provider of the Fortune Global 500 and the world’s leading law firms. We foresee more work flow from the law firms as they are under constant pressure from their client corporations to reduce their billing rates. To maximize efficiency in the minimum cost, law firms will need to explore different ways of working which will include partnering with LPOs.
Bar & Bench: Give us some insight on the technology used in LPO sector and also the technology developed in UnitedLex?
Pavan Vaish: LPO’s offer a variety of technology-powered solutions to their clients for managing their global delivery operations. For teams working across different geographies of the world, innovative workflow technology platforms play a vital role in connecting them instantly. Interactive technology platforms are best suited for managing processes like document review, contract management, intellectual property and litigation services. LPO’s have an edge in the market as they are well versed with providing superior technology applications to their clients who prefer it as opposed to having an in house technology set up. This further adds to the cost saving advantage.
LPO proprietary technology is a huge competitive advantage. It has been designed to fill gaps and serve niche/custom requirements not addressed by third party systems. The technology used in this industry has an ability to make enhancements to third party technologies to improve performance (e.g. developing a distributed architecture and custom scripting to enable parallel processing of data). Also, the information security environment has matured with the ISO 27001 certification and other control implementations.
UnitedLex benefits hugely from this new trend of sharing technology platforms as it manages to attract even those customers who do not outsource their legal work. The customers log in and work on our SaaS (Software as a Service) environment hosted in our private cloud.
Some of the unique technology powered solutions that UnitedLex has developed/uses are LexBase Technology Platform, LexDiscovery Technology and Document Hosting Technology.
Bar & Bench: Do you see changes in the manner in which the LPO sector is perceived now?
Pavan Vaish: Yes. There has been a considerable shift in the way LPO’s have been perceived. As we have been experiencing stupendous growth in this sector, we are now being seen as a specialized and knowledge-driven industry that combines deep domain expertise with a blend of technology and people processes to deliver success benchmarks in the legal arena. The industry is no more looked as performing only low-end, simple and routine legal services. However, we still need to cover more ground in this area.
We have developed the unique ability to blend in-depth domain knowledge with technology and a strong process orientation to provide efficient and effective solutions that meets the needs of clients.
Bar & Bench: Over the last decade, a large number of companies have tried to crack the LPO sector and failed. How have you managed to survive for so long?
Pavan Vaish: UnitedLex, as the preferred legal outsourcing provider of the Fortune Global 500 and the world’s leading law firms is committed to client satisfaction. We make sure that we deliver high performance in every aspect of business and take great pride in our long term client relationships. We have managed to keep the trust of our clients over the years by consistently exceeding their expectations. Our Globally-integrated delivery capability coupled with our advanced approach to technology powered legal and business solutions uniquely differentiates us from our competitors. We have been successfully able to combine cutting edge technology, deep domain consulting skills and a globally integrated, world class process outsourcing capability to constantly help our clients succeed. We are a unique blend of People, Process and High end Technology that enables us to become the market leader.
Bar & Bench: Last year, Ajay Agrawal, co-founder of UnitedLex sold his entire stake in the company. Did his departure have any impact on the company?
Pavan Vaish: No, it did not have any impact on the company as we had sufficient depth in both the senior leadership levels as well domain expertise to continue managing business operations efficiently. Our revenue grew to $40m last year which represented a 60% year on year growth rate and our outlook for the future continues to be very bullish.
Bar & Bench: What are some of the challenges you are facing?
Pavan Vaish: The transactional nature of some service lines makes it difficult to manage a large fixed base of employees. In the US, there is a concept of temporary staffing but it becomes difficult to apply that concept in India. Further, the team management skills of lawyers need to be honed to enable them to manage larger teams.
The attrition rate among young lawyers, who form the main task force, is another challenge that the LPO industry has to deal with. These young lawyers have multiple career choices and therefore this availability of choices along with the fact that they are early in their careers and have not settled down causes a higher attrition level.
Hiring senior lawyers – with more than 15 years of experience – having appropriate skills face a different kind of problem. Sometimes the cost of hiring such a talent at an offshore location is almost as high as in the U.S. There are very few people with such specialized skills and we constantly need to find out ways to get them associated with us.
Bar & Bench: Are you seeing any slowdown in the LPO market due to current economic situation globally?
Pavan Vaish: Economic situations have been found to impact every business because of which all departments of a corporation, including the legal departments have been under constant pressure to reduce operational cost. This has turned out be favorable for the LPO market as it has the capability to deliver cost effective legal solutions to the clients. This in a way is a big opportunity for companies with comparatively low cost operations such as in India. We are not seeing any slowdown in the market at this time.
Bar & Bench: Right now you have about 750 lawyers working for you with two-third lawyers in India. Do you see the company moving to establishing similar numbers in other countries as well? Tell us about the growth plans at UnitedLex.
Pavan Vaish: UnitedLex operates on the concepts of the Right shore model and has the capability to offer the optimal combination of expertise, cost effectiveness, proximity and client preference with respect to specific project requirements. The company will continue to proactively scan the marketplace and client needs and basis that, if there is requirement to set up operations in other countries, we would be keen to go ahead in that direction.
We will continue to grow and expand the capabilities of UnitedLex as the global leader in the Legal Services Industry. We’ll do this by combining cutting edge technology, deep domain consulting skills and a globally integrated, world class process outsourcing capability. We are also strong proponents of making a difference in our clients business -not just by driving arbitrage savings but by using our technology-consulting-outsourcing model which enables them to compete more effectively in the marketplace.
Bar & Bench: What are your thoughts on future trends of LPO Industry?
Pavan Vaish: The need for deployment of captive legal knowledge centers. The ability to recruit and retain the right talent is an enormous challenge for Global Fortune 500 companies. Getting the unique technology right is equally a challenge. UnitedLex is well positioned to address these issues and provide dedicated teams that foster efficiency and scalability – and enable companies to retain the vast amount of intellectual capital that is generated in these units. LPO’s are not about cost arbitrage anymore. There are many established IT / BPO / Consulting players that are intending to offer LPO services.
This industry has moved up the value chain and the focus is expanding from the earlier administrative services (contract abstraction, patent proofreading, and litigation coding) to higher complexity services (eDiscovery analytics, litigation readiness assessments, collections, expert witness services, patent drafting, patent analytics services, contract negotiations, obligation management). LPO’s have also been exploring non-traditional services like loan processing, litigation financing etc and unlike earlier this competitive sourcing is now managed by procurement departments (RFPs, due diligence audits) from the client side. This in itself is a testimony that the business trend is evolving for LPO’s. The demand for end to end integrated solutions (combining services, technologies, jurisdictional coverage) are increasing as the smaller players are being acquired (CrownBridge and LawScribe acquisition by UnitedLex) by bigger players to make the industry more competitive. Another most visible trend is the interest that the European, Australian, South African and Asian clients have been demonstrating in this sector.