Clifford Chance offshoring reduces client costs by almost 20%
When Clifford Chance released their results last week the main focus was on their £60m cost of restructuring. However, another interesting detail to emerge, picked up by Legally India , was the 12,000 hours of work farmed out to Clifford Chance’s Gurgaon "knowledge centre". The report stated, "Knowledge Centre lawyers worked with 15 offices last year, putting in over 12,000 hours of work on over 300 client projects… On a large project for a major international bank the use …
When Clifford Chance released their results last week the main focus was on their £60m cost of restructuring. However, another interesting detail to emerge, picked up by Legally India , was the 12,000 hours of work farmed out to Clifford Chance’s Gurgaon "knowledge centre". The report stated, "Knowledge Centre lawyers worked with 15 offices last year, putting in over 12,000 hours of work on over 300 client projects… On a large project for a major international bank the use of Knowledge Centre lawyers for certain aspects reduced the overall cost to the client by almost 20 [per cent]."
Yes it does say overall cost. With savings like that, it is going to be hard to wean clients off the offshoring drip even when the upturn gets into full swing. Eversheds and Clifford Chance announced plans to send work to India last year causing concerns for the future of junior lawyers and paralegals. At the time CC’s managing partner, David Childs, did not forsee trainee numbers in London being affected although the downturn has since seen to that. Earlier this year, other firms also announced plans to outsource lower level work including Lovells and Allen & Overy. Pinsent Masons and Simmons & Simmons went a step further with plans to instruct agency lawyers in low-cost jurisdictions.
All this adds up to more factors conspiring to put the junior ranks under pressure. Assistants and associates who are still employed may not have a lot to fear since brutal redundancy programmes alleviated some of their competition. But new recruits and the hordes of out of work lawyers seemingly face yet another competing factor as clients continue to squeeze firms on costs…
Clifford Chance offshore Indian lawyers work on 300 deals [Legally India]
More on outsourcing:
September 29, 2009
Canniablising the future of the firm for increased margins now. A sad reflection of our current economic state.
September 29, 2009
Law firms will still expand at trainee level when things improve. Fees will go back up so will recruitment. Outsourcing will just mean more leverage potential and bigger profits.
September 29, 2009
I think 2 has got it spot on although I see some time passing before firms become enthusiastic about expanding headcount again.
October 2, 2009
slippery slope
October 22, 2009
Outsourcing is a business strategy used by firms in all kinds of business process, like the legal industry for example. It has a negative effect to the local workers since they are losing their jobs but I think this would save businesses from closing down and I believe that it is better to for a company to reduce employees than to be out of business and will leave all unemployed.