The Rise and Rise of Alternative Legal Service Providers (ALSPs)

The legal industry is constantly evolving, and one of the most recent trends is the rise of alternative legal service providers (ALSPs). These providers offer a wide range of services outside of the traditional model of lawyers working in law firms. This article takes a closer look at the ALSP market, the different types of service providers, and the tasks they typically perform. We'll also discuss the reasons why more organizations are choosing to work with ALSPs.

Evolution of ALSPs

Alternative legal service refers to the way legal services are provided outside of the traditional model of lawyers working in law firms. The ALSP market began around a decade ago?in the United Kingdom, where the first legal services support operations were set up in low-cost jurisdictions such as Belfast and Manchester and offshore in India or South Africa. Law firms established these operations primarily to offer cost savings to clients.

ALSPs are more established in the United States, where they initially focused on providing discovery services for litigation but quickly expanded into other areas, such as contract management and legal research.

This can include various forms of delivery, such as:

• Legal process outsourcers (LPOs):?Alternative legal service providers can include legal process outsourcers (LPOs), which are independent organizations that carry out routine legal services on behalf of a law firm or in-house team. They are often located in lower-cost regions.
• Captive LPOs:?Captive LPOs are similar, but they are wholly owned by a law firm or corporation.
• Managed service providers:?Managed service providers, independent or captive, typically carry out all or part of an in-house team's function from end-to-end.
• Contract and staffing services:?Contract and staffing services provide lawyers on a temporary basis to companies and law firms, with tasks ranging from entry-level document review to those requiring highly skilled specialists.

Additionally, legal services can also be provided by organizations that are not primarily law firms, such as the Big Four accounting firms.

Reasons Why Organizations Use ALSPs

The global financial crisis of 2008 led to a migration of legal work in-house and a corresponding growth of in-house teams. However, this trend has been reversed in recent years as organizations have come under pressure to reduce operational budgets and introduce efficiencies in service delivery. As a result, more general counsels have turned to ALSPs, as a cost-effective and efficient resource for document-heavy tasks.

The COVID-19 pandemic is likely to have accelerated this trend and provided new opportunities for ALSPs. While their use is still considered "alternative," it is now a mainstream legal option, with?79% of law firms and 71% of corporations using ALSPs. ALSPs perform many of traditional law firms' tasks, such as document review, contract management, legal research, and e-discovery. As they also offer cost savings and increased efficiency, making them an attractive option for organizations looking to reduce operational costs and improve service delivery.

Conclusion

The ALSP market is a rapidly changing landscape that is gaining momentum in the legal industry. With the increase in demand for cost-effective and efficient legal services, we can expect to see more organizations turning to ALSPs for support. With the recent acceleration due to the pandemic, the market is expected to grow even more in the coming years.

Event Update:

Unlock the full potential of your legal team with Vyapi 's exclusive webinar on "How ALSPs can help Corporations to do more with less in 2023?" Learn from industry experts on how to streamline processes, manage data, and collaborate effectively with ALSPs to support your business in a challenging economy. Sign up now for valuable insights and practical strategies for success. Register here: https://www.dhirubhai.net/video/event/urn:li:ugcPost:7021830537828859905/