Outsourcing as a Way to Improve Leverage

There are four components that influence the financial success of a law practice. Leverage is one of those factors; and, some would say, the most important factor. One form of leverage is delegation - pushing work down to the level where it can be completed competently and at the least cost to the firm and/or the client. I find in my work with firms of any size that the principle of delegation is one that is unanimously understood but rarely implemented in law practice. It's hard to let go. Of the four financial factors in law firm profitability, leverage may be the most important one. Leverage is the degree to which a firm is successful in using technology, expertise, legal and non-legal staff and other resources to produce work for and provide value to the client. In the solo and small firm practice, there is not always an apparent way to delegate - there may not be anyone to delegate to, which is where technology is so vital to the practice. Delegation of administrative and management functions is probably the most difficult to do because it is there that the lawyer feels most vulnerable. The lawyer who is trying to balance the management of her practice with her practice more often than not will neglect practice management so that client needs can be met. At some point, her failure to adequately manage the business side of law will begin to affect the practice side. This is the point where the firm is most vulnerable to malpractice and most likely to neglect a client. Outsourcing logical business or back-office functions makes sense when there is no one in-house to perform these functions, other than the lawyer. Outsourcing allows you to focus on your core competencies while others (in-house or outside the firm) focus, on your behalf, on their core competencies. The end result is that the client work will be get done and the management work will get done and both wlll be done well.