INSIGHT: How ALSPs Can Gain a Competitive Edge With Law Firms

The momentum driving the $10.7 billion alternative legal service provider (ALSPs) market is unprecedented. As law firms and corporate legal departments increasingly turn to ALSPs for specialty staffing, document review, discovery and a variety of other legal services, opportunities abound. But competition for these opportunities is growing as well. How can ALSPs differentiate themselves to gain the edge?

Certainly not through gimmicks or secret sauces: Law firms and in-house counsel are looking for consistency and reliability—expertise in matching talent to the task, supported by proven methodologies and workflows. The ALSPs poised to thrive in the coming years do the following five things religiously:

1. Develop an Understanding of Current Needs of Law Firms, Corporate Counsel

The constantly evolving model of how work gets done in legal settings can be burdensome to those held accountable. ALSPs that best serve their clients listen to their goals and concerns, and help them navigate their particular set of circumstances. It’s up to us as ALSPs to create cost-effective solutions that include the right people and processes.

More than ever before, clients are looking to reduce costs. As they strive to keep headcount to a minimum, they are reaching out to ALSPs to help them manage the ebbs and flows of work. ALSPs should be able to provide talent when and where it’s needed, at a relatively low cost.

Law firms and legal departments are also evaluating how they can push lower-level tasks to non-lawyers, both to cut costs and to free-up their specialists for higher-level assignments

2. Anticipate the Market

Being aware of what’s happening politically, economically and socially can offer ALSPs insight that equips them to be proactive in preparing for emerging legal needs.

For example, those who anticipated the rash of corporate bankruptcies we’re witnessing today had the opportunity to build their pool of bankruptcy talent to be prepared to provide staffing at a moment’s notice. And we should all be preparing to support clients challenged by the sunsetting of LIBOR (London Interbank Offered Rate) as well as companies vulnerable to class-action suits related to climate change.

3. Mitigate Risk and Cost for Clients

Whether you place the ideal candidate to fill a gap on your client’s team or you recommend the best combination of talent and technology to create a high-caliber, defensible work product without raising headcount, you are helping them mitigate both risk and cost.

Help clients understand that they don’t have to add to their payroll to keep every type of expertise on their permanent bench. You can bring in talent as needed, providing access to high-level, specialized individuals while keeping costs down. (Of course, once on board, it’s incumbent upon the client, not the ALSP, to manage the candidate and sign off on their work.)

4. Remain Agile

As a growing number of larger organizations enter the legal space, vying for the same clients as ALSPs, ALSPs can shine brightly if they have built agility into their processes. Can you have your client up and running with a talented team and solid workflow processes in 24 hours or less? That’s the point where you need to be.

Large organizations tend to want to map everything out prior to startup, often taking weeks to ramp up a solution. As ALSPs, we can give the client the resources they need right away, mapping as we go, to help them attack their legal issue as quickly as possible.

The key to getting this right is to be thoughtful and vigilant—never haphazard—with quick deployments, making sure the work is buttoned up so your client can hit the ground running without leaving themselves exposed in any way. Here’s where your expertise in identifying the right person or team will truly be put to the test, and where you simply cannot sacrifice defensibility. There’s little room for error when you are creating immediate solutions, especially with a goliath waiting in the wings.

5. Know Your Client (KYC)

Being a strong competitor also means mitigating potential risks to your own firm. KYC compliance, once reserved for banks, has become critical to the security and well-being of ALSPs. Always verify new clients’ identity and conduct due diligence on their business activities and reputation to assess the level of risk they might bring to the business relationship. Could they have illegal intentions? Are they engaged in business with money launderers, terrorists, or other dangerous players?

Background investigations are essential for every new client, including checking into their clients and other business partners. Remaining a viable ALSP competitor means never exposing your organization to bad actors. Good business partners will demonstrate a desire to achieve mutually agreeable goals, communicate with transparency and respect, and treat your candidate(s) well.

Being competitive among the sea of ALSPs and other organizations in the legal space today requires a strong commitment to not only building the knowledge and expertise necessary for making solid staffing decisions for clients but also giving them sound strategies for process and workflow.

The ALSPs that help law firms and corporate counsel reduce costs and improve or sustain the quality of the work they are turning out are well-positioned to win the day.

This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.

Author Information

Leslie A. Firtell is the founder, president, and chief executive officer of Tower Legal Solutions. She’s a 20-year veteran and pioneer of the legal staffing industry and an attorney. She introduced the benefits of legal staffing to law firms and corporations before it was a common practice.