Outsourcing is the act of delegating work that should be done by employees of an organization to a third party. Outsourcing of legal services is influenced by factors such as cost, availability of qualified staff and the improvement in quality derived from the outsourcing exercise. The driving force in outsourcing of legal services is profit maximization and cost efficiency. The cost of labor in America and some European countries is very high. Companies in these countries, therefore, outsource services like legal services from countries such as India where labor is cheap (Alder, n.d.).
The outsourced company is paid a fraction of what permanent employees could have been paid for the same work. Outsourcing in a cross-cultural environment is not a good idea because it leads to massive loss of jobs for residents of a county. Outsourcing in an intercultural environment takes away control of quality from the managers. Outsourcing legal services compromises the client’s confidentiality (Patterso, 2013, p.188). Outsourcing also faces opposition from some customers because they believe the outsourced firm will not assure quality.
Outsourcing should only occur in those processes and services that are not core to the operations of businesses. Some of these functions are information technology and purchase and supplies management. The two services are similar to legal services because they support the activities of an organization. The services also lead to cost reduction and efficiency.
Outsourcing is a critical venture that requires managers to take into consideration a number of factors before venturing into it. Some of the factors include the economic benefits of outsourcing, the existence of resources in the organization and the required level of compliance with the law (Alder, n.d.). The most important factor, however, is the economic benefit. Managers conduct a cost-benefit analysis in order to determine the viability of on outsourcing venture.
Alder, H. Outsourcing (1st ed.). Retrieved from http://www.cips.org/documents/PG_Outsourcing.pdf
Patterso, L. (2013). Outsourcing of Legal Services: A Brief Survey of the Practice and the Minimal Impact of Protectionist Legislation (1st ed.). Retrieved from http://rjglb.richmond.edu/wp-content/uploads/2013/03/rgl_7-2_patterson.pdf