Offshore legal outsourcing is becoming a vital part of cost-saving initiatives, according to a new survey by Citi Private Bank.
Citi Private Bank, a leading financial strategy consultant company, analyzed mid-year survey data from 187 U.S.-headquartered law firms for the report. According to the authors, the survey reveals a legal services market in which demand is low and competition is high.
Chairman Dan DiPietro and senior client advisor Gretta Rusanow say the situation has resulted in ongoing pressure from clients for law firms to provide greater value at lower cost.
Law firms have cut expenses, largely through cuts in lawyer head counts, leading to increases in productivity and contribution per lawyer, defined as revenue per lawyer minus expenses per lawyer, say the authors in a summary of the report that ran in The American Lawyer. With the new incoming class of lawyers, there may still be excess capacity, however, the authors say.
Also, DePietro and Rusanow say cutting equity partners has been a “focal point” for firms in 2010. And they predict it “will continue to be a priority throughout 2010.”
