Alternative Legal Service Providers: Considerations for Outsourcing Legal Services

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The alternative legal service provider (ALSP) market is booming right now. This $10.7 billion segment could grow by an additional 25 percent over the next few years as attorneys seek better ways to manage increasing workloads with dwindling resources. Just about every corporate legal department or contracting agency has used one of these services with varying success levels. 

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Legal departments thinking about engaging one of these providers have many options to consider. However, without clearly defined expectations it can be hard to measure the value of an ALSP. Understanding the critical features of some of the more popular ALSP categories can help firms discover the right talent to meet their needs.

The Rapid Rise of ALSPs

While the origin of ALSPs is disputable, it is typically traced to the legal outsourcing firms of the 1950s. The earliest agencies focused on patents. The renewal process was a simple but tedious task for attorneys who needed time for more complex matters. Legal outsourcing allowed the attorneys to renew patents and reclaim those billable hours. Eventually, other agencies expanded the concept to offer similar services that would eliminate mundane, time-consuming functions. Today, ALSPs specialize in a wide array of areas, including: 

  • Contract Review: Spot checking contracts takes time, and there is still a risk that busy attorneys will miss important issues. Outsourcing contract review saves time and helps ensure critical errors are noted 
  • Bulk contract management: The average organization can have hundreds of employment contracts, nondisclosure agreements, and other forms that require monitoring and updates. Most organizations do not have the time to handle all these contracts in house, so they outsource the management to a company that digitizes the documents and then alerts the company of needed updates. 
  • Research: Research is different from discovery, which concentrates on case law and precedents that prove an argument. Research enables firms with extensive databases and search tools to quickly locate similar actions that may apply to the attorney's situation.

These are just a few types of alternative legal service providers. There are hundreds more that run the gamut from end-to-end intellectual property management to one-time handling of court matters. Chances are if it's a common legal task, there is an ALSP for it. That's a bit of a double-edged sword, as it can lead to challenges in choosing the right agency. 

Alternative Legal Service Provider Categories and Considerations 

Understanding the types of ALSPs is a lot easier than knowing which one to choose. High demand leads to many ALSPs adjusting their service offerings, hoping to take advantage of the need. Unfortunately, this can cause ALSPs to offer services that they're not qualified to provide. It's vital to know what to look for to avoid running afoul of one of these agencies.

ALSP Provider

What to Look For

Contract Review

Contract review providers need to offer two components: accuracy and speed. The reviewer should not merely redline issues and send the contract back. They should provide detailed notes on areas of concern, explain the potential risks, and offer alternative clauses. In some cases, this process is so detailed it can even replace negotiations

Bulk contract management 

The ability to manage contracts en masse requires a unique combination of legal expertise and technology. The ALSP should be able to monitor a database and tag the right information – like expiration dates or clauses requiring updates – to avoid missing critical deadlines.  

Research

Legal research is another software-driven process. Tools capable of compiling and understanding massive amounts of data can help attorneys find the right citations and ensure they're correctly added in their legal filings. The reviewer should consider the software the deal-breaker when vetting services. 

ALSPs and Artificial Intelligence

Increasingly ALSPs are leveraging artificial intelligence (AI) to augment their services. In contract review, for example, AI provides rapid evaluations of contracts, returning marked-up documents in only moments. These programs can also offer suggestions for resolving areas of concern. They leverage data from prior successful agreements and clauses to perfect arrangements. This streamlines contract drafting and negotiations while improving outcomes. 

AI can enhance the offerings of alternative legal service providers. It quickly reviews contracts, manages legal research, aids in bulk management, and improves negotiations. When it’s employed correctly, it can take a lot of burden off of in-house legal staff and legal departments, while improving their outcomes. One of the simplest ways for lawyers to get the best possible ALSP is to choose one that has harnessed the power of AI


LexCheck is not itself an alternative legal service provider. It’s an AI-powered technology solution for automated contract review and negotiations. To learn more, request a demo.

gary-sanghaGary Sangha | Founder & CEO

Gary Sangha is the Founder and CEO LexCheck. He's a serial entrepreneur and an academic. Gary previously founded Intelligize, a legal technology company that was acquired by LexisNexis. He's affiliated with the University of Pennsylvania and Stanford University and started his career as an attorney at Shearman & Sterling and White & Case.