Build vs. Buy: Insource/Outsource for Law Firms, with Ben Gideon and Jeff Wright

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Hello, everyone. Welcome to Elawvate

Build and Grow Your Law Firm.

I am Jeff Wright,

chief operating officer here at Gideon

Asen and as always joined by owner,

managing, partner,

extraordinaire Ben Gideon.

I think our topic today is going

to be on the very exciting topic

of insourcing versus

outsourcing of responsibilities.

It may not be the most

exciting thing in the world,

but it's a discussion that's happening.

You mentioned Injury Board a little while

ago and there was a firm that reached

out to Injury Board and wanted to talk

about whether they should insource

or outsource the COO

and a marketing person.

And I spent some time

speaking with that firm.

So we do think these are discussions

happening at other firms. And Ben,

I don't know if it makes sense to

kind of start at the beginning.

You've obviously alluded to the fact

that when you and Taylor started,

you were Jack of all trades. You were IT,

you were facilities, you were finance.

And at what point did you feel

you had to have the outsourcing

discussion where you knew you had to

bring on other assets to handle those

things either in- house or outsourced?

Yeah, it's a great question, Jeff.

And one reason I wanted to do an episode

on this topic is it's something that

when we started our firm and I

would say still through today,

it's a constant decision point

of whether for a particular task

or functionality, you're better

off spending the time, money,

and effort to build that internally

versus going out and finding a

vendor that can supply that product

or that service to you for a charge.

And in some sense,

we've discovered what the right balance

for our firm is through trial and error

in some instances, attempts that

have failed, things that have worked.

And I thought I would share some of that

with our listeners that might help them

enhance their ability to get to the

right decisions their own course.

So I mean, when you start your firm and

you're building it from the ground up,

one exciting thing I thought about

the ability to outsource certain

tasks is that it allows you to

develop a larger footprint really

from the inception than you might

justify based on the internal

numbers of your operation. So a firm

that has, as we did when we started,

just two lawyers and a couple

of support staff can operate

like a somewhat larger firm

by selectively outsourcing

certain tasks and duties. There

was a time for a law firm,

not a time recent past,

but a decade plus ago

where probably the standard

workflow was for the most part

for firms to handle everything

from soup to nuts for their

own operations internally.

I can think back to starting at my

last practice where we were still using

handheld dictaphones and

dictating memos and letters

and then those would get handed off.

The cassette tape would literally

be ejected from the dictaphone.

I know the technology sounds so

ancient. This wasn't that long ago.

You would eject your little

cassette, your mini cassette.

You would hand that to

your legal assistant.

They would put that into their listening

device with the headphones on and a

foot pedal and they would literally

create the transcription of your letter

or your memo. Someone might proof it and

then it would get circulated around as

needed. And that process of having

administrative staff transcribe

dictation still continued forward to

the time that I left that practice

about five years ago. There

were no longer mini cassettes.

They now I would dictate on my

iPhone using an app and then it would

automatically get uploaded or emailed.

The secretary was still transcribing it,

proofing it and et cetera.

One of the very first outsourcing things

we did in our new firm was to outsource

that transcription function

using a company called Rev,

which for a very low cost

will outsource it to somebody

around the world.

And it used to be that you would dictate

and that that would create a queue for

your legal assistant and they would

get to it whenever they could next in

their order of priority managing and

juggling all the other things they were

doing that were on their plate.

That could take a week sometimes. I mean,

if you had a lengthy memo that

you had dictated 10-page memo,

you might not get that

back for a week. Using Rev,

you get back a high quality

transcription of that memo within about

30 minutes. No matter if you

uploaded a hundred things,

you would still get a hundred pieces

of work returned to you within about 30

minutes because they're all getting

outsourced obviously to different people

that are ... If you're using

the human transcription service,

which we typically do,

there's also the fully automated voice

transcription service that's a lower

cost that tends to have more inaccuracies.

So that's one example of just a simple

outsourcing product. But as you go,

you start to identify other areas

early on where you can increase your

footprint and they're so accessible

today because everything tends to be

cloud-based. So if you're using a vendor,

they can easily get access to your data,

your information and workflow. So other

early examples of areas we outsourced

were our IT function. In the old days,

people had IT employees that

were on site that managed your

server room, your hardware,

software, et cetera.

Now I'm sure there are many firms that

still have internal IT and maybe when you

get scaled up large enough, that does

make sense. But for a small firm,

they're very good options for outside

vendors that can handle all of your IT

functions. The one we use

called TeamLogic, I think

it's a national company,

but we work with their ... I think

they're a franchise business,

but the office we work with out of

New Hampshire is exceptionally good,

very responsive, really nice folks.

And they can remote in to your laptop

or your desktop and handle almost

everything right away without even

having to pay an in- person visit to your

office. Obviously, no one has

server rooms or servers anymore,

get automatic backups so that everything

we do is backed up on about a 10-minute

cycle.

They can help with other things such

as cybersecurity issues and things like

that that all need to be addressed

these days. So as you're building,

you start to realize you can act

like a larger firm than you are by

outsourcing some of these

non-essential functions.

That's kind of the early phase of it.

Let me just kind of explain what there

have been vendors we have used that

didn't work out well.

Here's a good example.

Our firm relies heavily on

the ability to efficiently

and promptly obtain large volumes

of our client medical records,

particularly for medical malpractice

cases because we complete a review of the

case until we have a

complete set of records.

For those who don't do this kind of work,

but I'm sure there's an analogy

in every other type of practice,

but it can be extremely frustrating

to just get those documents

in- house because the system is really

designed to be inefficient so that it's

difficult to get the records you need.

No one's very responsive in that world

and it can take weeks or months,

which really grinds our whole practice

to a halt. We started out, we thought,

well, that would be a

good task to outsource.

It's a routine administrative

clerical task that is

repetitive really requires

the same approach and it

should be something that can

be done efficiently by somebody

we don't have to employ.

We hired a firm to do that. It became

a complete disaster. We went weeks,

months waiting for records to come in.

They never came in to the point where

our entire practice had really grown to a

stop. We couldn't create demands for

clients because we didn't have records.

We couldn't complete case reviews for

clients because we didn't have the records

and we were six months away from

having no pipeline and source of

viable cases because we didn't

have the records we needed to

perform the work. So then we decided,

well, we have to insource that.

So we hired somebody to do

that job internally and you

know who that was, Jeff,

it was Christine.

She came in and she did a phenomenal

job doing that and kind of salvaging

that part of the practice by starting

the flow of records coming back into our

office very aggressively pursuing them

to make sure they were coming in problem

solved. However, the problem with

that job is it's a thankless job.

It's incredibly frustrating.

There's a high burnout rate.

And after doing that

job for several months,

it was clear to us that Christine

was just getting burnt out of it.

We then hired somebody

to replace Christine who

Christine trained and then it

became apparent that this person wasn't

going to last in that job very long

either. It started to unravel

again. So we were faced with,

and this is sort of a classic dilemma

I think firms get faced with in certain

areas, doesn't have to be medical record

retrieval, be any number of things,

but you've got a particular

job that's difficult,

thankless. There's not a lot of

room for professional growth,

but it's essential in terms of blocking

and tackling to the core function you're

trying to do.

But what you recognize is you're going

to have high turnover and constantly

having to train people,

they're going to leave,

you're going to have

to train somebody else.

It's going to be a continual problem going

forward for you unless you can find a

workaround and a fix. At that point,

rather than continue to hire people and

insourcing that responsibility going

forward, we then made a second attempt

to outsource it and that ended up being

successful.

And it was successful because we found

a different vendor that performed the

service in a very different

way than our prior vendor had.

And we were very careful in terms of

vetting that vendor and following up and

managing that process until we felt

comfortable it was working well. But now

it's a problem that we've solved and we

don't have to internalize it and deal

with all of the fallout from having

to manage that process in- house.

And by the way,

that vendor was called Streamlined and

I highly recommend them for anybody who

needs medical record retrieval services.

This same problem cuts across

all aspects of a firm. I mean,

most law firms have dealt with marketing

vendors that could be particularly

problematic, particularly in say web

mastery and search engine optimization.

We're on our third different

SEO vendor and all our

past vendors were problematic

in different ways.

We can talk more about that in a moment.

Fits and starts, trial and error,

getting to the point of figuring

out what we can insource,

what we can outsource, which has led to

some kind of takeaways from all that,

which I'll share in a

moment, but I'll stop there.

Yeah. I was going to say one of the

things you touched on it briefly,

you need to have somebody internally

that is willing to spend the time

to look at multiple

vendors, do your research,

touch base with other firms,

get references, do demos,

go through your contracts.

And it's a considerable amount

of time if you do it correctly,

but nothing is worse than

signing a multi-year contract

with a vendor and you're

six months into it and you really don't

have a good out clause and you realize

you made a mistake.

So putting the time and effort in if

you do decide to outsource something,

you need to do it right out of the gate

and you need to identify somebody in-

house ideally not the attorneys

that should be using their time

obviously on cases, but if you

don't have that person in- house,

you need to identify them.

Yeah. And in our case, that's you, Jeff.

That whole backdrop of trial and error

that led to failures and successes with

outsourcing in some areas and not others

led me to develop some general rules of

thumb about what makes sense to insource

and what makes sense to outsource and

how to distinguish one from the other.

So let me just share that and then we can

go through how that plays out maybe in

some of the different areas

of your firm or practice.

So my rule for insourcing is

you want to insource core value

added services that define the product

or service that your firm delivers.

So obviously you have a value

proposition for your customers,

that key value proposition,

whatever your area of law is,

your legal services, your judgment,

your professional experience,

your reputation, that

cannot be outsourced.

People are coming to you for that service

and that's where you're making your

name and your brand. You would outsource

that at great peril because no one else

is going to have the

same reputation you have.

They're not going to have the experience

you have and that's ultimately going to

dilute your brand, dilute your

reputation and diminish your firm.

I don't think anybody would argue

with that and that we all know that.

The second area where you should insource,

and this is the one that's a little

bit more interesting, I think,

is what I've described as other

areas where building unique

capacity offers strategic

or competitive advantage and

can be accomplished at an

acceptable return on investment.

We can get back to examples of

what those things might look like,

but that's a critical part. So again,

that's in addition to your

essential function and core

value added proposition as a law firm,

I'm talking about other things now other

than your legal services to insource.

So let's talk about what you

should outsource. Number one,

you should outsource ancillary

and routine tasks that are not

core to the legal services of the firm

and that are more cost effective to

outsource. So we already gave an

example, transcription services,

medical record retrieval. Those are

not core to your legal services.

Nobody cares who transcribes the memo

or who transcribes the letter or who's

responsible for getting the medical

records. At the end of the day,

it doesn't make any difference

to your customer, to your client,

to the outcome in the case.

It's a back office function.

And if you can do that in a more

cost-effective way by outsourcing it,

you should outsource it. Number two,

you should outsource tasks where there

is little to no strategic or competitive

value in developing

individualized capacity.

And I will give some examples of

that in a moment. And number three,

you should outsource tasks.

And this is kind of the flip

side of that second category.

You should outsource tasks where there's

actually a strategic advantage to

outsource to somebody with a higher level

of targeted expertise and experience

than what you have than what

you can bring to the table. Now,

hopefully that's not in the core area

of legal services you're practicing

because if you're not the best or

confident in your ability to provide

that service,

then maybe you should go work for a

different law firm until you've burnished

your credentials to a point where you

could offer or you feel confident that you

are offering something of value from

your unique legal services that your firm

can offer.

But there are other things that you're

not going to be an expert at that you

would gain value from and your clients

will gain value from having you actually

outsource those things. So let's talk

about those are the categories I came up

with. What are your thoughts about those?

Do you have other categories or insights

into the ones that I've identified?

Actually, I think those

categories are perfect.

I don't have anything in addition to

those. But I think a lot of these things,

especially your last one,

which kind of sounded on the surface

like it flies in the face of your earlier

ones,

it really doesn't when we drill down into

that because there are areas that our

attorneys and our legal services staff

are not going to have expertise in and it

makes perfect sense for a strategic

advantage to utilize those from a third

party. Maybe the most important thing,

especially from a budgetary

standpoint is really identifying

those routine or ancillary tasks that

you just don't want your people to do.

We had a guest on, I forget,

months ago and she was a CFO and

she was still opening the mail every

day because it's something she just

always did. She'd come into the office,

she'd open the mail, she'd sort it,

she'd deliver it. And finally someone

said to her, "What are you doing?

At your salary,

your time should be spent better

elsewhere." And it sounds like such a

minuscule thing,

but she said that really opened her

eyes to what tasks should people

not be doing that can either be gotten

rid of or can be assigned elsewhere

to free up your team to do the

work they're supposed to be doing.

And identifying those ancillary tasks

and getting them off everyone's plate

might be the number one thing that

I would tell firms to address first.

It's the more low hanging fruit.

Agreed.

And it's not just a time wasting issue

that people aren't maximizing the

highest and best use of their time

with their credentials or their salary.

It's also a burnout factor because people

are doing thankless wrote repetitive

tasks that don't engage them,

that don't engage creativity

or their intellectual needs,

those people will leave.

And then the time and effort it requires

to recruit and train somebody knowing

that they're likely not going to last.

Those are the perfect things to outsource,

make that somebody else's problem.

And there's companies that then they

want that business because they've built

systems that make those repetitive

thankless tasks something they can

do efficiently and people that are

happy to have that work doing those

things and probably turn over too,

but they build that into

their business models.

So we've talked about the concepts.

So let's move to the practical,

how we've implemented those in our firm

and hopefully that will give folks an

idea for parallel ways they could be

implemented in your own firm. So when I

think about the first point that one

thing you want to insource is the core

value added services that

define the product and service

that your firm delivers

uniquely to the client, that doesn't

just include the legal services.

That includes your vision, the

visionary elements of your business.

We've talked a lot about that.

Your unique leadership structure,

you can't outsource that.

You can't outsource,

have somebody else develop

your vision for you.

You can't have somebody else lead

your firm or manage your firm.

You need to do that yourself, obviously.

We talked about the legal services.

So whatever type of practice you're in,

you're going to provide the legal

services. That's going to include lawyers.

That's likely to include support

staff for lawyers, whether paralegals,

legal assistants, case managers,

whatever is required to perform your

value-added legal services at the highest

level. In our type of practice,

I also think the core value added

services include our intake process

because the full experience

that a consumer has from

their contact with our firm,

which is very important to us,

begins with the first

phone call or contact,

email and insourcing that.

And what I mean by insourcing it is

insourcing the management of it.

There can be elements of the

intake that we do outsource,

but we'll talk about that in a minute,

but we don't outsource the process.

We don't outsource our

evaluation of the data.

We don't outsource the triaging of how

the cases are going to be triaged and

handled case evaluation. So that can

start with that first phone call,

but it in our case goes forward from

that to further analysis of whether this

is a case we want.

That's also something we really

can't and we don't want to outsource.

So building that capacity

for us is valuable.

And it offers us competitive

advantage. And in addition,

because it allows us to be able

to cast a wide net to filter out

a lot of different cases,

to accommodate a lot of referring

attorneys who want to send us work because

they know we will be responsive. Clients

will have a good experience when they

interaction with our

firm. We won't miss cases.

We'll be able to make informed decisions

about whether to take a case or not to

maximize the value of that case asset.

So those are all things you're

not going to want to outsource.

In your own business, that may

include the intake function.

Yo may not have a high enough volume

that that's something you really need to

worry about,

but there may be other things that go

along with the acquisition of work part of

the business that you're

going to need to insource.

The other area we talked about

was areas that you've identified

as a business where building

unique capacity offers

strategic or competitive advantage that

can be accomplished at an acceptable

return on investment.

Let me give you some examples

from our own business of that.

So one is operations. That is

Jeff's function as a chief operating

officer. So the question is some firms

don't have chief operating officers.

They either have nobody who's

really full-time in that position,

or they may choose to outsource

that by working with a vendor

to retain a fractional COO, for example.

So that's a question of what

is that capacity if you own

it as a firm versus

outsourcing it to a vendor,

where is the tipping point where there's

a strategic and competitive advantage

to building that capacity

internally versus outsourcing it?

And if you're going to build it

based on your own scale of practice,

can you do so at an acceptable

return on investment? Now,

if you only have a one or two lawyer

firm, the answer to that is probably no.

The return on investment from hiring a

full-time COO is not an acceptable ROI

for a two lawyer firm depending

on what the revenue is and so

forth. But you get to a point

in scaling up that the ROI is

acceptable and in my view,

the strategic or competitive

advantage to owning that capacity to

fully manage operations within

your own firm to develop unique

capabilities and people with the

institutional knowledge and firm specific

personal relationships

within the office, et cetera,

is worth it at a certain point. Jeff,

thoughts about insourcing of the COO role?

Yeah, obviously I'm a little biased here,

but it also depends on what the firm

is going to ask this individual to do

and what expectations they have.

Ben and Taylor here have given

me a lot of responsibility.

They've been willing to let

go of a number of things.

They've entrusted me with significant

decision-making ability and I could

not do this role

effectively remotely or as a

fractional COO without knowing the cases

and more importantly, knowing the

staff and all the employees intimately.

I'm much better at my job

by being onsite hands-on

and my ability to manage the

day-to-day and manage the

personalities and be able

to deliver appropriate

answers to the senior management

team and make appropriate suggestions

couldn't be done as a fractional.

If you have a paired down

version of your operations,

you want them to just

handle very specific things,

you might be able to get away with it.

But if you're going to ask a lot of this

individual, it's funny, we

just hired a new litigation,

new IECU attorney and during

the interview process,

one of the things that she

said was intriguing about

our firm was the fact that

Ben and Taylor hired a non-attorney

to run the day-to-day and that we're

treating it like a business.

She has not worked.

This is someone that's been in

the field, I think, a dozen years.

She said she has not worked at a

firm that was structured like that.

And that was one of the things that

intrigued her about coming to work here.

That's a great example of where that

provides strategic and competitive

advantage because I mean, she

was a highly qualified person,

great academic background,

federal clerkships,

somebody that we think very highly of

and could probably work at a lot of

different places and she wanted to be

somewhere that was well run like that.

And having been at other firms

that weren't run that way,

that was something that

was important to her.

So that gave us a competitive advantage

in that marketplace of recruiting and

hiring that we wouldn't

have otherwise had.

I actually think that's been true of a

number of our staff that have come here

because they want to be in an

environment where they feel supported,

where they have somebody that they can

work with as a mentor to help them grow

professionally.

So that's just one way in which having

a full-time COO I think does provide you

competitive and strategic advantage,

especially if you're competing against

firms that don't have that because

they're not going to have the ability to

execute business operations in the way

that we can.

And so when there's,

whether it's a marketing issue

or recruiting issue or employee

attorney compensation,

whatever the case may be,

we are going to be able to execute

on that better and therefore provide

ourselves a strategic advantage

and that just grows over time.

So as that capacity improves,

our advantage increases.

So it's something in our view that could

be done with our scale and acceptable

return on investment and did provide a

significant and competitive advantage and

continues to do so. Other areas

that we've identified like that,

finance and financial reporting.

Many firms outsource their entire

bookkeeping and financial function.

We've elected not to do that.

We do outsource aspects of that,

which we'll get to in a moment,

but our core finance function is

insourced because when you've got a

business that's managing millions and

tens of millions of dollars running

through your accounts and there's a lot

of strategic planning that you need to

do based on cash flow and based on

understanding revenues and sources of

revenue and millions and tens of

millions of dollars running through your

accounts and there's a lot of

strategic planning that you need to do

based on cash flow and based

on understanding revenues

and sources of revenue

and decisions on expense side

of things and compensation,

having that capacity and building that

over time is extremely valuable. And the

person we have doing

that not only does that,

but then she translates

that into extremely useful

reporting that allows us to

keep track of all of our KPIs and

metrics on a weekly basis to track our

progress. Again,

I think having that capacity

insourced is incredibly valuable.

Nobody else on an outsource basis is

going to learn and know our firm like

that and be able to provide that level

of transparency and detail into our

operations at a very intrinsic level

that allows us to manage our firm

effectively. Again, many

firms outsource that,

but we've elected to insource

it for the reasons discussed.

Marketing is a tricky one because

it's something that as lawyers,

we don't have a lot of inherent

knowledge or capacity to

understand necessarily advantage.

And there's lots of different vendors out

there that would be happy to take your

money to promise you the world

in terms of marketing claims

that what they can deliver for you. We

are barraged by that on a daily basis on

social media and email and so forth.

Originally, when we started our firm,

we had outsourced all of

our marketing efforts, SEO.

We talked about web management,

social media, all of that.

And we became increasingly frustrated

with that because what we have found in

the marketing space is that there's a

very formulaic approach to how law firm

marketing vendors operate.

And it's really no fault.

They're all working on small margins.

And so the business model is really to

provide a standardized basically cookie

cutter program to law

firms in exchange for a

monthly fee that can seem quite

high for what they're providing,

which is very minimal.

You also don't gain any competitive

advantage from that because all of your

competitors are buying the same standard

program from some other marketing

vendor that's operating on the same low

margin that's providing the same exact

service. So everybody has the same

website, the same SEO material,

the same junkie blog posts

written by 24-year-old kids who no

experience in the law and et cetera.

So at some point we just decided if we

want to take that function seriously,

we needed to insource that

and build real capacity.

And that has been a really

great development for us.

When we went out to locate somebody

to do that job, we were very,

very dubious that we would be able to

find somebody who could check off all the

boxes that would understand the

digital side of marketing from

websites to SEO to social media,

but also have enough managerial and

strategic insight that could lead that

function for us and provide us

good advice. But we decided, "Hey,

we'll just put it out there and see who

comes through the door." And we ended up

finding somebody who really checked all

of those boxes and has been a great fit.

And it's really been phenomenal to see

how that's translated into building our

unique capacity on a marketing

front. Jeff, finance and marketing.

The biggest things for me,

I'll talk generally first is by us

deciding to keep these in- house,

we've put a high value

on somebody creating

institutional knowledge and being able

to utilize that knowledge to do their

job more efficiently.

I think outsourcing marketing

or outsourcing your finance,

they're not going to have

that institutional knowledge.

They're not going to know

the ins and outs of the firm.

You're going to be

missing something. I mean,

our finance person is absolutely amazing.

We're very transparent with finances here.

But also a big thing is we

make a lot of our decisions,

virtually everything

based on science and data.

And we're doing internal

projections on case costs and

internal projections on

when case resolutions are

going to happen and what our

cashflow is going to look like.

That's very difficult to do at that

granular level by outsourcing that

function.

We do have an outside bookkeeping firm.

Very recently we had a bookkeeper

and the firm outgrew them.

There's nothing wrong with that.

You're going to outgrow

vendors as you begin to scale.

So like I talked about before, myself

and our head of finance, Christine,

vetted different bookkeeping firms and

met with them and got proposals from them

and everything and made a determination.

We switched about three months ago and

we're through and they're a firm that can

scale with us and she works hand

in hand with them weekly on things

and is able to provide

extremely good data that really

formulates decisions made at

the senior management level.

I'd say the same thing for marketing.

If you want to outsource it,

you just need to realize that firm that

you're outsourcing that to is going to

be working with 20, 30, 40 other

clients. They are not eating,

sleeping,

thinking about your firm and what can be

done and what tweaks they can make. We

made a decision with

increasing our marketing spend,

doing direct to consumer

for the first time.

We need somebody thinking

about Gideon Asin only.

If we're going to do this right,

we need someone 100% committed to

us and we've brought it in- house.

Matt's been with us for I think right

around a year now we wouldn't look back.

It was a fantastic decision for us.

Yeah.

And the other thing about both the finance

and the marketing functions is once

you insource it and build the

capacity internal knowledge,

it actually makes your vendor

relationships better and more

efficient and more profitable for you

because they can manage those vendor

relationships better than you could

if you didn't have that capacity.

So for instance, on the marketing side,

we still use a third party vendor to do

our webmastering and to do some of our

SEO stuff because we don't

want our fairly high salaried

marketing director to be doing all of

the mundane day-to-day things to just

keep the website functioning. And

if he needs something specific done,

he can outsource that to them.

What he does is provides us complete

transparency into what they're doing.

And he'll say, for example, last

month they did these three things.

That doesn't ad any value.

I'm going to tell them to stop doing that

and to take their dollars and do this

other thing with those dollars instead.

And so now we're getting good value out

of that vendor in addition to

having our marketing person.

I would say the same on the finance side.

We identified a problem

with the billing, I'm sorry,

with the bookkeeper because we had

somebody who was deeply into that and were

able to trage that and find a

different solution to that quickly.

Just some other examples of areas, again,

where you can build unique capacity.

We did that with our focus groups.

We built out a separate company that

manages focus groups because what we

recognize is we do a lot

of jury focus groups.

We didn't want to have to spend money

on an outside vendor where that can be

very expensive.

They don't really add a lot of value

above what we can do on our own.

And we are able to insource

that by creating a separate

company with a different

name that can run social media ads,

recruit people for our focus groups.

And we can do all that in- house for a

fraction of what we would pay if we had

to hire someone to perform focus groups

for us.

And that gives us the flexibility to

do a lot more focus groups when we like

doing those.

There's another area we've recently

discussed about insourcing to build unique

capacity and that has to do

with our chief AI officer.

I'm going to table that for the moment

and we'll get back to the listeners once

we've circled back and made final

decisions about that and can report out on

that. Let's talk about areas

where we've outsourced.

So we talked about one area of outsourcing

is for ancillary and routine tasks

that are not core to the legal services

of the firm and are more cost effective

to outsource. I already gave an example

of that. The transcription service LEX.

Second example for our practice,

medical records retrieval streamlined.

Another example,

which we alluded to in the context of

intake, we outsource elements of that.

So while we do intakes with real humans

in our office taking phone calls during

normal work hours,

we have outsourced overflow

calls and after hours calls.

So if we get too many calls at

once, they bounce to the outsource.

If they come in on

weekends or after hours,

they bounce to the outsourced

service. We had used one service.

It was okay but not great.

And we've recently changed to a different

service and we'll get back to folks on

that. But part of our

thinking is trying to,

particularly with the development of AI,

see what elements of the high

volume of calls that we need to

field can be effectively fielded at

a good return on investment without

missing important cases

and still providing a good

customer experience can be

outsourced using AI. And what percentage

of those are we going to continue to

have to keep with in- house

and continue to insource?

So that's a continuous process that

we're very involved in managing.

I don't know if you wanted

to talk on that for a moment.

Any firm should be very focused

on their intake procedure. I mean,

obviously that's where you're

probably getting a lot of your cases.

It's that first line of

defense, it's the first voice.

It's you need that person to instill

confidence in that potential client

and be able to react

as quickly as possible.

Ben had talked about back in the day

having the medical records person and that

being a very high burnout position.

I really think the only potentially

high burnout position we have left in-

house at the firm is

our intake coordinator.

We are extremely lucky to have a

young woman named Katrina who is just

fantastic at her job,

but it comes to a point as we're scaling,

there's only so much one person can do.

We're at a point where you

need to make a decision.

Do we try and find another Katrina,

bring another full-time employee on,

pay all the benefits and everything,

or do we try and utilize a third

party to support her with that after

hours, with that overflow,

without losing that personal touch

that this firm is very proud to

have. And Bennett alluded to

it. We're making a change.

They're actually implementing the

logic into their AI system as we speak.

And I should have that demo back for us

to vet this week to see how that goes.

Focus on your intake.

It's something that you can do a

mix of in- house and outhouse and

outsourced and do it properly.

The second category of areas that are

appropriate to insource, in our opinion,

are tasks where there's little to

no strategic or competitive value in

developing individualized

capacity. In a sense,

they're just things you're not in the

business of that somebody else is in the

business of that they can do better than

you and there's no reason to reinvent

the wheel. If they can provide

those services at a reasonable cost,

you're better off outsourcing them and

insourcing them isn't going to do much

for you in terms of your competitive

or strategic position anyway.

So outsource if possible. So we

already talked about one of them,

which is information technology,

basic IT services, outsource that.

Another category we've noted

ancillary HR related. So payroll,

we're not in the payroll business.

Someone else perfected that business.

Outsource it. Employment

lawyer, outsource it,

unless you're an employment lawyer

yourself. Ancillary finance related.

So we talked about bookkeeping.

That's kind of routine stuff,

making sure things are in the

right columns on the spreadsheet,

making sure things are categorized

appropriately, outsource it,

outside auditing.

Obviously that's something

you by definition need to

outsource. Tax accounting,

you're going to outsource that.

Marketing, ancillary marketing.

So although we have a marketing

director, as I mentioned,

we have an outside firm

that does our web mastering,

basically maintaining the website,

making edits or alterations to it. SEO,

some basic SEO functions as managed

by our marketing director ad and video

production, that's

outsourced. We're doing video.

There could come a point where it makes

sense for some firms to have a full-time

video production capability.

I do think that that is something in the

future we may consider because it could

ad unique value,

but it's hard to see how it adds a lot

more value than what it can do for us if

we're outsourcing the same function with

somebody we've grown to know and trust

and that's worked well for us.

Basic design. So designing ads,

for example, I'm talking about print

ads, things like that. We outsource that.

Here's the category we

were talking about earlier,

which is kind of the inverse of what

we're generally saying where value added

things, you want to insource them,

but there are some kind of more

rare and targeted value added

things that you aren't going to be

the best in yourself that you may

need and your business is going

to be enhanced by outsourcing.

So one example I put on our list is

appellate work. So we're trial lawyers.

We're very good at trying cases.

We're very good at getting

good results for our clients.

We do not do a high volume of appeals.

And when you're in a plaintiff's practice,

you don't want to do a lot of appeals

because it ties up time and ties up money

and prevents your clients from getting

paid for a prolonged period of time. But

when we have high leveraged appeals,

there are firms that specialize

in handling only appeals.

They have the ability to dedicate 100%

of their time and attention to doing the

appeal in a big case.

And we've just decided in some instances

that it's better to work with a firm

like that than to tie up our

own lawyers doing appeals.

We're going to get a better work product.

It's a good return on investment

for a third party to handle that.

We do targeted contract work.

So sometimes we get a high volume of legal

research and writing that needs to be

performed that needs to

be done at a high level,

but that can be in a discreet way

outsourced to a contract lawyer

who can do good quality legal

research and writing tasks for us.

Don't tie up our litigators doing an

overwhelming amount of legal research and

writing. And we get overall a better

worked product because we have a single

person who can be dedicated to doing

one writing assignment at a time.

So that's an example. Big data. We do

a lot of big data studies in our cases.

They're firms that handle big data.

We've thought a lot about internalizing

the function of doing big data,

but it's a big proces to acquire this

knowledge and skills and infrastructure to

do that. At this point, the ROI

on that hasn't made sense for us,

so we continue to outsource it.

We've now chosen to outsource podcast

production as evidenced by LawPod's

involvement in this podcast.

So there were a number of years in the

first three and a half years or so of

doing my other podcast,

the Trial Lawyer Podcast.

We did a lot of that in- house,

but at some point the ROI to outsource

that became obvious and we now

outsource podcast production to

LawPods who does a phenomenal job. Firm

consulting. We have an outside

consultant we've talked about before,

Melissa Shanahan at VelocityWorks. Again,

that's something we

could do in- house. Jeff,

you could convene our quarterly

meetings, you could run the meetings.

We've decided that there's a value

in having somebody who's an expert in

facilitating meetings handle that for

us instead of doing that ourselves.

Another category I have is

jury consultants. We hire

jury consultants. Again,

they're specialized in doing jury

selection, helping us with voir dire.

We could do that ourselves.

We think there's additional

value in outsourcing that.

So those are some examples

of that. Depending on what

kind of practice you have,

there's innumerable examples that fit

into all of these different categories.

I think the key here takeaway is start

with those big picture categories.

Try to think strategically and

critically about each item.

Does it make more sense to insource it?

Does it make more sense to outsource it?

And if anybody has questions

about it or looking for possible

vendors that we've used and liked,

happy to field any questions for folks,

just send us an email or give us a call.

Good. I know we're coming up against

time, Ben, and your next appointment,

so that was good. Very well thought out.

Yeah. And so when you

start going down the list,

you realize it's a lot of stuff.

I probably have only covered about two

thirds of it, but it gives you a sense.

Yeah, it's a lot more decisions

than you think there is. Yeah.

And when you see the checks

go out, you realize that.

Hopefully they come in at

equal rate. Well, thanks folks.

We'll catch you next time.

Appreciate it. Have a good one.

Take care. Bye-bye.

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