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21 August 2009

rupees_medMany law firms would probably pay consultants an arm and a leg for this advice. Inspired by FoxMandal Delhi's recent cash flow woes, regular Legally India commenter Legal Dodo posted an interesting list for law firms to save money. For free!

While Legal Dodo is happy to admit that some of these points are obvious and may not necessarily apply to every law firm, his/her points are nevertheless worth thinking about:

"Here are some random thoughts/tips on cost cutting. They are in no particular order of priority and may not necessarily apply in every situation. Some of them are borne out of experience. Of course - some are very obvious.

1) Assess all the infrastructure you are using - especially the real property. Do you own excess space? Have you leased excess space? If yes, ensure that all your staff work together. Keep the excess space unoccupied. This helps save electricity costs. If you use air-conditioning - believe me - the savings can be substantial.

2) In case you are paying an above average rent for the space you are
occupying, negotiate with your landlord for a downward revision of the rent. After the recent global meltdown, there are hundreds of office spaces lying vacant.
Your landlord will be put on the defensive and is likely to accede to your request, especially if you threaten to vacate.

3) Alternatively, negotiate for a right to sub-let. If you have excess space and your growth plans are not as aggressive as they were when you first leased your office space, short-term sub-letting makes a lot of sense.

4) Is your office located on a main road in a prime business location? If yes - then reconsider whether it makes sense continuing from there. For a law firm, such a location offers little advantage. Consider shifting into a suburb or into an office off the main road. Rents are considerably lesser in these areas. Perhaps, your staff's efficiency may also increase.

4) Do you have multiple telephone connections (landlines) or multiple
Internet connections? If so, it makes sense to cut down on them.

5) If your office has good ventilation and natural lighting, consider making optimum use of the natural air and light. This could help cut down your electricity consumption.

6) Cut down on your marketing and promotional spending. Avoid sponsoring seminars, conferences, moot-courts, local-events and/or business-round-tables.
In my experience, these are a colossal waste of time and money.

7) Similarly, stop attending such seminars, conferences or other events, especially if you have to pay through your nose for it. If you are invited, and do not want to miss out on the networking opportunity, offer to speak at the conference. Often, organizers are short of speakers. If so, they will be more than happy to
get a free speaker and perhaps may also give you a few free delegate passes, which you can share with your colleagues.

8) Avoid wasteful travel. If you have to travel, then do so and stay economically. Staying in five star hotels and commuting in expensive chauffeur driven cars burn a significant hole in your pocket. You can stay just as comfortably in good service apartments and save on transport by using city taxi. Avoid overnight stay, if possible.

9) Avoid expensive lunches/outings and/or throwing lavish parties.

10) Cut down on the freebies that you give to your staff. Do they have free telephones? Are they provided with expensive cars? Impose a limit on their telephone usage. Consider car pooling for the staff.

11) Cut down on your excess security and maintenance staff. Keep the minimum staff required to ensure security and cleanliness of the office. Invariably, these employees are sourced from a security or house keeping agency. Therefore, you are not firing anyone, and even better, they are not losing their jobs when you relieve the security and maintenance personnel of their duties.

12) Cut down on unnecessary subscriptions, especially foreign publications.

13) Hire interns, instead of fresh employees, for doing routine work or carrying out support functions.

14) Use Skype or e-mail to communicate and reduce telephone costs. Reduce stationary usage by printing only if you have to. Use both sides of paper while printing. For rough drafts, you can use the printer option to print multiple pages per sheet.

15) Cut down on giving corporate gifts.

16) Use the courier service only for important documents. For routine mails, use the postal service. It's much cheaper.

17) This is the most contentious point. Chop dead wood. In other words, identify the non performing staff and encourage them to leave. Almost every organization lands up making hiring mistakes and taking on people whom it should never have hired. Employees with an "entitlement culture," i.e. those who cannot look beyond their own nose, are the worst people to have around at any time, more so during an economic crisis. Such employees shirk work, avoid responsibility and mysteriously develop high fever or a severe tummy ache whenever a complex assignment crops up. They stop looking for work the moment they are employed.

Once employed, they are the first to approach the HR Department to ascertain how many sick leaves, casual leaves, paid leaves and national holidays they are entitled to. They expect hefty pay hikes every six months and fudge their time/work records to show how well they are performing. While at "work," they spend time chatting, surfing the net, taking long coffee and smoking breaks and complain about just anything they can complain about. Invariably, whatever little work they do requires to be entirely redone. Such employees are a big nuisance and extremely demoralizing to have around. It's a big mistake to consider them as "family" and put up with them. Invariably, they go around bad-mouthing the organization at every given opportunity. Such employees are perhaps the greatest liability any organization can have, especially a service oriented organization like a law firm, whose human capital is its greatest asset. It's wise to be diplomatic while doing away with such employees. Give them glowing recommendation letters, if necessary. Words are free. Won't you be glad that your worst performer lands up joining your rival?

As I mentioned earlier, these are just random thoughts. Constructive criticism welcome. Feel free to add to the list.

Legal Dodo."

And as requested, I'd like to add a couple of extra points to this very comprehensive list:

18) Institute reasonable pay-cuts. A lot less painful that outright lay-offs and a sensible option for unsustainable salaries that were pegged after blind competition in a boom market.

19) Introduce a part-time working option for employees who are interested for personal or other reasons. Someone on a four-day week will save a firm 20 per cent and if the employee is good they could end up managing their time more efficiently than a full-time employee. On the flipside, it can be a headache to manage from an HR and client service-level perspective.

20) Consider outsourcing your back-office operations (which is perhaps my most contentious point). Clifford Chance, for example, was targeting £8m (around Rs 60 crore) annual cost savings with its offshoring of document production (and now also paralegal fee-earners) to Gurgaon.

Please do add your ideas, suggestions and comments.

17 August 2009

Li-LegallyIndia_sml_logoGood news: no lawyers were laid off in US Biglaw last week - the first time since records began (this year). But how have Indian lawyers fared in the downturn?

US blawg Abovethelaw.com teamed up with fellow blawgers Lawshucks to produce a beautiful graph of number of lawyers retrenched versus time.

And lo-and-behold, a trend is clearly visible - lay-offs spiked heavily in March, then began dropping off gradually until this week, when for the first time this year all US lawyers apparently held on to their jobs.

Although the US economy and lawyers are unlikely to be out of the woods yet completely - almost 600 US lawyers still lost their jobs in July and the country overall saw an increase in initial jobless claims to 558,000 last week.

Nevertheless, in the US and UK, lawyers' jobs were amongst the first professions to get hit by the downturn, exhibiting as they do exposure and sensitivity to many sectors.

This could also mean they will be at the vanguard of the recovery.

In India, by contrast, retrenchment has often been talked about in hushed tones with many firms denying any took place whatsoever.

What has been your experience?

Please comment below or send us an email confidentially: .

29 July 2009

call_centre_vlima_com_thA new university course offering a qualification in legal process outsourcing (LPO) has been launched in a barrage of acronyms.

The course is a joint venture between Indian legal training providers/recruiters Rainmaker and the Indira Gandhi National Open University (IGNOU) School of Law.

The Rs.18,000 one-year on-line taught course is snappily entitled P.G.D.L.P.O. (or Post-Graduate Diploma in Legal Process Outsourcing, to give it its full name).

According to a press release published on LPO blog Legally Yours, the syllabus will cover: "Professional English Proficiency (“PEP”), Virtual Intelligence Methods (“VIM”), Legal Education and Proficiency (“LEAP”), Skills, Personal Effectiveness and Enterprise Development (“SPEED”)".

Catchy! (even though VIM's long-form is slightly confusing).

Apparently, according to the press release, 500 students have applied already for the first semester and the University is going to roll out a second intake in August to meet demand.

This programme could very well catch on and it could also be something that LPO providers facing high staff attrition have been clamouring for.

The main question will be whether law graduates will really be up for spending another year studying and losing themselves in an acronym jungle.

Photo by vlima.com

16 July 2009

Will limited liability partnerships (LLPs) actually work, asks Indian Corporate Law Blog, notwithstanding the recent tax changes.

Lead blawger V Umakanth uncovered an interesting academic paper analysising what the Limited Liability Partnership Act could actually mean in practice for lawyers.

One possible conclusion is that, hindered by the Indian Companies Act 1956, it in fact won't do anything to alleviate one of the main reasons for law firms to turn LLP in the first place: breaking through the technical 20 partner limit.

A commenter disagrees with the analysis and writes that the Indian Companies Act's section 11 provides "a carve out for associations 'formed in pursuance of some other Indian law'."

The "some other Indian law" in this case would presumably be the LLP Act, but it remains to be seen how lawyers will interpret (embrace?) the law.

Legally India has currently not had any luck accessing the original article directly (linked to from Indian Corporate Law), but will be sure to read it as soon as it is back on-line.

30 June 2009

Blawger Legally Infantile dishes out some choice legal advice to an old school colleague about being fined Rs 5,000 for getting caught cheating at exams.

Never mind that the school will allow him to remain at the school as well as retake the exam, the culprit now wants to sue the school.

Legally Infantile, being a sensible young corporate lawyer, tells him to go away. Somewhat politely.

Do you have any stories of relatives and old friends coming out of the woodworks asking for obscure legal advice, as soon as you qualified as a lawyer?

Were you able to help?

22 June 2009

SEBIIf you were left behind by SEBI's whirlwind of activity last week do not fret: the Indian Corporate Law blog has a crash course in SEBI reforms.

Read the blog post to give you the full run down.
14 June 2009

Swine fluIndian blawg Law and Other Things posted a brilliant article dissecting the statutory framework that is being used to deprive suspected swine flu cases of their liberty. But, asks the blawg, is the Act actually fit for purpose?

Probably not: although swine flu is frightening and has reached global pandemic status, it is technically unlikely to be an epidemic in India and would thus not fall within the Epidemic Diseases Act 1897.

While some of the powers of the Act are suitably draconian to allow the state to deal with diseases serious enough to destroy it (although the maximum Rs 200 fine is unlikely to hurt much), does the 100-odd-year-old legislation leave public health officials defenceless against the virus until it is too late?

Photo by Fleur-design under Creative Commons licence.

10 June 2009
Blawg-osphere US legal blog Above the Law has published an in-depth interview with an Indian legal process outsourcing (LPO) company, providing a good insight into where LPO could take the US and UK legal markets in future.

Above the Law talked to Gururaj Potnis, the director of Manthan Legal, which claims "over 700 man-years of experience in the LPO industry".

Potnis said that US firms would have to wake up to LPO if they want to survive and offer value to clients. "Some law firms are just wanting to be blind," he told Above the Law. "There is a tremendous value potential. But people do not want to take an open view."

The business case he makes is sound on many fronts: clients will increasingly request low-level legal work to be outsourced, LPO can solve headaches for management such as underutilisation and high fixed costs, as well as keep the legal work-flow ticking over 24/7 – although one imagines many US white shoe firm associates already work almost as many hours in the week, or at least did, before the downturn.

In typically ironic, vociferous and often offensive fashion (you have been warned), Above the Law readers commented on the story in droves – currently the thread runs to 123 comments and counting.

They include the good ("Again, outsourcing is not a magic solution to every problem. But properly used, it can be a very useful tool."); the bad ("These Indian lawyers are helping to BURST THE BIGLAW BUBBLE!"); and the ugly (from a "parody of a xenophobic hick").

See today's story on Legally India about the Scottish, who see the future of Indian outsourcing in Scotland.