top of page
Search

Aligning ALSPs & Legal Technology

By Ari Kaplan with Nicolas Leroux.


Ari Kaplan speaks for the series Reinventing Professionals with Nicolas Leroux, the founder and CEO of Kalexius, an alternative legal services provider.


Ari Kaplan

Tell us about your background and the genesis of Kalexius.


Nicolas Leroux

I am a lawyer from Geneva, Switzerland and used to practice in the field of international arbitration and public international law. Over time, the way that law firms were addressing their clients' requirements started to make little sense to me. I was thinking about the billable hour and how to give the most value to clients, so nine years ago, I decided to start Kalexius, which is an ALSP.


Ari Kaplan

How do you define an ALSP?


Nicolas Leroux

ALSP stands for alternative legal services provider, which is distinct from a traditional law firm. Some focus on staffing or e-discovery. We concentrate on identifying and delivering value in relation to contracts and corporate work because when you have sufficient volume, you can truly leverage and realize benefits from process review and technology.


Ari Kaplan

What is the difference between an ALSP and a legal technology company?


Nicolas Leroux

An ALSP is not a legal tech company because an ALSP is effectively an outsourcing company. We use legal tech in the delivery of services and it helps us to be more efficient, but our core business is really services that drive legal transformation. That process is about how to make a legal department leaner, more productive, and increasingly enjoyable for the lawyers that work there by freeing them from the more routine parts of the job. One of the problems that we find in the market today is that the terms transformation and technology are often conflated by lawyers. Tech is only one piece of the puzzle and it is called a tool for a reason. If I wake up tomorrow and decide to lose weight, I must exercise more. The first task would be to buy a nice pair of trainers or a bike, but then I need to start running or get on that bike. Buying tech is relatively easy, trendy, and exciting. The CEO wants to see tech everywhere and it is easy to get a budget. Transforming the way your department works and the way people interact with each other is much harder.


That's where an ALSP and outsourcing are usually part of the solution because it's just too difficult to do it alone. An ALSP can deliver more savings than just technology and we did a study recently about contract review in which we found that using contract review software delivered about 21% of savings. 21% is not nearly as much as you can save when you use an ALSP, when you use outsourcing, or when you use ALSP, outsourcing, and technology together.

Ari Kaplan

How can in-house legal teams incorporate an ALSP into their portfolio of service providers?

Nicolas Leroux

When we work with clients, the first step is always a consulting process. We ask people to tell us what they do. Legal departments often don't know what they do and have very little data on the activities of their team members. When you draw it out, you realize that a lot of relatively simple work is being done by very senior people, so we focus our initial efforts on right-sourcing. Our goal is to find the appropriate resource for a given type of work. It can be someone who's more junior than the person who's doing the work currently, it can be a paralegal, it can be someone in a local center in the US, or it can be someone offshore. In fact, it is usually a combination. Everyone wins because the senior lawyers, who were initially reluctant when we started the review because they were scared for their job or because they were just uncomfortable with change, realize the benefits of the transformation on which we are focused. It can be a learning process for in-house teams to leverage an ALSP and understand that change, including that outsourcing is an opportunity for everyone.


Ari Kaplan

Where does further change need to occur?


Nicolas Leroux

It's a mindset. The legal profession is built on the idea that services are bespoke and artisan, which is how law firms justify their fees. For the most part, it's true. I used to practice international investment arbitration. It took me 10 years and a PhD just to start understanding what it was about. But, if you look at traditional M&A advice, litigation, and regulatory matters, they are often the same. It's very bespoke and does require hand-picked senior people that have loads of experience in their legal field or industry, but because the majority of the work is like this, lawyers tend to assume that everything they do is bespoke, strategic, and super high value, yet it is not. The classic example is NDAs, but it can also be terms and conditions in retail agreements, vendor contracts, and routine corporate work for companies that have entities to manage around the world. All of that work can be “playbooked,” streamlined, and outsourced at a lower cost. Lawyers need to realize that not everything is bespoke or strategic. Some tasks need to be approached in a more standardized way.


Ari Kaplan

How can leaders in law departments persuade reluctant stakeholders to adapt to their approach?


Nicolas Leroux

What we've seen in terms of the legal stakeholders is that there is an initial reluctance

because there's a concern that they're going to cut or offshore jobs. That's usually not the case. What happens is that the ALSP comes in as a welcomed addition to the existing team to bring flexibility, a new approach, and capabilities that the in-house lawyers do not have.


Ari Kaplan

You mentioned that some of your team used to sit on site and as a result of the pandemic no longer do so. Do you expect that to shift back?


Nicolas Leroux

Whoever was sitting in the office before will come back to the office to the extent that the client’s personnel goes back to the office. It is really driven by the clients and not us. The wider question is: To what extent will the trend towards working from home make it easier for companies to use ALSPs? The answer is that it will be easier and it should drive growth. Now that everyone will be working remotely at least part of the time moving forward, it makes it easier for us to offer an outsourced solution, which will further strengthen the growth of the ALSP sector.


Ari Kaplan

Where do you see legal services headed?


Nicolas Leroux

We are going to see a division of labor between those providers that focus on high-value work, such as international litigation or M&A, or very strategic work, which requires highly-trained specialists. On the other hand, providers like Kalexius and other ALSPs that focus more on the commoditized, lower-value work will address it through a combination of people and technology. The market is still very focused on tech because it has woken up to the possibilities of tech. The next step will be realizing tech alone does not work and that what really works is technology with a provider that knows how to leverage it.

 

Ari Kaplan regularly interviews leaders in the

legal industry and in the broader professional services community to share perspective, highlight transformative change, and introduce new technology at http://www.ReinventingProfessionals.com.


Listen to his conversation with Nicolas Leroux here:


Komentarze


bottom of page