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As the global demand for lower cost and efficient legal services grows, we will see new innovations in the delivery of these services. Integreon, a global provider of outsourcing services recently announced the opening of its legal process outsourcing (LPO) onshore UK delivery centre.

The facility in Bristol will provide a full suite of LPO services, including document review, contract management, merger and acquisition (M&A) due diligence and compliance support.

This is an interesting turn of events in the LPO space. The whole premise of LPO services is the significant cost advantage of the service (amongst other benefits) over local comparable services. So how can there be such cost advantages if the services are being delivered in the UK?

According to Integreon, “As the delivery of legal services evolves, it’s clear that most law firms and corporate counsel require a mix of onshore and offshore support”. “Although cost is clearly a significant driver in determining the choice of location, there are many other forces at play, including ethical and legislative restrictions, complexity of the task at hand, familiarity with a client’s particular legal system, amount and type of communication required, project duration, client comfort with a location, time zone preference and language skills. Some outsourced services are best delivered from an onshore facility.”

The news of this onshore service comes alongside an official launch of Integreon’s paralegal service, which will see the outsourcer provide firms with temporary staff when extra capability is required.

Is this shift toward an onshore servicing model a sign that the market hasn’t fully accepted the traditional LPO model? If clients are looking for bottom line savings, I am not sure that these developments are a move in the right direction.

According to legal management consultancy Fronterion LLC, changes will sweep through the legal services outsourcing sector in 2012 as competition for potential clients heats up. Time will tell whether more LPOs will establish local servicing centres. If this happens, clients should expect that the rates for these services will go up (and will likely go up significantly).