LPO News

A growing number of companies in the United States are considering alternative outsourcing centers for legal work across the globe. Israel appears to be one such destination that can provide the specialized skill repositories that the American firms and corporates are looking for. Israel is trying to fill this void by providing high-quality and specialized services to their American clients. The outsourcing market could generate hundreds of millions of dollars in annual revenue.

The first conference of this kind was organized on April 2, 2008 in Manhattan with the objective of alerting the US business community that Israel is an attractive alternative to countries that have traditionally provided outsourcing services.

In an interview, the Israeli Minister for Economic Affairs in New York, Yair Shiran said:

This is a niche that Israel can fill very well. Although Israel’s labor costs are higher than in Asia, but they are still significantly lower than in the US by 30-50%. At the same time, the quality of Israeli outsourcing services will be much higher and a customer calling from the US will be unaware that he is speaking with someone thousands of miles away.

Israel is still virgin territory for this industry. This conference, and those that will probably follow, are a reminder for US companies that Israel is the next wave of outsourcing.

One of the reasons for Israel’s edge in this business is the availability of thousands of US-trained lawyers fluent in English. They are as qualified as their American counterparts and are willing to work at 30 - 50 % of the wages. Shiran noted that Israel has not only been operating traditional call centers, but also other channels for outsourcing services, such as reviewing documents of legal nature, analysis of X-ray images, and the provision of software solutions.

However, the continuing war in Gaza and West Bank has perennially raised geopolitical security concerns and the risks from a long-term perspective are higher than those in India, which provides a politically conducive environment for Outsourcing centers to perform. There are obvious scalability concerns with the higher paid work-force conspicuously immigrating to North America and Europe.

Many of the law firms would be uncomfortable with sensitive work information demanding attention of qualified and trained American attorneys being shipped abroad increasing risk of compromise.

Related article: IDT and Others Finding Success in Israel