{"id":347,"date":"2020-05-22T14:07:43","date_gmt":"2020-05-22T14:07:43","guid":{"rendered":"http:\/\/www.discoveroasis.com\/ediscovery-unredacted\/?p=347"},"modified":"2021-03-24T15:36:49","modified_gmt":"2021-03-24T15:36:49","slug":"legal-service-providers-during-quarantine-whos-exposed","status":"publish","type":"post","link":"https:\/\/www.oasisdiscovery.com\/ediscovery-unredacted\/security\/legal-service-providers-during-quarantine-whos-exposed\/","title":{"rendered":"Legal Service Providers During Quarantine: Who\u2019s Exposed?"},"content":{"rendered":"\n<h4><strong>We talked with twenty legal service providers\u2013here\u2019s what they said. <\/strong><\/h4>\n\n\n\n<p>This is a challenging time for legal service providers. Not only do we\nneed to comply with new workplace standards brought on by COVID-19, but we\u2019re also in\nthe wake of the most significant security breach in our industry\u2019s history.\nThe ransomware attack carried out against Epiq was a wake-up call for many that\nhad been taking data security for granted. Clients are now asking, \u201cIf Epiq can\nget hacked, what stops me from getting hacked? Or my outside counsel? Or\nhosting providers?\u201d The truth is the fallout from Epiq\u2019s failure\nwill have long-lasting consequences. However, it\u2019s still early\nand the consequences have been temporarily overshadowed (and delayed) by the\nmore imminent threats brought on by COVID-19.&nbsp;\n<\/p>\n\n\n\n<p>All at once, the entire world\u2013including those of us that provide services in the legal industry\u2013have begun transitioning to a virtual workplace and advancing data security methods. There\u2019s no denying the effect that the world\u2019s current crisis has had (and will continue to have) on the legal industry, so we decided to \u201ctake the pulse\u201d on our LSPs. Overall, we wanted to know what they thought their business would look like post-crisis. We also wanted to know if they\u2019ve had to change the way they work to meet new expectations.<\/p>\n\n\n\n<h2>The Questions: What We Asked<\/h2>\n\n\n\n<p>Oasis led twenty conversations with individual business executives\nselected from our customers (LSPs) and vendors (software companies). We wanted\nto understand what they had experienced so far and what they anticipated for\nboth the short and long term. Here\u2019s what we asked them:<\/p>\n\n\n\n<ul><li>When things\nstart to calm down, do you think your business will be changed for better or\nworse? <\/li><li>Do you\nforesee any changes in the type of services you provide or how they are\ndelivered? <\/li><li>What are the\nkey issues clients are reporting?<\/li><li>Any silver\nlinings? Unexpected positives?<\/li><li>We also asked\ngenerally, about the state of the industry from their perspective and what\nconcerns they had about the future.<\/li><\/ul>\n\n\n\n<h2>The Sample: Who We Talked To<\/h2>\n\n\n\n<p>We intentionally selected interview\nsubjects that represented a cross-section of the industry, broadly classified\nby their primary sources of revenue:<\/p>\n\n\n\n<ul><li>Legal Service\nProvider\u2013Project\nManagement, Collections, Processing and Hosting <\/li><li>Managed\nReview\u2013Document\nReview and Staffing<\/li><li>Software\nProvider\u2013Licensing and\nSaaS Hosting <\/li><li>Law firms or\ncorporate legal teams were not interviewed for this article<\/li><\/ul>\n\n\n\n<p>We selected different sized\norganizations to represent their unique perspectives:<\/p>\n\n\n\n<ul><li>Small\u2013less than 20\nemployees<\/li><li>Midsize\u201320 to 100\nemployees<\/li><li>Large\u2013100 to 1,000\nemployees<\/li><li>Global\u2013more than\n1,000 employees<\/li><\/ul>\n\n\n\n<p>Our interviewees also reflect\nregional differences:<\/p>\n\n\n\n<ul><li>Western US<\/li><li>Midwest US<\/li><li>Eastern US<\/li><li>United\nKingdom<\/li><li>Mainland\nEurope<\/li><\/ul>\n\n\n\n<h2>The Results: What We Found<\/h2>\n\n\n\n<p>Based on the responses received from our legal service providers, we\u2019ve identified certain types of organizations that may be more vulnerable to the impact of either COVID-19, the renewed scrutiny being placed on security, or a combination of the two. <\/p>\n\n\n\n<ul><li><strong>Law Firm Clients &amp; Transactional Services:<\/strong> Service providers that receive a large portion of their income from managed service contracts or even simply recurring revenue (like hosting) are in a much better position to weather this storm. Other companies that rely on a steady stream of new business\u2013regardless of the organization\u2019s size\u2013are anxiously anticipating business-as-usual.<br> <ul><li>Most respondents described their law firm customers&#8217; preference of working on a transactional basis and \u201cpay when paid.\u201d They expect these clients to exceed payment terms soon. <\/li><\/ul><ul><li>Clients working with law firms reported more disruption with fewer remote collections or understanding of remote collection requirements (asking clients for permission, organizing collection timetables). This meant that their projects were slowing down or being paused.<\/li><\/ul><ul><li>Although data collection work had slowed down, 60% of our clients reported increased activity in review databases with increasing numbers of people on the corporate client-side requesting access.<\/li><\/ul><ul><li>30% of clients reported that their law firms were actively bringing document review projects inhouse from outsourced providers. This suggests some firms are trying to maintain billable hours by repositioning litigation and having lawyers work on document review. <br> <\/li><\/ul><\/li><li><strong>Small Businesses:<\/strong> It\u2019s a fact of life that small businesses have few options when it comes to absorbing disruptions to cash flow. Small businesses (in all industries, not just ours) simply do not have access to big banks, private equity, venture capital, or other debt markets, putting them in an especially difficult situation until things return to normal. <br> <ul><li>Smaller businesses without an \u2018anchor client\u2019 or diverse service offerings will struggle. <\/li><\/ul><ul><li>Four to six weeks in lockdown was noted as manageable to interviewees. Two months was reported to be the maximum amount of time manageable without seeking other resources. <\/li><\/ul><ul><li>Organizations with varied service lines have already been moving resources into high-demand groups like bankruptcy, restructuring, and insolvency services, leading eDiscovery teams to be repurposed in those areas.<\/li><\/ul><\/li><\/ul>\n\n\n\n<ul><li><strong>Big, Complex Service Providers:<\/strong> It takes time to turn an aircraft carrier. Big, complex organizations that are the result of the M&amp;A frenzy over the last five years face challenges adapting to the new reality of both working from home and the recent focus on end-point security.<br> <ul><li>80% reported that they had been asked to provide additional information on their security and data privacy policies. <\/li><\/ul><ul><li>70% of our interview subjects said their clients were willing to pay a premium for service providers that could \u201cpivot\u201d and create solutions to problems in difficult circumstances.<\/li><\/ul><ul><li>Organizations that maintain a lot of physical space are absorbing that cost on an ongoing basis. Organizations with a lower footprint (particularly businesses with a large remote workforce) have fewer of these costs and are better able to adapt to new and unexpected market conditions.<\/li><\/ul><\/li><\/ul>\n\n\n\n<p>In addition to identifying those in vulnerable economic positions, we also gathered feedback from the LSPs and vendors regarding their feelings on the state of the industry.<\/p>\n\n\n\n<ul><li>All of the legal service providers we spoke to were confident that they would be okay over the next few months. While some reported a slowdown in new projects, it was evident that new and continuing business was not going to stop. <\/li><li>90% of clients interviewed have the majority of their staff working remotely or have the capacity to work remotely. No clients reported the need to reduce staff numbers or furlough staff at this time, though clients with paper processing said they are now running a &#8216;skeleton crew&#8217; to complete certain tasks.<\/li><li>Software companies reported no impact on their business operations as almost all staff worked remotely prior to the state closures. They did report increased demand in the areas of support and training.<\/li><li>Almost all clients predicted that receiving payment (collections) will be an issue in the months ahead.<\/li><\/ul>\n\n\n\n<h2>Summary<\/h2>\n\n\n\n<p>During this process, we recognized that the impact of the global\npandemic is not evenly distributed and that it\u2019s difficult\nto gather results on \u201cgeneral industry impact.\u201d Each organization faces unique\nchallenges based on its business model, revenue sources, access to capital, and\ngeographic location. While some organizations face serious threats, others are\noperating normally during this time.<\/p>\n\n\n\n<p>Yet the conversations had with our clients led us to summarize that\nwhile they felt the current state of the legal industry was healthy, they also\nthought the general focus will change in the future to center around people,\ntechnology, and service. The overnight conversion to a global remote workforce\nwill have shown naysayers what is possible and\nwill have (finally) broken down the barriers to flexible working and\ncloud-based technology. That said, it was apparent that not everyone will be\nable to take advantage of these opportunities. Large organizations that have\ngrown via acquisition and integration are going to have a much tougher time\nreorganizing to keep up with the \u2018new normal\u2019 as they begin shedding staff, facilities, and service\nlines that are no longer profitable. <\/p>\n\n\n\n<p>We may see fewer global \u2018end to end\u2019 or \u2018full service\u2019 service\nproviders in the future, as clients see the value in working with smaller, more\nnimble \u2018specialists\u2019 that can deliver with less overhead and higher\nquality. We\u2019ve all seen some businesses taking action sooner than\nothers. As the conversation shifts to easing restrictions on business\noperations, it\u2019s time for organizations to sink or swim, making way\nfor the \u2018new normal\u2019 in the industry to emerge. <\/p>\n","protected":false},"excerpt":{"rendered":"<p>This is a challenging time for legal service providers. Not only do we need to comply with new workplace standards brought on by COVID-19, but we\u2019re also in the wake of the most significant security breach in our industry\u2019s history.<\/p>\n","protected":false},"author":2,"featured_media":352,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":""},"categories":[4],"tags":[49,7,27,9,17],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.11 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Legal Service Providers During Quarantine: Who\u2019s Exposed? | Oasis Blog<\/title>\n<meta name=\"description\" content=\"All at once, legal service providers have begun transitioning to a virtual workplace and advancing data security methods.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.oasisdiscovery.com\/ediscovery-unredacted\/security\/legal-service-providers-during-quarantine-whos-exposed\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Legal Service Providers During Quarantine: Who\u2019s Exposed? 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