As Freshfields mulls more low-cost bases, why are firms increasingly keen to set up multiple hubs?
Providing inexpensive support to all jurisdictions and timezones is moving up the agenda for law firms
June 21, 2015 at 07:04 PM
4 minute read
Freshfields Bruckhaus Deringer's plans to add a second and third low-cost support hub to its new Manchester base are nothing if not ambitious.
Before Manchester has even opened for business the firm this week confirmed it is already planning to create two further support centres in the US and Asia-Pacific.
Numerous firms have set up nearshoring centres for support functions in recent years, but the number with multiple offices spanning different timezones is still relatively small, making Freshfields' decision from the outset to open in a trio of locations a brave move.
The list is growing though, and now includes Latham & Watkins, whose new Manchester base comes on top of an existing hub in Los Angeles; Baker & McKenzie, which recently opened in Belfast after nearly 15 years in Manila; White & Case, which has a legal support centre in Tampa and back-office support in Manila; and Linklaters, which opened in Warsaw last year, adding to its long-established centre in Colchester.
Clifford Chance (CC) meanwhile has put finding at least one more base to add to its Delhi shared service centre firmly on the table as part of its new strategy, with Herbert Smith Freehills also looking to build on its Belfast centre elsewhere.
The reasons for adopting a multi-centre model are compelling, according to partners. As global law firms get ever larger, providing low-cost support for all jurisdictions and timezones is moving up the agenda.
"Rather than employing people on the graveyard shift, we can find good people in the European timezone to work proper business hours over here," says Rod Harrington, Latham's chief administrative officer for Europe and the Middle East. "We worked hard to provide coverage by employing people in the middle of the night, but that's not an efficient or sustainable model. People who work those late shifts don't hang around for long."
Time differences are not the only factors in setting up a support service that straddles jurisdictions though. Language skills also play a large part, with CC, for example, keen to fill this gap in support.
Jason Marty, global director of operations at Bakers, explains the firm's decision to have more than one support centre: "It's not just timezones. We are a global firm and like our global clients we need to be focused on the right people doing the right
work in the right places [to achieve] the best service and financial outcomes."
So why have more firms not gone down this route before? "Larger firms generally still have a headquarters, most of their revenue comes from a small number of countries and smaller competitors probably just don't need multiple centres," Marty points out.
The investment costs relating to each centre mean there are risks involved. Bakers, for instance, expects its Belfast office to cost £8m a year to run by 2017, a not insignificant sum of money.
Certainly, in the US, where wages and rents are often higher than in developing nations, a service centre is not likely to come cheap. Particularly as, unlike the handful of firms listed above with multiple bases, Freshfields is planning to offer both legal and back-office support at all three proposed sites.
One UK-based support centre head says they are surprised at Freshfields' decision to target the US in particular because they "can't see where the cost saving is".
With the firm yet to reveal a timescale, staffing levels or precise locations for the two new hubs, the success of the venture will probably come down to the details. Regardless of success, it is increasingly likely that other firms will follow Freshfields' move as the market becomes ever-more global.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View AllTo Thrive in Central and Eastern Europe, Law Firms Need to 'Know the Rules of Game'
7 minute readGOP's Washington Trifecta Could Put Litigation Finance Industry Under Pressure
Trending Stories
- 1Free Speech Causes a Neighborly Feud
- 2Read the Document: 'Google Must Divest Chrome,' DOJ Says, Proposing Remedies in Search Monopoly Case
- 3Voir Dire Voyeur: I Find Out What Kind of Juror I’d Be
- 4When It Comes to Local Law 97 Compliance, You’ve Gotta Have (Good) Faith
- 5Legal Speak at General Counsel Conference East 2024: Virginia Griffith, Director of Business Development at OutsideGC
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250