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US financial crisis may help LPOs
The Times of India
November 2008
If there is any sector in India which are likely to benefit from the financial crisis in the US, it is the Legal Process Outsourcing (LPO). Delegates at a seminar “Outsourcing Ventures 2008” felt that the Obama administration is expected to soon formulate a set of regulatory norms, especially for the financial services sector, in the wake of the meltdown in the US.
The more complex and comprehensive the financial regulations, more will be the need for lawyers as there would be many rules to be complied with, delegates felt.
“There is an opinion that the financial crisis in the US was a consequence of excessive business freedom given to the financial services sector. President-elect Barrack Obama is expected to address this issue on a priority basis and order a regime that will create some kind of a monitoring and regulatory mechanism aimed at checking the possibility of such a crisis in future,” said Ganesh Natarajan, president and chief executive officer of LPO firm Mindcrest.
“As the financial services sector suffered a setback, the legal work in terms of financing, credit and merger and acquisitions was on a low,” Natarajan pointed out. He said that the crisis has created many problems including the rise in the cases of bankruptcy which will need the services of lawyers.
“The US government is preparing to create a regulatory structure where none existed. Lawyers will be needed to interpret the new regime and advise companies on compliance,” Natarajan said.
Vishal Aggarwal, senior manager at Wipro Technologies LPO, said the business of LPO envisages a long-term relationship between a client and an outsourcing partner. “It will be essential for the outsourcing partner to state clearly the role his client is expected to fulfill and the inputs needed from the client’s side,” Aggarwal said.
Poonam Vasudeva, head of delivery services at Infosys LPO, said given the confidentiality and information security issues surrounding the outsourced work, it is essential that the client and the outsourcing partner share excellent communication to create a strong long-term relationship.
“All the success stories in the LPO domain have demonstrated the existence of such trust,” she said adding that the providers of LPO services should also create robust knowledge management systems to ensure business continuity and client confidence.
