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Help close at hand
Nearby businesses often meet outsourcing needs
Santa Ana, Calif. - After seven years in business, Message Broadcast in Newport Beach, Calif., grew to need more legal assistance than its outside law firm had time for. But the marketing firm still didn't have so much legal work that it needed to hire a full-time general counsel.
Instead, the company decided to outsource the work - not to China, but to Orange County, Calif.
Enter The General Counsel LLC, an Orange County firm that goes to clients' sites to fill the gap between companies that need only occasional legal advice and those that must hire a staff attorney.
Message Broadcast gets experienced, cost-effective legal help, and The General Counsel LLC gets to include Message Broadcast in a broad base of customers.
Outsourcing is often equated with sending work to other countries. But studies about outsourcing - such as a report from consulting firm PricewaterhouseCoopers that 73 percent of U.S. executives outsource at least some business processes - typically don't distinguish between work sent halfway around the world and what's sent across the street.
While the motivation to send work to foreign countries usually is saving money, domestic outsourcing often enables small or growing companies to tap greater expertise than they could afford to hire as employees. It also gives them flexibility when their workloads spike temporarily.
Marketing and human resources are among the functions that businesses frequently outsource domestically.
The General Counsel LLC owners Stuart Blake and Michael Oswald had been general counsels for such companies as Kinko's and Lantronix. Rather than dispense legal advice at $400 an hour, they decided in May to become part-time counselors at clients' offices.
"Our clients are busy enough to need an experienced lawyer on their management team, but not big enough to warrant paying a full-time legal department," Blake explained, estimating that a full-time employee would earn $150,000 to $200,000 a year, plus benefits. The General Counsel LLC charges $1,500 a day.
Message Broadcast President Bill Potter thought he would bring Oswald in three days a week to catch up on contract, insurance and transaction work and then cut back to two days a week.
"I get the greatest amount of expertise at the least amount of money and no [long-term] commitment," he said.
Flexibility, rather than cheap labor, is the motivation for companies' outsourcing to local third-party providers.
Filenet, a Costa Mesa, Calif., software company, has 100 marketing employees worldwide but hires The PowerMark Group Inc., a San Juan Capistrano, Calif., technology marketing firm, for special projects, such as planning a user conference in Las Vegas.
"I expect outsourcing to smooth out the peaks and valleys, so I don't hire people for the whole year to do three months' work," said chief marketing officer Martin Christian.
Domestic firms that handle outsourced tasks tend to have experienced people in specialized areas, said Denise Chavez, chief executive of Conduit International, a Long Beach, Calif., marketing company that outsources work to Erin Baldwin at Baldwin Business Consulting in Costa Mesa instead of hiring its own chief financial officer.
"Erin is very talented, with a breadth of experience," Chavez said. "I didn't have time to train an employee to do the work."
Baldwin started her business in 2003 after she couldn't get a raise at the law firm where she was office manager.
"I had peaked on salary, but I knew I hadn't used all my skills," she said. "Every year my business has doubled. Now I'm making double what I made as a law firm administrator."
