Compared with other forms of dispute resolution, mediation can have an informal, improvisational feel. What does the process involve?
What at first seemed like a minor misunderstanding has spiralled out of control.
A printing company hired your IT consulting firm to train its staff to use its new computer system. Throughout the training, though, your consultants found the company’s staff to be inattentive and unmotivated, and you weren’t surprised when the company kept summoning your team back for individualised training and troubleshooting.
Now the printing company is refusing to pay the $35,000 you’ve billed it for these follow-up services. You point out that the contract stipulates that they must pay for the additional work, but the printing company says that the work was needed only because your consultants provided poor initial training — a view you vehemently dispute. Several tense telephone calls and meetings later, the two sides come to an agreement on only a single point: You need help resolving your differences.
Mediation seems like the next logical step, but where should you turn and what should you expect?
Compared with other forms of dispute resolution, mediation can have an informal, improvisational feel. The process can include some or all of the following steps.
Before mediation begins, the mediator helps the parties decide where they should meet and who should be present. Each side might have lawyers, co-workers or family members on its team, depending on the context.
Imagine that the consulting firm and the printing company from the story above have decided to hire a former judge with about 10 years of experience as a mediator. Three-person teams from the two companies meet at the mediator’s office. As a senior manager of your consulting firm, you bring along a colleague and a lawyer. Two managers and a lawyer also make up the printing company’s team.
With the parties gathered together in the same room, the mediator introduces the participants, outlines the mediation process and lays out ground rules. She also presents her goal for the mediation: to help the parties come to an agreement on the issue of the disputed consulting fee and resolve their business relationship amicably.
Following the mediator’s introduction, each side has the opportunity to present its view of the dispute without interruption. In addition to describing the issues they believe are at stake, they may take time to vent their feelings.
Suppose that the spokesperson for the printing company begins by discussing how shocked he was to be presented with a bill for the additional consulting work.
“Since your training obviously didn’t work,” he says to your team, “I don’t understand how you could charge us for the work you failed to do in the first place.”
You explain that your contract clearly states that work conducted beyond the initial training session is subject to your usual rates.
“I’m sure we discussed this over the telephone at some point,” you say, “and, in any case, a lot of your employees slacked off during the initial training. Their low motivation is not our problem.”
The mediator and the disputants are free to ask questions with the goal of arriving at a better understanding of each party’s needs and concerns. Because disputing sides often have difficulty listening to each other, mediators act like translators, repeating back what they have heard and asking for clarification when necessary. If the parties reach an impasse, mediators diagnose the obstacles that lie in their path and work to get the discussion back on track.
If emotions run high during a joint session, the mediator may split the two sides into separate rooms for private meetings or caucuses. Often, but not always, the mediator tells each side that the information they share in caucus will remain confidential.
The promise of confidentiality can encourage disputants to share new information about their interests and concerns. In caucuses with both sides of the IT training debate, the mediator learns that the printing company is in financial distress. When the mediator caucuses with your side, you explain that you are worried that news of a failed training contract will hurt your firm’s reputation in your city and beyond.
At this point it’s time to begin formulating ideas and proposals to meet each party’s core interests. The mediator can lead the negotiation with all parties in the same room, or she can engage in “shuttle diplomacy,” moving back and forth between the teams as she gathers ideas, proposals and counterproposals.
The mediator’s conversations with the other side probably have given her knowledge of its interests that you can use in packaging your proposal. Suppose that your caucuses with the mediator have led everyone to understand that your firm is primarily concerned about maintaining its reputation, while the printing company is most worried about paying its bills.
This new understanding of both parties’ interests leads to a round of bargaining in which you agree to cut your follow-up consulting bill in half, from $35,000 to $17,500. In return the printing company takes responsibility for the difficult trading conditions and promises not to malign your firm to other organisations. Although you feel that you have gotten the short end of the stick, you are ultimately glad to put the dispute behind you.
Depending on the complexity of the issues, mediation might last hours or it might take days, weeks or months to resolve. Some resolutions will truly be win-win, while others will be only barely acceptable to one or both sides — but still better than the prospect of a continued fight or a court battle.
If the parties come to consensus, the mediator will outline the terms and may prepare a draft agreement. If you fail to reach an agreement, the mediator will sum up where you have left off and may engage you in a discussion of your non-settlement alternatives.
© 2014 Harvard University
The New York Times Syndicate