Dispute Mediation

Dispute Mediation: Is an effective method for addressing a variety of business-related matters, including:

·       Negotiating an ownership and/or partnership agreement when forming a new business or professional practice.

·       Resolving disputes between principals of an existing business or practice.

·       Renegotiating aspects of an existing ownership and/or partnership agreement.

·       Negotiating an amicable dissolution of an existing business arrangement when dissolution is the desired outcome.

·       Resolving conflicts between businesses.

·       Resolving personnel disputes.

Mediation helps to establish and maintain successful working relationships. In today’s ever-changing business environment, the difference between success and failure is often a function of the quality of the relationships within an existing business as well as between businesses.

Mediation has many advantages over traditional approaches, including the following:

·       A “win-win” result is often achieved because the agreement is satisfactory to each person.

·       New businesses can move forward more quickly as the principals have a clear, specific agreement about roles, responsibilities, goals and objectives.

·       Existing businesses can continue to grow and thrive, no longer hampered by unresolved problems or unclear agreements.

·       The parties’ ability to preserve an existing business relationship is enhanced.

·       It is less costly and less stressful than other alternatives, especially litigation.

·       A final settlement can usually be reached more quickly.

·       It provides a more confidential, informal, convenient and comfortable atmosphere in which to address the decisions that need to be made.

The results stand the test of time. Research shows that people are more likely to follow through with a mediated agreement and are less likely to engage in future litigation.

Mediation is a collaborative problem-solving and decision-making process. The goal is to help people make decisions that address as many of the needs and concerns of everyone involved as possible. The emphasis of the process is on mutual satisfaction, not winning and losing.

Prior to the start of mediation, we offer a free consultation to anyone who wants a face-to-face meeting with the mediator before committing to the process. This meeting is scheduled with the parties together and lasts approximately one-half hour. It is optional, however there is no charge.

The first formal step is to meet separately with each person. The purpose of this interview is to obtain a brief history of the situation at hand, get to know each person and his/her perspective on the issues that need to be addressed. This includes an understanding of one’s needs and concerns, as well as one's thoughts about how to resolve those issues. (Initially, this is easier to do if the other person is not present.)

Most of the remaining time is spent meeting together. During these sessions, we assist the parties in making decisions that meet as many of their needs and concerns as possible. At the beginning of the first joint session, the mediator presents the parties with a summary of the issues they are to address, based on what was learned in the individual interviews. Once everyone agrees on the agenda, the process begins wherever the parties chose.

We encourage our clients to make their agreements as detailed as possible. The more detailed the agreement is now, the less room there is to argue about what it means in the future. One of the reasons former spouses end up in litigation and/or mediation is because portions of their agreement were not clear.

Once an overall agreement is reached, the mediator will prepare a memorandum of understanding that describes the terms of the agreement in great detail. If either person has an attorney, we ask that the agreement be reviewed with the attorney before it is finalized or signed. Any questions raised by the attorneys are brought back to mediation in order to iron out any remaining wrinkles.

The individual sessions are scheduled for one and one-half hours at a time. The joint sessions are usually scheduled for two-hour blocks of time, as more can be accomplished in one two-hour session those in two one-hour sessions. However, the clients are charged only for the time that is actually used.

Negotiation formats vary in the degree of structure. Generally, the higher the level of trust between the parties, the less structure that is needed. Some examples of formats from the least amount of structure to the most are:

·       Direct discussion between the parties with no one else involved.

·       Direct discussion with the help of a facilitator or mediator.

·       Collaborative law process where attorneys actively participate in the negotiation process as advisors and spokespersons for their clients, but not in an adversarial manner. Other professionals may participate as needed.

·       Negotiations through and/or with the assistance of attorneys who represent their clients in an adversarial, litigation mode.

·       Settlement conference situation, where the parties and their attorneys go before a person of authority (attorney, judge, former judge, etc.), who uses experience and expertise to push them to make an agreement. Often times, that person shuttles between the parties who are kept in separate rooms. This may occur just shortly before they are scheduled for a court hearing.

Mediation vs. Arbitration

The difference between Mediation and Arbitration is straightforward. Small Business Mediation is voluntary. The parties mutually agree upon a fair settlement. Arbitration is mandatory. The Arbitrator makes a ruling, which is final. Arbitration is similar to court except it is quicker and cheaper. Arbitration clauses are included in many contracts and business agreements. Most Small Business disputes and complaints are resolved by voluntary Mediation before enforcing mandatory arbitration clauses. The major disadvantage with Arbitration is: The Arbitrator Ruling is Final. You cannot take further legal action in Court. In Small Business Mediation if both parties don't come to mutual resolution, the options for Arbitration or Court Litigation still remains.

Complaints vs. Dispute

Complaints are an expression of displeasure, grief, regret or resentment. A dispute is controversy that parties actively disagree; argue about, a matter of personal rights or policy.

Summary

Business people involved in a dispute usually consider filing a corporate lawsuit in order to resolve the dispute. Taking their case to court for litigation usually occurs when efforts that involve informal dispute resolution fail. Courts of law are indeed the places to settle differences in opinions that characterize a business dispute.

However, nowadays, most businesspersons tend to shy away from litigation as dealing with it usually takes a lot of time and money.

Some cons in litigating a business dispute:

One of the main disadvantages in having a business dispute go under the court system is that the parties involve lose control over the outcome or judgment. In court, a jury or judge will make the decisions concerning the matters at hand. The decision would always tend to point out a winner and a loser.

However, in reality, both the winner and the loser after the litigation, tend to both lose significantly in terms of expenses, time and focus to the management of the business.

Judgment on lawsuits are usually unpredictable and a party may become so engrossed in winning out their position that they do not think of the possibility that they may lost the case.

The whole process of litigation usually becomes very galvanizing. The tension created between the parties during the process make it difficult for them to patch up their differences and continue with their partnership. Thus, this could have detrimental impact on their financial status.

With these adverse effects, it is not surprising that most businesses undergoing a dispute tend to consider alternative ways to resolve it, which is relatively time efficient, cost effective and may encourage the nurturing of the partnership of the parties.

One of these alternative ways is mediation. Mediation can be accomplished at any given time and anywhere favorable for the parties involved. It can also be done with a hired dispute attorney present, or even without such presence. However, it would always be more productive to have such an attorney monitor the settlements.

Everyone wants to be heard and respected. BMCS advocates for mediation based on the fundamental belief that individuals, consumers and businesses can resolve their complaints and dispute when provided skilled guidance and support. The focus of Small Business Mediation is on achieving quick, fair justice.

While every Dispute Resolution is unique to the organization under impact, there are logical steps to take to handle and avoid the confusion of how to act.  Business Management Counseling Services can aid your company or organization prior and during this time.  We highly recommend a pro-active approach of preparedness, however when a pro-active plan does not exist we can facilitate the least amount of collateral damage to the event.

The Importance of the Mission Statement

The Mission Statement is a crucial element in the Strategic Planning of a business organization. Creating a mission is one of the first actions an organization should take. This can be a building block for an overall strategy and development of more specific functional strategies. By defining a mission an organization is making a statement of organizational purpose. I will define Mission Statements, specify their importance, discuss important factors of Mission Statements, and give a process to follow in their development.

Defining a Mission Statement is the first step in this discussion. There are several ways that Mission Statements are defined. Some people get a vision statement confused with a Mission Statement. "A vision statement pushes the association toward some future goal or achievement, while a Mission Statement guides current, critical, strategic decision making," (Drohan, 1999). In The Mission Statement Book by Jeffrey Abrahams, TRINOVA Corporation defines a Mission Statement in the following way, "A Mission Statement is an enduring statement of purpose for an organization that identifies the scope of its operations in product and market terms, and reflects its values and priorities," (Abrahams, 1995). Christopher Bart a leading researcher in the art of Mission Statements says,

"A good Mission Statement captures an organization’s unique and enduring reason for being, and energizes stakeholders to pursue common goals. It also enables a focused allocation of organizational resources because it compels a firm to address some tough questions: What is our business? Why do we exist? What are we trying to accomplish?"

Stone gives another definition extracted from Say and Live it: The 50 Corporate Mission Statements That Hit the Mark. "Corporate Mission Statements...are the operational, ethical, and financial guiding lights of companies. They are not simply mottoes or slogans; they articulate the goals, dreams, behavior, culture, and strategies of companies," (Stone, 1996). Basically, a Mission Statement is designed to say exactly what the organization anticipates it will achieve.

"Every company no matter how big or small, needs a Mission Statement as a source of direction, a kind of compass, that lets its employees, its customer, and even its stockholders know what it stands for and where its headed," (Abrahams, 1995). A Mission Statement gives everyone the opportunity to know what the organization is about and what it is not about ("Thinking Ahead," 1998). With this in mind an individual is able to decide if this mission is something that they can commit to ("Thinking Ahead," 1998). A well-developed Mission Statement offers several potential benefits. These benefits include direction, focus, policy, meaning, challenge, and passion ("Thinking Ahead," 1998). Direction states what the organization does and what it wants to be successful in ("Thinking Ahead," 1998). Focus concentrates on the company’s strengths and competitive advantages and tells people how to obtain them ("Thinking Ahead," 1998). Policy is a guideline of what a company finds acceptable and unacceptable and states organizational values ("Thinking Ahead," 1998). Meaning shows what a company strives to achieve and why they wish to do so ("Thinking Ahead," 1998). Challenge is the setting up of goals and measurements of achievement for employees ("Thinking Ahead," 1998). Passion makes everyone involved with the organization show feelings of enthusiasm, pride, and commitment ("Thinking Ahead," 1998). With all of these benefits it is amazing that some organizations do not establish a well-developed Mission Statement. However, if a good Mission Statement is developed it will not be effective if every member of the organization does not know how the mission will be accomplished (Bailey, 1996).

There are some basic elements that should be incorporated into a Mission Statement. To begin with, the target audience is important (Abrahams, 1995). It needs to be established whom the Mission Statement will be directed to. Some groups that may be considered are employees, stockholders, customers, and the community (Abrahams, 1995). The Mission Statement can be targeted at a combination of these groups or just one of them. Next, the length of the Mission Statement needs to be considered. Some companies Mission Statements are only a single sentence and others are very long including visions, philosophies, objectives, plans, and strategies (Abrahams, 1995). "All that’s necessary is that the mission be long enough to reach the target audience," (Abrahams, 1995). In addition, the tone is also important. In this aspect it is important to use appropriate language that is directed to the target audience and reflects the makeup of the organization (Abrahams, 1995). Establishing the correct tone involves a process of intentional, individual word selection (Abrahams, 1995). If you make the language too flowery and cumbersome a great Mission Statement may not be taken seriously (Drohan, 1999). "A Mission Statement should be written to encourage commitment and to energize all employees toward fulfilling the mission" (Stone, 1996). Endurance should also be considered. "Mission Statements should serve to guide and inspire the organization for many years," (Stone, 1996). The Mission Statement should be able to withstand time and ultimately have a meaning in the long-term standings of the organization. In the same respect the Mission Statement should also remain current. A Mission Statement created years ago may no longer be effective (Stone, 1996). When the competitive environment changes the mission should be revised (Stone, 1996). Finally, it should consist of an element of uniqueness (Stone, 1996). A company’s Mission Statement should be unique to the organization. It should portray the individuality of the company (Stone, 1996).

In considering specific components of a Mission Statement, Bart tracked the correlation between twenty-five items and company performance measured by financial measures (Bart, 1998). This research indicated that not just any Mission Statement would do. Bart found six items that are consistently linked to firm performance (Bart, 1998). These are a statement of purpose or general nonfinancial goals, a statement of values, specification of behavioral standards, identification of the organization’s competitive strategy, a statement of vision, and an expression of intent to satisfy the needs and expectations of multiple stakeholder groups (Bart, 1998). Companies that had Mission Statements that included these items showed higher performance than companies that did not use these components in their Mission Statements. This research indicates there is a strong correlation between performance and well-developed Mission Statements.

Developing a Mission Statement can be a very difficult process. Drohan says that when creating a Mission Statement it should be done as part of the strategic planning process for the organization (Drohan, 1999). This process should be started with and environmental analysis, followed by development and prioritizing goals and objectives (Drohan, 1999). After this process is finished, the mission of the company becomes clearer and an effective Mission Statement can be created (Drohan, 1999). Then, you need to decide who is going to write the Mission Statement (Abrahams, 1995). A mission-writing committee should be set up to perform this duty (Bailey, 1996). It can be either a group of only management members or a more diversified group of members from different areas in the corporation. It is more effective to use a committee made up of management and non-management personnel (Bailey, 1996). "The organization may lose valuable input by limiting the voices it is willing to hear; also, people may be more willing to carry out a mission that they helped develop,"

The committee should also include people from outside the organization (Bailey, 1996). These people may include customers, suppliers, and other interested parties (Bailey, 1996). Several different perspectives are important to be considered in developing a Mission Statement. By using different perspectives in the development the final product will be directed so each individual can comprehend the mission (Bailey, 1996). After a situation analysis and all the important factors are considered, the selected committee is ready to draft the Mission Statement. When the draft is complete it should be shared with all members of the organization (Stone, 1996). If agreement is established it is time to communicate the Mission Statement (Stone, 1996). In this process the form and structure the Mission Statement will take is decided (Stone, 1996). This form may include an annual report presentation, a copy printed on fancy paper and hung on a wall in a frame, a brochure, an engraved granite piece, or any other form (Abrahams, 1995). It is also important in the communication process to introduce the Mission Statement to all the employees and ask for suggestions on implementation (Stone, 1996). The final step is to operationally activate the Mission Statement. In order to do this, the company needs to make its strategies, tactics, and operations remain consistent with the Mission Statement (Stone, 1996). The Mission Statement should be translated into performance objectives and used as a basis for strategic planning (Stone, 1996).

The effective Mission Statement can be a great asset to an organization. When everyone is working together in a defined manner greater organizational purpose is achieved. A Mission Statement is a stepping-stone in the strategic planning process. It is important that when an organization implements a Mission Statement they apply it to their functional strategies and consider input from various groups.