Disputes are a constant in human relationships. Dispute resolution at its most primitive is a survival technique. We all practice it, some better than others.

Disputes incur a cost. That may be emotional, relational, or financial: often a combination of all three. Intuitively we carry out a cost benefit analysis to determine whether continuing or settling is the best option.

The emotional component of this process is often disproportionately influential. Consequently, it distorts our view of the facts and impacts how we justify our actions: the tail wags the dog. Try as we may, we can all be susceptible to this to some extent.

When it comes to business, we consider ourselves to be far more measured and pragmatic. The truth is that in most cases we aren’t as pragmatic as we think we are.

The cost to a business of engaging in and maintaining a dispute can be considerable. The financial costs of the engagement and outcome are quantifiable, but what about the other factors? Anything that distracts the attention of a business from its strategic aims bears a cost. In commercial disputes – what could be earned in the time given over to litigation? How much down time is there for employees who are called as witnesses in employment tribunals?  Insurance may cover the financial exposure to some extent, but what impact is there on future premiums?

During a highly charged dispute, pragmatic views are often considered weak and “a gross simplification of a complex and principled matter”. Cold analysis, conducted after the event once the dust has settled, often leads one to a different conclusion: complexity and principle had been used as a cover for emotional stress.

There are of course some situations where principle is uppermost and must be upheld, but the challenge to that claim is often too lightly made.

What can be done? 

There are several things that can, and ought to be considered, throughout the stages of any dispute.

Recognise a potential dispute as soon as the signs appear.  

Maintaining and raising awareness is key to this. Individually this tends to happen – we know when there is a change in a relationship. Language (verbal and body) changes. Defensive positions become reinforced, elevated in importance over consideration of core issues.

The development of a corporate culture whereby an emergent dispute is made visible, shared, and elevated – such that all potential consequences can be considered, is a sound investment. As well as the obvious outcome of heading off (or preparing for) disputes at an early stage, as part of a supportive culture it contributes to a healthy workplace.

Analyse your WATNA and BATNA 

These are tools of assessment which Mediators employ to encourage reflective thinking when facilitating a Mediation. They are though, a valuable tool in advance of that stage.

WATNA is the Worst Alternative to a Negotiated Agreement, whilst BATNA is the Best. Leave aside the emotional aspects – what could the cost be (say) if a case goes all the way to court and you lose? If it goes all the way and you win – what will the best outcome look like? Can the other side pay your costs (rarely recoverable in full in commercial disputes, virtually never at all in employment tribunals)? What is the cost of the downtime? Is there a reputational issue? Do you really want to give up this much headspace to the issue?

Conduct constant reality checks. 

Again, Mediators use this approach to challenge perspectives to move from positional negotiation to principled. What are the issues? What are the facts? Have you considered the other side’s perspective  – how would you advise them to proceed if you were their advocate? Blending these views enables a party to re-evaluate the strength of the relative positions, better informing decision making.

Consider the non-judicial options to reach an agreement. 

The judicial process is limited in terms of options when it comes to making awards. A Mediation based approach allows for other options to be included in a final agreement, not available to a court. For example, in a contractual dispute, perhaps the parties have a level of mutual respect which, if protected, can lead to future engagement rather than destruction? Perhaps one party values some recognition of their (real or perceived) suffering such that it changes their reliance on a pure financial settlement (often we hear of this in health and medical claims). Broadening out the view at a pre-litigation stage encourages more informed discussion, again with a refocus from positions to issues.

Be aware of the retrospective view.

At some point, if matters do not settle through facilitation, it is likely that a third party will sit in judgement and determine an outcome. How parties have behaved throughout the process, especially when a Judge is determining the allocation of costs, may be influential. This view, whilst cynical, is often helpful when managing conduct.

Engage third party advice. 
Not just on the litigious options but to enable an unemotional whole-view assessment. We approach this by assisting clients to develop what can be a difficult view to produce at first hand. Appropriate robust challenge is a highly valuable input.

In conclusion… 

Disputes are a constant in our lives. How much we avoid or encourage them is a matter of style and personality to some degree. In all cases though it makes sense to properly assess the options and cost of engaging, or indeed of not engaging. The nature of disputes is such that they can grow rapidly out of control; reflective thinking is a quality worthy of development both individually and corporately.