University of Phoenix
Instructor Andrew W. Russo, MBA
May 5, 2009
Third-Party Conflict Resolution
In the negotiation process, the use of third-party conflict resolutions often comes into play when parties cannot seem to reach an agreement regarding resolving mutual interests. These types of third-party conflict resolutions are: arbitration, collaboration, litigation and mediation. For the Seatcor Manufacturing Company, the use of third-party conflict resolution is necessary. The researchers of Team A have reported collaborative ideas of this case by (1) analyzing the possible intervention strategies, (2) applying what is thought to be the best strategy, (3) explained how the best strategy should resolve the conflict, and (4) developed a contingency plan in case the best strategy does not work, or is rejected. Intervention strategies
Possible intervention strategies include negotiation, mediation, arbitration, litigation, collaboration and hybrids. Two types of hybrid intervention strategies are mediation – arbitration and arbitration-mediation. • Negotiation - There are four elements to the negotiation process, which include managing interdependence, engaging in mutual adjustment, creating or claiming value, and managing conflict. Negotiations consist of two or more parties be that individuals, groups, or organizations. A conflict of needs and desires exist between parties and the parties chose to negotiate. Parties expect a “give and take” process that is fundamental to the definition of negotiation itself. The parties prefer to negotiate a resolution on their own and seek a mutually beneficial outcome. A successful negotiation includes consideration of the tangibles and intangible aspects of an agreement. Tangible aspects involve the price and terms of a contract, while the intangible consider the feelings of the participants. • Mediation – The objective of mediation is to help the parties develop and endorse the agreement they can live with. Here a third party, the Mediator assists in identifying areas of dispute and searches for compromises in those areas from both sides. Mediation has become a popular low-cost solution to litigation, especially for divorce cases. Since the Mediator has no formal power, the participants have the greatest say in shaping the terms of the settlement. This of course only works if the parties are open to the process, as most cases are voluntary. • Arbitration - Arbitration allows negotiators to have considerable control over the process but little control over the outcome. Outcomes in arbitration can be voluntary or binding. In voluntary arbitration parties are not required to comply with the arbitrator’s decision, but are by law or contractual agreement in binding decisions. Some decisions are left almost entirely to the arbitrator’s discretion, while others in “final-offer” arbitration must be selected from previous chosen outcomes presented by the parties. Arbitration is the most widely recognized intervention strategy because of its use in labor relations and professional sports. • Litigation – Parties utilize this strategy when they do not share common goals and interest. Litigation also allows parties to draw the process out as long a possible. This type of strategy may be beneficial when changes over time may be advantageous to a party. The draw- back is the outcome typically does not concede to any middle ground. Therefore, this strategy is more distributive in nature in that usually only one party gets what they want.
• Collaboration – In collaboration, parties seek cooperation and seek solutions advantageous to both parties. This win-win strategy assertively utilizes the fact that both parties have common goals. Parties identify common ground and search for areas of agreement. • Hybrids - Mediation-arbitration is a...