Tradition and Non-tradition Litigation
Litigation refers to a legal, a judicial contest or a law enforcement preceding that normally takes place in a court in order to determine the outcome of the case on either party. What are the risks that businesses and other organizations encounter when dealing with traditional litigation? The business risks to either lose or gain at the end of the court proceeding. Lose of Time- The process of handling traditional litigation in relation to businesses and organizations normally forms a crucial scenario as it affects the firm’s entire performance either positively or negatively. While undertaking on the traditional litigation, the business/organization spends much of its time in handling the relevant case in legal institutions. Time is a key factor that ensures efficiency and effectiveness in the functioning of any given firm. Delays caused by attendance to the litigation by the firm’s management may lead to lower production in the organizations activities (Carroll, 2005). Confidentiality- The organizations relationship with its customer through the Customer Relation management (CRM) is vital in maintaining trust and confidentiality in its services and products. The traditional litigations ruins the customer relationship with the firm as the level of confidentiality reduces with the increase in the number of litigation cases reported in relation to its functioning. This eventually affects the output realised by the firm as the sales volumes may reduce with time. Publicity- The image of a firm to the outside world forms a fundamental strength that maintains and boosts the functioning of a firm’s activities in its market as it determines its growth. In the case of such occurrences (litigation cases), the image of the organization is badly ruined as the public’s loses confidence in transacting business with them in the long run as they fear such incidences may also occur. Bankrupt- The firm is exposed to the danger of being closed down eventually if the litigations against it declare it bankrupt. In such case, a firm is closed down according to court orders. The closure renders its entire management jobless as the organization is closed indefinitely waiting for a final judgement by the court. â¢ Where might ADR be a more appropriate measure in order for business managers to reduce those risks? Alternative Dispute Resolution (ADR) is common way that is used in resolving multitude cases involving organizations as it has proven to be the most suitable mean of handling economic cases in business. All the staff related claims, client’s claims and contractual disputes are solved using ADR method in most companies. In the process of minimizing the above risks, the company engages in use of in-formal methods like ADR forms that comprises of: Negotiation, mediation and Arbitration (Carroll, 2005). Negotiation- This is a method where the involved parties come up together and agree to solve their dispute without using the legal organs (courts). The method is normally preferred as it as it does not recommend the presence of a third party person (neutral party). Mediation- The process involves the coming together of the involved parties to an agreement which is normally facilitated by a mediator who is a third party. He/she identifies the possible solutions to the bone of contention of the firm’s involved. The mediator has to remain neutral on either side in the final decision. Arbitration- The method is commonly used in cases where there is a written contact that binds their functioning. It may involve litigations that calls for favours on either side of the companies involved in the drafting of the contract under litigation. An independent arbitrator is normally selected to listen on both side and come up with a final decision that is normally not subject to appeal by any party. The main aim of using the above forms is to reduce on the costs incurred in...
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