Originally from Dispute Resolution Journal

Organizational risk management has become the number one topic at business conference after business conference, and much of the discussion has focused on rapidly changing legal exposure and how best to cope with it.

The burden of civil litigation in the United States is staggering—estimates run between $200-$300 billion annually, and no business of any size is immune. Typically, when legal exposure is discussed, the conversation takes one of two directions: litigation avoidance or how best to resolve disputes when they arise.

A research project sponsored by the American Arbitration Association, which was conducted by the independent market research firm Clark, Martire, Bartolomeo & Shulman, suggests strongly that some companies which can be characterized as “most dispute-wise” are ahead of the game, benefiting in demonstrable ways from a set of best practices in the handling of disputes. In addition, these same companies are usually actively engaged in conflict avoidance, having put in place a framework that helps prevent disputes from arising and deals with conflict in its earliest stages. This kind of approach to handling disputes appears to be culture-driven—occurring in organizations where dispute resolution has been assigned a management priority and the legal department has an integral role in corporate planning and risk management.