Originally from Dispute Resolution Journal

I. INTRODUCTION

Since the competitive pressure of the 1980s forced corporations to reduce costs of mergers, acquisitions, and other corporate reorganizations, many American firms have turned to alternative dispute resolution (ADR) mechanisms to settle problems arising from major corporate transactions.1 The companies that are particularly in favor of ADR tend to be larger entities like Fortune 1000 companies; these corporations experienced major downsizing and restructuring during the 1980s and thus needed to lower expenses wherever possible.2 As such, their corporate boards and executives began disfavoring costly litigation and started seeking other means of tackling disputes. Mediation became a popular tool for resolving conflicts, and its usefulness led corporations to view mediation as something more than just an alternative to litigation and arbitration. In fact, corporations have utilized the principles and theories behind various mediation methodologies to formulate systems for managing conflicts.3 These systems often contain an early case assessment capability to make corporate leaders aware of problems before they escalate.4 Also, the systems frequently contain a reserve of contingency plans to handle unexpected consequences of conflict management.5