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Mediation of a Conflict Between Business Partners

Most powerful is he who has himself in his own power.


When we start doing business with partners, we are full of hopes that our business will go better and more successfully in cooperation.

Business partnership is an interaction between people, which differs little from interaction in a family. This is a long-term deeply personal relationship where it is necessary to take into account each other's differences and be able to use this differences to achieve success.

We are often so optimistic about cooperation that when a conflict with a partner arises, we are completely unprepared for it.

Meanwhile, in any joint activity, conflicts arise and they are objectively relate to the need to ensure the quality of activities, to a difference in views on the assessment of work, to the introduction of innovations into your business and to the personal characteristics of people.

Conflicts arise due to a lack of coordination of actions, insufficient information, wrong decisions, excessive control, uneven work load distribution, dishonesty, due to a low level of communication culture and a variety of other reasons.

The following conflict resolution tactics can help partners:

1) Plan: if any issue causes disagreement, it is better to discuss it in advance, even it may seem a burning issue,

2) Do not judge the decision of a partner, but have patience and will to think over why it was made,

3) Conduct active listening sessions, communicate regularly, ask more questions,

4) Explain, why your decisions may be interesting for the other partner,

5) Argument your claims,

6) Understand and take a close look at the difficulties of another,

7) Do not escalate the conflict and be calm,

8) Do not abuse or manipulate your position,

9) Talk openly about your difficulties and interests,

10) Do not prolong the conflict,

11) Control your emotions.

If the above methods have not resulted in the agreement, then do not hesitate to call for help. Mutual friends and partners or professional mediators can provide this assistance. One of the ways to resolve a conflict is to invite a mediator, a neutral third party.

A mediator can help business partners to develop a cooperation program and to come to an agreement where the parties will define their interests and the protocol of interaction. Such an agreement differs from those documents that are prepared by lawyers, but may include enforceable provisions.

In a mediation agreement, business partners can describe their expectations from each other, common goals and interests, values, envisage personal obligations, and steps they need to take to grow their business.

In order to help the parties to come to such an agreement, the mediator holds a general meeting where the parties express their accumulated claims. At this meeting, the mediator creates conditions where the partners will talk not about their positions (legal or economic), but about their interests.

If the parties cannot define their interests and express personal grievances in the presence of each other, the mediator conducts confidential individual interviews with each partner separately. In such interviews (caucuses), the mediator asks many questions in order to assess the situation and help the participant in the process of creating ideas for resolving the conflict. Information obtained in the caucus cannot be disclosed to the other party of the conflict without appropriate consent.

Partners at a general meeting can name some of the reasons of the conflict. However, real problems tend to be completely different. And the mediator's job is to find these hidden problems.

Such real problems can be personal grievances, health reasons, fears of loss, betrayal, a variety of biases and misconceptions associated with lack of information. And if conditions are created for a more open dialogue between business partners, a whole chain of unexplained situations and conflicts between them may emerge. They definitely require discussion.

With the assistance of a mediator, business partners may:

1) Get a neutral view of the problem (without judgment and assessments),

2) Freely not emotionally express themselves on the topic of their interests,

3) Create a draft partnership agreement where the parties can provide decisions for different life situations (for example, illness or disability of one of the partners),

4) Freely discuss financial and personal problems,

5) Sign the agreement and monitor its observance in accordance with its provisions,

6) Find another form of cooperation or terminate the legal relationship peacefully if the partners cannot continue their work.

Thus, conflicts between business partners are the flip side of cooperation. In order to prevent them, it is necessary to use certain tactics and plan the discussion of sensitive issues. If the conflict is growing and it is not possible to resolve it on your own, then you can address to a neutral professional negotiator (mediator).

Mediation may be a more effective tool for resolving a dispute than litigation, since in mediation not only open causes of the conflict are investigated, but also those that are not so obvious.

Arbitration and Mediation