Business Mediation

How to Choose the Right Mediator for Business Mediation

We want to remind you that the information provided does not constitute legal advice.

The right of self-determination in business mediation and the parties’ first attempt at collaboration starts from the decision to mediate and the act of choosing an appropriate mediator.

The right to self-determination – whether the choice of mediator is based on cost, qualification, experience, subject matter expertise, effectiveness, or on any other basis – is critical to framing the mediation and the parties’ hopes of success. The mediating participants and their legal representatives must be confident in the mediator’s ability to help them resolve their dispute effectively, thoughtfully, compassionately – and at a reasonable price. If the parties disagree or feel uncomfortable, look for another mediator.

Some of the issues mediating parties should consider during the process of selecting a mediator are as follows:

A. Tools in the Business Mediation Toolbox. The mediator should have “more than one tool in his/her toolbox.” If the mediator only has a hammer, that mediator will use it, and every issue will look like a nail. Your mediator, staying with this analogy, instead must have a tool chest with a variety of tools to use – i.e., be knowledgeable and skilled at multiple conflict resolution models, including, but not limited to the following eight (8) basic models:

1. The Thomas-Kilman Conflict Resolution Model – The mediator should understand the conflict between negotiating parties’ desire to satisfy their own interests and concerns, and the interests and concerns of their counterpart. This requires an understanding of the five basic conflict resolution styles and the pros and cons of using each style. It also requires a working knowledge of how to help the parties navigate from one conflict resolution style to the other in a fluid manner.

The five styles are: 1) Competition; 2) Avoidance; 3) Accommodation; 4) Compromise; and 5) Collaboration. A skilled mediator will be able to recognize the style used by each party (and their representatives) and help the each of them individually, and all of them collectively, move from Competition to Collaboration, which exponentially increases the likelihood of reaching an agreement at mediation.

2. The Conflict House Model – The mediator should understand how to help the parties have difficult conversations in a constructive way without alienating each other with trigger words or acts, attacks, micro-aggressions, etc. Using this model, a skilled mediator will be able to help the parties, and their lawyers, set a constructive and positive tone before the mediation starts in a confidential pre-mediation conference. Done effectively, on the date of the mediation, the parties can avoid derailing the mediation, and the opportunity to reach an agreement, at the beginning of the process.

3. The Empathy Model – The mediator should understand how to help the parties recognize their inherent empathy for the other parties and build on that empathy and understanding. If done effectively, throughout the process the increased empathy will help the parties focus on the critical underlying interests, as opposed to positions. This also accelerates the potential for an agreement.

4. The Value Creation Model – The mediator should understand how to help the parties use the information they know about each other (whether gathered before or during the mediation process) to create a value proposition that will help the mediating parties do the jobs they have to do regarding the conflict, reduce the pains experienced, and increase the opportunities for the mediating parties to get the gains they want.

5. The Speed of Trust Model – The mediator should understand that trust has several waves, including self-trust, relationship trust, organizational trust, market trust, and societal trust. With this understanding as the foundation, the mediator can effectively help the mediating parties demonstrate:

a. their integrity, while acknowledging the other side’s integrity;

b. their intent in a constructive way, while seeking to understand the other side’s intent without attacking or feeling attacked;

c. their capabilities and the other’s side’s capabilities, and hone in on the relevance; and

d. their ability to produce results on both sides.

If the mediator is able to do the above effectively, the parties will have a better chance of recognizing the elements of integrity. trust in each other, and build upon it, which is necessary before embarking on the performance trust issues. Both are critical to facilitating a meaningful and lasting agreement between the parties.

6. The Behavioral Model – The mediator should understand how his/her behavior and the behavior of the mediating participants affect the mediation process, and consciously work towards modeling the right behaviors, and encouraging the same with the mediating parties. Here is a list of the behaviors:

a. Talking Straight
b. Demonstrating Respect
c. Creating Transparency
d. Righting Wrongs
e. Showing Loyalty
f. Delivering Results
g. Getting Better
h. Confronting Reality
i. Clarifying Expectations
j. Practicing Accountability
k. Listening First
l. Keeping Commitments
m. Extending Trust
n. Inspiring Trust

7. The Action Plan Model – The mediator should understand how to help the parties create a reasonable and workable action plan.

8. The Transformative Model – The mediator should be able to help the parties transform from feeling victimized to feeling empowered during the mediation process. Effective mediation requires self-determination; therefore, it is critical that the mediator understand how to help the mediating parties graduate from victimhood to empowerment. A skilled mediator understands that when a mediating party feels like a victim, it is likely that he/she will not be very productive or constructive during the mediation process.

There is also a risk that the other party, recognizing the vulnerable state of the victimized party, may take advantage of the “victim.” Therefore, the ability to help each party transition from the feeling of being a victim to the feeling of being empowered is critical and necessary to help them meaningfully participate in the mediation process. Once empowered, the parties can transition into a healthier conflict resolution state, allowing them to meaningfully transition from competition to collaboration.

B. The EQ Factor. The mediator also should have a high degree of “emotional intelligence.” He/she must be able to regulate his/her own behavior in such a way to take a leadership role during the mediation, understand how to regulate his/her relationship with the parties and their counsel, and help the parties regulate their relationship so that they do not alienate each other, but work constructively towards a common resolution.

C. The Impact of Life Cycles. Where the mediating parties are in their personal, relationship, family, professional, and business life cycles affect how they view the world, how they relate to each other, and how they resolve disputes. Therefore, mediators should have a basic understanding of each life cycle, the stages of each life cycle and the expected skills, knowledge, abilities experiences, focus, needs, emotions, maturity level, and key relationships that are normal and predictable during each stage.
This will help the mediator help the mediating parties not only address the obvious issues raised during the mediation, but also the underlying and collateral issues that can be just as, or even more so important.

D. The Importance of Experience. The mediator also should have relevant and extended experience as a mediator. A novice mediator, including a mediator who is transitioning into mediation as a second career (such as a retiring attorney or retiring judge) usually do not have the knowledge, skills, experience, and abilities to be as effective as a mediator who has been mediating for several years. In their professional life cycles as mediators, they are, in essence, baby mediators. While these mediators may have the core subject matter knowledge and experience, they still need to develop their mediation knowledge, skills, and abilities to be effective. Ideally, the mediator should be entering the prime of his/her professional career as a mediator.

E. The Role of Gravitas. A mediator also should have some “gravitas.” An experienced attorney, a retiring attorney or retiring judge would have gravitas earned from their years of experience and/or former profession, which can be helpful to instill a sense of confidence in the parties and their lawyers. This gravitas can be especially helpful in cases where the parties are looking for “parental” guidance in the process, or will rely on the mediator for an evaluative approach.

F. The Subject Matter Expert. In some instances, a subject matter expert will be necessary to understand the vernacular and language of the mediating parties. For example, if the mediating parties are discussing the intricacies of a jet engine, it will be helpful if the mediator has a mechanical engineering background. In the majority of instances, however, an understanding of the subject matter of the mediation is not as relevant.

Discussing the subject matter issue with the opposing party or his/her representative before developing a list of possible mediators is a good idea . If a subject matter expert is critical, then only select mediators with that expertise. If it is not as critical, but still important, if the mediator you would like to use has the skills, knowledge, experience, gravitas, EQ, and has the ability to add value, consider providing educational information to him/her so that he/she can be familiar with the subject matter. This will help the mediation process flow constructively.

G. Fighting the Urge. When selecting a mediator, the lawyer should fight the urge to retain a colleague or friend as a mediator based upon personal or professional relationship only. Instead, selection of a mediator should focus on the above factors, as well as any other factors the parties and their representatives believe are important to help them navigate the mediation process as constructively as possible.

H. Price vs. Value Added. Finally, consider the value of a mediator who can give you the best chance of resolving your dispute before going to court. Paying a “good” mediator at a higher hourly rate saves tens of thousands of dollars that would be spent in litigation. A day of mediation can cost the parties approximately $2,000 each (the average cost of a “good” mediator is $500 per hour). While prosecuting or defending a lawsuit, can cost, at the low end, up to $25,000 in lawyers’ fees, plus costs (excluding court-mandated mediation before trial), in many cases, litigation costs easily can exceed $100,000 before a final resolution.

In addition to the financial costs, there are the emotional costs, lost opportunity costs, the costs associated with lost time, and the costs of lost or deteriorating relationships. These all add to the expensive litigation financial price tag. A “good” mediator may be able to help the mediating parties eliminate or mitigate these non-financial costs during the mediation process.

If you are interested in learning more about business mediation skills, book a free consultation with Private Corporate Counsel™ today by calling us at 877-647-7887.