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Did you know that when conflicts occur, managers spend 42% of their time helping the parties reach agreement?   The average cost of defending a litigated employment claim is $130,000.  Fortune 500 executives spend 20% of their time in litigation related activities.   Can your business or organization afford the high costs of conflict?

If you are busy trying to work out a dispute with an employee or a vendor you are not available to focus on long term strategic goals.  In all of these instances you are losing money even though it may not be reflected in your balance sheet.

While direct costs of conflict include legal fees and opportunity costs, indirect costs include diminished productivity, poor morale, higher employee replacement costs and shorter employee tenure.

Conflicts inevitably arise between and among individuals or teams within an organization.  It is part of our everyday life.  However, it doesn’t have to cause damage to your company or your bottom line.  Increased productivity, improved morale, reduced absenteeism are clear benefits of systematic conflict management.

So what can you do about the inevitable existence of conflict?  First of all, plan for it.  Put a conflict management system into place.  This helps ensure that disputes are handled early and at the lowest level in an organization.   As part of this system, review your existing policies.  Develop a corporate culture of early conflict resolution.  Don’t handle conflict like an ostrich…it only leads to trouble.

Second, put appropriate dispute resolution language in all of your contracts as well as your employee manual .  Oftentimes contracts include mandatory binding arbitration language.  But arbitration is often not the best approach, or at least should not be the first approach to handling conflict.

Finally, get to know some local conflict resolution professionals so that you can call someone in to help if needed quickly.   A good source of dispute resolution professionals can be found at www.mediate.com or ask your local bar association.   Additionally, most state courts have mediation programs and a roster of mediators is maintained by the clerk’s office or the alternative dispute resolution office.

For more information feel free to email Ellen at ek@alternativeresolutions.net.  Contact her for a free FAQ on dispute resolution options.

Alternative Resolutions, a woman owned business that just celebrated ten years in business, provides conflict resolution services, training and meeting facilitation.  Visit us at www.alternativeresolutions.net.

Tags: Alternative dispute resolution, Arbitration, Conflict resolution, Dispute resolution, Law, Lawsuit, Mediation, Services

This entry was posted on Wednesday, March 3rd, 2010 at 5:38 pm and is filed under Business Growth, Entrepreneurship, Legal Issues, business success secrets. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.