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Business Mediation & Collaboration Services
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| info@bmcassociates.com (888) 922-1262 | >>
For Partners & Owners |
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"The process of mediation is such that we are able to guide negotiations in to allow both parties to be in control of their own destiny, rather than subject to a third party decision." Ed Kopf, Ph.D., Principal |
Resources
Achieving Collaboration through Mediation The editor of the Conflict Resolution Handbook asked David Gage and Scott Meza, an Associate with BMC, to write a chapter for their handbook that would explain where mediation fits in to the range of options available to owners of closely held businesses. The authors write how business owners “can follow many paths into conflict, but only a few paths lead out of it.“ In addition to mediation, the paths out of conflict include the following: negotiation, facilitation, counseling, expert advice, arbitration, and litigation. The chapter includes a discussion of the strengths and limitations of the various approaches. The Handbook may be purchased through the Family Business website: Familybusinessmagazine Don't Let Strife Ruin Business Partnerships IBD business reporter Sylvia Tiersten tells a story of two warring partners who became clients of BMC. One of the 50-50 partners was actually a day away from filing for receivership of their thriving 5-year-old company. With the help of the co-mediators (a business advisor and a psychologist) the owners successfully changed the ownership structure and the leadership of the comp nay, and established a board of directors that included outside members. As a result, the company stayed intact and was successfully sold in 2002 for sixteen times its value at the time of the strife. When the company was acquired one partner declared, “The sale was the real culmination of the mediation process.“ Can't We Get Along? Fortune magazine declares, “When dynamic duos become warring partners, it's time to hire a business mediator.“ Fortune staff writer Lori Ioannou writes, “Entrepreneurs are used to warfare, whether it's in the boardroom with venture capitalists or on the competitive battlefield. But nothing leaves more scars than partnership brawls. When such conflicts arise, co-founders usually take out the big guns. The upshot: The business gets embroiled in litigation and is often sold to end the whole nasty affair. Unless, of course, entrepreneurs seek the help of business mediators like David Gage.“ This piece is an interview with BMC's founder, David Gage. A Cross-disciplinary Approach to Solving
Problems This article was based on interviews with a number of BMC Associates. It provides a good description of why the firm was founded and how mediation with people in business works. A former client of BMC was also interviewed regarding the team's use of co-mediators. “Having two mediators made a dialogue more possible and the dynamics more manageable,“ he said. “And they saw issues from different perspectives so they could bring more of a fine-tuned approach to the problem we were dealing with.“ One Associate is quoted as saying, “Our goal is to provide a unique blend of psychological techniques and business acumen.“ Not All Business! Mediating The Personality
Differences behind Internal Business Disputes The editors of the American Bar Association's magazine dedicated to alternative dispute resolution asked David Gage and John Gromala to write an article describing the unique methods BMC uses to help business partners prevent and resolve conflicts. “Unlike consultants, mediators do not develop a solution for businesses with problems. Instead, they help businesses develop their own solutions. Because each participant has a vested interest in the new plan, the chances of success are much higher.“ They describe business charters, “A business charter addresses issues that are ignored by partnership agreements and job descriptions. It is a non-binding memorandum that clarifies, among other things, what each person expects of the others and how they will work together.“ (GP Solo published an abridged version of the article, one of two appearing in the Business and Commercial Law Section of this issue which republished the “Best of ABA Sections“ articles. The article was originally published in ABA Dispute Resolution Magazine, Summer 2001, the link is to full text of original article.) Mediators Can Reconcile Warring Partners Celebrated business columnist, Jane Applegate, tells the story of a father who started a business with his two sons. “But seven years later, the family business was faltering. The father and sons were so angry with each other, they were about to hire their own lawyers to untangle the financial and emotional mess.“ Applegate, interviewed the company's attorney who explained, “It was a very complicated situation, especially the way their finances were entwined..If they went to court no one was going to come out a winner.“ With assistance from two BMC mediators, the father and sons were able to amicably figure out a graceful exit for one of the sons. The company's lawyer who referred them to BMC told Applegate, “Through mediation they had a chance to say what was making them unhappy“. If it hadn't been worked out, they would have lost $1 million or $2 million and gone out of business.“ Mediation: One Discipline or Many? This entire issue of the National Institute for Dispute resolution's journal was dedicated to exploring the question of what professional background a mediator should have. Melinda Ostermeyer and David Gage, both from BMC Associates, make the case that the wide range of types of disputes that erupt in the business world make an interdisciplinary approach to mediation the most constructive. “We suggest that different cases have such different complications and needs that an interdisciplinary team is a necessity, not a luxury.“ To resolve disputes most quickly and effectively a mediation team should have professionals with backgrounds in law, psychology, finance, and business. Using three companies as examples, the authors describe how the particular needs and circumstances of the client dictate which two mediators are best suited to quickly comprehend the client's situation, help them with creative problem solving, and facilitate a consensual resolution of their problem. Stepping into the Fray: Mediating Client
Disputes The editor of this accounting industry publication wanted to address the problem of business people pulling in their accountants to try to resolve conflicts among co-owners. Judy O'Dell, a Pennsylvania CPA who had been pulled into many partner and family business squabbles, admitted, “Such disputes inevitably demand dealing not just with strong emotions but also with a lot of family baggage, which I was never trained to do.“ Probably the most serious problem for any existing business advisor who tries to act like a mediator is being perceived as neutral. Walter Deyhle, a highly regarded CPA at Gelman, Rosenberg & Freedman in Maryland, put it squarely, “I can't think of a situation in which all partners viewed us a totally neutral even when we thought we could be.“ David Gage and lawyer-mediator, Judy Weintraub, describe certain red flags that advisors can watch for to know if their clients would benefit from mediation. They suggest times when it may be valuable and appropriate for accountants to serve as expert advisors when their clients are in mediation. Weintraub attributes mediators' high success rate (approximately 80%) to mediators' specialized training. The article lists numerous advantages of mediation and suggests important factors to consider when selecting mediators.
Avoiding Costly Legal Battles Through
Mediation Because most family business disputes involve personal or business issues rather than legal ones, the most appropriate avenue for such businesses to resolve disputes is through mediation. In this brief introduction to mediation, David Gage takes a look at this “fastest, cheapest, most flexible, least threatening“ method of dispute resolution. The Hafts and Mediation: Lessons for
Businesses Wealthy partners have more to lose when they fight! The Haft family partners' interpersonal and business conflict erupted into multiple lawsuits that cost them around $40 million. More than that, however, businesses were destroyed and the privacy vanished as their sparing became front-page news. Most tragically, relationships among parents, children, and grandchildren suffered dearly. The highly regarded judge who presided over the case, Judge Rufus King III, spoke with David Gage about business partner conflicts. “King believes that mediation is much more appropriate than litigation in most business partner conflicts because, he says, 'Even a 'win' in court can be a loss for everybody involved.'“ King explained that even judges or arbitrators with the best intentions “won't be humanly capable of understanding the nuances of the business the way the owners do.“ This article helps to clarify some of the many differences between mediation-a truly collaborative process-and litigation and arbitration, both of which are strongly adversarial. |
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