Strategic conflict management!?!
…Danish companies spend more than DKK 18.3 billion annually on conflicts. In round figures, this equates to approximately three-quarters of the cost of the Øresund Bridge, were it to be built today. For the individual company, this means that an average of 8.2% of after-tax profit is spent on conflicts—and in high-conflict sectors such as construction, this figure reaches as high as 14.1%. It therefore makes good sense to have a strategy for managing conflicts within the company.
Strategic conflict management—also known as Planned Early Dispute Resolution (PEDR)—is a defined and pre-established framework outlining how a company can best prevent conflicts from arising and which tools should be employed to manage them when they do occur. This may include, for example, conflict-prevention measures such as early warning systems for disagreements and scheduled regular meetings, as well as direct negotiation, the use of adjudicators or dispute boards, mediation, conciliation, litigation, arbitration, and hybrid processes tailored to specific disputes.
The key is to view conflict management as an aspect of overall risk management aimed at achieving the company's strategic goals.
A PEDR system is essentially a risk management system that enables companies to take control of disputes at the earliest possible stage, rather than simply reacting to actions taken by counterparties and legal authorities.
By using a PEDR system, companies can design a procedure tailored to their interests and thus proactively:
- handle disputes as early as possible
- preserve business relationships and reputation
- reduce time and costs associated with litigation and arbitration proceedings
- reduce process risks
- minimize distraction from their primary business activities and
- maintain focus on the company's key priorities.
Click on the image to read more about Strategic Conflict Management and how your company can prevent and handle conflicts more effectively.
You are, of course, also very welcome to contact us to hear how we can help you tailor a solution that suits your company, or to read about it. here.