Founding Partners of a Small Consulting Firm.

¶ … founding partners of a small consulting firm. The company's attorney noticed the growing tension in the office and worried that there was going to be a blow-up.

But, like the majority of business disputes, this one was resolved by mutual agreement without resort to litigation (Corley, Reed, & Shedd, 1995). In fact, the attorney suggested that the partners call in a mediator team, and this successfully defused the problem. Corley et al. define mediation as "a process in which a third party is brought into the controversy to help settle the dispute" (1995, p. 100). A mediator brings to the bargaining table an unbiased viewpoint and skill in bringing about compromise (Corley, Reed, & Shedd, 1995). Also, unlike arbitration, the solution suggested by the mediator is not binding, but is given significant weight (Corley, Reed, & Shedd, 1995).

These characteristics of mediation were central to solving this disagreement between partners.

At the start of the dispute, all three partners characterized the situation differently. Under the partnership agreement, each partner in the financial firm owned one third of the business and each took an equal share of the profits. Not all the partners were still happy with this arrangement. The first partner, Jerry, was a self-proclaimed workaholic. He spent between 50-60 hours per week in the office and made sure everything and everyone, including the support staff, did their job. Jerry saw the growing discontent in the firm as being due to low profits and a lack of firm growth. He felt that he put in a disproportionate amount of the work compared to the other two partners and had dropped several hints to the others about this.

The second partner, Bert, was an avid golfer. Although he spent only about 25-30 hours a week in the office, his social activities brought in the large part of the firm's new business. Bert felt that at the time of the dispute his activities with the clients were the only thing keeping the business alive. He also thought the reason Jerry is in the office so much is because he can't stand spending time with his wife, not because the work needed that much time to accomplish and that Jerry should delegate more of the tasks around the office. Bert believed Jerry wanted to ask for a larger share of the profits, but he did not think it is justified so he was unwilling to suggest it.

Ted was the third partner. He spent about 35-40 hours per week in the office and had not said anything about the growing conflict. He was happy with the profits of the company and the roles each partner is playing. The only thing he did not understand is why both Bert and Jerry kept asking him to talk to the other partner and "straighten him out." Because Ted did not see anything that needed to be changed about the company and how it is running, he did not particularly agree or disagree with Bert or Jerry's point-of-view. He realized, however, that his silence meant both Bert and Jerry think of him as an ally. Being in the middle between these two partners was a distinctly uncomfortable position for Ted.

As this quick review makes clear, the core issues in this dispute were closely tied to the varied personalities of the individuals involved. Gage and Gromala, two business mediation consultants, note this is a common situation for disputes that occur in small, privately held companies (2001). Sharing this view, the mediators called into this situation worked to come up with a solution that originated from the three partners that would be tailored to their three differing personalities, in hopes that the partners would see it as "their" solution, rather than the mediators.' Utilizing a technique recommended by Gage and Gromala, a central aspect of this mediation involved the drafting of a business charter. Unlike the typical partnership agreement, a business charter does not focus on shares or management structure or job descriptions. Instead, the document "clarifies what each person expects from each other and how they will operate together" (Gage & Gromala, 2002).

In drafting the document, the mediators do not try to change the personalities, but attempt to open lines of communication that lead to better understanding between the partners.