Why So Expensive?
What we think of as the usual way of resolving conflicts does not foster
resolution! Unfortunately the operative premise that someone will win, and
someone will lose produces all losers, no matter who thinks they won. The
dispute resolution machinery often fuels the fire of conflict, and impedes
resolution.
Worse, while engaged in the conflict resolution process, your productive
activity, what your life is really about, is diluted. Most conflict resolution
conversations do not foster resolutions that address the underlying sources of
conflict - breakdowns in relationship. The processes are not concerned with
getting people back to an optimal state of productivity.
The current thinking paradigm embodies struggle, control, and a survival of the
fittest mentality. It is based on dialectic, right/wrong, either/or patterns
that originated in Aristotelian logic. Even though we live in a densely
populated, rapidly changing technological world that cries out for systems that
foster collaboration, individuals and institutions tenaciously cling to old
habits. What's missing are the bedrock ethics and values that were taught by the
educational community and religious institutions and were fostered in extended
families. These values have become clouded in our modern, mobile, sound-bite
techno-society.
Because family structures and religious institutions have become so fragmented,
we no longer rely on them to provide the education of core values. Many people
seek external standards that will tell them what to do. People often have little
grounding in collaborative skills because real partnership flows from within the
"conventional" relationships that community, family, and religious institutions
have traditionally demanded and fostered. Many people have no role models and
sadly, in many instances, don't know how to treat each other from within a
common covenant.
Noted futurist Alvin Toffler, author of Future Shock, The Third Wave, and
Powershift, says: "The place we need really imaginative new ideas is in conflict
theory. That's true with respect to war and peace, but also it's true
domestically. The real weakness throughout the country is the lack of conflict
resolution methods other than litigation and guns."
Toffler is on the right track. Our current crisis is caused by both the aspects
of today's conflict resolution system and the way that it is administered, such
as:
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Increase in the body of statutory and case law reflecting the growing numbers of
lawyers, and complex transactions requiring regulation.
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Commercialization of the legal tradition fostered by competition and
advertising.
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Growing reliance on counselors and therapists who care for our internal conflict
and feed our conflict-avoidance mentality.
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Breakdown of trust and the inability to assess the value of, or need for,
specific actions that therapists or lawyers take (evidenced by growing
malpractice claims).
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Attorneys' conflict of interest because their practice of hourly billing results
in a devotion to process, not results.
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The growth of the contingent fee and a class of cases in which there is nothing
to lose by taking a chance.
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The legal, economic, and emotional minefields of the litigation process.
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The myth of finding truth and justice in a courtroom, a myth that has been
perpetuated by the role models celebrated on TV.
These reasons are symptoms. They evidence a breakdown in the covenants of trust
between people who are members of the same "community." They point to a lack of
communication. People are focusing on themselves. They are concerned about their
"rights" and "entitlements" without thinking about their responsibilities toward
others. This all flows from the win/lose systems and practices that are in
place.
Many people are looking for guideposts and rules that will tell them how to
treat each other. This requires new practices and new ways of thinking. The best
way that I know to get people interested in new habits of thinking and doing is
to examine the real cost of doing things the present way. As we review all the
costs of conflict, imagine how much more you might accomplish if you could
harness the resources expended - the money, time, and energy used in the
"battle" that is traditional conflict resolution. Imagine using those resources
to focus on the outcomes you want for the future instead of rehashing the past.
The Cost of Conflict
The cost of conflict is composed of the following:
- Direct Cost : Fees of lawyers
and other professionals;
- Productivity Cost: Value of
lost time, diminished capacity and the opportunity cost of what those involved
would otherwise be producing;
- Continuity Cost: Loss of
ongoing relationships including the "community" they embody;
- Emotional Cost: The pain of
focusing on and being held hostage by our emotions.
It's important to identify the
costs of our current paradigm and examine some tangible examples. Recognizing
the cost, I hope, will motivate change.
1. Direct Costs
Because of an inability to face conflicts, many people spend money they can't
afford on professional gladiators hired to do their bidding. A divorce between
two people whose only asset is their home can transform that residence into
legal fees. The process brings out the worst in people who thought enough of
each other to marry, but now can't even sit down and talk.
The rule of thumb used to be that if you had over US$100,000 in dispute,
litigation might be cost effective. Today that number is at least US$1,000,000.
2. Productivity Cost
Time is a valuable, limited commodity. When people are focused on rehashing the
past, they cannot create and produce value in the present. There are two aspects
of this cost--direct loss and opportunity cost. The direct loss is the value of
a person's time--what the person should be earning but is not being paid because
he or she is engaged in the conflict. This would also include diminished
capacity. The opportunity cost is the value the person might have produced if
his or her energy was focused on future creation and innovation.
3. Continuity Cost
Continuity costs result from being stuck in the past - costs such as the loss of
relationship and community. Gary was on a fast track management development
Program. He was transferred to manage the branch office of a financial services
Company. Unfortunately he could not get along with Brandy, the office manager.
Gary objected to the way Brandy completed reports, and the way she socialized
with co-workers and clients. Even though she had been doing things her way for
years, and even though Gary was made aware of the power she had in the local
community, he was insistent on her following standard policy. He would not back
off and they ended up in a nasty confrontation. Gary's youth forced him to test
his power as "the boss."
Two years later both Gary and Brandy are gone. Brandy quit and went to work for
the competition. It takes two people to do what Brandy accomplished, and they
can't do it as well. Revenues for the office are down 10%. The cost: $230,000
per year.
4. Emotional Cost
Sometimes there are situations you can't let go of: a fight with a spouse, boss,
co-worker, neighbor, friend, partner, or the person who ran into your car. The
emotions of anger, fear, and blame grip you and force a reaction that saps your
current productive capacity. Instead of going about your business, you are
riveted on the injustice done to you and the untoward behavior of the
perpetrator.
You are consumed with vengeance and a desire to punish the wrongdoer. You expend
energy on your anger in addition to the loss you have already suffered. All of
this energy will never be recovered.
Summary
Current attitudes and systems of conflict resolution foster conflict. Conflict
is very expensive. It consists of the following, never to be recovered, costs:
1. direct cost - professional fees;
2. opportunity cost - what would otherwise be produced;
3. continuity cost - the loss of relationships and "community";
4. emotional cost - the pain of being held prisoner by emotions.
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