What is Alternative Dispute Resolution?

Alternative Dispute Resolution is a mental model used for better thinking and decision-making.

How do you apply Alternative Dispute Resolution?

To apply Alternative Dispute Resolution, identify situations where this framework is relevant, then use it as a lens to evaluate your options and decisions. The model is most useful when combined with other complementary mental models.

What category does Alternative Dispute Resolution fall under?

Alternative Dispute Resolution falls under the Business & Strategy category of mental models. Other models in this category can be found on the Business & Strategy hub page.

Why is Alternative Dispute Resolution important?

Alternative Dispute Resolution is important because it provides a structured way to think about problems that would otherwise be approached with intuition alone. Understanding this model helps you avoid common reasoning errors and make better decisions.

Alternative Dispute Resolution Mental…

Alternative Dispute Resolution Mental… | Faster Than Normal

Section 2

How to See It

Contracts & Deals

You're seeing Alternative Dispute Resolution when a contract specifies mediation or arbitration before litigation, or when parties choose a neutral facilitator instead of lawyers and courts.

Leadership

You're seeing Alternative Dispute Resolution when a leader brings in a third party to reframe a conflict (interests, not positions) or uses a structured process (e.g. caucus, joint session) instead of escalating to HR or legal.

Section 3

How to Use It

Default to ADR when relationships matter, speed matters, or you want a tailored outcome. Use mediation when you want to preserve the relationship; use arbitration when you want a binding result without a public trial.

Decision filter

"Can we get to a better outcome with mediation or arbitration than with litigation? If the relationship or speed or privacy matters, ADR first."

As a founder

Build ADR into key contracts (co-founder, key partners, investors) so disputes have a path before "sue or surrender." Train the team on interest-based negotiation so internal conflicts don't default to escalation.

Section 5

Founders & Leaders

Herb CohenNegotiator; author, You Can Negotiate Anything

Cohen popularised negotiation as a skill for everyone, not just lawyers. His emphasis on preparation, BATNA, and "it's all negotiable" aligns with ADR: resolve by design (process, interests, options) rather than by default (threats, courts). Founders can apply the same mindset to disputes before they become legal.

Section 7

Connected Models

Reinforces

BATNA

BATNA (best alternative to a negotiated agreement) is the benchmark for any negotiation or ADR. Knowing your BATNA tells you when to settle and when to walk; ADR is the process, BATNA is the leverage and exit criteria.

Tension

Win-Win

Win-win aims for mutual gain; ADR can end in compromise or one-sided arbitration. The tension: prefer win-win outcomes inside ADR processes, but design for the case where the other party won't cooperate — hence arbitration and clear rules.

Leads-to

The Third Story

The Third Story is the neutral narrative that reframes a conflict so both sides can engage. Mediators use it in ADR to move parties from positions to interests and options — the story comes first, then the deal.

Section 8

One Key Quote

"The best way to get what you want is to help the other side get what they want — if you understand their interests."
— Roger Fisher & William Ury, Getting to Yes (1981)

Section 11

Summary & Further Reading

ADR (mediation, arbitration, negotiation) resolves disputes outside court. Use it when relationship, speed, or privacy matters; pair it with BATNA and interest-based negotiation.

Getting to Yes — Roger Fisher & William Ury (1981)

Book

Classic on interest-based negotiation and process; foundation for effective ADR and deal-making.

You Can Negotiate Anything — Herb Cohen (1980)

Book

Practical negotiation mindset and tactics applicable to business and ADR contexts.

Difficult Conversations — Douglas Stone et al. (1999)

Book

How to structure hard talks and move from positions to learning and options; supports mediation-style thinking.

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