Alternative Dispute Resolution (ADR) in the Service of Organisational Performance

Alternative dispute resolution (ADR) settles internal and external disputes more quickly, fostering a context of “peace” conducive to the sound development of organisations.

Did you know that internal conflict costs French companies the equivalent of one month of lost work per year for a large majority of employees? This figure, drawn from a 2021 study, highlights a major strategic issue: the speed and quality of dispute resolution are no longer an option, but the very heart of organisational performance.

When it comes to relationships with their partners, organisations must likewise maintain a context of peace in order to secure their development, since every dispute adds to uncertainty and makes decision-making difficult. The search for a swift amicable solution is therefore a priority for the external disputes of organisations as well

Mediation and conciliation emerge as the essential levers for turning these hidden costs into gains in productivity, engagement and competitiveness. Far from being mere legal tools, these amicable dispute-resolution methods (ADR) draw on law, sociology and management to create a serene context for development.

Here is how a structured approach to mediation and conciliation drives your organisation’s performance.

1. The Legal Framework: Accelerating Resolution to Control Costs (Law)

The French legal system has strongly encouraged amicable settlement as the preferred route, thereby acknowledging the need to ease congestion in the courts and to offer organisations faster and less destructive solutions.

Since 1 January 2020, a prior attempt at amicable resolution (mediation or conciliation) has been made mandatory for certain disputes, on pain of the legal claim being ruled inadmissible.

The impact on performance is measured in time saved and legal certainty:

• Reduced timeframes: Mediation and conciliation offer markedly shorter resolution windows than litigation, allowing managers and teams to refocus quickly on productive objectives.

• Securing agreements: Mediation agreements relating to the employment contract may be approved by the employment tribunal (Conseil des prud’hommes), giving them enforceable status on a par with a judgment. Moreover, resorting to these amicable procedures suspends the limitation period, safeguarding the right to bring legal action should the process fail.

The speed of amicable settlement prevents escalation and limits the financial and human costs associated with lengthy proceedings.

Further reading:

• Decree No. 2019-1333 of 11 December 2019, which came into force on 1 January 2020, on the requirement to attempt amicable resolution for certain disputes.

• Mediation feature, Soins Cadres Vol. 30 - No. 130 - October 2021.

• Book chapter, La Médiation en entreprise (2021), by Valérie Ohannessian.

2. The Sociology of Organisations: Restoring Trust and Engagement

From a sociological standpoint, conflict is the expression of the interplay of actors within a system, going beyond the façade of unanimity that organisations so often seek. Mediation intervenes here as a powerful tool for restoring cohesion and corporate culture.

The mechanism for improving performance runs through engagement:

• Perceived Organisational Support (OST): When the organisation invests in mediation to resolve disputes in a fair and humane manner, employees perceive strong Organisational Support. This socio-emotional support positively reinforces the employer-employee relationship.

• Restoring Engagement: This sense of recognition and worth leads to a heightened level of employee engagement, as employees become more motivated to commit to collective success. This engagement acts as a key mediator between calmer working relationships and greater organisational performance.

• Constructive culture: Mediation restores deep communication, fosters listening and mutual understanding, and enables the parties to arrive at lasting solutions on their own. This consolidates a positive corporate culture, essential to the continuous improvement of results.

By turning crisis into a learning opportunity, mediation strengthens the company’s social capital.

Further reading:

• L’analyse de pratiques en médiation : Méthodes, outils et réflexions (2020) by Carine Bernardi.

• Conflits au travail : Passer de la crise à l’opportunité en 4 étapes (2020) by Jean-François Thiriet.

• Mediation Effect of Employee Engagement on the Relationship Between Employee Relations and Organizational Performance (2024), Journal of Business Management Review.

3. Managerial and Strategic Lever: Measuring Return on Investment (Management)

Strategic management regards mediation as an investment, not an expense. It is a tool for managing risk (disputes, resignations, sick leave) and for creating value (performance, innovation).

Calculating the Return on Investment (ROI):

• Avoided costs: One of the main values of mediation lies in avoiding the hidden costs of conflict, which include the loss of managerial time, absenteeism, reduced quality of work, and the cost of any potential litigation. An amicable approach bears no comparison with the costs of adversarial confrontation or protracted disputes.

• Relational gains: Beyond direct savings, mediation makes it possible to restore or improve informal relationships between partners (business-to-business) or staff (internal), stimulating creativity and fostering lasting relational contracts.

• Mediating management: The development of “managerial mediation” is a strategic issue. Managers trained to regulate tensions and to adopt the posture of a mediator establish an enduring climate of trust, essential to collective performance.

Mediation is an instrument for the early detection of, and support for, companies in relational or financial difficulty.

Further reading:

• Press release from the cost-of-conflict observatory (2021), highlighting the financial losses caused by conflict.

• Report from the Médiateur national du crédit and the Médiateur des entreprises (April 2025), on the early detection of difficulties.

• La médiation managériale : Un levier stratégique pour la résolution des conflits en entreprise (2025).

Conclusion: Mediation, a Strategic Imperative

Embedding mediation and conciliation within organisations must become a first-order reflex; it means adopting the stance of a mature, high-performing company. It means choosing speed of process, durability of solutions, and improved human engagement.

It is a skill that should now be built into every managerial function.

By making amicable settlement a factor of internal and external peace and of cohesion, your organisation does not merely resolve its conflicts; it transcends them, turning them into the source of its resilience and future success.

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Paul-Antoine TUAL · AI Transformation Leader · Croissance & Transitions