Alternative dispute resolution (ADR) offers several advantages over traditional litigation. ADR methods like mediation, arbitration, and settlement conferences allow organizations to resolve disputes privately and confidentially, avoiding public disclosure of sensitive information. They also provide faster and less expensive resolution compared to litigation, which can drag on for over a year with high legal costs. Additionally, ADR preserves business relationships since the cooperative resolution process is less adversarial than litigation. It also gives the parties flexibility in choosing neutral decision makers and remedies instead of being limited to what a jury may decide. Overall, ADR is a more efficient alternative that better protects organizations compared to the risks and uncertainties of traditional litigation.

1. Running head: TRADITIONAL AND NO TRADITIONAL LITIGATION 1
Traditional and nontraditional litigation
LAW531 – Business law
University of Phoenix

2. TRADITIONAL AND NONTRADITIONAL LITIGATION 2
Traditional litigation system and Alternative dispute resolution
A number of legal ways are available to organizations to solve disputes without the need
for a formal and traditional process of litigation. Various forms of mediation, private judging,
mini-trials, and moderated settlement conferences are available to companies, unable to
independently to resolve their disputes but who wish to avoid the expense and delay of the full
litigation process (Sherman, 2011).
Organizations prefer alternative dispute resolution to traditional litigation for different
reasons; with alternative dispute resolution, the organization information, trade secrets, and other
confidential information are not subject to a judicial process, in which any person, media, or
organization would have the right of access. Access to the information would give the
competitors some advantage because they would be able to misappropriate use of the
confidential information. A traditional litigation process often results in public disclosure of
organizations information and ADR procedures would allow the parties to resolve the disputes
but better protecting confidential information.
The traditional litigation processes do not allow achieving satisfactory negotiated results,
and the free access to the confidential information can result in high monetary costs, which can
affect the organizations bottom line. Alternative dispute resolution give the litigants the
opportunity to avoid many problems inherent in dealing with traditional litigation process while
allowing the parties to resolve the differences fairly, and can provide a cost-efficient alternative
to the traditional legal system, which has high costs and delays.
Advantages of ADR over traditional litigation processes
Each type of alternative dispute resolution offers different advantages and disadvantages,
and would make the process far more appropriate for resolving a particular dispute than another:

3. TRADITIONAL AND NONTRADITIONAL LITIGATION 3
Faster Resolution
ADR reduces delays in resolving legal claims.
Lower cost
Litigation processes are costly; even small litigation disputes can result into costly legal
battles. Litigation typically takes long time, during which management must deal with many
expensive tasks, resulting in time taken away from the regular duties and no focus on
management activities.
Quick resolution
ADR processes have realistic alternatives to resolve disputes expeditiously. Whereas a
traditional dispute may take more than a year to resolve, ADR can take just few months.
Confidentiality
Described in the top, traditional legal processes are open to the public and media, these
records can result into permanent damage to the organization’s reputation. ADR is a private
confidential process, the parties’ final agreement can specify that neither party will disclose
details about the dispute or its resolution (American Management Association, 2011).
Fairness
ADR is an objective, reasonable, and even-handed process; this does not mean satisfying
everyone. In ADR processes each party has an opportunity to participate and make unforced
decisions.
Flexible remedies and choice of decision maker
In ADR, the parties are not limited to what a jury may award, they are usually free to
select the mechanism, and determine the amount of information that needs to be exchanged. The

4. TRADITIONAL AND NONTRADITIONAL LITIGATION 4
parties can select a neutral decision-maker with specific experience or expertise, and agree on a
format for the procedure.
Preservation of relationships
ADR process allow the parties to work together and find a friendly solution, while a
traditional litigation process the process can result into a hostility level, altering the relationship.
Reducing risk involved with litigation processes
To reduce exposure to risks involved with litigations, management must remain
cognizant of its business environment’s rules, regulations, and laws that affect the business
model. The organization should merge external influences with the ethical code of conduct, and
educating workers of proper processes; these decisions would help to minimize risks that can
result into costly litigation. Training programs and internal control processes would help to
identify, limit, and manage litigation exposure. Management should seek legal advice and
assistance to reduce the risk of potential claims becoming actively litigated claims.
To mitigate the impact of litigation processes, management should increase capital to
cover potential judgments or settlements, and maintain adequate and cost-effective insurance
coverage.
When earnings or capital could be negatively affected, management should take steps to
mitigate, prepare, and limit the effects of that potential reduction in capital or earnings on the
operations of the organization (Comptroller, 2000).

5. TRADITIONAL AND NONTRADITIONAL LITIGATION 5
References
American Management Association (AMA). (2011). What is ADR. Retrieved from
http://www.flexstudy.com
Comptroller. (2000). Litigation and Other Legal Matters. Retrieved from
http://www.occ.treas.gov
Sherman, A. (2011). Alternatives to Litigation. Retrieved from http://www.entrepreneurship.org