IBISWorld research has just released a report on Alternative Dispute Resolution Services in Australia (IBISWorld Industry Report OD4116, February 2014).

The report is summed up with the phrase “Undisputed growth: Demand for industry services as an alternative to litigation increases”.

The executive summary of the report explains:

The Alternative Dispute Resolution Services industry in Australia provides individuals and corporations avenues to resolve disputes that do not involve litigation. Alternative dispute resolution (ADR), generally consisting of mediation, conciliation and arbitration, has surged in popularity during the past decade, underpinning strong growth in industry revenue and profitability. Industry revenue is expected to grow at an annualised 6.4% over the five years through 2013-14 to be worth $682.9 million, with growth of 6.0% forecast for the current year.

Growth has been underpinned by the increasing use of ADR to solve commercial, family and workplace disputes. ADR provides a number of benefits relative to litigation. ADR is generally cheaper, faster, more flexible and confidential, and less adversarial than going to court. Since the mid-1990s, governments have supported the use of ADR by introducing a number of mandatory and optional schemes, particularly in the areas of employment, family and commercial arbitration law. Business has also turned to ADR, as the tight economic climate, rising cost of litigation and threat of reputational damage and class actions led companies to seek an alternative to litigation. Both trends are expected to continue over the next five years.

The increased scope of industry activity has encouraged many new players to enter the industry and existing players to expand, while employment has also grown strongly. As the industry becomes more established, this growth in enterprises and establishments is expected to slow. However, employment growth is likely to continue at a similar rate as existing players grow their businesses.

The reforms of the past few years have positioned the industry well for growth, with governments and business expected to continue turning to ADR as an alternative to litigation. During the five years through 2018-19, industry revenue is expected to grow at an annualised 4.4% to reach $845.2 million. There is still room for the industry to compete with traditional legal services. The movement into new areas and the expansion of activity as current reforms are adopted will continue to support industry revenue growth.

Some of the interesting findings of the report include:

• There are about 1,456 businesses in the industry in Australia.
• Market share in the industry is primarily held by big law firms.
• Key external drivers for the ADR industry in Australia include: Capital expenditure by the private sector, days lost to industrial disputes, the price of legal and accounting fees, and the number of divorces.
• The ADR industry is in a growth stage, has low barriers to entry, and medium levels of competition (concentrated in NSW and Vic).
• Fees charged by industry participants have risen in line with demand for services, leading to a boost in profitability.
• Mediation comprises about 38.7% of the market, 36.2% is arbitration, 19.3% conciliation and 5.8% other.

The whole report is available at http://www.ibisworld.com.au.

Those of us who did our mediation training in the late 80’s were required to adopt ‘Trust the Process’ as our mantra. I think there were T-shirts too (or maybe I am just revealing myself as an aging hippie). While I can smile about the T-shirt I have adopted the message. As a teacher, researcher and practitioner of ADR I recognise the value of choosing not to focus on the ‘solution’ and trusting that the process will give the parties an opportunity to discover a good outcome for them.
But recently I had the unusual opportunity of watching 12 quite experienced mediators at work in 12 different mediations. Whilst watching some very elegant work I also observed many moments that were far from elegant. To my surprise, what I watched was the process getting in the way of the mediation rather than enhancing it.

It was disconcerting to observe and to be fair the observer presence may have contributed to some awkwardness. To my eyes the mediators were quite heavy handed in driving the process to where they obviously thought the parties should be going. Some went as far as saying ‘Well – I’m in charge of the process and what we need to do now is …’. Others simply intervened to require parties deeply engaged in recounting their experiences to stop and create an issues list. It looked like an exercise of power or perhaps a need to demonstrate usefulness rather than skilful use of the dynamics of the moment. I came away feeling that what I had seen was more about the mediators than about the parties and their dispute. It was less about ‘trust’ and all about thrust’.
I have been reflecting on this in the context of the professional identity theme to which members of this Research Network are contributing. It reinforced my view that in most professions, the path from training to practice is a series of connected steps. The lessons from formal training are interpreted and enhanced via supervision and ‘on the job’ learning from more experienced professionals.
As a calling largely practised confidentially and alone, ADR lacks the supervision and guidance which enhances and distinguishes established professions. It is another consideration on the road to establishing a professional identity.