A mediation has in general five phases, plus an optional sixth one:
In a preliminary phase, the mediator regulates the „formalities“ with both parties, including the signature of a mediation agreement, and explains the main principles and steps of a mediation. The mediator furthermore confirms that the representatives of both parties have decision authority and in a busines-to-business environment the mediator would recommend that both parties are represented by lawyers.
The opening phase starts with both parties explaining their (legal) positions. In a business-to-business context, it can be useful that the lawyer of each party prepares a short summary of the positions of the party he or she represents, which is then shared with the other party and the mediator. Furthermore, both parties would outline the topics, which they would like to discuss and solve during the mediation.
Afterwards, in the exploration phase, the mediator tries to explore the interests of both parties, which are „behind“ the parties´ (legal) positions. So the purpose of this phase is to better understand why each party takes its respective positions. Understanding the interests of both parties gives a holistic picture of the dispute and increases the chances to find a sustainable solution.
In the subsequent bargaining phase, the mediator will try to facilitate the exchange of realistic settlement-offers between the parties. In this phase, but also already in the exploration phase, private meetings between the mediator and one party at a time (e.g. by way of „shuttle mediation“) might have a strong impact in helping to find a solution. At the end of the bargaining phase, the parties should have identified the key terms of a potential settlement. In a business-to-business setting, the lawyers of both parties can significantly help to negotiate a settlement in this phase – if they are in general open to mediation.
The settlement terms are then concretized and formalized in the conclusion phase. In this phase, in a business-to-business setting, the lawyers of both parties again play a very important role because they should review the settlement that is being negotiated.
A couple of months after the settlement, many mediators are then setting up a short sustainability phase. This would be a type of „recap“ whether the concluded settlement works in practice or whether some adjustments would be needed.