“In these complex deals, change is the norm and it’s very easy to get out of alignment as new players come in town. So we have to keep the relationship and the contract in continual alignment with everyone’s interests.”
You are probably familiar with some of these terms if you have ever participated in a complex contractual arrangement: arbitrator, mediator, certified deal architect, even the “wise persons committee.” All of these titles refer to objective third parties that are brought in to help resolve high-stakes situations.
Kate Vitasek, a member of the graduate faculty in executive education at the University of Tennessee, and the creator of the Vested model, has recently co-authored a whitepaper that takes the concept of the roles above and modifies it to meet the needs of ongoing, complex third-party relationships.
A “standing neutral” is a form of alternative dispute resolution. It is different than the roles above in that a standing neutral is brought in before the conflict occurs; they are part of a contract’s governance structure. They are neutral, and mutually approved by the parties to the contract.
Kate provides background and case examples to show:
- How, when and why two (or more) companies might bring in a standing neutral to facilitate contract governance?
- What impact the standing neutral role has on the relationship associated with the contract.
- That using the right standing neutral under the right circumstances allows companies to proactively prevent conflicts and misalignment that could rob both parties of intended value.
Subscribe to Art of Procurement
Apple | Stitcher | iHeart Radio | Email
