Recently practitioners, scholars and enthusiasts of alternative dispute resolution gathered—virtually and in person—at a JAMS Resolution Center to examine one of the most pressing and intriguing questions in the field: What happens when the very technology causing or complicating a dispute is also asked to help solve it? At the event, titled “AI’s Double-Edged Role in Dispute Resolution: When the Machine Tries to Solve the Dispute It Created,” participants witnessed a meticulously staged simulation of a challenging international mediation. Through this scenario, attendees explored how artificial intelligence (AI) could shape the future of conflict resolution and how human mediators might continue to excel despite, or perhaps because of, the new tools at their disposal.
Setting the Stage: A Complex, Cross-Border Dispute

The central case study for this event featured a dispute between two parties: AI Horizon (Horizon) and Quantum Cognition (Quantum). Horizon, a Luxembourg company owned by a Beijing-based conglomerate, had commissioned Quantum, a Silicon Valley startup, to develop a large language model (LLM) intended to rival global conversational AI systems. The final product was supposed to handle multiple languages, comply with diverse legal regimes (notably the EU AI Act and various Chinese regulations) and ultimately enhance Horizon’s brand worldwide.

Yet trouble emerged quickly. Horizon withheld an $8 million payment, claiming that the LLM produced “hallucinations”—factual misstatements or offensive content that could be legally and reputationally hazardous, especially in the Chinese market. Horizon insisted the malfunctions endangered its compliance with strict EU and Chinese regulations. Quantum, on the other hand, argued it delivered exactly what Horizon requested on a constrained budget, using only open-source data. It saw the hallucinations as an inherent artifact of current AI technologies, not a breach of contract. Instead of paying, Horizon demanded $95 million in damages—an astronomical figure that Quantum dismissed as outrageous.

The event’s simulation allowed attendees to follow the dispute from a joint mediation session through private caucuses and back again, showcasing how a human mediator might facilitate a resolution. Attendees were also invited to contrast how an AI-driven mediator—or AI-assisted mediator—might handle such a complex scenario.
Human Mediation in Action: Uncovering Interests and Managing Emotions

Attendees watched as a human mediator navigated the emotional and legal thicket. In the initial joint session, tensions ran high: Horizon’s representatives insisted on compensation for reputational damage and compliance risks, while Quantum’s counsel threatened to leave, calling the demands “nuts.” The human mediator’s role here was to cool tempers, invite a short recess and encourage more constructive dialogue. With gentle but firm interventions, the mediator guided the parties toward separate caucuses.

In private sessions, the mediator dug deeper to understand each side’s underlying interests. Horizon’s team privately admitted they were desperate for a fix—less concerned with the large damages figure than with preventing reputational ruin in China. Quantum’s representatives, behind closed doors, expressed frustration at not being paid and worried about setting a precedent for endless liability. They acknowledged that the hallucinations could be mitigated, but not eliminated entirely with better data and more resources.

For attendees, this underscored a classic mediation lesson: Beneath the bravado and extreme demands lie real interests. Here, Horizon wanted reassurance, brand protection and regulatory compliance; Quantum wanted fair compensation, limited liability and long-term viability.
Introducing AI Into the Equation: Risks and Opportunities

The event did not merely showcase traditional mediation. It framed the dispute as one in which AI was both the source of the problem and a potential tool for its resolution. Attendees learned that, while current AI language models can summarize positions, predict outcomes and propose bargaining ranges, they lack the nuanced empathy and cultural awareness that can defuse emotional standoffs.

When tensions rose, would an AI mediator have recognized the cultural sensitivities at play—Horizon’s Chinese parent company’s emphasis on “face” and reputation—or the softening stance of Quantum’s CEO, who felt “bad” for Horizon’s predicament? Probably not, at least not without sophisticated cultural training and emotional intelligence that current generative models struggle to replicate. By comparing the human mediator’s approach—acknowledging cultural concerns, suggesting creative solutions such as an apology and an insurance policy—to what a purely AI-driven tool might do, participants concluded that human insight remains invaluable.

However, the event did highlight how AI can assist mediators. AI-driven tools could have quickly analyzed the contract language, outlined relevant EU and Chinese regulations, and even reviewed prior precedent on AI-related disputes. It could have provided data-driven risk assessments and suggested best practices for contract amendments. The key is that these capabilities supplement, rather than supplant, the human mediator’s role.
Creative Solutions: From Insurance to Apologies

A turning point in the simulated mediation was the mediator’s suggestion to use specialized insurance to cover reputational harm caused by AI hallucinations. This represented the hallmark of effective dispute resolution: expanding the pie and finding options beyond a simple monetary exchange. By insuring against the risks of offensive hallucinations, Quantum could offer Horizon a level of reassurance without promising the impossible—zero hallucinations.

Similarly, the mediator proposed a carefully crafted apology that would resonate with Horizon’s Chinese stakeholders. Quantum’s representatives, initially hesitant, agreed to a statement that acknowledged the difficulties and consequences without admitting legal liability. This culturally sensitive gesture, coupled with insurance to mitigate future problems, allowed both sides to move beyond their entrenched positions.

This creative problem-solving demonstrated the value of a human mediator. The human element—empathy, creativity, cultural literacy—remains irreplaceable.
Balancing Rationality and Emotion

The event demonstrated the delicate interplay between rational negotiation and emotional satisfaction. Horizon’s large damages claim initially seemed irrational, but in private, it became clear it needed to signal seriousness and protect its image with its parent company. By the end of the mediation, Horizon was willing to reduce that figure drastically if it could secure data licensing, additional training, hosting agreements and proper safeguards against reputational fallout.

Quantum learned that simply insisting “we met the contract” would not solve the problem, as it ignored Horizon’s deeper interests. The insurer’s involvement and a thoughtful apology helped bridge this emotional and cultural gap. While on purely rational grounds Quantum might have resisted further concessions, addressing Horizon’s emotional needs allowed both sides to reach a workable solution.
Looking Forward: AI and the Future of Dispute Resolution

The event concluded with reflections on the role AI might play going forward. Could AI-driven mediators one day handle such disputes independently? Perhaps, but current AI tools struggle with nonverbal cues, deep cultural contexts and the emotional intelligence required for high-stakes conflict resolution. Instead, a more realistic near-term scenario is a hybrid model: a human mediator supported by AI analytics. Technology could handle data-intensive tasks while the human mediator maintains rapport, injects creativity and displays sensitivity.

Attendees left with a clearer appreciation of both the potential and limits of AI in dispute resolution. Although AI can cause or complicate disputes, it can also provide tools to manage them more efficiently. Still, it is the human mediator’s judgment, empathy and creative problem-solving that ultimately bring parties to a durable, culturally appropriate and mutually satisfactory resolution.
If AI Gains the Ability to Read Emotions: A Future Outlook

In recent developments, AI has been enhanced to be able to understand visual data. It can now be given access to your computer screens or video camera and be able to interpret what it “sees” with great accuracy. As of the writing of this piece, it does not yet have the ability (or is not yet allowed) to interpret emotional states. However, if AI systems became adept at recognizing nonverbal cues, cultural signals and subtle emotional states, this may actually prove beneficial for human mediators.

In such a scenario, human mediators could leverage these advanced tools as an emotional radar of sorts, detecting shifts in tone or stress before disputes escalate. This partnership would enhance mediators’ ability to respond more effectively. However, mediators would likely focus even more on complex, deeply rooted conflicts that require moral judgment, cultural nuance and the ability to address existential questions that machines cannot yet replicate authentically. AI offers numerous advantages, but it will ultimately be human behavior that dictates its adoption. Just because AI is available doesn’t mean it will always be used. In complex mediations involving significant financial stakes, AI can provide best practice suggestions and informed recommendations. However, when the stakes are highest, people often prefer to speak directly with the top decision-maker or advisor.

While AI might handle more routine cases or assist in reading parties’ emotions, it remains likely that human mediators would distinguish themselves by providing genuine empathy, trust-building and creative problem-solving. Far from rendering human mediators obsolete, emotionally perceptive AI could push them into more specialized, higher-level roles. Human mediators would emphasize what makes them uniquely human—empathy, cultural intelligence, ethical reasoning and the human to human and pier to pier connection—preserving their indispensable role even in an age of emotionally savvy AI.

Today, I’m here to talk about a subject close to my heart—how mastering conflict resolution can be your secret weapon in tackling some of the most pressing issues faced by companies, nonprofits, and institutions today.

1. Employee Engagement and Productivity

• Challenge: Keeping your team engaged and firing on all cylinders, especially when they’re spread across various work environments. A recent article from Fast Company Daily talked about the “red flags” of remote work for job seekers and how we all should pay attention to the short cuts some companies take to lure job seekers to accept that unbelievable offer. How can your company align both employee goals and employee gifts to win in remote, hybrid, and in-person workspaces?
• My Take: Implementing effective conflict resolution strategies means improved communication and a stronger team alignment with limitless agility. When this intentional alignment exists, people managers are able to navigate conflict by learning the triggers and traits of each leader. This results in employees who are not just present, but are actively engaged and highly productive. Start by asking the right questions. Look for the free download on tomorrow.

2. Talent Acquisition and Retention

• Challenge: Finding and keeping your top talent in a transactional job market. Many of my leaders struggle with two things here: finding and retaining the raw talent of unicorns in the hiring and recruitment space. I suggest having a solid strategy that is inclusive and employee led to ensure there is zero disconnect between hiring managers and the job or people managers.
• My Take: A robust conflict management system makes your workplace a magnet for top talent. It also soothes the rough edges that might otherwise lead to talent churn. This is accomplished by having company wide training from an outside consultant with expertise in inclusive leadership and human development experience/expertise. I often take clients on a “what if” journey in their first session to release the anchor of “status quo” so we can define their next step in attracting, hiring, developing, and retaining their best future employee.

3. Workplace Culture and Morale

• Challenge: Building a culture that breathes diversity, equity, and inclusion. My, my, my…..I think this may be the greatest obstacle to overcome in my 30+ years of leading and learning in professional work environments. What you don’t know or investigate can and will prevent the growth most leaders talk about. The first step to building a DEIcentric organization is minimize assumptions and embark upon your personal DEI journey. Next, ask every member of your organization to start where they are and join you. Each path is unique but what you are guaranteed to find ways to improve how each leader shows up and how they work together inside the agency. Consider hiring a DEI coach to work with your people leaders and offer peer support for everyone which includes ally groups also.
• My Take: Conflict resolution isn’t just about quelling disputes; it’s about valuing diverse opinions and fostering a culture where everyone feels seen and heard. This boosts morale and fortifies your company culture. Period. In fact, this is the work I love most because to see the “ah ha?” moments in a room full of diverse leaders and positions when I facilitate workshops and healing sessions, I get extremely excited. This is when I witness the growth they wrote about in our first year of working together.

4. Leadership Development

• Challenge: Developing leaders who aren’t just bosses, but true visionaries and change agents. Sometimes we find people who don’t know what to do or are too busy to care. If this sounds like you or leaders in your organization, here is a tip to consider for improved communication.
• My Take: When leaders are equipped with conflict resolution tools, they lead with empathy and inspire their teams. They transform challenges into lessons and conflicts into collaboration. The secret to leadership development is asking the leaders what they want and actually listening and supporting them in their journey. It may be classes, a flexible work schedule, or a mentoring relationship. I encourage you as people leaders to be the connector for your team.

5. Change Management

• Challenge: Navigating the choppy waters of organizational change, be it through digital shifts or company mergers. Many organizations struggle with change management due to natural human resistance to change. Employees often fear the unknown and worry about how changes will affect their roles, which can lead to reluctance or opposition. This resistance can be compounded by a lack of effective communication from leadership, insufficient training to adapt to new processes, or a previous history of poorly managed change initiatives.
• My Take: Solid conflict resolution skills are vital as they help smooth out the bumps of transition, aligning everyone towards the common goal. They enable organizations to effectively address and mitigate employee fears regarding change. By fostering open, empathetic communication and actively involving employees in the change process, conflict management helps to build trust, reduce anxiety, and secure buy-in. This approach ensures that concerns are heard and addressed, leading to smoother transitions and more successful implementation of new initiatives. Those who complain most often become my test team to identify all of the gaps and help leadership develop contingency plans and training for the transition.

6. Conflict Resolution

• Challenge: Keeping small skirmishes from blowing up into full-blown battles. Conflict among employees can significantly disrupt productivity by diverting attention from work to interpersonal issues, causing delays, errors, and decreased quality of output. This disruption not only affects team dynamics but also directly impacts the bottom line through lost time and reduced operational efficiency, ultimately leading to a tangible decrease in revenue.
• My Take: Directly tackling conflicts quickly and efficiently ensures that your organization runs like a well-oiled machine, without unnecessary disruptions. I encourage leaders to take personality and conflict assessments to help leaders understand how they are perceived and how they perform based on their styles. Implementing conflict resolution tools and fostering effective communication within teams can dramatically improve interpersonal relations and productivity. These strategies encourage constructive dialogue, promote empathy and understanding, and help resolve tensions swiftly. This results in a more harmonious workplace where team members collaborate more effectively, focus better on their tasks, and contribute to higher overall productivity and performance.

7. Employee Wellness and Mental Health

• Challenge: Supporting your team’s mental health in today’s high-pressure work environment. Mental health significantly impacts employee performance and presence in the workplace. Poor mental health can lead to decreased concentration, lower energy levels, and increased absenteeism or presenteeism (being present at work physically but not fully functioning). This not only affects individual output but can also dampen team morale and productivity, making mental health support a critical component of organizational success. In fact, over 70% of employees feel that their work impacts their mental health and often not in a positive light.
• My Take: A proactive approach to conflict resolution reduces stress by addressing the root causes of workplace tension and anxiety. Addressing mental health in the workplace is crucial for maintaining a productive and thriving work environment. Research and expert opinions highlight that poor mental health can lead to significant declines in employee performance, engagement, and satisfaction. Stress, we know, is one of the most common mental health issues in corporate settings, affects bodily functions and can lead to physical symptoms that disrupt daily work. Moreover, the psychological strain from unaddressed mental health issues often results in increased absenteeism and reduced overall productivity. Employers who proactively address mental health not only foster a more supportive workplace but also enhance their organization’s resilience and operational effectiveness. Creating a culture that prioritizes mental wellness helps mitigate the risks associated with mental health challenges, such as high turnover and the associated costs of training new employees. By integrating mental health support into the workplace, such as providing access to counseling services, training managers to recognize signs of distress, and fostering an open dialogue about mental health, companies can significantly improve their workforce’s productivity and engagement. This proactive approach also helps in maintaining a positive workplace atmosphere where employees feel valued and supported.

To my fellow CEOs, directors, and people managers—embracing conflict resolution is not just solving problems; it’s about preempting them. It’s about building a resilient workforce ready to face the challenges of tomorrow. Let’s champion these strategies and make our workplaces not just functional, but phenomenal.

Join me in leading the charge. Together, we can transform our workplaces, one resolved conflict at a time. Who’s Ready???? Let’s connect today and start the journey together

This issue, which currently preoccupies people, goes back a long way. The evolution of technology, which has been ongoing for at least seven centuries, starting from the introduction of the horse collar in Europe, presents a complex and diverse issue concerning its impact on job replacement, a topic that spans multiple centuries. We have now entered an era dominated by artificial intelligence (AI), which is radically altering many professions.

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Premise: Conflict is a normal and natural occurrence of interacting with one another. The cost of resolving conflict is negligible relative to the cost of leaving conflicts unresolved.

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