AVOIDING AND MANAGING COMMERCIAL DISPUTES: SUPPLY CHAIN DISPUTE RESOLUTION MECHANISMS DIFFERENCES AND SIMILARITIES IN UAE AND UK
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In presenting this dissertation for assessment, I declare that it is a final copy including any last revisions. I also declare that it is entirely the result of my own work rather than where sources are explicitly acknowledged and references within the body of the text. [or: in footnotes, endnotes, as appropriate]. This dissertation has not been previously submitted for any degree at this or any other institution’
Signed by student
Humaid Al Ansaari
Student ID: 00454265
CONTENTS
1.1 Background to the Research 4
1.2 Research Questions, Aims and Objectives 5
1.3 Justification for the Research 6
1.5 Outline of the Rest of the Dissertation 8
Abstract
Supply chain management is becoming more and more complex year-on-year; however, the area supply chain disputes has not garnered academic interest as opposed to other aspects of supply chain management. This paper examines the ever-critical concept of resolving supply chain disputes through Alternative Dispute Resolution in the background of data from two countries- United Kingdom and United Arab Emirates. To achieve this objective, various sampling and analysing methods have been deployed.
In the first part, the paper will analyse how supply chain disputes are managed and mitigated before parties can resort to litigation. The paper will also have juxtaposed the prevailing legal mechanism in UK and UAE to highlight their similarities and differences.
From the results of this paper, it can be concluded that entities in both countries studied show a preference to risk avoidance. The results also stress why entities are more inclined to choose ADR (alternative dispute resolution) to resolve any supply chain disputes. It is also concluded that entities in both countries show similar perception of ADRs to solve their supply chain disputes.
Chapter One
Introduction
1.1 Background to the Research
Supply chain management entails developing and streamlining the supply related operations of a business entity to maximize value and have contiguous competitive advantage. Supply chain management is considered important “for squeezing greater efficiencies out of a delivery system for products and services” (Wolf and Pickler, 2010). Given supply chain’s considerable importance, many parties involved in businesses have become more receptive to the idea of injecting more resources into their supply chain infrastructure and IT support (Harrison and New, 2002). That being said, prevailing global business and technology forces require companies to outsources so many of their operations to countries, which culminates in supply chains being disintegrated, rendering them more prone to disruptions. Just like any numerous operations, supply chain is also susceptible to adverse disruptions, which usually culminate in myriad disputes between the parties. Hence, the susceptibility of supply chain to disputes creates the need for devise effective means to avert supply chain conflicts that may arise both in the realm of domestic jurisdictions and international alike, since the supply chains are usually scattered globally. Further, since supply chain conflicts and disputes are ordinarily inevitable, this dissertation also espouses the resort to alternative dispute resolutions to effectively settle disputes as ADR procedures are deemed cost-effective, neutral, and expeditious” (Wolf and Pickler, 2010). This study will evaluate ADR methods by comparatively analysing the prevailing conditions regarding supply chain management and dispute resolution in UK and UAE. The paper endeavours to highlight the biggest and smallest details of ARD in the two countries in question, such as its strengths, weaknesses, opportunities and threats of ADR procedure when it comes to resolving supply chain conflicts in the commercial industry. Moreover, the paper offers a venue to emphasize the potential risks, critical issues of resolving disputes and implement sound supply chain dispute resolution mechanisms in UK and UAE.
1.2 Research Questions, Aims and Objectives
The current study aims to explore the effectiveness of well-made contracts and alternative dispute resolution tools in resolving supply chain conflicts, resolving the contentious issues between the customer and the company and means of establishing an effective long-term relationship. Hence these are the specific aims of the study:
- To investigate whether well-made contracts and alternative dispute resolutions make a positive contribution to the supply chain industry and what are the limitations when comparing with conventional conflict resolution tribunals.
- To discover the kinds of supply chain dispute mechanism tools, present in UAE and UK that are most useful to maintain the relationship between the company and the customer, and to gain more business.
The main question this paper seeks to ask is how Alternative Dispute Resolutions are advantageous to commercial disputes. In order to answer this, three further related questions are posed:
- First, what are some of the advantages of Alternative Dispute Resolutions in the United Kingdom and UAE?
- Second, given these advantages, how are they different from the judicial process?
- Finally, how do these advantages affect commercial dispute resolution?
The research aims will be fulfilled by undertaking the following exercises. First, by reviewing related literature, the study will seek themes that resonate in using supply chain dispute resolution mechanism in UK and UAE. These themes are the difficulties, benefits and pitfalls faced by organizations in resorting the same in their operations. The findings in the existing literature will be tested if the same themes and figures resonate in selected organizations in UK and UAE. This will be done through interviews with representatives of these organizations.
1.3 Justification for the Research
According to Rathke (2015), supply chain disputes mainly arise from poor contract management. Worse, due to the voluminous cases clogging the conventional conflict resolution tribunals (i.e. courts), they no longer effectively settle the same fast enough to meet the needs of these supply chain partners (Pickler & Wolf 2010). As such, in the effort of resolving conflicts in the supply chain, this study will be developed in order to contribute to the growing body of literature that supports such an advocacy. Results of this research will therefore be beneficial to goals of promoting effective solving disputes in supply chain management. Apart from this concern, issues surrounding the need to promote well-made contracts and alternative dispute resolutions are equally given importance. This study will take on the responsibility as well to add to the number of researches that have continuously promoted the resort to extra-judicial means of resolving conflicts in the realm of supply chain. Therefore, the results and implications gathered within this research are anticipated as a method of communicating the message of supply chain dispute resolutions across the commercial domain, promoting non-judicial means to alleviate conflicts. Overall, this study supports campaigns expressed in previous assertions in literature, which ascertain that that Alternative Dispute Resolutions be first be availed, particularly in commercial disputes, before filing a claim for a judicial decision.
1.4 Outline Methodology
According to Creswell (2009), the selection of qualitative approach is apt for an inquiry approach method and perceived as useful tool in exploring and at the same time understanding a central phenomenon (Creswell, 2009). Obviously, the chosen inquiry process was designed to study a human social issue in detail, which is typical of a qualitative approach. A quantitative research on the other hand is also a good method in human social issues especially if aiming to predict based on variables. Patton claimed that a qualitative approach provides data either by descriptions, analysis and observation of social behaviour (Patton, 2002). This dissertation employs qualitative research design to assess the effectiveness of supply chain dispute resolution mechanism in UK and UAE.
Monette, Sullivan and Dejong (1997) argued that the choice to use qualitative or quantitative study is based upon two factors: “the familiarity of a particular subject and the researcher’s position concerning human social behaviour.” Hence, participants play a major role in this dissertation because they have been perceived as an important tool to gather, analyse and report information that is bias-free. This was complemented by Abusabha and Woelfel when they claimed that “qualitative researchers argue that, in the absence of close connection with the object of study, results will be distorted” (Abusabha and Woelfel, 2003).
1.5 Outline of the Rest of the Dissertation
This section briefly summarizes each chapter of the study. The first chapter gives the readers insight about the background of the study. It gives an outline about the context of the study and the particular setting where the study intends to explore (Supply chain dispute resolution mechanism in UK and UAE). The rationale for choosing the topic is also presented and, hence this chapter also briefly outlines the research aims and objectives that prompted the study. Lastly, it also gives insight to the readers what research approach that the study will utilize in dealing with the research.
Chapter two includes review of current research literature that addresses the problem. Review of related Literature chapter is further subdivided into subchapters.
The third chapter contains a summary of the methodology of the study. It also includes summaries of the population selected for the study, the rationale of the research design, data collection procedures, the manner of analysis for recovered data and internal and external validity of the study.
The fourth chapter presents a constructive analysis of the trends and patterns in the collected data both from the literature and from the population. It subsequently discusses the results and analysis of the findings and their contextual interpretation grounded on the theoretical framework of the study.
The fifth and last chapter includes the discussion and conclusion of the study. A comprehensive conclusion drawn from the literature review and data analysis will be presented. More importantly, this chapter gives future trends and recommendation essential for both future researches and for supply chain management.
Chapter Two
Literature Review
Unlike many other aspects of a business operation, supply chain management has surprisingly been one of the areas that court minimal research attention. For all the lack of research and academic interests around supply chain management, it is definitely not an area that managers can afford to overlook (Chopra and Meindl, 2007). The prevalent view that supply chain management is ordinarily and largely involves placing orders, supervising and maintaining communication channels with a network of suppliers, has been called into question by so many authors and scholars alike. The network in question ordinarily consists of entities, institutions, resources, and operations all related to the production of a particular service or a product. Sheffi (2005), the author of a pioneering study into supply chain management, demurs from this orthodox view and posits that supply chain management, in the 21 century, is going through phase of rapid change that is effected by advancing technology, increasing customer demands, and other decisive factors. Fisher et al. (1997) posits similar conclusions regarding the rapid change in supply chain management. The above-mentioned and factors necessitate supply change managers to enhance service, upgrade supply sustainability, mitigate the vulnerability of all the entities involved in the supply chain to unforeseen threats and minimize environmental damage Goebel et al. (2001).
To plug the current gap and attain sustainability in supply chain management, the managers are required to embrace the complexities. This explains the increased attention that is being focused on supply chain to find new avenues for improvement (Giunipero et al. 2006). The plethora of new research into the field of supply chain management does not seem to suggest that SCM has not been the subject of contention as to itself as a comparatively new theory. The dissenting opinions have been highlighted in a number of key studies and researches conducted into the field of SCM. Some researchers showed an unequivocal tendency to define supply chain management as dealing with merely purchasing and used it as a substitute for entirely placing orders (Stuart 1997).
However, other researches, judges by the conclusions in their researches, have grasped the fact that supply chain involves more than merely integrating operations placing orders, and maintaining efficient logistics. These researchers have come to define supply chain as an issue of great moment that deals with cultivating strategic relationships, and leadership skills (Giunipero et al. 2006), Oftentimes, these studies also broaden the purview of supply chain, and what it concerns everything from sourcing raw materials to delivering the product or the service to the end consumers (Davis 1993).
The studies analysed by this literature review also suggests that division of opinion about supply chain management is not restricted to what it includes, it also further to outside factors, adverse and favourable, that can have decisive influence on supply chain management. (Storey et al. 2006)
Evidently, the debate as to what falls under the ambit of supply chain still remains just as intense. Given the contentious and perennial debate as to what clearly falls within the ambit of the so-called SCM, it is enticing to conclude that the same research attention and debate has also been concentrated on the concept of disputes and conflicts in the supply chain, as proposed by Slack et al. (2013). Notwithstanding the voluminous body of research, which focused on supply chain management itself, the disputes that occur in the supply chain, and how best to resolve them have not compelled meticulous attention in the studies that were analysed and cross referenced (Akkermans et al. 2003).
In view of the increased focus on supply chain management as a business of fact, there has been a significant body of literature amassed on the topic of supply chain management. It has been highlighted by many studies that academic discussion on supply chain has long cantered on factors such as increased cooperation between the disparate operations, leveraging the World Wide Web to gain efficiency, and combining and streamlining the diverse operations that anchor the very supply chain management (Wolf and Pickler, 2010). Notwithstanding voluminous research on the supply chain management itself, there is a palpable lack of research and studies undertaken into the realm of supply chain disputes and their resolution. This has been corroborated by a number of researchers over the last decade. Wolf and Pickler, (2010) decry the lack of substantive research into how to properly handle disputes and conflicts that are poised to occur in the ever-global supply chain. The study also d presupposes that the disputes are likely to occur stem from the cultural dissimilarities, Judi rate conflicts, and other determining factors.
As explored in the preceding paragraphs, ever scattered global network of supply chain management brings about a number of disputes (Grim et al. 2015). The disputes and conflicts that arise in the supply chain have the potential to have adverse long-term effect on the competitive advantage of the company and the value it passes onto the end consumer (Park et al. 2012). These disputes can be formally settled in a court of suitable jurisdiction, or through conference such as the American Arbitration Association. Considering the far-reaching effects of supply chain disputes can bring about, these types of disputes necessitate an expeditious settlement, citing the need to protect the larger part of the supply chain when it faces disputes. This view expressed by Wang, (2012) is highly similar to that of these whorish authors, who also emphasizes the need for swift settlement methods for disputes and conflicts that are bound to occur in the supply chain method. ‘Disputes must be rapidly and on the spot, if possible’ asserts the same author. Wang, (2012) also propounds that the likelihood of both parties involved in the supply chain incurring losses as a result of a dispute is invariably guaranteed should the settlement process become ‘too legal’
That being said, the courts are usually regarded as the most time-consuming, and cost-prohibitive of all the settlement options for supply chain disputes (Park et al. 2012). Customarily, court’s possible complications and limitation apply to all disputes, including supply chain ones. However, for supply chain disputes, the courts pose even greater threats since protracted litigations adversely affect almost every actor involved in the supply chain dynamics. This has been explored by Boon‐itt and Paul, (2006) in his seminal study on supply chain dispute resolution. To corroborate his assertion, Boon‐itt and Paul, (2006) exemplifies the case of supply chain dispute that involved American and Turkish partners, who resort to court to settle their dispute, which proves to be protracted, and costly. A study conducted by ARA (2012), found that time delays in legal litigations not only decrease the profitability of the business actors involved, but also subject them to prohibitive financial costs and other limitations. ARA study concludes that the total direct losses borne by the business due to delays at US district courts amounted to as much as 180 million USD per month (2012).
In contrast with the courts, a less formal, and far swifter method of dispute settlement is afforded by a conference- an alternative mediation method. These types of meditations are commended by a numerous study, who stipulate its effectiveness and overall value over a settling disputes in the courts (Baker & Mackenzie 2014). Settling the dispute through American Arbitration Association conference is contingent upon whether or not both of the parties involved decide to execute the dispute settlement in a less formal way (ARA). However, given more consideration, it can also be resolved through negotiation which is rather informal. This kind of conflict holds unfamiliarity to many and some of the details are better not be publicized (Grim et al. 2015). Each kind of risk has an equivalent comprehensive discourse in which possible remedies are tackled in order to come up with sufficient risk avoidance method, yet it goes without properly addressing the field of dispute resolution conventions (ARA, 2012). Taking into consideration the connection between risks and disputes, avoiding the risk itself is, needless to say, favourable to other methods of dispute resolution that might be applicable and available to the parties.
Given the unprecedented dynamic engendered by the vulnerability of supply chain to disputes, and conflicts, adopting a well-crafted strategy of risk avoidance is ordinarily considered the optimal course of action. Long (2016), lucidly describes risk avoidance as ‘the elimination of hazards, activities, and exposures that can negatively affect an organization’s assets’. Risk avoidance in supply chain management starkly contrasts with risk management strategies, by highlighting the fact that while risk management objectifies to contain the detriment of, both physical and financial, of detrimental risk, risk avoidance in supply chain aims to avoid the detrimental risk at all costs (Christopher, 2011). Risk avoidance strategy are deemed to be preventative measures, and customarily entails cultivating efficient channels of communication between the parties, facilitating better coordination, increasing cultural awareness and investing heavily into technology that renders all the above possible. The effectiveness of risk avoidance over any method of dispute resolution has also been emphasized by the pioneering study of Wolf and Pickler (2010). Giannoccaro (2004) stresses how entering into revenue contract- type of contract that allows for the revenue of contract to be considered in the percentage of completion- can allow for better integrations, collimation in less or no conflicts between the parties. However, Wolf and Pickler (2010) cast aspersions on the viability of revenue contracts, since they posit it is only applicable to centralized supply chain networks. A feasible platform that can is conducive is risk avoidance in supply chain management has been presented (Dmitris & Ioannis in Wang J, 2012). The authors stress how supply chain disputes can be avoided by the use of the so-called ‘traceability system’. Dmitris & Ioannis in Wang J, (2012) contend that traceability system will be deployed to store information across the spectrum of supply chain- product production & quality, consumer safety and timeframes. The traceability system would afford access to pertinent information to the intended parties, and reduce the likelihood of a disputes arising between them. This view has also been articulated by the research conducted by Baker & McKenzie which stipulates that tracking that the subcontractors are executing the projects in compliance with the contractual terms can reduce the disputes by as much as 75%. At 83% rate, the method furnishing information and training to suppliers and partners was found to be the most effective among the respondents- 100 high level executives overseeing supply chain side at their respective companies- of Baker& McKenzie (2014) report. On the other hand, Vaagen, Wallace and Kaut, (2011) centre their risk avoidance mechanics in on logistics planning relation to supply chain disputes. Vaagen, Wallace and Kaut, (2011) explore how to supply chain managers can leverage the information they have at their disposal to efficiently avert any disputes, and lessen the risks of arising conflicts. Vaagen, Wallace and Kaut, (2011) give credence to their theory by employing the empirical evidence in the form of Norwegian oil company case.
Coates and Rathke, (2015) two career lawyers specializing in supply chain dispute resolution, emphatically conclude that the contract drafting stage is the most important step in minimizing the risks for both involved. For businesses to be able to bring a case in a reputable dispute arbiter, the supplier contracts should contain a clause pertaining to how the parties should resort to the specified arbiter to settle their disputes. Rosemary and Sarah (2014), contend that a well-drafted contract with clear provisions, and dispute resolution clause will do more than lessen the risks of disruptions and disputes. As much as the studies analysed offered differing and in some cases, conflicting views about the methods of risk avoidance in supply chain, there seem to be a consensus as to the importance of identifying the sources of disputes as a feasible way of overcoming the threats posed by them.
Identification of the sources of conflicts in supply chain allow for better management of the conflicts that are bound to occur in the supply chain. This view, which is held by this paper, has been substantiated by Constantinescu (2017) who defined it being cognizant of the source of the conflicts was the ‘stepping stone’ to resolve those very conflicts. Kumar & van Dissel, (1996) harbour similar perceptions, and cite identifying the sources of supply chain conflicts was the first step in managing the conflicts and charting a proper course of action that would lead to favourable outcome for all the parties involved in the supply chain. Constantinescu (2017), takes a further step by identifying the types of destructive effects of supply chain conflicts. Constantinescu’s outcome in relation to the cross effects of supply chain conflicts have been corroborated by many authors (2017).
Since the myriad external factors that can exert far-reaching effect on the whole network of entities, individuals, operations, and the flow of information which embed the supply chain of any given product or service. This has been underscored by Lunsford (2007), who cited the instructive example of Boeing to call attention to how far reaching of an effect supply chain disputes can have, and how the threat is aggravated international jurisdiction since the so-called actors in the supply chain are dispersed all over the globe. However, Rahim’s findings run counter to the findings in studies referred to above, which centre upon how destructive the effects of supply chain conflicts can be (2001). Rahim (2001), while he acknowledges supply chain conflicts can have destructive effects such how conflicts in the supply chain would lead to discontent mistrust, and long-term damage in the relationship between the businesses involved, he also asserts that conflicts between the parties have the potential to encourage innovation and creativity, resulting in more effective decision making. Eisenhard (1997) also vociferously advocate for the ‘benefits of conflicts’ in supply chain management. The authors assert that conflicts are essential between the parties since it fosters effectiveness, and the need for better decision-making. Eisenhard (1997) even ventured further to claim that no conflict did not mean the parties were executing the task at the highest level, but it meant that they were apathetic, and aloof from all the operations. Other studies have also concluded similar results to that of Bradford et al., (2003); Hagel & Brown, (2005) stress that, as opposed to the other findings about conflicts, conflicts help achieve a greater understanding of the relationship between the partnering parties in a supply chain. Pondy (1967) also emphasize how constructive the effect of supply chain conflicts can be by pointing to their findings that conflicts afford opportunities to parties to voice their disagreements, and discontent in relation to the activities of one another, whereby allowing for a critical evaluation of their activities. (Pondy 1967) suggest , which is effected by conflicts, facilitate ingenious and inventive problem solution process. On the other hand, a plurality of studies conducted into the supply chain conflicts do not share the same enthusiasm as relative to its dispute settlement. Skinner, Gassenheimer & Kelley (1992) maintain that any conflicts in management, not just in supply chain, culminate in low level of cooperation, high levels of antagonism, and low levels of alacrity to team up between the conflicting parties. Similar viewpoints are demonstrated by Blackhursta et al., (2008), who denounces the destructive effects of conflicts in supply chain, and imputes degraded performance to the conflicts that might arise between the parties. Koza & Dant (2007) also delve into the destructive effect supply chain conflicts can have by concluding that conflicts retarded the communication between the partners, and led to decreased levels of flexibility and willingness to share information regarding the whole process. Wall & Callister (1995) ventures, and asserts that conflicts lead to restricted communication between the parties, Wall & Callister (1995) even reported of cases where parties tried to sabotage each other’s reputation and business when conflicts arose between them.
Various studies analysed concur that natural disasters, bankruptcies and industrial strikes, regional conflicts, and even incompatible geopolitical interests are just some of the main factors that can affect unexpected disruptive threats to the supply chain. Risks usually occur in supply chain have been the focal point of a number of studies. Chopra (2014) has addressed several other risk categories, which encompass ‘disruptions, delays, systems, forecasts, intellectual property, procurement’. They both have furnished valid and research backed premises for the occurrence of each of these risks. However, as per the exhaustive research conducted for the purposes of this paper, Lee (2008) successfully identifies a risk- having multiple supply chain actors and partners. This particular risk has been overlooked by Chopra (2014). On the other hand, Denning (2008) expresses a rather conservative view in relation to supply chain risks. The author predicated the so-called threats, or risks in supply chain network, largely on logistics related delays in the ports, roads, and rail network. Li, Du, and Wong (2005) explores the realm of supply chain management in terms that are strictly restricted terms of more efficient integration. Li, Du, and Wong (2005) espouses the of effective information integrations during virtually all the phases including planning and development in effecting a less risk-prone supply chain network. Wolf and Pickler (2010) cite another underestimated risk-access control conflict. Access control conflict occurs, the author explains, when the very same actors working on the same project have varying levels of access to data that is essential to the executions of that particular project. The Baker& McKenzie study, however, emphasizes the need for partners to be extra cautious when they share information with their suppliers and partners on the cloud system (2014). Better access control policies to police the practice of data sharing can ensure that there will be less risks, and that projects can be executed in a timely manner. Wolf and Pickler (2010) touch upon another type technology-borne conflict- propaganda conflict. The authors stress propaganda conflicts transpire when company A affords access to its data to a company B, and when that data might have information about company C, a third-party that is not involved in the relationship between company A, and company B (Monczka et al, 2014).
It has been underlined by the studies referenced to above that risks in supply chain can stem from even factors that are ordinarily overlooked. Khan & A Zsidisin (2012) cites the case of Gazprom a state-owned Russian company, which abruptly turned off the gas supply to EU. The author capitalized on the case of Gazprom to illustrate the political risk that are inevitable in supply chain. Baker & Mackenzie (2014) study found that legal jurisdiction complication poses a greater threat to the settlement of supply chain disputes. According to the study, there are multitude of cases of supply chain disputes where companies were unable to have their rulings they had received from another jurisdiction (UK) be enforced by local jurisdictions (China). The study also cites problems that are associated with the courts that are predominantly in emerging markets. The study contends the courts in emerging markets do not usually afford the sufficient protections to either party, which renders resorting to courts into those countries not only cost-prohibitive, but also futile (Chopra and Sodhi, 2004). Overall, it can be concluded that there exists a common consensus as to the grave risks that are poised to be existent in supply chain.
A mitigating course of action, otherwise known as risk avoidance action, for supply disruptions comprises redundancies on developing suppliers and sustaining larger inventories. The benefits of a mitigating course of action as opposed to some full-fledged legal litigations in supply chain have been strikingly illustrated by a diverse set of studies, including Long (2016). Evidently, there the void of academic exploration into dispute resolution methods has been underlined by the studies references to above, however, the same is not the case with risks that usually occur in the supply chain (Chopra and Sodhi, 2004).
By now, the importance of a swift dispute resolution has clearly been highlighted and given credence to by so many studies, and case reports. However, there is a huge gap of empirical data in the use of alternative dispute resolutions in supply chain management, insists Chopra and Sodhi (2004). The preceding paragraphs, while building on the arguments propounded, will zoom in on what alternative dispute resolution is and how it can be used by businesses that are susceptible to conflicts in relation to their supply chain activities.
The Law Reform Commission (2010) had defined Alternative Dispute Resolution as “a broad spectrum of structured processes, including mediation and conciliation, which does not include litigation though it may be linked to or integrated with litigation, and which involves the assistance of a neutral third party, and which empowers parties to resolve their own disputes.” Alternative Dispute Resolutions in the United Kingdom are not always mandated by law. Nevertheless, its prominence in settling dispute between parties have brought about legislation as exemplified by acts such as the Arbitration Act of 1996 and the Alternative Dispute Resolution for Consumer Disputes (Competent Authorities and Information) Regulations 2015. As such, since it does not include litigation, inherent in it is some differences from litigation. These differences, more or less, form part of the advantages of Alternative Dispute Resolutions. These advantages include (1) efficiency and/or practicality; (2) voluntary nature; (3) control exercised by parties; (4) binding effect; and (5) regulation (the Law Reform Commission, 2010)
Alternative Dispute Resolutions are commonly more efficient and/or practical than court litigation (Pryor, 2014). They are considered to cost less money and consume less time. Although of course, Alternative Dispute Resolutions are not applicable in absolutely all cases, they therefore do not in absolutely all cases take less time and money. Such would actually be dependent on the complexity and intricacies of each case (Avery and Range, 2014). However, it is generally recognized that Alternative Dispute Resolutions are relatively efficient and/or practical compared to court proceedings, keeping in mind that an application of the appropriate process of dispute resolution could result to a cheaper and quicker result, contends Dickinson (2017).
Efficiency and Practicality is provided here as the first advantage as Alternative Dispute Resolutions are not only practical because of money and time, but they also provide a venue where the parties in dispute have the discretion on whether or not they want to resort to an Alternative Dispute Resolution, while having relative control exercised in its process, with having the force and effect of law and having security of law (Pryor, 2010). These are also the other advantages of Alternative Dispute Resolutions (Griffiths and Robers 2014)..
It is important in Alternative Dispute Resolutions that both parties to the dispute agree to settle their differences in a venue other than the Court (Pryor, 2014).. As stated by the Law Reform Commission in their Consultation Paper on Alternative Dispute Resolutions, “Voluntariness is exercised at each moment a party chooses to remain at the table, and is best validated by the approach that any party may withdraw from the process at any time they choose.” (2010).
Further, the availability of Alternative Dispute Resolutions is not purely contractual (Fiadjoe 2004).. To be clearer, parties do not have to initially provide in their contracts that they would first resort to an Alternative Dispute Resolution before heeding the help of the Court (Mistellis, 2003). Its voluntary nature allows the parties to avail of these processes after the perfection of their principal contracts (Fiadjoe 2004). This ensures the parties’ freedom in the sense that they do not have to resign themselves to leave the reconciliation of their problems to the judiciary, when more hands-on options are available. This voluntariness does not only entail that parties may choose to settle with a dispute resolution, but also the freedom to decide and consent to the other aspects of the proceedings (Nolan Haley, 2013). This allows for the possibility of a truly amicable settlement between the parties, thereby lessening the chances of a souring relationship between them (Dickinson, 2017).
There are two types of Alternative Dispute Resolutions: determinative and non-determinative. Their difference lies on how the decision is reached. In the former, a neutral third person makes a decision, which is binding upon the parties. In the latter, it is the parties who negotiate with each other to reach a settlement (Nolan Haley, 2013).
Mediation and Conciliation, on the other hand, are two kinds of non-determinative Alternative Dispute Resolution. The Law Reform Commission (2010), in recommending that when a legislation with regard to Mediation and/or Conciliation is made, the former be defined as “a facilitative, consensual and confidential process, in which parties to the dispute select a neutral and independent third party to assist them in reaching a mutually acceptable negotiated agreement,” and the latter as “an advisory, consensual and confidential process, in which parties to the dispute select a neutral and independent third party to assist them in reaching a mutually acceptable negotiated agreement.”
Evidently, even in Court proceedings, there is a third body which interferes between the processes of resolution (Wang, 2014). The main difference is on how much these third persons interfere. More than just provide for their definitions and outline the boundaries of third party interference, these kinds of Alternative Dispute Resolutions are shown to further emphasize the parties’ control, as posited by Blake et al (2014). The variations on third party interference allow the parties to freely choose the dispute resolution they may deem to fit in their particular case (Mackrell Turner Garret, 2017).
The parties also have relative control over who such third parties are. Their power to agree to submit to arbitration also gives them the power to choose the arbitrator, in the same way that they are free to decide on mediators or conciliators. The parties, therefore, have control over almost all the aspects of the process (Wang, 2014)..
Considering that Alternative Dispute Resolutions are not Court proceedings, their binding effect is a valid concern. True, it would prove useless to avail of these processes if the parties involved are, in the end, left with no means to have the decisions enforced Mistellis (2001).. Properly, determinative Alternative Dispute Resolutions are binding. By reason of their agreement to have their case handled by a competent party, the decision of made by their designated third party is binding upon them. On the other hand, non-determinative Alternative Dispute Resolutions have no binding decision by a third party. Instead, the parties themselves are forced to resolve on their own their disagreement (Mackrell Turner Garret, 2017). It is that agreement which is enforceable between the parties.
Unlike the English Courts which stand their ground and rely on previous decisions, the doctrine of Stare Decisis is not enforceable in Alternative Dispute Resolutions. This means that provided with essentially the same facts and issue surrounding two cases, the Court is generally bond to make the same decision(Nolan Haley, 2013)..
Such is not the case for Alternative Dispute Resolutions. A much wider leeway is given for the peculiarities of each case. The results, therefore, are binding or enforceable only as between the specific parties involved in the dispute. Previous decisions can nevertheless be used as guides, providing for a basic process and a skeleton resolution (Nolan Haley, 2013).
Given all the control the parties are allowed in Alternative Dispute Resolutions, unfairness and incompetence could be some of the risks encountered, as found by Blake et al (2014).. The English Courts provide for a system where, if the parties to a dispute provided for an arbitration clause in their agreement, then the Court would stay its proceedings(Mackrell Turner Garret, 2017. That is to say, Court could not exercise jurisdiction until arbitration is sought Mistellis (2001).. In this case, the decision of the arbitration is recognized to the effect that it binds the parties, no longer with the need to further resort to a judicial decision (Griffiths and Robers 2014)..
Necessarily a process that affects the social interest as it provides for a binding decision in several fields of law like civil and commercial, the law provides for safeguards to regulate Alternative Dispute Resolutions(Wang, 2014).. An example of this is the Arbitration Act of 1996, which was passed in order to provide for better arbitration proceedings.
The same advantages noted above apply to the commercial disputes. As one that deals with the trade or exchange of goods and commodities, transactions are made keeping in sight, among other things, the value of time, money, and property (Blake et al 2014).. As it is common for the value of property to fluctuate with the passage of time, a resort to a quicker and cheaper dispute resolution is essential for parties who engage in the exchange of such goods and commodities(Wang, 2014). Even if the efficiency and practicality of resorting to Alternative Dispute Resolutions are dependent on the complexities of each case, nothing is taken away in considering such processes.
Commercial disputes concern capacities private in nature, assert Blake et al (2014).The parties are concerned mainly with their own interest and move for the benefit of their own businesses. As such, in a field filled with agreements and contractual relations, it could only prove beneficial to resort to Alternative Dispute Resolutions as engaging in them are inherently voluntary, as asserted by Ridley-Duff and Bennett (2011). Established and made effective via consent, the voluntary nature of Alternative Dispute Resolution looks out for the trader’s want for control in the effect of certain relations to his business (Dickinson, 2017).
As was provided, Alternative Dispute Resolutions allow for the parties’ control in almost every aspect of the proceeding (Ridley-Duff and Bennett 2011). It could be resorted to anytime, left so long as appropriate. The parties have freedom to choose the kind of Alternative Dispute Resolution they deem fit, and along with this comes the right to choose the interfering third party (Griffiths and Robers 2014). This right to choose not only establishes a trust relationship between the parties and the third party, as their reliance is backed by their own discretion, but it also allows for a perusal of competent authority. In this sense, the parties may rely on the judgment or guidance of a third party actually engaged and experienced in the specialized field of commerce (Ridley-Duff and Bennett 2011).
The drive to reach for an amicable settlement could shape the relationship between the parties, says Mistellis (2001). Especially in non-determinative Alternative Dispute Resolution like Mediation and Conciliation where the third party only serves as a guiding entity, the parties negotiate with each other . As they compromise their wants to meet each other’s needs, the parties of the dispute could build a more beneficial rapport as they achieve a result they are both satisfied with, state Ladder and Zeleznikow (2010).
Further, the State supports the exercise of Alternative Dispute Resolutions by acknowledging their importance through means such as recognizing the latter’s jurisdiction through a staying of judicial proceedings and the enactment of laws that safeguard social equity. Case in point, the Alternative Dispute Resolution for Consumer Disputes (Competent Authorities and Information) Regulations 2015 was legislated for consumer protection. This set of regulations provide for the requirements “ADR entities” or simply those who wish to engage as arbitrators.
Although no such legislation is made for Mediation or Conciliation, the State supports these types Alternative Dispute Resolutions (Mistellis (2001). As reinforcement, the Law Reform Commission has published a Consultation Paper collecting studies on Mediation and Conciliation, thereafter providing a Report for their recommendations for law reform.
With regard to commercial disputes, Alternative Dispute Resolutions are not mandated by law as a pre-trial action (Ladder and Zeleznikow (2010).. At most, arbitration clauses are given importance and agreements, made by the parties through Mediation or Conciliation, are respected. Alternative Dispute Resolutions do not run counter to judicial proceedings . In fact, they are as beneficial to the Courts as they are to the parties as cases settled through Alternative Dispute Resolutions are cases that do not further congest the dockets of the Courts (Ladder and Zeleznikow (2010). Nevertheless, if ever the parties could not settle on their own through non-determinative Alternative Dispute Resolutions, they could resort to Court (Wang, 2014).. On the other hand, although a decision made through Arbitration is binding between the parties, it is not truly without law, as various legislations regulate not only arbitral process, but the entities engaged in Arbitration as well (Griffiths and Robers 2014).
Regarding the Alternative Dispute Resolution in UAE, it is prudent to look at what ‘litigation’ means in this particular jurisdiction. Litigation in UAE is described as a process primarily used for the resolution of disputes by taking legal action through court proceedings (Morris, 2015). The Emirate legal system is unique and is best captured by ‘To maintain harmony between them the Emirates were given the constitutional right to opt for joining the Federal judicial system or to maintain their own independent system, as found by Zeidan (2015). Except for emirates of Dubai and Ras Al Khaimah which maintain their own judicial systems, the other Emirates have joined the Federal system(Awwad et al 2016).. The Federal UAE courts, similar to the courts in most of the countries in the Area, are organized to form two main divisions civil and criminal and are also generally divided into three hierarchies namely: courts of First Instance, Appeal and the Federal Supreme Court (colloquially referred to as Court of Cassation) (Awwad et al 2016). The jurisdiction of the third division, namely the Shariah courts, which initially was to review matters of personal status, was expanded in certain Emirates such as Abu Dhabi to include serious criminal cases, labour, and other commercial matters. Important cases with a security aspect are referred to special courts’ (Gulf-law, 2017)
The jurisdiction system, established in 1972, also necessitated the creation of sound and efficient mechanism to allow for the parties involved in a supply chain dispute to resolve their disputes without the need for recourse to the courts (Herber Smith, 2011). To follow the examples of UK and other countries with sophisticated mechanism for amicable dispute resolution for commercial disputes, Dubai courts- Dubai specific, courts that are independent of the Federal justice system- operate the so-called The Dubai Courts Centres for Amicable Dispute Resolution(Awwad et al 2016).. These Centres were created with a view to provide swift, and less costly legal services to cases that fell within the jurisdiction of the Dubai courts (DLA PIPER, 2017) . As per DCCADR, these centres offer alternative path to settlement of disputes with reduced time logs, and costs. The Dubai courts require all the cases (disputes) to be considered at these centres wherever possible, however, for a case to proceed to the Court itself, a referral from the DCCADR is required (Morris, 2015).
Another aspect of the Emirate legal system that is relative to alternative dispute resolutions is the DIFC Courts. DIFC Courts have been established by the virtue of the ‘Dubai Law No.12’, and are independent English language, common law courts in UAE (Alghafri, 2013). Initially, their jurisdiction was limited geographically, however, ever since the enactment of The Dubai Law further expanded its jurisdiction, rendering its jurisdiction to international and local cases (Zeidan, 2015.). The Federal Law No 26- enacted 1999- established the Alternative Dispute Resolution Committees, to offer expeditious and less costly alternatives to resolve disputes (Dla Piper, 2017). These committees were created in all of the Federal Courts, including Sharjah, Ajman, Umm Al Quwain, Fujairah. The Federal Law No 36 require cases to be heard at these ADR committees before a case can proceed to Federal Courts (Alghafri, 2013). These ADR committees in fact offer swift settlement of disputes compared to traditional litigations in UAE. The fact that they have been becoming more and more prevalent among disputing partners since 2010 is a testament to how effective and efficient ADR committees are compared to other options of litigations, opines Zeidan (2015.)
The efficiency and effectiveness, and the advantages of the DIFC courts have been explored by many scholars such as AlGhafri (2013). This suggests the improved legal infrastructure for the supply chain disputes settlement in arbitration.There have been further, noticeable strides in the ADR laws made by the UAE government, as confirmed by numerous studies. To facilitate the whole arbitration process, and to ensure that awards of arbitration awards issued in UAE is enforceable in other foreign countries, or vice versa, the UEA government signed New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958.
As a Signee to the New York Convention, the awards that were presented in UAE are enforceable elsewhere, as asserted by Dla Piper (2017)
Notwithstanding all the advances in the realm of Alternative Dispute resolution realm, many studies asm in relative to ADR. The UAE legal system still lacks a federal lasert there is still room for improvement in UAE legal systew governing arbitration, such the one in the UK- the Arbitration Act 1996 (Mistellis, 2003). Overall, the analysis of studies suggests that the prevailing conditions in the countries being studies are highly comparable, and that UAE has made great headways in improving its legal system to facilitate the mechanism of better ADR, concludes a report by Herber Smith (2011).
Chapter Three
Methodology
Research Philosophy
This purpose of this chapter is to elucidate the research methods and research designed employed to answer the research questions proposed in Chapter 1.To examine the merits of ADRs in supply chain disputes in two countries, UK and UAE, and how risk avoidance strategies can minimize risks in the SMC, the paper resorts to a number of research methods, qualitative method. Qualitative method has gained widespread prevalence amongst the research community in the last decade due to how flexible it is (Haynes, 2006). Sandelowski (2008) argues how qualitative research method can render effective and efficient in a number of research papers. The principal objective of a qualitative research is to produce a comprehensive report of all features or elements that elicit a significant result on the construct under study (Bansal and Corley, 2012). Thus, this kind of research is geared towards and more concerned with the implications of the study or with what a condition, stimulus, response or any occurrence could denote and what certain significances could it indicate (Willig, 2008). Qualitative research is therefore seen as best fit for this study as the design is decisive and definite in nature and is not only aimed at the superficial goals of the study but seeks to determine underlying causalities. Availability of information on the subject also play a key role in choosing either qualitative or quantitative method. (Naoum, 1998) As above-mentioned, supply chain disputes court minimal research attention, and qualitative research method positions the researcher to tackle the research questions more effectively (Braun, V., & Clarke, V. (2006).
Moreover, another aspect of this particular paper is to analyse the certain peculiarities between the prevailing condition in UK and UAE in relative to how supply chain disputes are settled through ADR or avoided. To accomplish that objective, the study utilizes a qualitative approach based from the assumption that inquiry approach is best method in order to explore and understand a phenomenon like what has been explained in Chapter 1. Qualitative research is the chosen inquiry process because it explores a detailed human social issue that can be predicted through its factors (Huberman and Miles, 2002). This research design will be utilized in order to comparatively examine the effectiveness of supply chain dispute resolution mechanisms in the commercial field in UK and UAE, respectively. Overall, it is considered that qualitative method would serve the research objectives of this paper.
Research Strategy
As proposed above, the study will follow a qualitative philosophy, which is largely predicated upon the interview method. The interview method is regarded as an effective way to capture the nature or current condition of a group, community, organization, or any other population under study (Bryman, 2012) . It also represents a systematic method for collecting data from a specified sample for the purpose of constructing a definite description and overview of the attributes of the whole population (Cervantes, Goldbach, and Padilla, 2012). The method also
reflects the purpose of gaining a conclusive understanding of a social problem. Such methods are also aimed at results reflective of more in-depth explanations; as such, these processes are also critical and cautious in their application.
Moreover, this study will also utilize the so-called black-letter methodology, which is loosely based on the deductive method of legal principles. Black letter method has gained traction amongst the legal researchers in the last decade, and involves researching and gathering preliminary materials and information (Salte & Mason, 2007). The information and materials collected are usually in the form of cases, statutes, and academic commentaries, largely presented in Chapter 2. The information was then utilized to illustrate the increased willingness of businesses in UK and UAE towards resorting to Alternative Dispute Resolution methods to settle their supply chain disputes, especially when they traverse borders . Therefore, the black-letter method coupled with the feasible cross referencing method allows for the preliminary information gathered to be verified, and be appropriate for the purposes of this study.
Research Design
As outlined above, the qualitative data that is employed in this study has largely been derived from interviews. Interviews will be conducted in face to face format in order to reduce the response bias introduced by the participants themselves. Before interviews are held, consent of the participants will be attained through the distribution of a consent form which explains the study, the corresponding goals and objectives, and a brief overview of the rationale and significances of the study. Once respondents confirm their willingness to participate, a brief exchange of information will be set between the researcher and the participant in order to set the date and time of the interview, fitting the schedule of the participant and assuring that inconveniences on the participant, which may affect the results of the study, are avoided. Prior to the date of the interview, a clearer picture of the study, depicted via a word document, will be e-mailed to the respondent in order to allow the participant to thoroughly understand the intent of this research. On the day of the interview, questions within the interview guide will be utilized to gather as much information as possible from the respondents. Impromptu follow-up questions will also be applied in order to extensively delve into the issues surrounding the research. Data will be recorded through tape recorders and written notes.
Regarding the design of the questions asked from the participants, they will be presented below, by way of narration.
The first two questions asked in the interview pertained to how supply chain managers could use risk avoidance, and what risk avoidance strategies rendered the most effective for the managers. These questions were asked with a view to gain insight into how the respondents, majority of whom are directly involved in supply chain management, would viewed risk avoidance strategies, and which strategy they perceived the most effective. Long (2016) and Christopher (2011) assert risk avoidance is the optimal, and renders effective results if carried out efficiently. The third and fourth questions centered on the respondent’s preference for ADR. The purpose of asking these questions were not only limited to determining whether or not they showed preference to ADR to supply chain disputes, but also intended to derive insight into as to why their preferred ADR over court litigation. The questions rendered insightful answers, which highly reflected the study presented in literature review. Court litigations were universally deemed to be the most cost-prohibitive, and time-consuming (Park et al. 2012). The succeeding two questions focused specifically on the UAE mechanism of ADR, and how effective it was compared to UK one. The question provided positive answers regarding the recent improvement in UAE legislation that led to a more effective and streamlined system of ADR, as evidenced by Herbert Smith (2011). The next questions were asked to derive a general idea of how respondents viewed each system of ADR with their respective ADR systems. DIF is considered to be commendable in UAE ADR system, as found by Zeidan (2015), while UK system is considered to be world-class among the studies analyzed in Chapter two.
Research Administration
Treatment of Data
To analyse the answers gathered from interviews, a series of procedures for analysing, evaluating and interpreting data will be taken into account. By large, qualitative means of answer analysis will be applied throughout the study due to the nature of the research conducted. Since statistical considerations are not evident within the intended procedures, no statistical forms of analysis will be utilized in the study. As per qualitative method analysis, however, various methods of analysis will be applied. Gathered i will be particularly analysed according to discourse, narrative, content, and matrix analysis. Grounded theory will also serve as a basis for the treatment of data as it may provide a better picture of the factors interwoven within this research.
Sampling Method
Cohen, Manion, and Morrison (2008) asserted that sampling is the process of selecting representative sample from the entire population. It has been discussed earlier that a large mass of population, both in UK and UAE resort to supply chain management dispute resolutions; hence the impossibility to use them all as sample. Thus, the researcher chose the best way to collect data and thus is to extract a sample from the population in order to represent the whole population. One of the most important processes in sampling method is the process of identification of participants. This process is important to consider in ensuring the qualification of the participants.
Hence the procedures for recruiting participants are as follows:
- Emails were sent to potential participants requesting their participation to be the representative sample of the entire population. The minimum requirement is their experience using supply chain dispute resolutions in dealing with conflicts in the industry.
- Upon getting affirmative response, they are asked to sign consent issued by the researcher. Appointment will be followed where the researcher will conduct a short interview about the background of the participant. This may be by phone or in person, depending on the discretion of the participant.
- On the day of the interview, the researcher will conduct briefing regarding ethical consideration of the study.
- The researcher also utilizes an interview protocol to facilitate the interview better. The interview protocol is in open-ended questions; the researcher encourages his participants to go in depth of their answers, exploring every detail of their experience using these dispute resolutions.
The design of the interview questions should jive with the research questions (Welman, Kruger and Mitchell, 2005).
According to Mutch (2005), adapting a semi-structured interview method allows the researcher to thoroughly address his research questions. This gives venue for the participants to clarify their answers in cases of uncertainties. Mutch (2005) asserted that this allows the respondents to give additional information about the topic regarding their experiences. Thus, the interview schedule of the study specifically aimed at maximizing the ability of the participants to go in depth of their answers. Moreover, this type of interview structure allows the researcher to read non-verbal clues (i.e. gestures, smiles) that the participants might show (Silverman, 2010).
Validity and Reliability
The researcher upholds the validity and reliability of the method employed in the study. The interview method was designed in such a way that it reflects the research questions and objectives of the study. The main idea of course is to see whether supply chain dispute resolution mechanism has been successful tool in resolving conflicts in the commercial domain. To maximize the validity, the questions were done in open-ended forms to get an in-depth analysis of the respondents’ answers.
Procedure and Timeframe
The use of timeframe in research is deemed to be useful in the success and viability of the research coverage (Cohen, et al. 2008). This allows the researcher to point out irregularities or potential pitfalls of the research. Hence, timeframe also allows the researcher to make countermeasures to potential pitfalls. Regarding this particular study, timeframe outlines the activities to be taken by the researcher. The designated timeframe was strictly implemented especially in the areas of sampling and interviews.
Assumptions
The researcher highly relies on the honesty and cooperation of the respondents with regard to the information they give during interview sessions. In addition, the coded and recorded data will be tied from the information gathered in interviews to ensure that it reflects from the respondents’ answers. One of the most salient assumptions of this study is that the recurring themes gathered from the review of related literature regarding the effectiveness of supply chain dispute resolution mechanisms will match with the recurring themes gathered from the interviews. These themes may be about the behaviour of the customers in dealing with supply chain disputes, the reasons of companies or organizations in using alternative dispute resolutions in case of conflicts, and the benefits and problems these organizations face in resorting to these extrajudicial mechanisms.
Analysis Plan
This research employs coding and verification as per analysis plan. According to Lichtnman (2010), coding pertains to the process of organizing the collected data and discerning the recurring ideas, themes and facts. This method was used in order to let the researcher see the recurring benefits and problems that supply chain dispute resolution mechanism faces both in UK and UAE. This is also a good way to develop a pattern to their answers. Coding was followed by recording of database. In addition to graphs and figures will also be provided in order to visually illustrate the trends and patterns of answers and behaviours by the respondents.
Research Ethics
Conducting a qualitative research invariably gives rise to a number of ethical issues, cause the researcher and the participants (interviewees) are personally engaged during the course of the research (Sanjari et al, 2014). As the case with other researchers conducting qualitative research, this study was also raised different ethical issues such as, protection of privacy, cultivation of candid interactions, and averting misrepresentations (Warusznski, 2002) To ensure that informed consent was in place, every respondent was asked to submit their agreement to being interviewed for the purposes of the research, and the research proposal was distributed to each of the respondent. This was done to ensure that there was no violation of consent and that the parties voluntarily assented to being interviewed. Informed consent, as proposed above, is an integral part of research carried out, and the onus of how the data derived from the participant will be used has to be explicitly advised to the participants (Hoeyer, 2005). Orb (2001) advises the research to clarify the following to the potential participants: their role, the identity of the researcher, the objective of the research and et.cetera. The researcher took every effort to ensure that every respondent (interviewee) compiled with the instructions.
Overall, it is evident that carrying out a qualitative research entails ethical issues, as substantiated by academics above. However, all efforts have been made by the researcher, to ensure that the potential ethical issues were either minimized or avoided.
To summarise Chapter 3, the methodology part, this study follows a qualitative method, with data, largely derived from the interview. The interview questions have been designed in a way to gain maximum insight, while not raising any ethical issues, that are poised to occur in a qualitative research.
Chapter Four
Findings & results
Ordinarily, research paper results are prefaced with an overall summary- statement- of the major conclusions of the study!
The results of this exhaustive research tend to confirm that Alternative dispute resolution is perceived as more efficient compared to judicial litigations in both of the countries studied- UK and UAE. Overall, deduction from the results suggest there is a slightly higher level of confidence in ADR amongst UK companies when compared to the level of confidence shared by the plurality in UAE.
The results are arranged in narrative and consecutive order to ensure that the presentation of the results do not distract from the overall value that is expected of it. The discussion of the results obtained with the interview method will be preceding all the methods this study resorts to! The discussion of the results of the black-letter method will follow those results obtained with the interview method. Finally, the discussions of the results will be concluded with the evaluation of results gathered through socio-legal approach!
Every effort has been made to ensure the validity of the research findings, and results. As for any study, it is of critical importance to take even conflicting results into account. Thus, the discussion of results will also take objecting results into consideration to make sure that the study’s main hypothesis of discovering, not proving the correlation between alternative supply chain dispute resolutions and countries- UK & UAE. The This particular discussion also makes it priority not to over interpret the results in this discussion, and strictly relies on the data it gained thru the various methods outlined in Chapter 3. The author has exercised reasonableness to ensure that there is minimal speculation attached to the results and the findings, and uses the results just to illustrate and answer the research question. Every effort has been made to refrain from inflating the importance of the findings to fit the research questions outlined in Chapter One. There have been so many studies conducted into how inflating the importance of findings and results in the discussion part of the dissertation is not appealing to the reader nor the peer reviewers of the study! Moreover, the researcher has also taken reasonable steps to ensure that the interpretation of the results of the study will be strictly grounded in the data collected through the various methods. The results of the research and its findings is presented below with reference to the thesis questions of this research, which were presented in Chapter On. This part will critically analyse and evaluate the results obtained by the interview method this study is predicated upon!
The interview method utilized by the research yielded us considerable insight into how businesses perceive resorting to alternative dispute resolution for supply chain disputes by British businesses, and whether or not this was the case with their Emirate counterparts. The primary questions, as outlined in Chapter 1, of this particular study deals examining the positive contribution the ADR make to the supply chain disputes, and ultimately to the party’s business interests. The data collected from the interview method will be discussed and critically evaluated below, however, prior to the discussion of the results, it is considered prudent to furnish background information about the interviewees. There were 20 individuals, who strictly satisfy the requirements set out in the sampling methodology part! All 20 of the interviewees were professional’s individuals who were involved in resolving supply chain conflicts. 10 of interviewees were identified as professionals well versed in the supply chain disputes in United Kingdom, and 10 of those interviewees were directly or indirectly involved in resolving supply chain conflicts in the United Arab Emirates. As for the industry, the plurality of the interviewees was involved in a diverse set of industries, food, fashion, clothing, real estate, and pharmaceuticals. Regarding the age factor, the majority tended to be over the age of 35. Moreover, the youngest interviewee was 27, while the oldest interviewees was 67 years old. As for the way the interviewees were conducted, most of interviewees showed clear preference for a phone interview (10 out of 20 interviewees), this was followed by email and face-to-face conversations. The preferences have clearly been presented in the table below. For the purposes of this study, these interviewees and their responses were enumerated to ensure there was no confusion as to the validity of their responses. The background information concerning the respondents and the method of interviewing are illustrated in the two tables (table 1.0 & table 2.0) below;
| Interviewee | Expertise (UK or UAE) | Age | Industry | interviewee method |
| Interviewee 1 | UK | 37 | Food | phone |
| Interviewee 2 | UK | 36 | Clothing | face to face |
| Interviewee 3 | UK | 28 | Pharmaceutical | |
| Interviewee 4 | UAE | 54 | Food | phone |
| Interviewee 5 | UK | 35 | Pharmaceutical | face to face |
| Interviewee 6 | UAE | 67 | Clothing | |
| Interviewee 7 | UAE | 27 | Pharmaceutical | face to face |
| Interviewee 8 | UK | 29 | Finance | phone |
| Interviewee 9 | UAE | 46 | real estate | phone |
| Interviewee 10 | UAE | 30 | real estate | phone |
| Interviewee 11 | UK | 45 | Fashion | face to face |
| Interviewee 12 | UAE | 48 | Pharmaceutical | |
| Interviewee 13 | UK | 39 | real estate | phone |
| Interviewee 14 | UK | 55 | Fashion | face to face |
| Interviewee 15 | UAE | 51 | Pharmaceutical | phone |
| Interviewee 16 | UAE | 49 | Food | phone |
| Interviewee 17 | UK | 50 | Food | |
| Interviewee 18 | UK | 45 | Pharmaceutical | face to face |
| Interviewee 19 | UAE | 54 | real estate | phone |
| Interviewee 20 | UAE | 39 | real estate | phone |
Table 1.0
Table 2.0
In compliance with the academic research guidelines, only the most striking and applicable interview responses will be sing-handily presented. It is suggested that including all the responses or their summaries in the discussion part of the research is often superfluous, and tedious, culminated in decreased levels of interest amongst the readers.
Interviewees showed a clear tendency to regard the Alternative Dispute Resolutions as more effective and efficient compared to judicial litigation in relation to the supply chain disputes. This tendency has been demonstrated by individuals belonging to both cohorts or countries- British & Emirates. On a scale of efficiency chart, the plurality pointed that Alternative Dispute Resolution was in fact more appealing to the respondents.
There was a question ‘What is the best way to resolve and manage supply chain conflicts you are bound to face in your capacity?’. The plurality (16 out of 20) concurred that ADR was the optimal solution, as opposed to judicial litigations. The optimism expressed by the majority in relation to the ADR is perfectly in consistent with the conclusions derived from the literature review in Chapter Two. ARA findings explore the demerits of resorting to the judicial litigations- court, and favour ADRs instead. This view has also been corroborated by a number of luminaries such as Wang (2012) who in his seminal book ‘Information Technologies, Methods, and Techniques of Supply Chain Management’, gives vent to his denunciation of the traditional courts when it comes to settling supply chain disputes. The author decries the extra costs and long wait times that are usually associated with a traditional litigation as the primary premise for his arguments. However, majority espousing the benefits of the Alternative Dispute Resolution did not conclude that there were not interviewees who did not concur with that opinion. Specifically, there were three respondents (interviewees 3, 7, 12) who did not share the enthusiasm about the advantages of the alternative dispute resolutions for supply chain conflicts that was expressed by the majority of the respondents. They instead stress that risk avoidance was the optimal course of action, and that parties when entering into a contract has to make clear-cut provisions to ensure there will be less or no conflicts between them. Only one respondent (interviewee 16) expressed his view that courts are the most optimal and effective method of resolving the supply chain disputes. Despite being the only person who directly veered from the partial consensus, his answer was considered striking and worthy of being singled out! The results are best summarized in the chart (table 3.0) below:
Table 3.0
The response of the three interviews who articulated that the optimal method of resolving supply chain disputes was by adopting a strategy of ‘risk avoidance’ as opposed to ‘risk management’ perfectly chimes in with the findings of Baker & McKenzie (2014) report, which gives precedence to risk avoidance strategies over Alternative Dispute Resolution in maintaining an efficient and effective supply chain network, minimizing the costs that are associated with any types of meditation. One respondent out of the three also mentioned ‘training and providing sufficient information to all the suppliers/partners’ was a key to a healthy relationship between the two. This response corresponds with what Baker & McKenzie (2014) found in their report on Supply Chain Management, which found training and information sharing to be the most effective strategy in averting disruptions that might exert negative influence and effect on businesses. The report also underscores the fact detailed and express provisions in contracts lessen the risk and disputes by as much as 73%. Even though the three interviewees (interviewees 3, 7, 12) expressed their view that courts are the least attractive option to resolve supply chain conflicts, asserting ADRs were well equipped with resolving these issues efficiently and effectively.
The next question was a little more specific, and urged the interviewees to give express and detailed advantages of ADRs in relation to resolving supply chain conflicts. The purpose of this question was to elicit the advantages that come with ADR in supply chain conflicts in both countries- UK and UAE.
In order to deduce country specific perceptions of Alternative Dispute Resolution in relation to supply chain disputes, there were some answers that had to processed with country specific objectives in mind. The objective was to see if there were varying attitudes towards ADR in UK and UAE. The answers received for this particular question which was ‘How efficient is ADR system in UAE or UK’ were illustrative of differing attitudes toward ADR in UK and UAE. Respondents practicing ADR in UAE were voiced irregularities and concerns about the ADR system in UAE, even though they noted the improvement in the system of supply chain disputes ever since the enactment of The Federal Law No 26 in UAE, which set up mediation and so-called conciliation committees throughout UAE.
The committees according to the answers we received, offer reconciliation services to civil, labour and commercial cases, which encompasses supply chain disputes. DIFC courts were only allowed to hear cases in a restricted geographical territory, however, since the enactment of the Dubai Law No 16, DIFC courts have been empowered to hear cases such as international and local, and were authorized to provide reconciliation (ADR) services to parties upon their mutual consent. Overall, according to the results, the UAE respondents were less satisfied with the ADRs that are applicable to their clients or their companies compared to those practicing in UK law. Nonetheless, they showed unprecedented level of increased willingness to have the option of ADR provision in their supplier/partner contracts. However, inducing from the interviewee responses, the alternative dispute resolutions such as mediation in UAE remain less prevalent, compared to in UK. For ADR in supply chain disputes to get more traction, the Emirate government should empower the Courts to require commercial contracts to have a ADR clause in them, and take a lead in enforcing those provisions. This way, the interests of both parties would be better served.
To get a clearer insight into the answered provided by the respondents, the next question was asked each and every of the interviewees. The question was as follows ‘What are the disadvantages of solving supply chain disputes through courts of law?’. Those interviewees who were practiced in UAE law, and supply chain disputes tended to point to the fact that disputes in courts were time-consuming. This is in consistent with the fact that cases in Emirate courts are subject to the so-called 3 tier system, which places time- related burdens on both of the parties involved.
When asked about the recent improvement in the alternative dispute resolution laws in their respective countries of specialization, the interviewees provided that the overwhelmingly pointed to the signage of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 by the UAE government.
As for averting potential supply chain conflicts, the interviewees overwhelmingly reached a consensus that well-crafted contracts, and communication was considered to be a key priority in avoiding any conflicts. This highly reflects the views posited by Wolf and Pickler (2010) As explored in Chapter two, Rosemary and Sarah also underline the importance of contract drafting stage!
Black-letter approach of research highlights that there is a clear positive correlation between the opinions voices and the legal cases, and materials. There is indeed an increased improvement in the legal infrastructure of UAE when it comes to Alternative Dispute Resolution. The literature point to the DFIC courts, which were established in collaboration with the London Court of International Arbitration (LCIA). Positive views about the English arbitration expressed by the interviewees is in harmony with the literature referenced to in Chapter Two that English legal system boasts of world-class arbitration mechanism, which includes the London Court of International Arbitration (LCIA). In the case of the legal dynamics pertaining to ADR in has been taken to the next level with the enactment of the Arbitration Act 1996. The interviewees made next to negligible mention of the Arbitration Act 1996, however, they credited it is as being one of the laws that have helped UK become the global leaders in arbitration. The socio-legal approach has afforded some information which confirmed the results gained with interview that there was indeed a tendency to regard contract as the most effective way of risk avoidance.
Chapter Five
Limitations
There have been a few limitations during the course of conducting the interview. The most sever limitation was the limited number of interviewees, which has the potential to detract from its validity and reliability. As the case with qualitative data, the increased levels of potential bias harboured by the interviewees was also seen as some limitations, thus, every effort has been to ensure that the data collected with interview method was as objective as possible.
Another limitation was the available academic papers and materials into this particular field, as mentioned above the topic of ADR in supply chain conflicts, unfortunately, still remain unexplored by the researchers. This limitation was even aggravated by the fact that some reliable sources as to the UAE law were in Arabic, however, there were a few sources on the internet, which were deployed for the purposes of this research. As the case with many foreign sources, there was heightened levels of anxiety over the reliability of foreign sources. To ensure that this limitation was did not dilute the overall value of this particular study, reasonable care was exercised.
Overall, it is evident that there have been a few major limitations, however, every reasonable step to mitigate and counter them was taken as a part of this study.
Conclusion
Overall, comparative analysis of the Alternative Dispute Resolution as to the supply chain conflicts in UK and UAE provided some there is an increased amongst the interviewees practicing both in British and Emirate law that there is an increased alacrity to choose ADR wherever possible. The research also found that, in consistent with the literature review, the prevailing conditions that pertain to supply chain conflict avoidance and resolution are almost comparable. Risk avoidance strategies such as drafting the right contracts, maintaining the flow of information were found to be indispensable in averting any supply chain conflicts by interviewees, representative of both countries. While everyone was positive about the ADR mechanism in UK, which is in keeping with the literature, not every interviewee was enthusiastic about the prevailing conditions pertaining to ADR in UAE. There were lots of studies done into the sources of supply chain conflicts, which many studies emphasized was necessary in drafting optimal risk avoidance strategies. The ADR system’s efficiency that was the main focus of so various studies mentioned above, has been further corroborated by the data gathered with the interview method. It is hoped that the research answers its research questions satisfactorily. There is a proven need to further improve the conditions in both countries, UK and UAE. Overall, even in the face of lack of research and some other limitations, the main findings of the research were that the drafting the most effective contracts were considered to be the most viable method of conflict avoidance, and the most viable method of resolving the conflicts was alternative dispute resolutions in both countries.
Recommendations
These recommendation concerns reforms that could likely yield favourable results to the ADR mechanism in UAE and UK, and these recommendations are strictly based upon the findings and results of this study. Every reasonable effort has been made to ensure that the research did not suffer from over speculation and unwarranted assumptions.
As for recommendations, it is suggested that UAE legal system should codify and assemble all the existing laws into a single law, just like the English equivalent- the Arbitration Act 1996. This will further act as the federal law governing all the laws that pertain to arbitration, streamlining the system of ADR more accessible and efficient to all parties involved. The inception of FDIC arbitration, which was largely based upon the English equivalent-LCIA-has been well received, however, there is still some improvements UAE can execute that will result in an ADR system that is more efficient and effective.
Future research
This study objectified to answer a number of pressing questions regarding the alternative dispute resolutions in supply chain conflicts in the background of two very distinct legal jurisdiction-UK and UAE. During the research process, it was discovered that there was a huge scientific and academic gap in research into supply chain and its ADR methods. Supply chain management is a wide-ranging topic that deserves academic interest.
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Appendix
Tables:
Table 1.0
| Interviewee | expertise (UK or UAE) | Age | Industry | interviewee method |
| Interviewee 1 | UK | 37 | Food | phone |
| Interviewee 2 | UK | 36 | Clothing | face to face |
| Interviewee 3 | UK | 28 | Pharmaceutical | |
| Interviewee 4 | UAE | 54 | Food | phone |
| Interviewee 5 | UK | 35 | Pharmaceutical | face to face |
| Interviewee 6 | UAE | 67 | Clothing | |
| Interviewee 7 | UAE | 27 | Pharmaceutical | face to face |
| Interviewee 8 | UK | 29 | Finance | phone |
| Interviewee 9 | UAE | 46 | real estate | phone |
| Interviewee 10 | UAE | 30 | real estate | phone |
| Interviewee 11 | UK | 45 | Fashion | face to face |
| Interviewee 12 | UAE | 48 | Pharmaceutical | |
| Interviewee 13 | UK | 39 | real estate | phone |
| Interviewee 14 | UK | 55 | Fashion | face to face |
| Interviewee 15 | UAE | 51 | Pharmaceutical | phone |
| Interviewee 16 | UAE | 49 | Food | phone |
| Interviewee 17 | UK | 50 | Food | |
| Interviewee 18 | UK | 45 | Pharmaceutical | face to face |
| Interviewee 19 | UAE | 54 | real estate | phone |
| Interviewee 20 | UAE | 39 | real estate | phone |
Table 2.0
Table 3.0
Interview questions
- What is the take on your take on the importance of risk avoidance in supply chain management?
- What is the best risk avoidance strategy in supply chain disputes?
- Do you prefer ADR over conventional litigation for supply chain disputes?
- Can you explain your preference for ADR?
- How would you rate UAE government’s efforts in streamlining ADR?
- How advantageous was the enactment of Dubai Law 16?
- What is the best way to resolve and manage supply chain conflicts you are bound to face in your capacity?
- How efficient is the ADR process in UK?
- How efficient is the ADR process in UAE?
- What is the most critical aspect of averting supply chain conflicts?
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