Weil, Henry Birdseye with Rayford L. Etherton, Jr., "System Dynamics in Dispute Resolution", 1990

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Since the mid 1970s, System Dynamics has contributed to the resolution of a wide range of business and legal disputes including contract claims and re-negotiations, management prudency hearings for nuclear power programs, and inquiries into the effects of government regulations on various industries. In these settings, a System Dynamics model can provide an objective, “transparent” view if a complex and emotional situation. The model can represent what happened and why, and what would have happened if certain events or conditions had not occurred. It can provide a basis for determining responsibility for delays, cost escalation, poor product performance, reliability and safety problems, complex situations are easier to understand and evaluate. The models and analyses become frameworks for debate and settlement.This paper describes the context, processes, and behaviors associated with many business-related legal disputes. The role of System Dynamics is dispute resolution is discussed in general terms, and then illustrated with a recent example. The example is a large contract claim for “delay and disruption.” That term refers to the indirect, secondary, or ripple effects of events or conditions (e.g., design changes) impacting an aerospace, shipbuilding, software development, or similar program. Delay and disruption impacts can be very substantial. They are the most difficult aspect of a change negotiation or claim to handle, and are the source of the most acrimony and disagreement in such disputes. The background of this case, the lawsuit, how the model was introduced into the legal proceedings, and how it helped to achieve a settlement, are described in detail. The paper concludes with a discussion of the practical results obtained from using System Dynamics in dispute resolution.

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  • 1990
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