What term is used when a third party makes a decision that both organizations must accept?

The term that refers to a situation where a third party makes a decision that both organizations must accept is arbitration. In arbitration, an impartial arbitrator reviews the evidence and arguments presented by both parties involved in a dispute and then makes a binding decision that both organizations are obligated to follow. This process is often used when organizations prefer to resolve their conflicts outside of court, allowing for a more streamlined and private resolution.

Other dispute resolution methods, such as mediation, involve a facilitator helping both parties reach a mutual agreement, but do not result in a binding decision made by the third party. Negotiation typically entails direct discussions between the parties to reach a consensus on their own, without the intervention of an outside party. Litigation refers to the process of taking legal action in court, which can lead to a judgment but is generally more adversarial and public than arbitration. Thus, arbitration is the distinct process that leads to a decisive outcome mandated by a third party that the involved organizations are required to accept.