The Oxford English Dictionary defines Mediate:
"To act as a mediator or intermediary; to intercede, or intervene for the purpose of reconciling."
In mediation the parties settle their dispute in private through a mutually satisfactory agreement that binds the parties as would any legally binding contract. The parties control the resolution with the mediator laying the foundation and keeping everyone on-track.
Does this mean that mediation is for everyone? Certainly not, because there are some disputes that are best handled by the courts and there are some people who enjoy long, bitter and expensive battles.
Does this mean that mediation always works? No, there is no guarantee that mediation will work, but having worked as a lawyer and a mediatior I am genuinely impressed with how often mediation does work and how often the parties are happy with the result.