can you please help me to understand the difference between Arbitration and mediation?

Answer 1

Mediation is an attempt to get both parties to agree to a compromise. Usually neither party has to agree, though.

Arbitration is similar to a court. The arbitrator makes a decision that most parties must obey.

http://www.corporate-partnering.com/adr.htm

Answer 2

Correction. It should be ALL parties, not most parties must obey.