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Use this model to frame and inform your negotiation strategy.
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- Know your exact BATNA.
Create a list of actions you can take if no agreement is reached and choose the m ...
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Your BATNA's strength can easily be affected by unexpected changes in conditions. At the same time, determining BATNAs for you and your counterparty is difficult due to subjectivity, as we have a tendency to overestimate the strength of our BATNA and to underestimate the strength of the other side's BATNA.
Other factors influencing BATNA, like relationship value and the likelihood of the other party maintaining their side of the bargain are also difficult to value and measure in a quantifiable manner.
Finally, using BATNA as a mental model to assist in negotiations should not be counterposed to developing rapport, active listening and other methods to connect and find potential win-win options.
The Brexit BATNA.
In August 2018 British Prime Minister Theresa May revealed a plan of contingency for exiting the European Union (E.U.) if the so-called Brexit negotiations ended in an impasse, revealing the Government’s BATNA to quell the public’s fears.
Salary negotiation.
In a salary negotiation, the employee might have a basic BATNA of their current salary, assuming that the negotiation will not end with them losing their job. They might increase this by applying for an alternative position with a higher salary, which will become their new BATNA. In such a case, it is not a like for like comparison so the BATNA might become difficult to assess. For the company, they must consider the cost of losing the staff member if they do not meet their expectations. Again this cost is hard to measure.
BATNA is a fundamental mental model in negotiation theory.
Use the following examples of connected and complementary models to weave BATNA into your broader latticework of mental models. Alternatively, discover your own connections by exploring the category list above.
Connected models:
- WATNA: the worst alternative to a negotiated agreement is the other side of this equation.
- Opportunity cost: BATNA is essentially the same as opportunity cost, applied to the specific purpose of negotiations.
Complementary models:
- Porter's five forces: particularly as it relates to the bargaining power of suppliers.
- Non-violent communication: challenges this model in attempting to find a win-win alternative.
- Cialidini’s six principles of persuasion: a powerful option used in conjunction with any negotiation process.
- Mutually assured destruction: where the BATNAs result in disaster for both parties, negotiation becomes an imperative.
- Cost-benefit analysis: in considering BATNA.
- Sunk cost fallacy: to support walking away from a protracted, even expensive negotiation.
BATNA was created by negotiation researchers Roger Fisher and William Ury of the Harvard Program on Negotiation and presented in their fundamental 1981 book Getting to Yes: Negotiating Without Giving In.
My Notes
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