"Zone of Possible Agreement (ZOPA)" is the range in which an agreement is satisfactory to both parties involved in the negotiation process. 2) Added Confidence In the preparation phase of your negotiation, you need to consider what is the worst that will happen if you do not sell in a particular negotiation. If other parties need you in order to reach their objectives, your BATNA is strong; your negotiating circumstances are strong. Is the WATNA better than satisfactory? WATNA stands for the Worst Alternative to a Negotiated Agreement. From: Jackol, Hong Kong. WATNA is the opposite — the worst alternative to a negotiated agreement. You can think of BATNA in negotiation like playing a game of cards. You start off with your 'walking-in' BATNA; the things you can influence or control before the negotiation begins. Related Content. While preparing for a negotiation, it is important to estimate the Reservation Value of your counterpart. However, it should be made clear at the outset that BATNA is not the so called bottom line that negotiators perceive as the means to guard themselves against reaching agreements where they give too much or receive too little. How To Determine Yours As a senior AOL official asserted “You would never do a deal without talking to anyone else. Their book is the most solid framework for how to approach negotiations I have read. It explains what a BATNA is and then contrasts it to a bottom line. Never.” (Rivlin 2000) In the course of transforming pharmaceutical startup, Millennium Pharmaceuticals, into a multibillion dollar enterprise, then Chief Business Officer BATNA stands for ‘Best Alternative to Negotiated Agreement’ and WATNA stands for ‘Worst Alternative to Negotiated Agreement’, first conceived by Roger Fisher and William Ury in 1981. A significant reality check on any party's BATNA/WATNA analysis is the other party's assessment of the same case from the other side. This article explains how a negotiator can use their BATNA to achieve a better bottom line instead of settling on a bad agreement. Q & A Table of Contents. Both parties, as well as the mediator, have to maintain a positive attitude; optimism can solve problems if both parties continue with the process. In many card games, your hand may change during the play as new cards are dealt to you (and others). They will be exposed to: We welcome the republication of this page's contents in part or full - we just ask that you include a clean link back to this site, to our www.negotiationtraining.com.au/training/ page. It is thus important to also consider the other side of the coin, embodied by the concept of WATNA, or the Worst Alternative to a Negotiated Agreement [13,16, 17]. 29 of 42 people found the following comment useful: "When Qing Dynasty negotiated during post Opium War, they did not have any BATNA and the Brits knew. Importance of ADR in India. The worst that can happen if you lose the negotiation. This can help you determine if a potential settlement offer should be accepted or refused. The only shortcoming of this article as I see it is that it does not shed light on the procedural differences between arriving at a bottom line and arriving at a BATNA. Since BATNA is the alternative to what a negotiated agreement would be otherwise, it permits far greater flexibility and allows much more room for innovation than a pre-determined bottom line. BATNA is Only Part of the More Important Focus, Negotiators’ Bottom Lines Because BATNAs are so dang shiny, people often think that they should be the main focus of negotiators’ analysis. Spotio suggests that in deciding whether a BATNA should be revealed to the other party/ parties will depend on the strength/attractiveness of the BATNA. 158 years later, PRC turned the tide. Without BATNA, this time, the Britts have to follow the old path of negotiation--concession. Telling a supplier, for example, that you dumped your last partner and are desperate to do a new deal is a surefire way to ensure the supplier will highball you on price and resist compromising. The previous article discussed the importance of moving through a BATNA/WATNA analysis to discover the true interests at the center of a dispute. Why BATNA and WATNA are so important. By Edrie Greer, Ph.D., Global Knowledge Instructor Negotiation is one of the oldest problem-solving methods in the world. If you have any time, I've just written a blog on BATNA and negotiation http://rolesrelations.wordpress.com/2013/03/18/buying-with-batna-gone-in-60-seconds/ It explains the process, related to selling a car. Negotiation: A process by which two or more people come to agreement on how to allocate scarce resources. Since its usually the last resort, the other party involved has to accept the BATNA presented or lose the negotiation. The alternative that best meets your interests is called your BATNA (Best Alternative To a Negotiated Agreement).Understanding these concepts and how to utilize their power in negotiations will help you reach more satisfying outcomes in your negotiations. In any negotiation, it is important to make sure that you establish your best alternative, but also your worst so you can weigh your options with greater accuracy, and, hopefully, better results. Should a negotiator learn that the other party is over-estimating its BATNA before the start of a negotiation, then they will be able to effectively use this information to lower the negotiation expectations of the other party. It’s a bit of both – identifying a negotiator’s BATNA is a necessary skill for developing the best strategies to use at the bargaining table. With regards to William Li's response, the first Anglo-Chinese 'Opium' war was fought in the late 1830s/early 1840s. It is defined as the most advantageous alternative that a negotiating party can … 2 pages) Ask a question Glossary WATNA. The article explains this well in the conclusion. Why Use BATNA (Best Alternative to a Negotiated Agreement)? You can walk away from a negotiation if your BATNA is better than the likely outcome of that negotiation. I highly recommend it. Although bottom lines definitely serve a purpose, they also regrettably foster inflexibility, stifle creativity and innovation, and lessen the incentive to seek tailor-made solutions that resolve differences. It allows the parties to create perspective on the options that they are thinking about. This will foster pessimism about their prospects if the negotiation fails; and. In here, you will understand your priorities , the range of the agreement and what could go wrong. The 'willingness' of a negotiator to break off a negotiation allows the negotiator to adopt a more firm and forceful stance when proposing ideas and interests as the basis for an agreement. This kind of skill and strategy has already been recorded in the Chinese history books 2000 years ago. WATNA give time for one to prepare and determine several crucial aspects for negotiation, and reconsider the bottom line. Good article and comments overall.". Training Guarantee | Your Privacy | Site Map | Terms, Excellent content. Why Is BATNA Important. Going to the worst case scenario in your negotiation preparation has a particular benefit: you might reconsider your bottom line. Reading comprehension - ensure that you draw the most important information from the lesson on BATNA and WATNA, such as which concept is employed in a given scenario Your walking-in BATNA may be the first cards you are dealt. The BATNA is almost more important than the WATNA. ", © Copyright 2017 Negotiation Training | E-mail us At least that was my interpretation. 9 of 12 people found the following comment useful: "Tom-if read carefully, William was not implying the Opium war was 2000 years ago, he was implicating the Chinese have had negotiation "skill and strategy" which he claims has been recorded in history books dated 2000 years ago. A well conceived and clearly defined BATNA gives a skilled negotiator the advantage to break off the negotiation if it becomes clear that a beneficial outcome is not possible. observation is the importance of developing your BATNA before negotiating. So your BATNA changes as new cards come into your hand. The negotiator would then know the consequences should the negotiation fail. However, if a negotiator has a weak BATNA, it would be better not to disclose the BATNA, especially if the other party indicates they are over-estimating their own BATNA as this would prove to be a bonus that should not be squandered through disclosure. It is a clearly identifiable course of action. Regards - Josh". Establishing the BATNA, MLATNA and WATNA can help negotiating parties to evaluate their options. WATNA Practical Law UK Glossary 7-205-6261 (Approx. A bottom line is set arbitrarily. When considering the BATNA, MLATNA, and WATNAs, each party should consider what alternative paths exist if … Thanks for clarifying!". A bad BATNA is also known as a WATNA, or worst alternative to a negotiated agreement. I can see how BATNA is very useful in negotiation and bargaining - especially in sales - but sales is mostly about relationship building and correct communication. BATNA and WATNA are, in many ways, just two sides of the same coin. Question: Can you please explain BATNA to me and tell me how it is useful in negotiating? We know what we will do if the deal falls through, which makes us less likely to dip below our bottom line, make desperate or unwise concessions, or fail to ask the other side for what we really want. If you have invested time in finding out what your BATNA is, you deepen your power and are more able to negotiate confidently. Without knowing them, you could end up accepting an offer you ought to reject. A concept developed in the context of negotiation theory. Thanks again for a great read! Get The Other Side Talking. Analysis and discussion of how to determine what each party’s BATNA and WATNA is and then the best ways to utilize this knowledge will be the focus of this set of articles. Worst alternative to negotiated agreement. Batna 1. Using negotiation lingo, alternatives are what you could do to meet your interests if you walked away from the current negotiation. Alternative Dispute Resolution mechanism provides scientifically developed techniques to Indian judiciary which helps in reducing the burden on the courts. However, the Chinese learnt their lessons on the importance of maintaining good relationship after negotiation, thus gave the Britts plenty of economic manoeuvring room to continue their prosperity. It's all very well determining and assessing your best alternative, but are there any skills that you should acquire in order to achieve a positive agreement? Britts had no BATNA and was unable to create one, not after the Falkland Island War. A bottom line or walk away signifies the worst possible outcome that a negotiator might accept. WATNA is another objective standard that can help you evaluate a potential settlement offer. Here’s a classic illustration of the BATNA negotiation skills concept: Negotiation skill or negotiation strategy? Strong internal pressure to make an agreement, as they will be unaware of what would happen should the negotiation fail; They will be over optimistic about proposed agreements which can then result in the associated costs not being fully appreciated; They will face the peril of becoming committed to reach an agreement, as they will be unaware of alternatives outside the negotiation. 33 of 37 people found the following comment useful: "Having read and put into practice the Harvard Negotiation Project's 'Getting To Yes: Negotiating Agreement Without Giving In', I believe the article here is well written. In situations where both parties possess a similar or superior BATNA, then given similar negotiation skills, negotiation would seem rather fruitless because there would be very little incentive to reach an agreement. However, the Chinese learnt their lessons on the importance of maintaining good relationship after negotiation, thus gave the Britts plenty of economic manoeuvring room to continue their prosperity. It has no external reference point. When negotiations begin, establish rapport and try to get the other side … With a BATNA and WATNA in place, we can enter a negotiation with greater confidence and approach the table with a greater sense of power. Brits knew how costly and risky to engage an immediate war with China that has nuclear capabilities. A WATNA is the worst possible outcome a party has in mind. In litigation, the BATNA value (the expected value of the court outcome) is only one element of one’s bottom line (aka “reservation price”). If you want to buy a new car and the same model is for sale at several car dealers, you have a strong BATNA because you can benefit from their competition for your business. A BATNA is the best alternative to a negotiated agreement, and the WATNA is the worst alternative to a negotiated agreement. New and immediate tools. When a negotiator has a strong BATNA, they also have more power because they possess an attractive alternative that they could resort to if an acceptable agreement is not achieved. By looking at BATNA as an ongoing, changing measure of negotiating strength, as a mechanism for deciding whether and/or when to quit, we develop a disciplined, informed approach to our negotiations. BATNA is an acronym that stands for B est A lternative T o a N egotiated A greement. Considering a WATNA means that each party thinks about what their losing scenario looks like. Question: Can you please explain BATNA to me and tell me how it is useful in negotiating?. 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