BATNA Negotiation - Getting to Yes

Best Alternative to Negotiated Agreement - BATNA

We had a wonderful negotiaton session. ILWs Intensive Learning Weekend.

The acronym, as you may know, stands for the ‘best alternative to a negotiated agreement’ – the options when your negotiations fail to result in an agreement. “This term was first used by Roger Fisher and William Ury of the Harvard Program on Negotiation in their famous book, ‘Getting to Yes’.”

Your BATNA determines the point at which you can say no to an unfavourable proposal, the book explains. “Thus, it is critical to know your BATNA before entering into any negotiation. If you don’t, you won’t know whether a deal makes sense or when to walk away.”

The second key concept is the reservation price, also known as the walk-away, or ‘the least favourable point at which you would accept a deal’. Together with BATNA, this gives you the confidence in negotiation.

Third, ZOPA, the ‘zone of possible agreement,’ or the range in which a deal can take place. This exists in ‘the overlap’ between the high and low limits between the parties’ reservation prices. Therefore, no ZOPA, no overlap, no agreement, “no matter how skilled the negotiators.”

Lastly, value creation has to happen through trades, meaning goods or services have only modest value to their holders compared to ‘exceptional value to the other party’.
Both parties end up satisfied, however, because “each party usually gets something it wants in return for something it values much less.”