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Batna

The best alternative to a negotiated agreement (BATNA) refers to the best option if negotiations fail. It is important to identify one's BATNA before negotiations begin to determine the minimum acceptable terms. To establish a BATNA, one should research alternatives, evaluate them based on value, select the most valuable option, and determine their reservation value or minimum acceptable deal value. Knowing one's BATNA makes one more confident and likely to achieve better negotiation outcomes.

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65 views2 pages

Batna

The best alternative to a negotiated agreement (BATNA) refers to the best option if negotiations fail. It is important to identify one's BATNA before negotiations begin to determine the minimum acceptable terms. To establish a BATNA, one should research alternatives, evaluate them based on value, select the most valuable option, and determine their reservation value or minimum acceptable deal value. Knowing one's BATNA makes one more confident and likely to achieve better negotiation outcomes.

Uploaded by

063AbhinavGuptaMarketing A
Copyright
© © All Rights Reserved
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The best alternative to a negotiated agreement (BATNA) is the

course of action that a party engaged in negotiations will take if talks


fail, and no agreement can be reached.
BATNA is often used in negotiation tactics and should always be
considered before a negotiation takes place. It is never wise to enter into
a serious negotiation without knowing your BATNA.
Batna is something that helps the parties involved to know when one
should walk away, or best alternative to a negotiated agreement.
If the sale doesn’t happen—or it can’t happen at terms that are favorable
to you—then no big deal. In fact, the faster you learn this the better,
because then you can free your time to focus on more fruitful sales
activities. This can be achieved through knowing your batna before in
hand.
Batna is something that helps you to figure out what your Plan B
is before negotiating to avoid making or taking an offer that’s worse
than your BATNA—or rejecting an offer that’s better than your
BATNA.

This means doing some research so as to find out the best alternative
available. This can be done by:

1. List all alternatives if your current negotiation ends in an impasse.


2. Evaluate your alternatives based on the value of pursuing an
alternative.
3. Select the alternative action(s) that would have the highest
expected value for you.
4. After you have determined your BATNA in Step 3, calculate
your reservation value or the lowest-valued deal you are willing to
accept.
If the value of the deal proposed to you is lower than your reservation
value, you should reject the offer and pursue your BATNA. However, if
the final offer is higher than your reservation value, you should accept
the offer.
By knowing your batna before negotiating the deal you will feel
 Confident about the negotiations
 Create and accept good agreements and
 Achieve better outcomes
Example is:
Mr. John has decided to buy the second-hand car for which he went to
the dealer to enquire about the price of the same. As per the dealer, the
second-hand car which matches the requirements of Mr. John is
available at 2 lakhs. And the same car is offered at 1.5 lakhs by the
colleague of Mr. John. The minimum price Mr. John is willing to pay is
1.2 lakhs. So, buyer’s settlement range is between 1.2 – 1.5 lakhs. And
dealers in the future can sell the same car to another customer at a
minimum of 1.4 lakhs. Now, the buyer’s BATNA is 1.5 lakhs, and the
seller’s BATNA is 1.4 lakhs. A negotiation deal is possible within this
range only.

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