BATNA stands for “Best alternative to a negotiated agreement.BATNA is the driving force and the key focus behind a successful negotiator. In short, you assess your business needs, list what you can do to solve them with the partner with which you are to negotiate and then pick the one that’s slightly better than not working with that partner at all.

BATNA Basics- Boost your power at the bargaining table

BATNA Strategies:

Consider what you can do to change it if theirs is very good Consider the other side’s BATNA It can be desirability of disclosing your BATNA Say yes if the other side thinks you have no alternatives Say no if they think you have better alternatives

How to Evaluate Your BATNA

There are four steps evaluate your BATNA:

List your alternatives: Start with a free flowing discussion, then start to enclose

them down.  What will you really do if you don’t get a deal in the negotiation?

Figure out these alternatives: Just go through each alternative and critically

inspect each alternative, the amount of pursuing it and the actual tendency of

pulling it off.

Abstract the highest value alternative:  This is the alternative you should

pursue if negotiations fail.  This highest value alternative is your BATNA.

Compute the lowest value alternative you will accept: Once you have

abstract your BATNA, find the lowest value deal you would accept from the other

side.  Now if they offer you less than that lowest value deal, you walk away.

Three Steps to Improve Your BATNA

If you have a strong BATNA, you are usually in a good negotiating position. You

might even be in a position to disclose your BATNA to the other side. So what

happens if your BATNA is weak?  Apart from not revealing it to the other

side, the reaction can be as follows:

 Augment it before you go into negotiations- For instance, if you are creating

value prior to a capital raising or sale by improving your purchase price for

materials, you might call your present supplier and seek 65 day terms instead of

25 day terms.  If the supplier agrees, then you can go into negotiations with the

second supplier probing 90 day terms, knowing you have at least 65 days up

your sleeve.  You could even let the second supplier know what they are up

against. The point here is to actually do something that improves your BATNA –

not just enroll in theoretical discussions.

Confine or segregate the other side’s BATNA- Yours might be weak, but

theirs might be worse.  So sometimes you only have to be slightly better than the

opposition.  For example, with a few phone calls to your competitors, you might

be able to find out what terms they were getting from supplier number two.  You

will be surprised at what people will tell you over the phone.  If they are getting 90

days, and selling to them is the supplier’s BATNA, why shouldn’t you get 90

days?

Weaken the other party’s BATNA- For example, if supplier number two bought

out supplier number one, then your BATNA of 65 days may well evanish or fade

away and the supplier number two is now the only game in town.  Alternatively, if

supplier number one and number two refuse to incite and influence, you could

let it be acknowledged that you are getting citation for machinery that you will

use to manufacture those parts yourself.  You don’t have to go ahead,

but reference or citation and authority reports on how this might be done might

make them sit up and take notice when you push them across the table.

Some of the most crucial factors which should be considered include:

The cost - How much it will cost ask yourself to make the deal relative to the cost of your best alternative? Cost estimation may impose as a burden both the short term and the long term. It boils down to an amount which of your options is the most affordable and best suitable.

Feasibility – Which of your options is the most feasible? Which one can you sensible and practical apply over all the rest of your available options?

Impact - Which of your options will have the most immediate positive influence on your current state of affairs?

Consequences - What do you think or enumerate will happen as you consider each option as a best possible solution?