Negotiating Skills and Participative Decision Making

BEST ALTERNATIVE TO
NEGOTIATED AGREEMENTS

(BATNA) Presented By:

Nidhi Bharti
Nidhi Grover
Nimisha Gupta
MBA-HR(09-11)
INTRODUCTION TO
BATNA
 The term BATNA was coined by negotiation
researchers Roger Fisher and William Ury in their
1981 bestseller "Getting to Yes: Negotiating
Agreement without Giving In."

 It is the alternative action that will be taken should

your proposed agreement with another party result
in an unsatisfactory agreement or when an
agreement fails to materialize
 If the potential outcome, of your current
negotiation offers a value that is less than your
BATNA, there is no point in proceeding with the
negotiation, and one should use their best
available alternative option instead.

 Prior to the start of negotiations, each party should

have ascertained their own individual BATNA.
 BATNA is not the so called bottom line

 In contrast to a bottom line, a BATNA is not interested

in the objectives of a negotiation, but rather to
determine the course of action if an agreement is not
reached within a certain time frame.

 As a gauge against which an agreement is measured,

it prohibits a negotiator from accepting an unfavorable
agreement or one that is not in their best interests
because it provides a better option outside the
negotiation.
 One of the best things you can do in advance of
negotiation is to visualize what the best alternative
would be if you were not to negotiate at all.

Your BATNA is your

“Best Alternative to a Negotiated Agreement”
DETERMINING BATNA

 BATNAs may be developed for any situation that calls

for negotiations, from negotiating a pay hike to
resolving complex conflicts.

 While a BATNA may not always be easily identifiable,

Fisher and Ury have outlined a simple three-step
process for determining it:

Develop a list of actions to take if no agreement is

reached
Convert the more promising ideas into practical options
Tentatively select the option that seems best
BASIC EXAMPLE
 If you do not receive an attractive job offer by the end of
the month from Company X, what will you do?
 Inventing options is the first step to determining your
BATNA.
○ Should you take a different job? Look in another city? Go back to
school?
○ If the offer you are waiting for is in New York, but you had also
considered Denver, then try to turn that other interest into a job
offer there, too.
○ With a job offer on the table in Denver, you will be better equipped
to assess the New York offer when it is made.
○ Lastly, you must choose your best alternative option in case you
do not reach an agreement with the New York Company.
○ Which of your realistic options would you really want to pursue if
you do not get the job offer in New York?
BATNAs AND OTHER SIDE

 same time you are determining your BATNA, should also

consider the alternatives available to the other side.

 The more you can learn about their options, the better
prepared you will be for negotiation.

 If the other side appears to have a strong BATNA, look

for ways to weaken it.

 according to McCarthy, "one should not reveal one's

BATNA unless it is better than the other side thinks it is."
BATNA AND ROLE OF THIRD
PARTY
 Third parties can help disputants accurately assess their
BATNAs through reality testing and costing

 the third party helps clarify and ground each disputing

party's alternatives to agreement.

 S/he may do this by asking hard questions about the

asserted BATNA

 Costing is a more general approach to the same process. It

is a systematic effort to determine the costs and benefits of
all options. In so doing, parties will come to understand all
their alternatives.
 If this is done together and the parties agree on
the assessment, this provides a strong basis upon
which to come up with a negotiated solution that is
better than both sides' alternatives.

 But if the sides cannot come to such an

agreement, then negotiations will break down, and
both parties will pursue their BATNA instead of
negotiation.
GOOGLE’S CHINA APPROACH AND BATNA – CASE
STUDY

 Google announced its new approach towards China,

and threatened to pull-out of the country owing to the
dictatorial policies, excessive surveillance and
‘official’ cyber attacks

 There are two schools of thought –

one that praises Google for its ballsy move and

another that says Google is anyways not doing so

great in China, so the announcement was merely a
smoke and Google anyways wants to pull out of China.
 China being a $10 billion opportunity, Google
couldn’t let go so easily.

 Google, probably tried out each and every means

to get Chinese government to relax their
surveillance and least to say, failed each and
every time.

 The blog announcement was probably the last

BATNA that they’ve ever had.
 What happened after Google’s announcement of
their decision?

US Secretary of State, Hillary Clinton issued a

statement

Chinese Government issued a public statement asking

for more details from Google

It turned into US vs. China, discussing Chinese

censorship and government-sponsored cyber-attacks –
something that was never discussed
 So what did Google achieve in the entire
story?

First time ever, Chinese government had been

challenged publicly by an American company on
censorship and privacy issue, which also
brought global attention to Chinese policies and
a pressure on them to come out clearly on the
policy.
 What did Google gain out of this?

A higher moral ground and a level-hand in

negotiation with Chinese Government (they had
the support of US government)
REFERENCES
 
 http://www.pluggd.in/google-china-controversy-and-batna-
negotiation-skills-for-entrepreneurs-297/ 
 http://www.beyondintractability.org/essay/batna/ 
 http://www.ehow.com/how_4782072_batna-alternative-
negotiation-agreement.html
 www.iqpc.com/uploadedFiles/Training/.../negotiation_batna.pdf
 www.northalabamapmi.org/.../papers/2007_Why_Use_BATNA.pdf
 http://en.wikipedia.org/wiki/Best_alternative_to_a_negotiated_agr
eement
 http://www.investopedia.com/terms/b/best-alternative-to-a-
negotiated-agreement-batna.asp
 http://www.calumcoburn.co.uk/articles/articles-batna/
THANK YOU