KNOW YOUR

BATNA

Presentation by

Mayur Dvivedi
The BATNA concept

BATNA in life

Strategic plan and

tips to use the BATNA
 The Need for Negotiations

 Situation, Parties, Issues

 Interests, Payoffs & Goals

 Bargaining Mix, Bids & Tactics

 Limits & Alternatives

 BestAlternative To Negotiated
Agreement
 The Negotiation Bargaining Zone

Buyer’s Reservation Price (BR)

Buyer’s Target Price (e.g., $25M)

ZOPA

Seller’s Reservation Price (SR) Seller’s Target

(e.g., $17M)
 The bargaining zone is the space between the buyer’s reservation price
(BR) and the seller’s reservation price (SR) – that is, the zone of possible
agreement.
 If BR > SR, then a Positive Bargaining Zone exists. The zone of agreement
is from SR to BR (e.g., $8M).
 A Negative Bargaining Zone

Seller’s Reservation Price (SR)

(e.g., $25M)

Buyer’s Reservation Price (BR)

(e.g., $17M)

If BR < SR, then there is no zone of possible agreement.

 Your TP Dealer’s RP Your RP Dealer’s TP

150000 180000 200000 220000

Bargaining Zone

190000=probable compromise
L&T Offer?

Present job L&T salary

salary offer

16 L 18 L
 The range of negotiated outcomes that are
acceptable to all parties
L&T Bargaining Range

Your Bargaining Range

Your
Your RP
L&T TP Your TP L&T RP Stretch
Goal

17 L 18 L 22 L 24 L 28 L
 L&T Your
Bargaining Bargaining
Range Range

L&T TP
L&T RP Your RP Your TP

18 L 20 L 22 L 24 L
Based on situation, identify BATNA clearly

• Better BATNA=more negotiation power

• Improve your BATNA

Consider other side’s BATNA

• Know the deal’s ZOPA
• Let other side perceive you have strong BATNA
• Consider disclosing own BATNA, if strong

Use Stretch Goals

• Make 1st offer to Anchor above your target
• Else re-anchor
• Prepare objective arguments
KNOW THE KNOW YOUR KEY FOR
SITUATION BATNA SUCCESS

PREPARATION