Worst Alternative To A Negotiated Agreement

BATNA/WATNA analysis can have a major impact on case assessment and resolution. Many clients need to think intelligently about whether a possible negotiated solution makes sense or whether they prefer to look for another alternative that could provide better results or result in lower costs. Mediators who can guide their clients through a carefully detailed and organized BATNA/WATNA analysis provide a valuable service. The use of a format such as the one presented here, as well as a clear understanding of how to use the analysis, should improve the mediator`s ability to work effectively with this tool. Winter is coming and you need someone to put a new lining in your fireplace. You call that person and get a $2,500 quote. You can say, « Of course, let`s do it, » or you can let the negotiations begin! In this case, your BATNA or the best alternative to a negotiated deal would be to hire another person to do the work at a lower price – but what is your WATNA? What`s the worst-case scenario if you can`t reach an agreement with that first person? In any negotiation, it is important to make sure you find your best alternative, but also the worst, so that you can weigh your options with greater accuracy and hopefully better results. Every result, whether in the best or worst case, comes at a cost. These costs can be both monetary and non-monetary and should be as detailed as possible.

The costs used in the analysis are generally limited to future costs that could be avoided if the mediation or negotiation process is successful. Costs already incurred are considered water under the bridge. In other words, they are less relevant because billing at this stage cannot prevent these costs from occurring. As the example above illustrates, it is important to have a better alternative to a negotiated agreement before starting negotiations. If Colin hadn`t had BATNA, Tom would have had more bargaining power Buyers` bargaining power Buyers` bargaining power, one of the strengths of Porter`s Five Forces industry analysis framework, refers to the pressure that customers/consumers can exert. .