best alternative to a negotiated agreement

Or BATNA, describes a negotiator’s best possible outcome if the current negotiations fail.

The following items are tagged best alternative to a negotiated agreement.

Crisis Negotiations in Europe

Posted by & filed under Crisis Negotiations.

On June 5, another casualty in the European debt crisis emerged, as Spain announced that it soon would be unable to borrow in the bond market without assistance from other European Union nations. Emilio Botin, the chairman of Banco Santander, said about 40 billion euros, or $50 billion, in European funds would be needed to repair Spain’s banking sector, according to Bloomberg News.

The Darker Side of Perspective Taking

Posted by & filed under Conflict Resolution.

Many negotiation experts recommend that you try to take the other party’s perspective, particularly when attempting to resolve disputes.

Recent research by Nicholas Epley of the University of Chicago and Eugene Caruso and Max Bazerman of Harvard University suggests a dark side to this generally sound negotiation advice. The researchers ran a series of experiments in which they asked participants to determine the fair division of a scarce resource. Half of the subjects (the “self-focused condition”) were asked how much would be fair for them to take. The other subjects (the “other-focused” condition) were asked to think about what would be fair for others to take and then write down how much would be fair for each party (not just themselves) to take.

Anchor Trials or Balloons in Conflict Resolution

Posted by & filed under Conflict Resolution.

The power of anchors in negotiation has been demonstrated time and again. Sellers who demand more tend to get more. Indeed, the initial asking price is usually the best predictor of the final agreement.

A trio of researchers may have found an important exception to this rule, however; lower starting numbers set by the seller in an auction can lead to higher ultimate prices. Professors Gillian Ku of the London Business School and Adam D. Galinsky and J. Keith Murnighan of Northwestern’s Kellogg School of Management found this result both in laboratory experiments and from data taken from online eBay auctions.

The Enduring Power of Anchors

Posted by & filed under Negotiation Skills.

In past issues of Negotiation, we’ve reviewed the anchoring effect – the tendency for negotiators to be overly influenced by the other side’s opening bid, however arbitrary. When your opponent makes an inappropriate bid on your house, you’re nonetheless likely to begin searching for data that confirms the anchor’s viability. This testing is likely to affect your judgment – to the other party’s advantage.

Psychologists Amos Tversky and Daniel Kahneman identified the anchoring effect in 1974. Participants watched a roulette wheel that, unknown to them, was rigged to stop at either 10 or 65, the estimated the number of African countries belonging to the United Nations. For half of the participants, the roulette wheel stopped on 10. They gave a median estimate of 25 countries. For the other half, the wheel stopped on 65. Their median estimate was 45 countries. The random anchors dramatically affected judgment.

Crisis Negotiations – Rolling the Dice in Court

Posted by & filed under Crisis Negotiations.

Going to trial, it’s said, is like rolling the dice. That proved true when an exasperated federal judge, the Honorable Gregory A. Presnell, ordered litigants to play a game of Rock Paper Scissors if they could not privately resolve their differences over a procedural issue. The lawyers were stalemated on where to depose a witness in the case, despite the fact that their offices were located just four floors apart in the same building. The judge didn’t want to waste public resources resolving such a trivial matter.

Many took the order as yet another exhibit in the case against shortsighted lawyers – and an attempt to shame them and their clients into more constructive behavior. Judge Presnell’s ruling also established a new best alternative to a negotiated agreement, or BATNA, for the parties: The matter would be decided by chance rather than on its merits, an unsettling prospect if each side was convinced of the righteousness of its position.

Team Building and Your Negotiations

Posted by & filed under Mediation.

During his years as George H.W. Bush’s Secretary of State, one of James A. Baker, III’s, goals was to encourage the free-market reforms that Communist Party of the Soviet Union General Secretary Mikhail Gorbachev had launched in the late 1980s. One day during his tenure, a high-level Bush administration official commented in the press that Gorbachev’s efforts were sure to fail. Baker called Bush to complain. “I said, you can’t have other people pontificating about these major foreign policy matters when this is one of our goals, and it’s totally contrary to our policy,” he said. “So they cut the knees off of this particular individual, and we didn’t hear that anymore.”

Baker shared this story on March 29 while receiving the 2012 Great Negotiator Award from the Program on Negotiation at Harvard Law School and the Future of Diplomacy Project at Harvard Kennedy School. In discussion with Harvard faculty at the Great Negotiator event, Baker elaborated on his greatest challenges as Secretary of State and shared negotiation lessons learned over the course of his long, successful career as a lawyer, campaign manager, and diplomat.

Powerful Thoughts

Posted by & filed under Business Negotiations.

For many people, thinking about the role of power in negotiation can be paralyzing. In fact, the same people who are anxious about negotiating in general tend to be anxious about exerting their power during negotiation. Why? Perhaps because most of us realize that power, even when not explicitly discussed, is often the precipitating and driving force of negotiation processes and outcomes. Obviously, power can generate competition and conflict. But when channeled effectively in negotiations, it can be a catalyst for win-win outcomes.

Using Bias to Your Advantage

Posted by & filed under Business Negotiations.

Articles in Negotiation have highlighted many of the cognitive biases likely to confront negotiators. Work by researchers Russell B. Korobkin of UCLA and Chris P. Guthrie of Vanderbilt University suggests how to turn knowledge of four specific biases into tools of persuasion.

So You Want to Buy a Car?

Posted by & filed under Business Negotiations.

How can you negotiate the best possible price for a new car? This is a common negotiation question, and naturally so. A car is one of the most significant purchases you’ll ever make—and the price is almost always negotiable. Here are a few tips to improve your performance:

Fine-Tuning Your Contract

Posted by & filed under Business Negotiations.

When negotiators sign on the dotted line, they sometimes worry about the wrong concerns. “Did I overpay?” wonders the buyer as he inks the sales agreement. Across the table, the seller is thinking, “I bet if I’d pushed a little harder, I would have gotten more.”