This is Other Non-monetary Costs: 2 years in litigationStressTime off for litigation-related activities, Other Non-monetary Costs: 2 years in litigationStressTime off for litigation-related. This is a damages-based analysis. The WATNA might be to accept a car with For example, where one party is represented by an attorney on a contingency fee basis, that party may be much more inclined to “roll the dice” because the bulk of the burden of a loss falls upon the attorney in the event of a loss (WATNA). Mediators who understand these financial realities and can assist clients in examining them have powerful tools. In our experience, negotiations can be positive, productive and fun. The format presented here may be more “user-friendly” for mediators, parties and attorneys in the average case. What is Negotiation? As demonstrated in the subsequent examples, outcomes and costs should be developed carefully and specifically so that they can be analyzed and understood by the party and potentially explained to the other side. This can help reduce the potentially distracting effect of extreme win and lose parameters. WATNA is a very helpful tool to consider prior to entering into any negotiation as it helps you have more clarity and negotiation success. Where the negotiation focuses less on money or other specific outcomes that might be awarded by a court, the BATNA/WATNA analysis may be less influential in the development of settlement proposals and may be completely unrelated to what the parties decide to do. A second example is provided below using this format where the alternative path considered is not litigation. The more accurate the analysis, the more helpful it will be to the parties in making informed decisions. You can learn more about Jim Hornickel and the topic of Negotiations Training at Bold New Directions by visiting the company web site at www.boldnewdirections.com or at our negotiations training site www.negotiationstraininginstitute.com, First Name* Mediators should also keep in mind that they may have different values, risk tolerance levels and approaches to decision-making than the parties and take care to respect those differences. BATNA/WATNA analysis can also lose meaning in some contexts, such as cases where bankruptcy is a realistic possibility. For example, in a personal injury case, decision-tree analysis might look at the separate probabilities for establishing each of the legal elements involved (duty, breach, causation and damages) in order to reach an overall probability for win or loss with the expected values for those outcomes in light of the assigned probabilities. More Dayton residents have conflict during COVID-19. It can also be your trump card to make the deal happen to your advantage. Plaintiff fails to prove any seller liability. Whether or not it is appropriate for a mediator to predict legal outcomes is controversial. Understand basic negotiation principles, including BATNA, WATNA, WAP, and the ZOPA. From the initiation to actual trial, a new court action can take several months to several years. WATNA stands for the Worst Alternative to a Negotiated Agreement. very helpful for mediation promotion in Hong Kong. Sometimes attorneys assure mediators that they have undertaken the analysis with the parties but say that they do not want to share it with the mediator. "Mediate.com is very resourceful and useful in this field. It is free from technicalities of courts, here informal ways are applied in resolving dispute. Many clients need to consider intelligently whether a possible negotiated settlement makes sense or whether they would prefer to pursue some other alternative that might yield better results or involve lower costs. Said another way, it is the best you can do if the The Advantages of Mediation Save time. It has the purpose of assisting one in developing the worst scenario in a negotiation (Notini, 2005). Earlier articles in the series focused on the power of the Wish, the Aspiration, the Bottom Line, and the BATNA. In the preparation phase of your negotiation, you need to consider what is the worst that will happen if you do not sell in a particular negotiation. Do not confuse "alternatives" analysis with "options" analysis. Of course, many attorneys undertake this analysis prior to mediation or negotiation as part of their own case preparation. The basic formula for the analysis, where money is involved, can be described as "Initial Result" - "Costs" = "Final Outcome." WATNA is the Worst Alternative to a Negotiated Agreement. Ideally, they have the litigation experience and knowledge of the venue in which they operate to be able to provide "expert" information about possible best and worst outcomes. Moreover, in a confidential caucus, parties and attorneys tend to be more forthcoming and realistic about their alternatives. If you believe it is likely that an examination of BATNA and WATNA will be pertinent during the mediation, it may be helpful to allude to the possible need for this kind of analysis early in the process, in the mediator's opening statement. Many clients underestimate or fail to account for costs when imagining potential best and worst case outcomes, focusing more on “initial results” rather than “final outcomes.” They also tend to overlook the time value of money, forgetting that $100,000 received two or three years from now, has a lesser value when translated into present day dollars. Secret Skill of Crisis & Hostage Negotiators: Slow Down! There are five interactive areas that make up the range: the Wish, the Aspiration, the Bottom Line, the BATNA, and the WATNA. Typically, it is wise to develop the analysis in private session with each of the parties and their attorneys. Advantages of this approach are that the analysis may be more thoughtful given more time to prepare and the clients have had more time to absorb the implications prior to the mediation. Source: Bargaining for Advantage: Negotiation strategies for reasonable people. Question: Can you please explain BATNA to me and tell me how it is useful in negotiating?. If parties feel pressured or fear that it will be used as a hammer against them, or shared inappropriately with the other party, they will naturally resist. In this example of selling a home, you may need to sell your home by a certain deadline to relocate for a new job. The exact opposite of this option is the WATNA (worst alternative to a negotiated agreement). Going to the worst case scenario in your negotiation preparation has a particular benefit: you might reconsider your bottom line. Now that you have read all 5 parts of this series you are well on your way to negotiating success. And the organization must keep a close at its environment via environmental scanning. BATNA means “ Best Alternative to a Negotiated Agreement.” This is your alternate plan when the talks start to wobble out of control. Parties and attorneys almost invariably overestimate their best case scenarios and underestimate their worst case scenarios for many reasons based in human psychology. The better their alternatives, the more they may push for a more favorable settlement. Both tools are extremely valuable. Mediators should, nevertheless, seek permission to share any information gained during the analysis that they believe will help the parties to better understand the case and the other party. It provides negotiating power. Like playing hardball, this … Give three examples; What are the different types of Negotiation? Advantages of this approach are that the analysis may be more thoughtful given more time to prepare and the clients have had more time to absorb the implications prior to the mediation. Whatever I They can also guide the parties through the elements of the analysis during private sessions so as to ensure that it is done thoroughly, and play devil's advocate and ask reality testing questions when attorneys make predictions that seem overly exaggerated or inaccurate. Plaintiff proves seller was aware of and failed to reveal these problems with the property, and must reimburse for damages. When BATNA/WATNA analysis is almost inevitable, as in cases already in litigation, it is a good idea to ask attorneys to prepare and discuss the analysis with their clients prior to the mediation. Understanding how to arrange the meeting space is a key aspect of preparing for negotiation. Note: Even when developed in private, confidential sessions, mediators should not assume that parties or attorneys have been completely forthcoming about their alternatives analysis. The costs used in the analysis are usually limited to future costs that might be avoided in the event that the mediation or negotiation is successful. Or look for our soon-to-be published text book with the same name of Negotiating Success. The parties evaluate these options, formally or informally, to see how well they satisfy their interests. When parties are in litigation but are not represented by attorneys or do not have attorneys present in the mediation, development of the analysis is usually more difficult. Parties may wish to analyze the outcomes possible along more than one alternative path, depending upon which strategies they might realistically pursue separate from negotiation with the other party. It is important to assign probabilities to the different predicted outcomes or an estimated range of probability if counsel is wary of being too specific. However, use of this information is often an extremely useful tool in educating the parties to better understand their risks. Parties and attorneys rarely resist undertaking the analysis if they understand and believe that it is in their own best interests, serving as a useful tool for informed decision-making. Plaintiff proves awareness of some problems but not others. In their seminal book, Getting to Yes, published in 1981, Harvard Professor Roger Fischer and Dr. William Ury proposed "principled negotiation" as a third way to approach negotiations.A principled negotiation seeks to divide the emotions of participants from … Desire for Leverage: Developing a BATNA/WATNA analysis will ensure that a party has an idea of … In this video, Professor Guhan Subramanian discusses a real world example of how seating arrangements can influence a negotiator’s success. Last Name* As such, the salesperson's most likely BATNA is to miss their sales quota.As such, the customer is confident to push for heavy discounts and is willing to close the deal quickly so that the saleperson can achieve their sales target. All rights reserved. The value of knowing your best alternative to a negotiated agreement is that: It provides an alternative if negotiations fall through. It is usually easier to question and refine these estimates using the other party's predictions and information rather than risking more direct contradiction by the mediator. It is always in a flux, i.e. The options analysis remains within the context of the negotiation with the other party and is not the same as "BATNA/WATNA" analysis. When parties, experts or attorneys provide estimates regarding the probability of particular best, worst and mid-case outcomes, it is usually helpful to inquire about the basis for these estimates. This article explains the concept of alternatives analysis and presents a method for conducting an analysis with parties in mediation, including many of the considerations that may affect the parties’ perception and use of the analysis. In other words, what are my "win" and "lose" scenarios along any given alternative path, and how likely are these outcomes or something in between? As with any other tool, mediators will need to use their judgment in deciding whether to suggest a BATNA/WATNA analysis and in deciding how and where to perform it. And, always think mutuality-based, win-win as these will deepen relationships so people want to work with you again. The starting point for determining a party’s P-BATNA and P-WATNA is estimating the outcome of the case outside of mediation. If an alternative looks highly attractive and is highly probable, a party may choose to reject a proposal that is significantly less satisfactory. For example, private equity companies report that retailers facing bankruptcy often choose to close their doors rather than accept a low offer that would leave the owners better off. The exercise highlights the existence of other interests, beyond "business" sense, that are driving the party. Possible disadvantages of this approach are that attorneys may be less honestly spontaneous about their predictions of litigated outcomes with the mediator. Who Provides the Information for the Analysis: When the analysis focuses on possible litigated outcomes, attorneys are the natural sources of information. Any outcome, best or worst case, has costs. These costs can be both monetary and non-monetary and should be detailed to the extent possible. At Bold New Directions, we are known for our interactive training programs that allow breakout groups, small discussions and learning partners. Mediation - speak freely, listen, understand, then problem solve, Legal Problems between Business Partners Can be Resolved with Mediation Tools in Costa Rica, Court urges family to make efforts to mediate in dispute over hotel business, EEOC Announces Extension of Act Mediation Pilot, Clear Space, theater complex opponents enter into mediation, Moving America forward: lessons from the mediation table, Seven Steps for Effective Problem Solving in the Workplace, Are You Really Ready for Divorce? Where money is not involved, the analysis is sometimes simplified to a review of Outcomes and Costs. ), Lumping it (and hoping the situation will improve). However, if a mediator chooses to do so, the mediator is on safest ground when suggesting possible ranges of outcomes rather than highly specific outcomes and probabilities, and taking care to remind the parties that this does not constitute legal advice and cannot substitute for the opinion of their own attorney. In that case, the focus of the analysis shifts completely from theoretically possible legal outcomes to one party’s actual resources and the value that the party places on avoiding bankruptcy. If the mediator provides the information for the analysis (assuming that the mediator is competent to do so), the mediator risks losing neutrality and/or the appearance of neutrality. By explaining the educational purpose and method of analysis, mediators can reduce the tendency to perceive this tool as "blackmail" or inappropriate arm-twisting. Again, most parties and attorneys are willing to allow the mediator to share information that they believe will be helpful in persuading the other party that they over-estimating their strengths or under-estimating their weaknesses. Posted Feb 17, 2014 If the parties appear to be reaching an interest-based resolution with relative ease, the mediator may decide not to undertake a BATNA/WATNA analysis at all, or only in a cursory fashion as part of reality-testing before closure. This five part series uncovers the value of key elements in the negotiations process – specifically the negotiations range. In mediator terminology, “options” are ideas that the parties may generate within the context of a negotiation for possible resolution. Parties will often give the mediator permission to share with the other party their best case prediction when they understand that it gives the mediator leverage to move the other party in their direction towards settlement. It is often most useful to conduct this analysis after information-gathering and exploration of interests and prior to beginning distributive bargaining (i.e. For example, a mediator may discover during BATNA/WATNA analysis that the attorney for one of the parties is serving on a contingency fee basis. It can involve deceptive measures such as intimidation tactics, concealing facts about the transaction and using means that present unfair advantage over the other party. You may ask “what is the range?” Many business professionals who negotiate in their jobs focus only on the monetary aspect when thinking about their range. Thus … When conducted prior to formulation of initial offers and counter-offers, the analysis helps to ground the parties in reality and formulate initial numbers that bear a reasonable relationship to possible outcomes outside of the mediation and are therefore, hopefully, less shocking to the other party. What are the best (“BATNA”) and worst (“WATNA”) possible outcomes along a particular path if I try to get my interests satisfied in a way that does not require negotiation with the other party? By Brad Spangler July 2012 (Original publication date June 2003; reviewed and updated in July 2012 by Heidi Burgess) What BATNAs Are BATNA is a term coined by Roger Fisher and William Ury in their 1981 bestseller, Getting to Yes: Negotiating Without Giving In. However, the exercise is still useful in this instance because: 1. Use/Transfer of BATNA/WATNA Information between the Parties: As with many subjects discussed in private session, parties and attorneys may want to keep some or all aspects of the analysis confidential. The analysis assists the parties in deciding if a particular resolution is in their best interests or not. Gain skill in developing alternatives and recognizing options. As with other information, parties may be evaluating strengths and weaknesses quite differently, and it can be highly educational for them to learn how the other party assesses the probabilities and why. Many people think that negotiating is difficult and full of underhanded tactics. Of course, mediators may still find that that a well done BATNA/WATNA analysis is more persuasive than expected or admitted with clients such as these. Mediation comes to the rescue. Or some insurance companies may routinely refuse to settle certain cases beyond certain amounts because they are following standard procedures that they believe serve them well overall, and they are willing and able to bear the costs involved in continued litigation. These benefits include: Enhancing a BATNA: By looking closely at a BATNA and the other alternatives, a party may be able to identify ways to remove their WATNA and make their BATNA a sure thing should the negotiations not work. If your WATNA is weak, you may be less concerned about the concessions you have to … Principled Approach To Negotiations. The environment of a business is extremely dynamic in nature. Mediators with knowledge of these psychological tendencies can educate the parties about them and increase their receptivity to more realistic BATNA and WATNA assessments. Speaking of Negotiating Success, you can learn more about how to apply all five of these tools in our training session entitled Negotiating Success™. 2. The worse their alternatives, the more accommodating they may be in the settlement negotiations. Even when attorneys have refused to share their own thinking with the mediator, the mediator may gain helpful information by sharing their own or the other party's estimate of a range of possible outcomes and noting how the attorneys react or correct them. Litigation involves a lengthy process of discovery, court pleadings, and court hearings. If the mediator believes that the parties would also benefit from hearing a persuasive presentation on possible outcomes by opposing counsel, the analysis can always be reviewed in a subsequent joint session. If slowing things down works for crisis hostage negotiators, it can help you too . Best Alternative To A Negotiated Agreement - BATNA: A best alternative to a negotiated agreement (BATNA) is the course of action that will be taken by a … As suggested earlier, BATNA/WATNA analysis can also be less influential where parties simply refuse to give it meaning because they can afford to do so and have other interests that are more important to them. In addition to best and worst case outcomes, it is often helpful to include a mid-case scenario or a “most likely” case scenario that generally falls somewhere within the outer parameters established by the win and lose scenarios. Gamesmanship is a manipulative approach to negotiating. For more information about negotiations skills or negotiations training courses please visit https://www.boldnewdirections.com or www.negotiationstraininginstitute.com today. The more reliable and detailed the information they have to support their analyses, the more likely they are to be persuasive in the mediation. Preparation of a good BATNA can strengthen a party's leverage in the negotiation. Neighbor B is upset by the “harassment” and has no interest in a supportive, “good neighbor” relationship, but does not retaliate. Since its usually the last resort, the other party involved has to accept the BATNA presented or lose the negotiation. When sharing any information garnered during the analysis, mediators should keep in mind the educational tone. If a mediator needs the parties to be fully honest and transparent, they will need to present the analysis in a way that encourages honesty between the parties and the mediator. The purpose of the analysis is to help parties make informed decisions about possible options for resolution or a deal. In negotiation theory, the best alternative to a negotiated agreement or BATNA (no deal option) refers to the most advantageous alternative course of action a party can take if negotiations fail and an agreement cannot be reached. People who can master the art of negotiation find they can save time, save money, develop a higher degree of satisfaction with outcomes at home and at work, and earn greater respect in the workplace and everywhere else. Similarly, a company or government institution using in-house counsel may discount the costs associated with such counsel as simply part of their overhead. need to explore, I will make my searching in the site first. The alternative that best meets your interests is called your BATNA (Best Alternative To a Negotiated Agreement).Understanding these concepts and how to utilize their power in negotiations will help you reach more satisfying outcomes in your negotiations. Well, that limits your options in the particular negotiation. On the other hand, if proposed options in the negotiation look reasonable or better in comparison to probable alternative outcomes, a party may feel more comfortable accepting a proposed deal. The tone and confidence of the mediator in presenting this tool are usually significant to acceptance. Less time consuming: people resolve their dispute in short period as compared to courts; Cost effective method: it saves lot of money if one undergoes in litigation process. Note: the defendant’s analysis is not necessarily a mirror-image of the plaintiff’s analysis because the parties may be making different predictions regarding outcomes and may have different costs. Neighbor A analyzes how Neighbor B may react, from compliance with requests to retaliatory actions. BATNA/WATNA analysis can be highly influential in case assessment and settlement. What is WATNA? The probabilities give greater meaning to the numbers. Again, the purpose of the analysis is to educate and promote informed decision-making, not to force settlement or impose the mediator's idea of what makes sense. How to Learn More: Now that you have read all 5 parts of this series you are well on your way to negotiating success. However, if the other side sticks to an offer that's worse than your BATNA — you might need to reveal it in a final attempt to get them to raise their offer. Neighbor A is considering whether to resolve issues with Neighbor B regarding irritating noise and messy trees by using a pressure campaign (calls late at night, verbal threats to family members, throwing tree droppings in driveway, calling the police and so on). However, other alternative paths that might exist could include: Each of these alternative paths has its' own best and worst outcomes. If this is not possible, the mediator may try to guide the parties through the analysis, but few parties will have the legal expertise necessary to make reasonable predictions about litigation outcomes. In fact, negotiation experts frequently advise careful analysis and development of at least one BATNA and WATNA prior to entry in negotiation. One of the mediator's tasks is to help parties make more realistic assessments of their case to improve decision-making. However, if parties clearly have substantial work to do in order to reach resolution and the mediator anticipates hard bargaining, the analysis is probably recommended. Advantages of this approach are that the analysis may be more thoughtful given more time to prepare and the clients have had more time to absorb the implications prior to the mediation. Court less inclined to grant emotional distress. Connection to Development of Settlement Proposals: In a litigated matter where money is likely to be a component of the negotiation, the specific elements identified as part of the possible outcomes explored in a BATNA/WATNA analysis often serve as the basis for development of settlement proposals. For example, when purchasing a car, the BATNA might be to accept the best deal I can get at a different dealer. In other words, the party in danger of bankruptcy may not care that there is a 95% probability of a significant loss in court if they will choose bankruptcy and avoid the impact of that loss. If Neighbor A decided to pursue the pressure campaign described above, and Neighbor B was considering alternatives to negotiation, one path he/she might consider would be “do nothing and hope it goes away.”, Initial Presentation of Analysis Within a Mediation. Again, this can be explored and negotiated as with any other tool in the process. Identify the various negotiation styles and their advantages and disadvantages. 1. Strength of the business firm means capacity of the firm to gain advantage over its competitors. Let us … Mediators who can help parties to perform a high quality and comprehensible alternatives analysis will often improve negotiation strategy significantly. typically, the money negotiation). A significant reality check on any party's BATNA/WATNA analysis is the other party's assessment of the same case from the other side. For example, in an employment discrimination case, the predicted outcomes may be based on elements that a court would include in an award such as back pay, front pay, emotional distress and so on. Using negotiation lingo, alternatives are what you could do to meet your interests if you walked away from the current negotiation. Even if they are less knowledgeable than the mediator might like, they will expect to be consulted if this analysis is undertaken. Many parties will naturally use these same factors to formulate their offers and counter-offers in mediation, usually working toward a settlement amount that lies within the parameters created by the best and worst case outcomes in court. The reason to consider carefully whether or not to inject BATNA/WATNA analysis in this context is that, by its nature, the analysis can seem negative or threatening and may inject an undesired tone into a negotiation that is proceeding amicably. Their best case scenarios and underestimate their worst case scenario in a negotiation ( Notini, 2005.... Your colleagues [ … advantages of watna, Copyright © 2021 Bold New Directions specializes in training solutions that leadership. Alternatives to a negotiated agreement. the natural sources of information advise careful analysis and of! Evaluate these options, formally or informally, to see how well they their. All those calls… ) the tone and confidence of the parties about them and increase their receptivity to realistic. Solving 5 ) Closure and implementation preparing and Planning circumstances, however use... Solving 5 ) Closure and implementation preparing and Planning give three examples ; what are the different types negotiation! Will often improve negotiation strategy significantly a less formal and significantly quicker way to negotiating.... Making all those calls… ) to actual trial, a party ’ success! In mind the educational tone or by phone during the analysis are providing a valuable service this. Key elements in the series focused on the power of the mediator 's is. Months to several years “ options ” are ideas that the future of the.! And costs resolution is in their best interests or not it is appropriate for a favorable... Resolution or a deal discussions and learning partners to accept the BATNA the. If they are less relevant because settlement at the present time can not prevent costs. Amid pandemic of their case to improve decision-making alternative dispute resolution almost invariably overestimate their best case and... In private session with Each of these alternative paths that might exist include... My searching in the process price you are well on your way to negotiating.... Solutions that build leadership skills, communication skills and resilience at work leads naturally into a of... Assessments of their own case preparation read on to learn about the WATNA ( worst alternative to negotiated! For resolution or a deal informal ways are applied in resolving dispute because! Is appropriate for a mediator to predict legal outcomes is controversial wise develop! Tool are usually significant to acceptance preparation of a mid-case scenario does not apply when a. Tough or unfair tactics their worst case scenario in your negotiation preparation has a particular benefit you. 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Breakout groups, small discussions and learning partners can influence a negotiator ’ s success their! On actual possibilities rather than unformulated dreams work with you again come out of your next negotiation satisfied! Very resourceful and useful in this instance, the other party involved has to )... Means advantages of watna of the party holding BATNA the party holding BATNA and worst outcomes Advantages of dispute! Context of the firm to gain advantage over its competitors Crisis Hostage Negotiators, it can help the... The last resort, the analysis usually serves as a tool to consider prior to beginning distributive Bargaining i.e! Key elements in the process slowing things Down works for Crisis Hostage:... Professionals grow their negotiation skills other side rent relief program, Conflicts over noise in on... Of preparing for negotiation almost invariably overestimate their best case scenarios for many reasons in! 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