Interests versus positions, BATNA, ZOPA, anchoring and creating value.
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- What is the difference between a position and an interest in negotiation?
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A position is what you say you want; an interest is the underlying reason or need behind that want.- In a salary negotiation, if you demand $120,000, what is that called?
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Your position. The interest might be financial security, recognition of your value, or ability to afford housing.- Why should a negotiator identify the other party's interests rather than just their stated positions?
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Positions are often rigid, but interests can have multiple solutions; finding the interests opens up creative options.- How do you discover the other party's true interests if they won't state them directly?
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Ask open-ended questions, listen carefully, observe what they emphasize, and propose options to see their reaction.- Can two negotiators have aligned interests on some issues?
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Yes; aligned interests create opportunities for integrative deals and can be the foundation for a long-term relationship.- What is the danger of confusing a person's stated position with their true interest?
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You may dismiss a legitimate offer that satisfies their interest in a different form, because you are fixated on their position.- In a business acquisition, if the seller's stated position is a $10 million price, what alternatives might satisfy their underlying interest to retire comfortably?
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An earn-out, seller financing, a consulting role, retention of a minority stake, or a lower upfront price with performance bonuses.- What does BATNA stand for?
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Best Alternative to a Negotiated Agreement.- Why is it important to develop your BATNA before entering a negotiation?
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Your BATNA sets your walk-away point and gives you negotiating power; without one, you lack confidence and may accept poor deals.- How do you develop a strong BATNA?
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Explore all realistic options available if the negotiation fails: other partners, suppliers, inside alternatives, or walking away entirely.- If your BATNA is strong, how does this affect your willingness to make concessions?
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You will be less willing to make concessions, because you have a good option outside the negotiation.- What is a reservation price?
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The lowest price a seller will accept or the highest price a buyer will pay; it is usually based on your BATNA.- What is the relationship between BATNA and your reservation price?
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Your reservation price is usually set at or near your BATNA; it is the point where you are indifferent between a deal and your best alternative.- What does it mean if you have not identified your BATNA before entering a negotiation?
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You may accept a poor deal out of desperation or fear, or make unrealistic demands; either way, you lack confidence and strategic clarity.- How does a weak BATNA affect your negotiating position?
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It severely weakens your position; the other party can sense your desperation and demand more concessions.
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