In their book, “Getting to Yes,” Roger Fisher and William Ury discuss Principled Negotiation, as referenced in the last article. As part of that Interest-Based Relational approach, they also delve into a few other useful negotiation concepts called the Zone of Possible Agreement (ZOPA), Best Alternative to a Negotiated Agreement (BATNA), and the Worst Alternative to a Negotiated Agreement (WATNA). The simplest example to use to explain these concepts it one where one negotiator is the Seller of goods or services, and the other is the Buyer.

ZOPA

In any sale, the Seller and the Buyer will each have a best-case and a worst-case scenario in mind. Let’s assume that the sale in the image above is for a new motorcycle. The Seller wants to charge $10,000 and the Buyer only wants to pay half that, $5,000. However, the Seller is willing to accept a lowest price of $6,000 and the Buyer is willing to pay a highest price of $7,900. $6,000 – $7,900, the price range that seller and buyer are both willing to accept is the ZOPA.

BATNA and WATNA

If the case where there is no overlap between the Seller’s lowest acceptable price and the Buyer’s highest acceptable price, the negotiation will fail and the Buyer and Seller will not do business together. This is where the BATNA and the WATNA come in.

The Buyer saw a used motorcycle advertised online for $6,500 USD, but it didn’t come with a factory warranty. So when thinking of their BATNA, the Buyer decides that they’re willing to pay a bit more for the new bike and the warranty, but if it’s going to cost more than $7,900, they can settle for the used motorcycle. If someone else buys that used bike first, the Buyer’s WATNA might be being stuck with no motorcycle at all and have to start their search all over again or going back to the Seller with even less bargaining power.

The Seller, on the other hand, would like to sell the motorcycle so they can make a healthy profit. However, they’ve been holding onto inventory for too long because new motorcycles aren’t selling, so they’re considering selling at a reduced price to move the stock off the showroom floor to make space for newer, more popular models. When thinking of their BATNA, they’ve decided that if they can’t sell the bike for at least $6,000 USD, they’ll put it up for dealer auction, which should go for a slightly higher price, but they’ll probably have to pay transportation costs to the new dealership. The Seller’s WATNA might be that the auction price is below $6,000 USD or it doesn’t sell at all, and they’re left sitting on inventory that won’t sell.

It is never wise to enter into a serious negotiation without each party understanding their BATNA and WATNA. The value of knowing both is that:

• You understand the alternatives if negotiations fall through.
• You understand the limits of your negotiating power.
• It determines your reservation point (the worst price you are willing to accept).

To determine your BATNA and WATNA:

1. Examine all reasonable alternatives in the negotiation process. What would you do in case of unsuccessful negotiations?
2. Assess the value (money, time, effort, etc) of each alternative option.
3. Determine which alternative is the most valuable to you. This is your BATNA.
4. Determine which alternative is the worst case. This is your WATNA.

After you define your own BATNA, calculate the minimum offer you are ready to accept within the current negotiations. When parties negotiate based on the WATNA, they have an opportunity to look at the subject of negotiations from a different angle. Thus, if one party offers the worst option of outcome, the second party may hesitate and agree to compromise below their BATNA threshold. This will turn out to be beneficial for the offering party. However, it is often presented as a bluff.

An Example of ZOPA, BATNA, & WATNA in Conflict Resolution

1. Research and scope the work
2. Create a technical design
3. Write the prototype code, including tests
4. Obtain user feedback on the prototype
5. Modify the prototype based on feedback and operationalize it for production
6. Load test the feature and ensure it scales for production use
7. Handle long-term support of the feature

Alex has already been talking with Product and Sales, so wants to focus on the technical research and design and write the prototype. Once it gets past that phase, they want to pass it off to Jordan to do the implementation. Alex would rather have nothing to do with ongoing support, since they don’t want to be paged at night if anything goes wrong with the product.

Jordan is finishing up an existing project and doesn’t have time to do any deep research right now, but definitely wants to be involved in the technical design to make sure that it conforms with their best practices and doesn’t have any gaping security, maintainability, or scalability challenges. They love doing load testing and are okay with picking up half the support, but don’t want to be the only one shouldering that load.

Neither of them are really keen on getting user feedback; Jordan’s introverted and doesn’t like dealing with customers, and Alex wants to shift focus to other work. They’re both also ambivalent about turning the prototype into production code. They know it will be a lot of work.

Each of them makes up a list of the things they want to do, don’t want to do, and would be okay doing, but would prefer not to do. They use this to figure out their BATNA and WATNA.

Alex

Want To Do	Won’t Do	Prefer Not To Do
Research & Scoping	Load Testing	User Feedback
Technical Design	Long Term Support	Operationalizing
Prototype Code

Alex’s BATNA is that they’ll do the research, design, and prototype and find a contractor to take over the project at that point. Unfortunately, there’s no solution for the long term support, so unless Jordan’s going to take that over, Alex may get stuck with it. Having to do the whole project alone and then being stuck with support because no one else understands it is the WATNA.

JordAN

Want To Do	Won’t Do	Prefer Not To Do
Technical Design	Research & Scoping	User Feedback
Load Testing	Prototype Code	Operationalizing
Some Long Term Support		

Jordan’s BATNA is that they’ll be cut out of the project entirely and it will be cancelled. This won’t be great for the company, but it’s better than releasing software that will be a failure. On the other hand, if the project goes through and Jordan doesn’t have any way to help design or create it up front, but then is responsible for long-term maintenance, that would be their WATNA.

Negotiation

Since they’ve made these lists and determined their BATNA and WATNA ahead of time, they both have a pretty clear idea of what their deal breakers are and what the consequences of no agreement will be. The good news is that there seems to be some clear areas where one or the other of them want different pieces of the work (Research & Scoping, Prototyping, and Load Testing) and some flexibility around who will do the Feedback and Operationalizing. The biggest points of contention are around the Technical Design and the Long-Term Support.

No one wants to be stuck supporting a product that they don’t understand because they weren’t involved in the design. Neither thinks that it’s worth the risk of being the only person who’s responsible for support, either, since that will lead to burn out. Bringing in a contractor will be expensive, and having the project cancelled would mean that the company loses out on an opportunity for additional revenue.

As they negotiate, the come to the following agreement (collaborative compromises, aka ZOPA in bold):

Alex	Jordan
Research & Scoping	Finishes up their existing project
Technical Design Draft	Technical Design Review
Prototyping	Prototype Code Review
User Feedback & Modifications to the Technical Design	Review of the Technical Design Modifications
Operationalization Code Review	Operationalization
Switches to a new project	Load Testing
50% of Long-Term Support	50% of Long-Term Support

Neither gets exactly what they wanted, but understanding the best and worst case alternatives helps them reach an equitable agreement. At the end, they’ve both had a hand in designing and building the product, so are able to support it when it goes into production. They also both get to work on their other projects by staggering the work around this project.

꧁༺ ༻꧂

The effective utilization of ZOPA, BATNA, and WATNA in conflict negotiation can be the key to achieving successful resolutions. By understanding the ZOPA, negotiators can identify the space where mutually acceptable solutions exist, fostering a collaborative atmosphere. Simultaneously, having a strong BATNA empowers negotiators with leverage and provides a safety net in case negotiations falter. Lastly, recognizing the WATNA sheds light on the potential consequences of not reaching an agreement, motivating parties to find common ground. By integrating these concepts into our negotiation strategies, negotiators can navigate conflicts with confidence, creativity, and the potential for positive outcomes that benefit all parties involved.