Effective Alternatives Analysis in Mediation: “Batna/Watna” Analysis Demystified

Topics: Mediation, Best, worst and average case, The Mediator Pages: 16 (5023 words) Published: November 22, 2010
BATNA: Best Alternative to a Negotiated Agreement
WATNA: Worst Alternative to a Negotiated Agreement
Popular Attribution to Fisher & Ury, Getting to Yes.
In most settlement negotiations, parties are influenced consciously or unconsciously by their assessment of their alternatives to a negotiated agreement. The better their alternatives, the more they may push for a more favorable settlement. The worse their alternatives, the more accommodating they may be in the settlement negotiations. Unfortunately, parties frequently fail to undertake an accurate and comprehensive analysis of their alternatives and, therefore, negotiate poorly based on unrealistic and uninformed ideas of what they might obtain in the absence of a negotiated agreement. Mediators who can help parties to perform a high quality and comprehensible alternatives analysis will often improve negotiation strategy significantly. 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. Essential Concept of BATNA and WATNA:

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? 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? Important Note:

Do not confuse "alternatives" analysis with "options" analysis. In mediator terminology, “options” are ideas that the parties may generate within the context of a negotiation for possible resolution. The parties evaluate these options, formally or informally, to see how well they satisfy their interests. The parties may consider some ideas to be favorable or "winning" options and others to be "losing" options, but all are theoretically possible bases for resolution between the parties to the dispute even though some are not realistic or would never be acceptable to both parties. The options analysis remains within the context of the negotiation with the other party and is not the same as "BATNA/WATNA" analysis. Alternative Paths:

Parties may have more than one path they can follow that does not involve negotiation with the other party. The most common alternative path in many mediated cases is litigation or arbitration, in which parties seek a judgment from a judge, jury or arbitrator that they hope will satisfy their interests better than anything they might be able to obtain in a negotiation with the other party. In this instance, the analysis focuses on the "win" and "lose" outcomes in court. However, other alternative paths that might exist could include: •Seeking results from a higher authority within an organization •Going to the press

Holding a strike
Seeking a new job
Seeking new (suppliers, buyers, distributors, employees etc.) •Lumping it (and hoping the situation will improve)
Each of these alternative paths has its' own best and worst outcomes. 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. Of course, the analysis itself is often used to decide whether or not it makes sense for a party to pursue a particular alternative. Purpose of the analysis:

The purpose of the analysis is to help parties make informed decisions about possible options for resolution or a deal. It is almost always helpful to compare possible outcomes along alternative paths to actual proposals on the table in a negotiation before making a decision within the negotiation. If an alternative looks highly attractive and is highly probable, a party may choose to reject a proposal that is significantly less satisfactory. On the other hand, if...
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