CPN BATNA & Negotiation Preparation 2 — Questions and Answers
Question 1: A negotiator discovers mid-negotiation that their BATNA has significantly weakened. What is the best immediate response?
- Conceal the change and continue as planned
- Reassess your reservation point and adjust your strategy accordingly (Correct answer)
- Immediately walk away before the other party finds out
- Demand a recess and refuse to continue
Correct answer: Reassess your reservation point and adjust your strategy accordingly
When your BATNA weakens, your reservation point must be recalculated to reflect your new alternatives before proceeding.
Question 2: Which technique is most effective for improving a weak BATNA before entering a negotiation?
- Misrepresenting your current alternatives to the other party
- Actively cultivating additional outside options and alternatives (Correct answer)
- Delaying the negotiation indefinitely
- Asking the other party to share their BATNA first
Correct answer: Actively cultivating additional outside options and alternatives
Proactively developing real alternatives before negotiations strengthens your actual leverage and walk-away power.
Question 3: What does it mean to 'anchor' in a negotiation, and how does it relate to preparation?
- Anchoring means refusing to move from your initial position regardless of circumstances
- Anchoring is making the first offer to set a reference point that influences the entire negotiation (Correct answer)
- Anchoring refers to legally binding yourself to a specific price before talks begin
- Anchoring is the act of matching the other party's opening offer
Correct answer: Anchoring is making the first offer to set a reference point that influences the entire negotiation
Setting a strong anchor early shapes the negotiation range, and preparation allows you to make a well-justified first offer.
Question 4: A buyer is negotiating with a sole-source supplier. What is the most accurate assessment of the buyer's BATNA?
- The buyer's BATNA is strong because suppliers always need customers
- The buyer's BATNA is weak because no alternative suppliers exist (Correct answer)
- The buyer's BATNA is irrelevant when dealing with a monopolist
- The buyer's BATNA depends entirely on the supplier's price list
Correct answer: The buyer's BATNA is weak because no alternative suppliers exist
A sole-source situation eliminates alternatives, which by definition weakens the buyer's BATNA significantly.
Question 5: In preparing for a salary negotiation, an employee has a competing offer worth $5,000 more per year. How should this affect their reservation point?
- The reservation point should be set at exactly the competing offer amount
- The reservation point should be set below the competing offer to seem reasonable
- The reservation point should reflect the competing offer plus any switching costs or risk premium (Correct answer)
- The reservation point is irrelevant when a competing offer exists
Correct answer: The reservation point should reflect the competing offer plus any switching costs or risk premium
The reservation point should account for the full value of the BATNA, including transition costs, benefits differences, and risk.
Question 6: What is a 'shadow BATNA' and why is it important in preparation?
- A secret offer you make to a third party to undermine the current negotiation
- An estimate of the other party's best alternative, used to gauge their walk-away point (Correct answer)
- A secondary internal option kept hidden from all stakeholders
- A worst-case scenario plan used only if negotiations completely fail
Correct answer: An estimate of the other party's best alternative, used to gauge their walk-away point
Estimating the other party's BATNA helps you understand their reservation point and how much pressure they can withstand.
Question 7: Which scenario best illustrates the concept of 'ZOPA' (Zone of Possible Agreement) in relation to BATNAs?
- ZOPA exists when both parties have equally strong BATNAs
- ZOPA is the range between each party's reservation point where a mutually acceptable deal can be struck (Correct answer)
- ZOPA only exists in integrative negotiations, not distributive ones
- ZOPA is determined solely by the party with the stronger BATNA
Correct answer: ZOPA is the range between each party's reservation point where a mutually acceptable deal can be struck
ZOPA is bounded by each party's reservation point (derived from their BATNA), and a deal is possible only within this range.
CPN BATNA & Negotiation Preparation 2
A negotiator discovers mid-negotiation that their BATNA has significantly weakened.
What is the best immediate response?