CPN BATNA & Negotiation Preparation 3 — Questions and Answers
Question 1: A professional negotiator is preparing for a complex multi-party deal. Which preparation step should be completed FIRST?
- Draft the opening offer to establish an anchor
- Identify all stakeholders and their respective interests and BATNAs (Correct answer)
- Set the negotiation agenda and meeting location
- Determine what concessions you are willing to make
Correct answer: Identify all stakeholders and their respective interests and BATNAs
Understanding all parties' interests and alternatives is foundational before crafting strategy or making any offers.
Question 2: When the other party appears to have a very strong BATNA, which negotiation approach is most advisable?
- Immediately match their BATNA value to prevent them from walking away
- Focus on creating value through integrative tactics to expand the pie beyond BATNA comparisons (Correct answer)
- Concede quickly to secure any deal before they exercise their alternative
- Exaggerate your own BATNA to create an artificial balance of power
Correct answer: Focus on creating value through integrative tactics to expand the pie beyond BATNA comparisons
Integrative bargaining can create joint value that makes your offer more attractive than the other party's strong BATNA.
Question 3: What is the primary risk of revealing your true BATNA to the other party early in a negotiation?
- It builds too much trust and removes competitive tension
- The other party can craft an offer just barely better than your BATNA, capturing most of the surplus (Correct answer)
- It legally obligates you to accept any offer above your BATNA
- It eliminates the possibility of an integrative agreement
Correct answer: The other party can craft an offer just barely better than your BATNA, capturing most of the surplus
Disclosing your BATNA allows the other party to make a minimally acceptable offer, leaving you little negotiating surplus.
Question 4: An experienced negotiator uses 'objective criteria' during preparation. What purpose does this serve in relation to BATNA?
- Objective criteria replace the need for a BATNA entirely
- Objective criteria strengthen your position by providing legitimate justification for your proposals independent of power (Correct answer)
- Objective criteria are only useful when both parties have weak BATNAs
- Objective criteria help you disguise the weakness of your BATNA
Correct answer: Objective criteria strengthen your position by providing legitimate justification for your proposals independent of power
Grounding proposals in objective standards (market rates, precedent, expert opinion) adds legitimacy that complements your BATNA-based power.
Question 5: In a real estate negotiation, a seller's property has been on the market for 180 days with no offers. How does this affect the seller's BATNA?
- It strengthens the seller's BATNA because they have more time to wait
- It weakens the seller's BATNA because carrying costs accumulate and alternatives diminish (Correct answer)
- It has no effect on BATNA since real estate always appreciates
- It strengthens the BATNA because buyers will sense desperation and offer more
Correct answer: It weakens the seller's BATNA because carrying costs accumulate and alternatives diminish
Extended time on market signals weakening alternatives and increases financial pressure, reducing the seller's effective BATNA.
Question 6: What distinguishes a 'target point' from a 'reservation point' in negotiation preparation?
- The target point is your ideal outcome; the reservation point is your minimum acceptable outcome tied to your BATNA (Correct answer)
- The target point is your BATNA; the reservation point is your opening offer
- The target point and reservation point are different terms for the same concept
- The target point is set by market conditions; the reservation point is set by personal preference
Correct answer: The target point is your ideal outcome; the reservation point is your minimum acceptable outcome tied to your BATNA
The target point is your aspirational goal while the reservation point (derived from BATNA) is the least favorable outcome you will accept.
Question 7: A negotiator is told 'take it or leave it.' How should BATNA preparation inform their response?
- Always reject ultimatums to avoid appearing weak
- Always accept to avoid the risk of losing the deal
- Compare the offer against your BATNA; accept if the offer exceeds it, reject if it does not (Correct answer)
- Request a mediator immediately to invalidate the ultimatum
Correct answer: Compare the offer against your BATNA; accept if the offer exceeds it, reject if it does not
A take-it-or-leave-it offer should be evaluated against your BATNA — if the offer is better, accept; if not, exercise your alternative.
CPN BATNA & Negotiation Preparation 3
A professional negotiator is preparing for a complex multi-party deal.
Which preparation step should be completed FIRST?