Your BATNA: what happens if you walk away

You will be able to state your BATNA for any negotiation and list ways to make it stronger.

Pick a negotiation you have coming up, such as a pay offer, a rent renewal or a quote from a supplier, and write down what you will do if it falls through. You can't judge any offer until you have that answer. Most people never put it on paper, but it still quietly decides how hard they push.

Your best alternative and the tomorrow test

The idea comes from Fisher and Ury's book Getting to Yes. Your BATNA is your best alternative to a negotiated agreement: what you will actually do if you and the other side don't reach a deal. Every negotiation has one, even when it doesn't feel that way. With a landlord, it might be renting a smaller flat two MRT stops away. With a client who won't pay your rate, it might be spending that week on another client's project. With a car dealer who won't move, it might be buying the same model from a different dealer, or keeping your current car for another year.

To test a BATNA, ask whether you could act on it tomorrow. If you could, it is a plan. If you can't count on it yet, it is a hope. "I'll probably find something better" is a hope, and so is "A recruiter said she might have something." "I'll stay in my current role at my current pay and keep applying" is a plan. "I have a second interview on Thursday" is a step towards a plan, but it isn't an alternative until there is an offer.

People overrate their BATNA when they're angry and underrate it when they're anxious. A friend who is furious with their boss may think any offer beats staying, and accept something worse than they would on a calmer day. Be honest in both directions.

To work out your own, list your actual alternatives if this deal doesn't happen and pick the best one. Put it through the tomorrow test, discarding hopes and keeping plans. Check your mood: if you're angry you may be rating it too high, and if you're anxious, too low. Then write it as one sentence a level-headed friend would agree with.

Where negotiating power comes from

Your BATNA is the reason you can say no. Someone who would be fine without the deal can hear a low offer, smile and ask for more, because refusing costs them little. Someone with nothing to fall back on hears every pause from the other side as a threat.

Most negotiating power comes from the BATNA rather than from charm or a forceful manner. Power is how good your position is with no deal, compared with the other side's. They have a BATNA too. A hiring manager's might be the next candidate on the list, or leaving the role empty for longer. A landlord's might be re-letting the flat, which may mean an empty month and an agent's fee. Lesson 2.3 covers estimating the other side's BATNA.

You don't need to be a tough negotiator to ask for more. You need to know, and believe, that your alternative is fine, and that belief changes your tone more than any script.

Wei Ling and the one-north offer

Wei Ling (an invented example) is 29 and works in marketing at a logistics firm in Paya Lebar. After three rounds of interviews, a consumer tech company in one-north tells her an offer is coming this week. She wants the job but dreads asking for more, hearing no, and then facing "what then".

On the MRT home she lists three alternatives: keep her current job, carry on with the job search, or chase the promotion her manager half-promised last year. Staying put beats the other two today, so her current job is her BATNA.

Nervous about losing the offer, she might forget that her current job is perfectly decent. She likes her team, the pay is fair and she isn't in a hurry, so her BATNA is stronger than it feels. She doesn't need to be tough with the tech company, only to know and believe that staying would be fine.

She decides to reply to a recruiter who contacted her last month and to ask her manager informally about the promotion timeline. Neither commits her to anything, and by the time the offer arrives she may have a much better answer to "what then".

Strengthening your BATNA before you talk

The best time to work on your BATNA is before the negotiation starts. Once you're in the room, it's usually too late to change it. The useful steps depend on the deal:

Job seekers can talk to other employers, take recruiter calls seriously, or find out what a promotion at their current company would involve. Tenants can view two or three flats so the cost of moving becomes a real figure. Anyone buying from a contractor or supplier can get a second or third quote. Anyone making a big purchase can price the same item at another shop.

Taking these steps doesn't commit you to anything. Each one either improves your alternative or shows it is weaker than you thought, and both outcomes are useful. If yours turns out weaker than you hoped, be more careful about walking away and perhaps more creative about options. Lesson 1.4, "Map the interests in a real negotiation", covers finding them.

Now apply this to your own negotiation. Write your BATNA in a single sentence, then pick two things you could realistically do in the next seven days to make it stronger.

Write your BATNA for your upcoming negotiation in one sentence. Then list two things you could do this week to improve it.

Course

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