BUSI 3706 Lecture Notes - Lecture 2: Zopa, Best Alternative To A Negotiated Agreement, Reservation Price

• School: Carleton University
• Department: Business
• Course: BUSI 3706
• Professor: Richard Darville

Document Summary

Batna - best alternative to a negotiated agreement. Reservation price - the amount at which you would be indifferent between entering into or not entering into an agreement. Batna tips: know your batna, you want your counterpart to think you have a good batna. Integrative - win-win: distributive - win-lose, lose-won, lose-lose. Be optimistic but realistic: resistance point, a price or outcome below which you will not go, asking price, initial offer. The negotiation bargaining zone: the (cid:271)argai(cid:374)i(cid:374)g zo(cid:374)e is the spa(cid:272)e (cid:271)et(cid:449)ee(cid:374) the (cid:271)u(cid:455)er"s reser(cid:448)atio(cid:374) pri(cid:272)e (cid:894)brp(cid:895) a(cid:374)d the seller"s reser(cid:448)atio(cid:374) pri(cid:272)e (rp) that is, the zone of possible agreement (zopa). If brp > srp, then a positive bargaining zone exists. If brp < srp, then there is no zone of possible agreement. The role of alternatives to a negotiated agreement: what is your best alternative to a negotiated agreement (or batna), alternatives give the negotiator power to walk away from the negotiation, make fewer concessions.