When you are in a business negotiation, you are seeking the best possible outcome for yourself and the other party. How do you know what the best deal looks like?
Harvard Business School Professor Michael Wheeler offers a system for choosing the best deal in the online article “How to Choose the Best Deal.”
In a linked negotiation, Professor Wheeler writes:
According to basic negotiation theory, Jim’s BATNA—his best alternative to a negotiated agreement—should be his benchmark. He’s supposed to compare what he’s been offered at the bargaining table with the best he could get if he walked away.
However, there are many variables that make this a tough position to be in. Professor Wheeler suggests moving passed the BATNA, and using the following five steps to find the best choice:
Find the equalizer: what item is most important to you and to what limit are you willing to go.
Assess the feasibility of each offer/situation
Improve your leverage
Keep control of the process
Take the plunge
According to Prof. Wheeler:
The test of success shouldn’t be the best imaginable deal, but one that’s good enough. Your goal is to achieve a substantive outcome, not to negotiate endlessly for its own sake.
Perhaps the key is not to think there is an absolute perfect and best choice. There may be a deal that really is “good enough,” where your main objectives, and those of the other party, are satisfied.