The term BATNA, or Best Alternative To a Negotiated Agreement, typically refers to your fallback plan in the event that whatever negotiation you’re involved in doesn’t go through. Whether you’re negotiating the salary for a new job or the acquisition of your company, having a solid and strong BATNA can help strengthen your overall position.

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However, the practice of developing options and alternatives is imperative outside of direct negotiations as well.

Let’s say, for example, you’re a startup that’s developed a shiny new widget. Its ready to go, you’ve poured everything you have into it: time, money, blood, sweat, tears, political capital with your family, the whole shebang. Now you’re working on that first big sales contract or you’re taking your consumer based product to market directly to customers.

Like many other subjects, the study and practice of negotiation has become a club shrouded in acronyms. Insiders throw terms like BATNA and ZOPA around like everyone should be teaching their kid to spell them in their alphabet soup. For the rest of though, many of these acronyms are simply meaningless.

BATNA Basics

When you enter into a negotiation with one or more parties, it’s usually under the premise that you want to improve your current position. Maybe that’s a new job, selling your company or getting your young daughter to hold still while you brush her hair. When negotiating any arrangement, your BATNA is your Best Alternative To a Negotiated Agreement. Or simply put, plan B.