David Omand – Book Author
HOW SPIES THINK
Ten Lessons in Intelligence
THREE LESSONS IN MAKING INTELLIGENT USE OF INTELLIGENCE
Lesson 8: Imagine yourself in the shoes of the person on the other side
‘I think we can do business together’ was Margaret Thatcher’s comment to the media about Mikhail Gorbachev before her meeting with him in London in the summer of 1984 on his first visit to a Western capital. He was being tipped as the Politburo member most likely to take over as Soviet leader from the ailing Soviet General Secretary Chernenko. This invitation to London with his wife, Raisa (a telegenic figure totally unlike the spouses of previous Soviet leaders), was not just a result of Margaret Thatcher’s political intuition about the value of getting ahead of the changes taking place in the Soviet Union. It rested on the secret insights provided by a remarkable intelligence success, whose fruits were also being shared with President Reagan and a few key members of his administration. The case illustrates the strategic impact that well-timed secret intelligence can have on international relationships and negotiations.
The great intelligence secret was that MI6, thanks to invaluable assistance from the Danish Intelligence Service, had recruited a well-placed agent, Oleg Gordievsky, inside the heart of the KGB. Gordievsky was now the Acting Head of the KGB Residency inside the Soviet Embassy in
London.1 During his three years in Denmark, he had provided SIS with a series of remarkable intelligence and counter-intelligence coups exposing Soviet spies as well as giving invaluable insights into the last days of the old Soviet Union under the ageing and ill Brezhnev and his successor, Andropov (whom we met in Chapter 3, as the ruthless head of the KGB intent upon crushing the Prague Spring of Alexander Dubček).
When Gordievsky returned reluctantly to a desk job in the KGB Centre after his tour in Copenhagen, SIS prudently agreed with him that they would not run him there. Given the intense level of surveillance to be expected and the operational difficulties of intelligence activity in Moscow, MI6 judged it was simply too risky. The penalty of any slip would be torture and death, as it had been for Colonel Oleg Penkovsky of the GRU in 1962, when he was uncovered through surveillance of his contacts with MI6 and the CIA in Moscow. Instead the strategic calculation was of the long-term value he could represent as an agent in place within the KGB, to be reaped when he was posted overseas again.
In 1982 Gordievsky resurfaced on being appointed to the KGB Residency in the Soviet Embassy in London, to the secret rejoicing of the small number of those in the know. I was rightly not one of that small group given the policy post I held, although working in the Ministry of Defence I later benefited from being on the distribution of his reporting without of course knowing his identity or role in the Embassy in London. Thanks to some subtle manipulation orchestrated by British intelligence in order to clear the way for him by discrediting his rivals, he was quickly promoted to the key post of head of political intelligence work in the KGB Residency (head of the PR Line in KGB-speak).
A stream of invaluable secret intelligence reporting to MI6 followed Gordievsky’s posting to London. So important was it that Margaret Thatcher herself was indoctrinated into the case in December 1982. ‘Probably no British Prime Minister has ever followed the case of a British agent with as much personal attention as Mrs Thatcher devoted to
Gordievsky,’ wrote her biographer.2 Carefully selected reports based on Gordievsky’s intelligence, with elaborate arrangements to disguise the source, were passed to the CIA and to the White House. The CIA’s assessment was that ‘Gordievsky’s intelligence was an epiphany for President Reagan’ in revealing the inner workings of the Soviet leadership.
Posted to London and contact resumed, it was Gordievsky who was able to reveal to MI6 that Gorbachev was the KGB’s preference for future leader well before he came to power. He described Gorbachev as a very different type of leader, who recognized the need for economic change if the Soviet Union was to survive. Unlike his predecessors Gorbachev saw the desirability of easing Cold War tensions and thereby reducing the burden of armaments expenditure. In part, his modernizing strategy failed because
Gordievsky’s advice, passed to President Reagan, was that Russian attempts to keep up with American defence technology (including Reagan’s Star Wars programme) would eventually crack the Soviet system. As it did.
In preparation for that important first meeting between Gorbachev and the Prime Minister, Margaret Thatcher, briefs were prepared on both sides in the usual way on issues that should be raised, together with defensive lines to take on matters raised by the other side. The extraordinary thing about this meeting was that the briefs on both sides contained substantive material from Gordievsky. Thatcher had the benefit of the insights provided by Gordievsky’s covert role as an SIS agent reporting on Gorbachev; and Gorbachev’s brief relied on Gordievsky’s advice as his head of KGB political reporting in the Residency in London. So Gordievsky was suggesting to Gorbachev lines to take on issues he knew, from MI6 and the Foreign Office, were of importance to the UK. Thatcher had not only advance warning from Gordievsky of what the issues to be raised by Moscow were, but also had his advice as a Soviet insider on the best manner of replying to ensure her responses struck home with the future leader of the Soviet Union. Gordievsky knew the plan was succeeding when he saw the daily KGB briefing for Gorbachev during his eight-day visit coming back ‘with passages underlined to show gratitude or satisfaction’. ‘Both sides were being briefed by us,’ said an MI6 analyst involved at the time. ‘We were doing something new – really trying to use the information, not distort it, to manage relations and open up new possibilities. We were a
handful of people working amazing hours on the cusp of history.’3
The visit to the UK was a huge success for Gorbachev and burnished his international credentials. On the back of it, in January 1985, the KGB promoted Gordievsky again, this time to be Acting Head of the Residency. That made him the most senior Soviet spy in London, giving both him, and thus his MI6 handlers, unparalleled access to the secrets of the KGB.
Gordievsky’s unique intelligence access proved to be even more important in US–Soviet relations. His reporting helped educate President Reagan and key members of his administration about the frightening level of paranoia felt by the old Soviet leaders about US nuclear capabilities and their fears of a US and NATO first strike. A genuine Soviet fear of the US deciding to launch first strikes against Soviet strategic forces had seemed the realm of airport novel fantasy. Having been the Defence Counsellor in the UK delegation to NATO from 1985 to 1988, and having participated in
numerous nuclear release exercises in response to scenarios postulating Soviet aggression, I knew at first hand how hard it had been even with the artificiality of exercises to get unanimous decisions from the NATO nations, let alone to imagine a collective decision to start a war with the Soviet Union.
Gordievsky revealed how the Politburo in Moscow not only believed the Marxist doctrine that a final showdown between capitalism and communism was inevitable but that the ‘principal adversary’ (the United States) was actively preparing for that day. The KGB Centre had sent instructions out to its residencies in NATO capitals for an intelligence-gathering exercise codenamed Project Ryan to report indicators of Western preparations, such as stockpiling blood and the number of lights burning at
night in ministries of defence.4 According to Gordievsky, the KGB officers in NATO capitals knew perfectly well this was the stuff of paranoid nightmares on the part of their leadership, but cynically fulfilled their quotas in the interests of retaining their highly prized Western postings. Today Russian state media under President Putin, himself a former KGB officer from this era, still pumps out propaganda accusing NATO of preparing to attack Russia – as improbable a scenario today as it was back
in the 1980s, as I know from my years spent in NATO.5
In 1983 that Soviet paranoia almost led to global crisis. US naval and air forces were closely shadowing Soviet forces and engaging in intelligence gathering on Soviet exercises, all designed to demonstrate President Reagan’s early resolution in the face of what was seen as growing Soviet
military power.6 The regular NATO exercise to practise nuclear release procedures, Exercise Able Archer, was monitored by Soviet intelligence, and a Soviet military commander became concerned it might be the precursor of attack and placed some Soviet forces on a heightened state of alert, precautionary moves previously only seen in real crises. Those forces included Soviet air forces in East Germany and Poland, and some nuclear units. These measures that were detected in turn by US intelligence, who interpreted them as potentially offensive. That ran the risk of provoking the US to raise automatically its own nuclear alert states in response. Sensibly, the US did not. Had the US done so then that step would most likely in turn have been interpreted by the Soviet High Command as confirming their worst fears of an impending first strike, thus triggering further Soviet
precautionary steps. Those in turn would be detected by the US and set off an unintended and dangerous escalatory cycle of action and reaction.
It was Gordievsky who provided the reason for these Soviet moves by explaining the paranoid origin of Project Ryan in the fear of a US first strike. The helpful outcome of the Able Archer scare, given Gordievsky’s intelligence-based explanation, was that Washington subsequently took greater care to avoid changes in US military posture that might be interpreted as part of an escalatory pattern. As the CIA internal summary of the Able Archer alert concluded: ‘… only Gordievsky’s timely warnings to Washington via MI6 kept things from going too far’.
In circumstances where one party feels threatened it can therefore be reassuring to have inside-track knowledge of what is really going on. That helps avoid the sort of nasty surprises that can lead to conflict. All countries make spying against them an offence in domestic law. But there is no prohibition on conducting secret intelligence activity in international law, in large part because nations take very different views about what constitutes an offence against national security interests (as academic researchers, innocent tourists taking photographs of beauty spots near defence establishments and plane spotters noting down tail serial numbers have discovered to their cost), but also because implicitly they understand that it is in their mutual interest. In arms control agreements in particular, intelligence is seen as essential to maintain confidence that the other side is not cheating. ‘Trust, but verify’ is a Russian proverb that expresses this thought, one which President Reagan became fond of during the years he spent seeking arms control agreements with the Soviet Union.
The same learning applies to commercial joint ventures and contracts where transparency between the parties from the outset avoids later misunderstandings that could lead to destructive mutual distrust. Not every new couple thankfully sees the need for a legal prenuptial agreement but all can benefit from being open from the start about the contribution each will make to the household financially and from continuing to demonstrate that these responsibilities are being met. That theme of delivery of what was promised building trustworthiness is developed further in the next chapter. It is an important contributor to the maintenance of long-lasting partnerships in all walks of life
In the 1970s US and UK intelligence warned the NATO allies that the Soviet Union was developing a new class of intermediate-range nuclear
missile, the SS-20, that could hit targets across Western Europe when fired from well within the Soviet Union. The SS-20 would have independently targetable multiple warheads, and a mobile launcher that could be concealed from satellite reconnaissance. Public concern in NATO nations grew about this major increase in Soviet nuclear offensive capability facing the European members of NATO, one not covered by existing US–Soviet strategic arms control.
By the late 1970s, driven by Germany’s concern that the missile effectively undermined NATO strategy, NATO controversially invited the US to deploy its own medium-range missiles and cruise missiles in Europe. At the same time, on a parallel track, the US invited the Soviet Union to negotiate a total ban on weapons of this class (hence the popular description of the NATO policy of 1979 as a ‘double track’ decision, although the justification for the NATO deployments strictly did not depend upon ‘countering’ the SS-20 with matching capabilities). Two years of negotiation in Geneva to ban these weapons led nowhere. By 1983 the German Bundestag felt obliged to agree to the deployment of the new US missiles and the UK began to prepare bases for US cruise missiles. Moscow pulled out of the talks in response. Three years later the negotiations finally resumed. The difference this time was that the negotiations were under the new Soviet General Secretary, Mikhail Gorbachev. And, as we have just seen, MI6’s former key source, Oleg Gordievsky, was now, from a position of safety in the UK, able to provide detailed analysis of Soviet moves.
As Thatcher had written to Reagan about Gorbachev: ‘I certainly found
him a man one could do business with. I actually rather liked him – there is
no doubt that he is completely loyal to the Soviet system, but he is prepared
to listen and have a genuine dialogue and make up his own mind.’7 Gordievsky himself was flown to Washington in secret to brief President Reagan again in person before he met Gorbachev in Reykjavik in 1986. That summit and the openness of the discussions between the leaders stimulated the search for nuclear arms control, of which the 1987 INF Treaty was a concrete result, signed in Washington by President Reagan and General Secretary Gorbachev on 8 December 1987. The INF Treaty prohibited both parties from possessing, producing or flight-testing ground-launched intermediate-range ballistic and cruise missiles and the destruction of existing weapons in that class. It had taken seven years of hard negotiation and several attempts to reach this point. But finally it was
achieved with intelligence help from Oleg Gordievsky. The British government viewed the agreement with genuine relief. It avoided the need for the highly controversial deployment of US nuclear-armed cruise missiles to Molesworth and Greenham Common in the UK. Greenham Common in particular had a highly publicized peace camp established at the perimeter of the base by women protestors, an expression of solidarity that had become an important way-point in the development of the feminist movement in the UK.
The sad end of the INF Treaty in 2019 also came as a result of secret intelligence. Technical reporting on missile tests revealed to the US and NATO in 2008 that Russia was de-veloping another new class of short-range missile, the SSC-8, with a potential range greater than 500 kilometres, the limit permitted under the INF Treaty. The US had complained, but Russia in response had asserted that the missile only had a maximum range of 480 kilometres. There the matter had rested until the Trump administration arrived, bringing with it a long-held scepticism about the wisdom of arms control agreements with an autocratic state like Russia. To the surprise of European NATO leaders, President Trump announced to reporters after a campaign rally in Nevada: ‘Russia has violated the agreement. They’ve been violating it for many years … We’re the ones that have stayed in the agreement and we’ve honored the agreement. But Russia has not, unfortunately, honored the agreement. So we’re going to terminate the agreement. We’re gonna pull out.’ By December 2018 NATO Foreign Ministers had been briefed on the latest intelligence on the actual deployment of the SSC-8 and had endorsed the US position regarding non-compliance. The INF Treaty therefore has sadly died.
The Gordievsky case itself nearly had a tragic ending. Not long after Gordievsky was appointed as the Acting Head of the London Residency in 1984, KGB counter-intelligence officers became suspicious of him after a Soviet spy inside the CIA, Aldrich Ames, had told them SIS was running an important double agent. Gordievsky was summoned back to Moscow for consultations. As he recounts in his own memoir, most disturbingly his wife and family were also brought back to Moscow, a standard ploy by the KGB so that they could be used as hostages if necessary. He was interrogated under a truth drug and his apartment bugged. Gordievsky survived this ordeal with his story intact but he knew suspicions about him had not been put to rest. Fearing the net was closing in, SIS extricated Gordievsky
secretly from inside Russia and brought him via Finland and Norway to the UK in a complex and risky operation (the first of its kind). After his escape the Soviet authorities found Gordievsky guilty in absentia and sentenced him to death, the inescapable Soviet penalty for treason. He nevertheless continued from his new place of safety in the UK to provide valuable insights into the changes taking place in Moscow as the Soviet empire imploded and the Berlin Wall came down. He met President Reagan himself
in July 1993. Reagan noted in his diary at the end of the entry for that day:8 ‘Forgot – this morning had a meeting with Col Oleg Antonovich Gordiyeveski [sic] – the Soviet KGB officer who defected to Eng. His wife and two little girls were left behind. We’ve been trying to get them out to join him.’ They finally joined him in the UK six years later, following personal appeals to Gorbachev by Margaret Thatcher.
Negotiating safely guided by backchannels
We have seen the importance of strategic intelligence assessment in modulating the dealings that Reagan and Thatcher had with the Soviet leadership under Mikhail Gorbachev. Such an extraordinary covert access to the secrets of another state is highly unusual. Secret intelligence rarely therefore has such an impact on international relations. But backchannels can play an important role to keep open communications in circumstances in which neither party wants to acknowledge publicly that they were in contact. In commercial life it is often the external financial advisers to a company who are asked to get together with their opposite numbers to take soundings in the strictest confidence on whether a merger, demerger or acquisition might produce mutual benefits. In personal life when, sadly, couples begin to break up, it is often the friends of both parties who can play the essential role of discreet backchannels between potentially warring parties.
One notable example was the use of such a backchannel by President Kennedy to help defuse the 1961 Berlin crisis. Bobby Kennedy, then Attorney General, had been in the habit of regularly meeting, in Washington, the GRU agent Colonel Georgi Bolshakov, who was posing as the press attaché in the Soviet Embassy, in order to maintain a private direct means of communication between his brother and Khrushchev. When a
crisis blew up in Berlin in 1961 that looked like escalating into hostilities over the Berlin Wall, the President passed a personal request to Khrushchev to withdraw his tanks aggressively positioned just behind the wall (with, we can assume, private assurances that there would be matching de-escalation on the Allied side). Face was saved on both sides when de-escalation
happened.9 Recalling Chapter 7, backchannels need to be chosen with care. The same Bolshakov deceptively assured Attorney General Bobby Kennedy at the time of the Cuban missile crisis that the Soviet Union did not have missiles in Cuba.
The Northern Ireland campaign provides a different example of a backchannel in operation, in the most sensitive of circumstances, when a democratic government wants to be in contact with a terrorist
organization.10 In 1972, the level of violent attacks by the Provisional IRA (PIRA) against police officers, soldiers and prison officers in Northern Ireland had risen to disturbing levels, coupled with rioting and inter-community disorder fomented by so-called Loyalist paramilitary groups. London felt the situation had slipped out of local control and instituted direct rule from London. That created an urgent demand for impartial strategic intelligence to be acquired directly for London, and not just through local police channels. One of the measures taken by the British authorities was therefore to set up the equivalent of an MI6/MI5 intelligence station in Belfast. A senior MI6 officer, Frank Steele, was sent out along with a small number of British officials who could act as political advisers. They set up camp in Laneside, a large house in an affluent suburb on Belfast Lough which served as both office and residence. Given the level of violence on the streets, the growing terrorist campaign from the Provisional IRA and the so-called Loyalist paramilitary groups, the personal risk to British officials was very high. The mission was kept a deep secret. Steele’s brief was to develop covert contacts with, and to seek ways of influencing, the IRA in order to persuade them to halt their terrorist campaign.
In 1972 the PIRA did call a short ceasefire, and just before the ceasefire was due to end, with the acquiescence of the Prime Minister, Edward Heath, a secret meeting was brokered by Laneside to allow the Opposition leader, Harold Wilson, and shadow Northern Ireland Secretary, Merlyn Rees, to meet PIRA leaders in Dublin. Hours of discussion about extending the ceasefire led nowhere and they were still talking when midnight came and
with it the resumption of active terrorism by the PIRA. Undaunted, Frank Steele himself met PIRA leaders in a country house near Donegal and agreed arrangements for key terrorist leaders to be flown to London to meet with Willie Whitelaw, by then Secretary of State for Northern Ireland. On 7 July 1972 Steele accompanied six PIRA leaders, including Sean MacStiofain, Gerry Adams from the PIRA Belfast Brigade and Martin McGuinness from the Derry Brigade, on to an RAF aircraft to be flown secretly to England. The meeting took place in the smart surroundings of the Cheyne Walk apartment of Paul Channon, one of Whitelaw’s ministers. It went badly from the outset and Whitelaw later described agreeing to it as the worst political mistake of his career. MacStiofain banged the table and demanded that the British side set a date for withdrawal. Whitelaw, who had been led to expect discussions about a longer ceasefire, remained polite but necessarily immovable. The lesson was learned: both sides had been insufficiently prepared about the expectations of the other.
When Steele’s tour of duty came to an end he was replaced by another highly experienced MI6 officer, Michael Oatley, who described himself as being in ‘a situation where intelligence would not simply be a matter of reporting on situations, but of influencing them’. MI6 officers are used to operating at the outer limits of their brief. British Prime Ministers had a stated policy of not negotiating with terrorists. When Roy Mason was Northern Ireland Secretary he went as far as to expressly forbid contacts by British officials, direct or indirect, with PIRA while the violence continued. Yet, despite the political risks and on their own authority, Laneside kept open covert channels of communication with the PIRA leadership with arrangements known only to a handful of senior British officials (the channel was known as the ‘pipe’, after the metaphor of a bamboo pipe down which puffs of air could be sent so that both sides knew there was someone there even if there were no substantive exchanges). As Oatley described it: ‘I didn’t think I was running any serious risk politically for the Government in letting the IRA know that there was still a point of contact if they should ever need it and it would operate wherever I happened to be in the world.’
Oatley found a trusted and secure (and brave) intermediary, Brendan Duddy, who could be at one end of the ‘pipe’ and carry messages when needed to and from the PIRA leadership in hiding in the Republic. Duddy ran a pie and chips shop in Derry; he had employed the young Martin
McGuinness delivering pies, and knew he was a rising star in the PIRA. Duddy was an ardent Republican who was convinced of the case for a united Ireland, yet he deeply disapproved of the indiscriminate violence of the PIRA campaign and so was willing to take risks to keep the prospect of peace alive. Duddy’s PIRA codename was the ‘mountain climber’. He died in 2017.
Some of the darkest days in Northern Ireland were in 1980, when convicted Republican prisoners at the Maze Prison went on hunger strike demanding political-prisoner status, including the right to wear their own clothes. With one of them close to death, the ‘mountain climber’ used the ‘pipe’ to suggest to Oatley (who by then had left Northern Ireland on another MI6 posting) that some compromise could be possible. Oatley then re-engaged and crafted a revision of the prison regulations, with the Permanent Secretary, the senior official in the Northern Ireland Office and through him ministers and the Prime Minister herself, Margaret Thatcher, that his contacts suggested might also be acceptable to the hunger strikers and the PIRA hierarchy. The hunger strike was called off in anticipation of the deal. Sadly, the level of ambiguity in the understanding, necessary to get both sides on board, proved too great for the prison authorities to cope with and PIRA disillusion set in, with Margaret Thatcher claiming victory and the PIRA responding that they had been misled. A second hunger strike started, this time literally to the death. Ten of the prisoners had died before the strike was called off. The government then quietly made the key concessions on clothing, free association and loss of remission for the protesters. The episode illustrates the value of backchannels, but also their limitations in brokering deals. The ‘pipe’ was nevertheless kept open and covert contacts maintained.
A decade later, in February 1993, a message was sent through the ‘pipe’ to Oatley’s successor in Belfast which was passed back to the Prime Minister, John Major. It read: ‘The conflict is over but we need your advice on how to bring it to an end. We wish to have an unannounced ceasefire in order to hold a dialogue leading to peace. We cannot announce such a move as it will lead to confusion for the volunteers because the press will interpret it as surrender. We cannot meet the Secretary of State’s public renunciation of violence, but it would be given privately as long as we were sure we were not being tricked.’ The response from London was quick and positive. There were nevertheless to be many ups and downs in the subsequent
manoeuvring on both sides before a peace process became firmly established under Major’s successor, Tony Blair, and the PIRA could not resist a final bombing campaign to try to put extra pressure on London. When the text of the message leaked later to the press, however, it provoked a strong denial from Martin McGuinness that that was the message as sent. It may well be that the intelligence officers in Belfast suggested the wording or may have reworded parts of it in transmitting it to London to make clearer what they had assessed was McGuinness’s intent and make it appear more palatable. If so, they gave the search for peace a boost when it was
In complex negotiations both sides will be equally concerned to establish that they are not being duped or misled in some way. Wise negotiators recognize that. We can only speculate whether Margaret Thatcher, and her successors John Major and Tony Blair, would have authorized the delicate backchannel contacts with the Provisional IRA had it not been for high-level secret intelligence confirming that some leaders of the Republican movement, including its military wing, had concluded that they should cooperate in trying to bring an end to the armed conflict. Their decisions led, after several false starts, to the peace process, even as terrorist violence continued, and eventually to the signing of the Good Friday Agreement.
The nature of successful negotiation
The examples just given show that having private access to some of the other side’s thinking can help when it really matters (including confirmation that what is being said is genuinely meant). Often it is obvious what the other side wants, and why, with plenty of detail and context that can be derived from open sources. But it would be a great mistake to draw the conclusion that somehow just establishing what is in the negotiating brief of the other side will ensure success. Some negotiations nevertheless fail. And even where a deal is agreed, in many cases it then collapses after a short time when it is put into effect. Why?
A good deal has to provide needed benefit for both parties to a negotiation. Without that aspiration why would any party enter negotiation, and without assurance of that benefit why would anyone sign up to the deal? There is a modern branch of economics – so-called mechanism design
– that builds on mathematical game theory to try to design rules for bargaining situations such that even when neither of the parties has privileged access to the other side’s brief, and both are acting selfishly to maximize their own interest or may be trying to deceive the other, nevertheless the outcome will be the best collectively. The 2007 Nobel economics prize was shared by the developers of this approach, Leonid Hurwicz, Eric Maskin and Roger Myerson.
Both parties in a negotiation will have ‘bottom lines’ that they do not want to cross as concessions are being horse-traded. Typically, in the final stages of a poor negotiation, the stronger party will try to push the other into just one more small concession after another, hoping to make the loss of ground seem a marginal concession given the larger prize to be gained from a deal. Such salami slicing may indeed induce the weaker party to go below their bottom line. But, even if agreed, such deals are unlikely to stick for long. The aggrieved party that felt it was pushed too far will try to make up lost ground. The fine print of the negotiated deal or contract may well be scoured for weaknesses that can be exploited. This is the opposite of a strategic outcome, as described in the next chapter.
One approach to negotiation that helps to avoid the risk of being salami-sliced at the end is to have established in some detail at the outset what the preferred alternative to the negotiation is. Rather than thinking in terms of the ‘bottom line’, the advice is to establish the BATNA: the best alternative
to a negotiated agreement.12 That is the negotiating strategy which I was taught at the UK Civil Service College. Before the negotiation starts, the parties should work out privately what for them would be the best alternative if the negotiation does not succeed. This BATNA is then worked up into a credible plan of action that you know you can execute if it becomes necessary. If the negotiations run into difficulties, the parties enjoy the confidence given by having their own alternative route ready. The approach rests on the observation that it is always better psychologically to be prepared to advance to a known position than to retreat into the unknown.
Knowing when to walk safely away from a negotiation that is in difficulties is certainly going to be easier when the alternative way ahead has previously been established. The negotiating partner will sense that you have a well-developed BATNA and that discourages attempts to chisel last-minute concessions. When moving house and negotiating to sell your flat so
that you can buy the new one you have already made an offer on it is wise to have prepared your BATNA, perhaps having already spoken to the bank about a bridging loan. If the potential buyer then tries to get you to drop the price at the very last moment, guessing you are pressed for time to get the sale, you have your alternative plan ready and can respond firmly to such a try-on. Chances are your sale will still go through at or very close to the previous price. It may be that in the summer of 2019 the Prime Minister, Boris Johnson, thought that he had a powerful Brexit BATNA in his insistence that the UK had worked up contingency plans and was ready and willing to leave the EU without a deal on 31 October if negotiations failed to deliver what he wanted. The evident risks of chaos and economic damage with a ‘no deal’ Brexit, notwithstanding the contingency planning, nevertheless persuaded Parliament that it was not ‘the best alternative to a negotiated deal’ and Parliament then passed a law mandating an extension of the deadline (to which the EU agreed) rather than crashing out in 2019 without a deal.
Short-term advantage does not ensure a long-term outcome
For that and many other reasons it is unwise to rush into a negotiation, despite the wish to get it over with so that uncertainty about the future can be lifted. It may well have been a profound error for the British government to send its Article 50 withdrawal letter to the European Union so quickly after the very unexpected (and narrow) win in the 2016 Referendum by the Brexiteers. There had not been time to think through what would represent outcomes consistent with the range of views of those who had voted to leave the EU, nor what might be done to reconcile the many who had voted to remain. In grinding and protracted negotiations the British side reiterated that the alternative to their preferred outcome was simply to crash out of the EU without a deal. This is the polar opposite of a BATNA.
The UK Brexit process has also been a failure to match negotiating strategy to the objective. The ministers initially in charge talked a very tough game in public to reassure their domestic supporters, but do not seem to have made much attempt to explain why they did this to their EU counterparts and thus to build trust with them. Quite the reverse, making
evident their expectation that the EU would try to punish the UK for the referendum result. Unsurprisingly, the result was high levels of mutual suspicion. Nor did the British ministers show any understanding of the legitimate interests (from an EU point of view) in preserving the EU legal and constitutional order. What the UK side demanded by way of ‘having your cake and eating it’ in preserving many valued benefits of EU
membership after having left was bound to be resisted.13 UK ministers saw such cases as continuing membership of Europol or the Galileo satellite system as being in the interests of both sides, and thus it seemed obvious that some solution would be found. In UK eyes this was applying simple pragmatism. They grossly underestimated that, for EU member states, this would be seen as rule breaking that threatened their fundamental interests in the EU as an institution. Failure to appreciate these cultural differences of outlook inevitably led to impasse, followed by UK concessions.
Preparing sensibly for a negotiation takes time and objective analysis to understand the other side. That is the opposite of the magical thinking which holds that all that is needed in negotiation is sufficient willpower and obstinacy. We can think of preparation for a sound negotiation working through the four-step SEES intelligence analysis process described in Chapters 1–4. The intelligence needed for this process in everyday life can be gleaned from open sources. This should start with identifying possible future benefits and if possible wider opportunities to both sides, not just your own, drawing on your situational awareness of what both you and the negotiating partner faces. At the same time possible risks have to be identified and strategies worked out to minimize the chances of ending up there. It is important to have the understanding of why both sides have come to the negotiating table and therefore what they will need to take away from the negotiation to count as success. Such thinking makes it easier to model how they are likely to react to different moves in the negotiation.
Lessons in the ethics of negotiation
Serious negotiations are concerned with securing more lasting outcomes on the basis that both parties will gain, not that one will suffer loss at the hands of the other. There is a principle followed by British intelligence officers
not to use blackmail to force agents to work for them. The blackmailed agent is likely to minimize the intelligence they hand over or try to get their revenge by distorting their reports in order to deceive. Similarly, it is not a good idea to pressure the other side in a negotiation to the point where after the deal is forced through the loser will try to get their own back. In commercial life it may mean reducing the effort put into the minimum stipulated in the contract, or even a little less if it is thought that will not be noticed, or trying to recoup more by claiming for extra work not originally contracted for, a favourite of the construction industry.
In devising a negotiating strategy much depends therefore upon how important it is to have a lasting and productive relationship with the partner. In The Art of the Deal, written over thirty years ago, Donald Trump famously set down an aggressive win-at-all-costs approach to the art of negotiation. The partner in a Trump negotiation is an adversary to be vanquished. His co-author, Tony Schwartz, has described this obsession with winning (and when thwarted still claiming success by redefining what
the negotiation was about) as grounded in fear of failure.14 He warns that in the process of behaving this way we will lose the capacity for empathy, rationality, proportionality and attention to the longer-term consequences of our actions. In such negotiations there is the temptation to try to unbalance the opponent by unexpected moves, including making excessive compliments followed by unsettling threats. Apparently maximalist demands are slapped on the table, to force the unnerved opponent to move from their preferred outcome range. Suddenly reversing concessions already made can have the same effect. Such destructive negotiating tactics may well provide negotiating ‘wins’, where it is a short-term gain that is sought at the expense of the other party. This is perhaps workable in a few areas such as attempting to finance property deals because if, later, the forced-through deal unwinds, then it can always be sold on. That cannot be done if it is the national interest that has to be jettisoned. The result of adopting this approach to any negotiation is that you are liable to be winning a battle at the expense of losing the war. Real negotiation looks to the longest term.
Besides, ethical risks accompany guilty knowledge. This is information that has come into your hands that you are not supposed to have. Motive matters if your intention is then to make use of it. The leading nineteenth-century advocate of utilitarian philosophy, John Stuart Mill, warned: ‘the
only purpose for which power can rightfully be exercised over any member
of a civilized community, against his will, is to prevent harm to others’.15 A nation under threat is unlikely to hesitate long before acting, citing the greater good. That will include gathering intelligence and using the power to act in secret. It is hard not to see Gordievsky’s intelligence, described earlier in this chapter, as contributing to good outcomes. On the other hand, it may be a desire selfishly to better your own circumstances at the expense of someone else.
Let me give a business example of an ethical dilemma over exploiting for advantage information you are not supposed to have. Suppose you are preparing to pitch your bid in an overseas commercial competition for a contract. The evening before, you eat in a smart downtown restaurant. Finally seated at a table, you feel something under your foot and realize it is a folder of papers left by a previous diner. Glancing through the documents to see who might have left them you realize with a shock that you are examining a copy of the presentation of your main rival in the competition.
Guiltily you look around to see if anyone is watching. Should you continue to study the pitch and then put the papers back where you found them? Should you just ignore what you have learned? Or do you rush back to your hotel and rewrite your own presentation? The thought may even occur to you that this might be a trap, leading to accusations of industrial espionage and thus being eliminated from the competition. The better angel of your nature will say you cannot benefit from information that you are not supposed to have. But if the roles were reversed, the devil on your shoulder whispers, competitors would not hesitate to benefit. But that is what makes us different, you conclude. That is our brand of trusted integrity. If we do not live our corporate values, then why should we convince others to trust
us?16 So, the next day, you explain what happened to the commercial director of the potential client and that you cannot hide the fact that you have read the opposing bid. The director tells you that in accordance with best practice he is cancelling the competition, which will be rerun. In the best case he will add, your action exemplifies what he hoped to find in a company they could rely on as a long-term partner with access to the secrets of the corporation. Your reputation goes up.
Jack Straw, then Home Secretary, once explained to me when I was his Permanent Secretary the ethical rule he personally applied. Simply put, when in doubt, do the right thing. It may not end up as you would hope,
often it will not, but you have a defence you can mount of honestly having tried to do the right thing. If you resort to subterfuges and wriggling around the truth and it still goes wrong, you are exposed and have no ethical justification to fall back on. Your lack of integrity will become all too apparent. One of the ways of knowing that a course of action is ‘the right thing’ to do is that it usually appears harder than the alternatives. We may, for example, fear immediate criticism or reprimand. Another is that it may involve telling more of the truth than we feel immediately comfortable with. We have all learned this from the pain of having to own up to misdeeds as young children, and when relief comes from experiencing eventual forgiveness. We will all, I hope, have learned as adults from watching young children come to recognize through experience the virtue of honesty as ‘doing the right thing’.
Conclusions: imagining yourself in the shoes of the person on the other side
In this chapter we have looked at the process of negotiation in which (usually) two parties settle disagreements about how far each can simultaneously satisfy their objectives to generate a joint outcome acceptable to both sides. Having well-thought-through analysis about the objectives and motivation of the other party is key (and vice versa) and likely to be more important than knowing their negotiating hand at any one time. In such circumstances the lessons are:
Do not rush into a negotiation feeling under pressure to get it over with.
Prepare carefully, including setting a BATNA you believe in (the best alternative to a negotiated agreement – a more reliable guide than a ‘bottom line’).
Use the SEES model to establish what you need to know about the short- and long-term objectives of the other party, as seen by them. Work out in particular what the other party needs to secure an agreement – it may include matters that are much less important to you.
Search for outcomes that will meet the interests of both parties and that both will count as success.
Having guilty knowledge does not always help get the best outcome:
when in doubt do the right thing.
Do not try to intimidate the other party by gamesmanship: a deal they are forced to accept is unlikely to last.
Be prepared to accept the maxim that nothing is agreed until everything is, but do not withdraw points already provisionally settled just to try to unbalance the other side.