Power can be categorized into two types: Formal and informal
A. Formal Power:
It is based on the position of an individual in an organization. Formal power is derived from either one’s ability to coerce or reward others or is derived from the formal authority vested in the individual due to his/ her strategic position in the organizational hierarchy. For example, a manager may threaten to withhold a pay raise, or to transfer, demote, or even recommend the firing of a subordinate who does not act as desired. Such coercive power is the extent to which a manager can deny desired rewards or administer punishments to control other people. The availability of coercive power also varies across organizations. The presence of unions and organizational policies on employee treatment can weaken this power base significantly. Formal power may be categorized into four types which are as follows:
1. Coercive Power:
The coercive power base is being dependent on fear. It is based on the application, or the threat of application, of physical sanctions such as the infliction of pain, the generation of frustration through restriction of movement, or the controlling by force of basic physiological or safety needs. In an organization one can exercise power over another if they have the power to dismiss, suspend, demote another assuming that the job is valuable to the person on whom power is being unleashed.
2. Reward Power:
The opposite of coercive power is reward power. Reward power is the extent to which a manager can use extrinsic and intrinsic rewards to control other people. Examples of such rewards include money, promotions, compliments, or enriched jobs. Although all managers have some access to rewards, success in accessing and utilizing rewards to achieve influence varies according to the skills of the manager.
3. Legitimate Power:
The third base of “position” power is legitimate power, or formal authority.It stems from the extent to which a manager can use subordinates’ internalized values or beliefs that the “boss” has a “right of command” to control their behavior. For example, the boss may have the formal authority to approve or deny such employee requests as job transfers, equipment purchases, personal time off, or overtime work. Legitimate power represents a special kind of power a manager has because subordinates believe it is legitimate for a person occupying the managerial position to have the right to command. The lack of this is legitimacy will result in authority not being accepted by subordinates. Thus this type of power has the following elements:
Ø It represents the power a person receives as a result of his/her position in the formal hierarchy.
Ø Positions of authority include coercive and reward powers.
Ø Legitimate power, however, is not limited to the power to coerce and reward. It encompasses the acceptance of the authority of a position by members of an organization.
4. Information Power:
This type of power is derived from access to and control over information. When people have needed information, others become dependant on them. (For example, managers have access to data that subordinates do not have). Normally the higher the level, the more information would be accessed by managers.
B. Personal Power
Personal power resides in the individual and is independent of that individual’s position. Three bases of personal power are expertise, rational persuasion, and reference.
Expert power is the ability to control another person’s behavior by virtue of possessing knowledge, experience, or judgment that the other person lacks, but needs. A subordinate obeys a supervisor possessing expert power because the boss ordinarily knows more about what is to be done or how it is to be done than does the subordinate. Expert power is relative, not absolute. However the table may turn in case the subordinate has superior knowledge or skills than his/ her boss. In this age of technology driven environments, the second proposition holds true in many occasions where the boss is dependent heavily on the juniors for technologically oriented support.
Rational persuasion is the ability to control another’s behavior, since, through the individual’s efforts, the person accepts the desirability of an offered goal and a viable way of achieving it. Rational persuasion involves both explaining the desirability of expected outcomes and showing how specific actions will achieve these outcomes.
Referent power is the ability to control another’s behavior because the person wants to identify with the power source. In this case, a subordinate obeys the boss because he or she wants to behave, perceive, or believe as the boss does. This obedience may occur, for example, because the subordinate likes the boss personally and therefore tries to do things the way the boss wants them done. In a sense, the subordinate attempts to avoid doing anything that would interfere with the pleasing boss –subordinate relationship. Followership is not based on what the subordinate will get for specific actions or specific levels of performance, but on what the individual represents – a path toward lucrative future prospects.
Charismatic Power is an extension of referent power stemming from an individual’s personality and interpersonal style. Others follow because they can articulate attractive visions, take personal risks, demonstrate follower sensitivity, etc.
Dependency: The Key to Power
The General Dependency Equation is as follows:
Ø The greater B’s dependency on A, the greater the power A has over B. When an individual possess anything that others require but that which alone the individual controls, he / she can make others dependent and, therefore, gain power over them.
Ø Dependency, then, is inversely proportional to the alternative sources of supply.
This is one of the reasons why most organizations develop multiple suppliers rather using just one. It also explains why individuals in general aspire to financial independence.
Three factors are responsible for dependency. They are as follows:
To create dependency, the thing(s) you control must be perceived as being important. Organizations actively seek to avoid uncertainty and hence, those individuals or groups who can absorb an organization’s uncertainty will be perceived as controlling an important resource.
A resource needs to be perceived as scarce to create dependency. For example, low-ranking members in an organization who have important knowledge unavailable to high-ranking members gain power over the high-ranking members. The scarcity-dependency relationship is also important in the power of occupational categories. Individuals in occupations in which the supply of personnel is low relative to demand can negotiate compensation and benefit packages, which are far more attractive than can those in occupations where there is an abundance of candidates. Thus scarcity in supply of certain types of skilled people can give them power to bargain over compensations and other benefits.
The more that a resource has no viable substitutes, the more power that control over that resource provides.