5 Types of Power in Businesses
Like many studies before and since, "The Bases of Social Power" by John R. P. French and Bertram H. Raven, was published in 1959 to respectful reviews. And then the study seemed to quietly disappear, as studies often do. But one quotation in a college business book led to a write-up in a business publication – and probably many more. It's difficult to track the trajectory from there, but by the time Raven had identified a sixth type of power base six years later, legions of college students had learned about the legitimate, reward, coercive, expert and referent forms of power. The model continues to thrive today, enabling small business owners to debate and decide which type of leader they wish to become.
People who are elected – those who serve in Congress or as mayors, trustees and aldermen – enjoy legitimate power. So do people who rise to a top leadership position by promotion or appointment. Their legitimacy creates a two-fold expectation: they are expected to issue requests and demands, and people are expected to respond to their requests and demands in kind.
Upside: People generally accept others who hold legitimate power, even if the acceptance is extended only grudgingly.
Downside: Legitimate power can be fleeting, disappearing as quickly as the title is gone or taken away.
People who wield reward power have many incentives at their disposal, including pay raises, bonuses, time off, promotions, junkets and the assignment of high-profile projects. Even public toasts and accolades serve as forms of reward power.
Upside: People tend to respond well to rewards, sometimes stifling bigger objections about work to acquire them.
Downside: The person dispensing the reward doesn't always wield total authority, sometimes having to clear the reward, even with the company accountant, before issuing it. At their worst, working environments motivated by reward can degenerate into a “do-whatever-it-takes” mode, leading employees to cut corners, as their focus is trained on acquiring rewards.
Small business owners can have legitimate reasons for transferring, suspending, demoting or firing employees. But a business owner who repeatedly threatens, either implicitly or explicitly, that he or she will resort to these methods simply to bend employees to his or her will is one who exercises coercive power.
Upside: Coercive power is a sure-fire attention-getter, and it's often effective.
Downside: It can create a bullying workplace atmosphere, create divisions between a manager and a suspicious team or lead employees to file formal complaints or quit.
People who brandish expert power have it made, though they've undoubtedly worked long and hard to establish this power base. Someone who possesses expert power is usually considered a subject matter expert – a go-to source who others trust, turn to and rely on for advice, ideas or direction. They don't always sit on the highest tier of a company's organizational chart (like someone with legitimate power), but they enjoy something intangibly more important: respect.
Upside: Expert power can engender loyalty, admiration and, sometimes, elevation to “hero status.”
Downside: It can create numerous interruptions and distractions (for the person holding the expert power) and trigger jealousy and recrimination among co-workers.
You don't need to do anything notable, be a subject expert or even hold an enviable position to possess referent power. You can simply be someone who people like and who naturally gravitate to based on charm, affability or magnetism. “For any type of power, the size of the range may vary greatly, but in general, referent power will have the broadest range,” French and Raven write.
Upside: When used effectively, referent power can influence and motivate people.
Downside: It doesn't necessarily foster respect and, at its worst, can be used to manipulate people to gain an advantage.
Six years after publishing The Bases of Social Power, Raven added a sixth power base: informational power. It addresses those people who are perpetually “in the know” – people who not only know what's going on but who also control information that is off-limits to others. This type of person corners a pipeline that can hold everything from the amount of annual bonuses to the site of the next company holiday party. The ability to access information is only one part of this influential, two-part power base. The other is the ability to alter, withhold, bury or share it with others at will.
Upside: Informational power can be marshaled to improve results and efficiencies.
Downside: It can be used as a bargaining or manipulation tool.