Types of Powers in Organizations

Six decades ago, social psychologists John R. P. French and Bertram H. Raven revolutionized the concept of power in organizational behavior. They came up with five types of power that define how individuals lead and influence others and why. Despite over half a century passing since, their work remains relevant and enlightening. Understanding the five forms of power can be beneficial for anyone seeking to gain advancement and authority in their career.

Most people, if they don’t have power, they want to be in power. Either way, understanding what types of power are most common, how they work and why they work can be helpful no matter whether you’ve got all the cards in your hands or you’re still looking to get in the game.

Everyone understands when someone grumbles about their “jerk boss.” The bad boss is a well-known phenomenon, and it’s an example of someone who thinks that being a boss and having power means wielding an iron fist and being demanding. The French-Raven study was illustrative in showing that power can come in different forms and still generate results.

Charismatic, respected leaders like Barack Obama, Angela Merkel, Richard Branson and Oprah Winfrey all rule without the iron fist. They’ve still managed to show their relentless determination, yet they don’t compromise on their world view or business aspirations. Understanding various power dynamics can help you navigate to a position of power yourself and maybe help you maintain and sustain that power for the long term.

Each power type falls under the classification of either personal or formal power. If someone has personal power, it means their power comes from people following or admiring them for who they are, what they know and how they act. On the other hand, formal power, also considered positional power, comes from their standing in their career or company – they’ve risen through the ranks and now have power based on their position in the organization.

When a leader favors coercive power above all others, it makes for an unpleasant environment. Coercion is when those in power rule by fear of punishment, demotion or shame to get workers motivated. In a coercive environment, people will arrive early and leave late for all the wrong reasons. They’re scared of reprisal and they dread failure because of the price they’ll pay.

French and Raven explained that coercive power can mean using other types of power, like referent power, to socially exclude those who don’t make the grade on projects or in day-to-day work. It can mean negative feelings over conditional rewards – meaning, someone excels but those who fail don’t escape judgment. On the flipside, coercive power used as one of many tools by a great leader can be the “stick” in the “carrot and stick” method of motivation. This is often when a leader is considered firm but fair and employees understand there’s a price to pay for failure, but that’s only a small part of what motivates them.

A great example of the coercive power is in the classic David Mamet film, "Glengarry Glen Ross." It’s about employees at a New York real estate office who learn that, at the end of the week, everyone except the top two realtors will be fired. The result is a fevered sales frenzy in which the realtors will do anything they can to make a sale. It’s an effective power play but destructive to the morale and integrity of all in the office.

Referent power doesn’t necessarily mean a person has positional power in a company. Instead, it means they’re well-regarded, respected and admired, and thus influence others as a result. A person with referent power can be someone whose opinions are always valued, who provides insightful commentary or creative ideas and who's turned to by colleagues for advice or consultation on matters.

The downside to referent power is it takes a long time to develop. It’s often associated with celebrities and public figures, and when they suffer moments of bad press highlighting bad judgment or poor behavior, it’s an example of how fragile referent power can be. It’s also hard to rule from a position of authority with referent power because referent power is better when experienced or witnessed firsthand rather than filtering down through a chain of command.

When companies talk of “incentivizing” employees, they’re speaking about putting reward power into play. It’s the carrot, not the stick – when people are given praise, rewards and promotions for doing their jobs well.

A good example is Starbucks, as the whole company thrives on reward power. Managers of stores are given targets for sales, staffing and more; achieving these come with many perks, not the least of which are cash bonuses and stock options. As a result, store managers tend to be highly driven people who voraciously read leadership and management materials issued regularly by the corporation. In turn, they, too, often lead by reward power, giving employees praise and recommending them for seniority and other rewards.

In a way, there’s a tinge of referent power in reward power, too, when management praises good performance rather than shaming bad performers. It often inspires employees to seek praise and social inclusion for their accomplishments rather than needing to ostracize others for failures.

It’s legitimate power that’s in play when someone uses their position within an organization to make others compliant. Typically, it’s high-ranking individuals like the CEO who issue directives that generally can’t be challenged or ignored because they call the shots.

In organizations that use a matrix power structure, legitimate power is compromised or weakened. Matrix organizations have several managers or leaders who may all have similar or equal power in a company, with none holding more titular power than the other. In these instances, legitimate power can be questioned or contravened because someone else could issue contradicting directives.

Like referent power, expert power takes a while to achieve. One must be considered a thought leader to wield expert power. In this instance, those around them feel the expert’s extensive experience and knowledge will guide them in making the most beneficial decision on a course of action.

Expert power is intriguing because one doesn’t actually need expertise to have expert power but instead must merely be perceived to have expertise. Simply having qualifications or certifications, or creating or gaining a reputation for wisdom, can be enough to give someone expert power.

That said, it’s also as easy to lose as is referent power. If one uses their expert power in a situation where their judgment proves to be bad or undesired results are attained, it can call their expertise into question and threaten their power. Also, times change, and both best practices and technologies evolve, changing what expertise is needed and ushering in new experts.

Several years after Raven and French’s paper on the five forms of power was published, a sixth form was added to the list – informational power. While this can be a long-term power type, it’s usually durational with a short life span. It’s when someone has information that gives them power over colleagues and others.

Maybe they’ve got inside information on a merger or perhaps they’ve learned of upcoming corporate restructuring plans. With information and data being so powerful in the digital era, it’s likely even French and Raven would be surprised at how much influence having the right information can give someone today, especially when that person can distribute or manipulate said information.

Now that you understand more about the kinds of power, know that nothing is black and white. You can break beyond the ascribed power types or even blend various attributes. It’s more important to have leadership qualities than to try to be defined by a single power structure. Here are 10 qualities of great leaders who know how to harness power.

• Emotional Intelligence: Leaders with emotional IQ can understand the underlying reasons employees and competitors act as they do. That understanding can get more out of people and achieve greater results.
• Resilience: As they say, it’s not falling that defines a person, but getting up and moving on. Adversity hits everyone, but are you the type who’ll knock adversity down after you get up? Great leaders rebound.
• Vision: Where a company goes and how they get there comes down to the vision of its leadership. Many now speak of how Steve Jobs wasn’t a nice guy, but no one argues that he had a singular vision that changed our world thanks to iPhones, iPods and other technology created by Apple. Today, Apple remains an industry leader, eight years after Jobs’ death, largely based on the legacy of his vision.
• Integrity: Whether it’s the low person on the totem pole or a major company they’ve just negotiated a deal with, if a leader doesn’t have integrity, stick to their word and adhere to their values, they won’t remain in high esteem.
• Problem-Solving: Problems happen. Red tape, disasters, currency issues, technology fails, staffing troubles – they’re all unavoidable in business, but a good leader understands the value of “Plan B” and knows how to overcome the hurdles of happenstance.
• Listening: It’s not just polite to listen, it’s illuminating. What’s said, and even what’s not said, can dramatically impact the roads taken in business. Good leaders know listening is invaluable in both creating solid relationships and generating new ideas and avenues toward success.
• Motivation: The greatest leaders inspire and motivate those around them. They know how to give people that extra push, even without rewards. It’s not just about making people work hard, but rather about making them want to give their best to the cause.
• Trust: If a leader’s judgment and vision, never mind their word, can’t be trusted, then it compromises everything they’re working for. Employees will hedge their bets and companies will negotiate in bad faith.
• Diplomacy: The diplomatic know-how to say what they’re thinking without stepping on toes. Diplomacy is the art of being clearly communicative yet sensitive and perceptive in all interpersonal dealings.
• Passion: If you don’t believe in what you’re doing, others won’t either. If you’re not driven in your day-to-day, then how can you motivate or inspire others?