BUAD 304 Final Study Guide

BUAD 304 Final Study Guide - BUAD 304 Final Study Guide...

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BUAD 304 – Final Study Guide Chapter 14 Power and Politics A Definition of Power Power : refers to potential ability to influence others so they do things they would not do otherwise Bases of Power Formal Power - based on an individuals position in an organization. Can come from the ability to coerce or reward, or form formal authority o Coercive Power - dependent on fear. One reacts to power out of fear of the negative results that might occur if one failed to comply. It its applied in threats, or physical sanctions, such as infliction of paint, the generation of frustration through restriction of movement, or the controlling force of basic physiological or safety needs o Reward Power - the opposite of coercive power. People comply with the wishes or directives of another because doing so produces positive benefits, one who can distribute rewards that others view as valuable will have power over those others o Legitimate Power - based on one’s structural position. The most frequent access to one or more power. The formal authority to control and use organizational resources. Positions of authority include coercive and reward powers. Legitimate power, however is broader, in that it is accepted by members in an organization. Personal Power – power that comes from an individual’s unique characteristics o Expert Power- is influence wielded as a result of expertise, special skill, or knowledge. o Referent Power- respect and admiration of others; is based on identification with a person who has desirable resources or personal traits. If I like, respect, and admire you, you can exercise power over me because I want to please you Which bases of power are most effective? o Research suggests that the personal sources of power are the most effective. Expert and referent power are positively related to employees’ satisfaction with supervision, their organizational commitment, and their performance Power as Dependency The greater the dependency the greater the power Successful leaders manage this well: they make others more dependent on them and themselves less dependent on others In most firms, key source of dependency: certainty Firms like certainty; the firm is most dependent on and pays those by the amount of uncertainty they absorb and the source of the uncertainty shift. A has power over B to the extent: 1
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o A has control over something B values (importance) o B Cannot obtain it elsewhere (scarcity) o B Cannot easily find substitutes for it (non Substitutability) What Creates Dependency? o Importance- the things one controls must be perceived as being important organizations actively seek to avoid uncertainty – we should therefore expect that the individuals or groups who can absorb an organization’s uncertainty will be perceived as controlling an important resource o Scarcity - must control something scarce if something is plentiful, possession of it will not increase your power – a resource needs to be scarce to create dependency (i.e. high ranking members have dependency on low ranking
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