One aspect often overlooked in the development of business leaders is the effective use of influence. Self-aware leaders are attuned to how they exercise influence and the effect it has on their direct reports.
When working with leaders, I often ask them to discuss the difference between authority, influence, and leadership. Leaders must assess their own preferences and strategies by analyzing the six types listed below:
- Coercive – Influence based on the threat of punishment.
- Competence – Influence that comes from having a high level of expertise, experience, and/or credentials.
- Reward – Influence that comes with the promise of rewards such as pay, recognition, promotion, prerequisites, celebration, time, etc.
- Institutional – This is influence that comes from a leader’s position in the organization.
- Interpersonal – This is influence that comes from positive personal connections. A request or directive is honored because of positive feelings toward the leader.
- Reason – This influence comes from the belief that a leader is being reasonable and is asking his/her employees to do what is right and beneficial.
As a leader, understand your personal preferences and how different circumstances require certain types of influence. Be careful not to overuse any one type and know which to utilize for each specific situation or person. Take note of what works and recognize common misuses of influence in your business.
Leadership involves having a worthy vision and the ability to accomplish it. Successful managers possess leadership qualities of influencing others toward achieving organizational objectives. Influencing others requires some type of power. Power and leadership are closely related: while an individual can wield power without being a leader, an individual cannot be a leader without power. Small-business managers can improve their leadership skills by understanding the sources of power and influence.
Charisma is the power of influence inherent in a leader’s style or personality. A charismatic leader develops a new, ambitious vision for the company and communicates it to employees through powerful speeches and unique behavior. The charismatic leader is also sensitive toward the needs of employees. Managers can augment their charisma by making small changes in behavior to create better rapport with others, such as making more eye contact or smiling.
Legitimate power resides in the leader’s position. People comply with legitimate requests because they feel they have to. Legitimate requests are more effective if they are made with respect and humility rather than arrogance.
Influence by rewards requires offering something in return for complying with a request. Rewards should be of value to the person. Effective rewards may come in the form of public recognition and awards. More importantly, the link between behavior and reward should be clear to employees.
Leaders can exercise influence by rational persuasion based on knowledge, skills or special abilities. The leader presents a plan of action with logical arguments and supporting evidence. Professionals such as lawyers, physicians and accountants draw on this type of influence.
The leader’s relationship network is a source of power and influence. To cultivate this type of power, managers need to identify and befriend the right people. Moreover, they should repair damaged relationships, improve their image, and seek to understand others better.
To builds an effective organization, managers should avoid hoarding power. Leaders need to empower followers and teach them the effective use of power and leadership. Empowering leverages manager's influence and increases leadership effectiveness.
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In 1959, social psychologists John French and Bertram Raven found that there are five sources of power people use over other people, including legitimate, reward, coercive, expert and referent. Additionally, power in management requires having access and control over crucial resources and information. Even today, these sources of power are applied throughout organizations worldwide.
Just by having a managerial position, a person attains some level of legitimate power within an organization. A manager’s rank or position gives the manager access to information and resources unavailable to subordinates. The manager can override decisions made by subordinates, and control the use of resources at hand. Rank also gives the manager a certain level of reward power. A manager has the authority to grant bonuses for good work, give job promotions or offer more resources and information to subordinates. Legitimate and reward power, while effective, are less secure sources of power because they can be lost if the manager’s rank or position is removed.
When a manager feels disconnected or powerless, he might apply coercive power by using pressure and tactics to force others to comply with his demands. Though coercive power can be effective in the short-term, it can be quite costly in the long run by corrupting communication and teamwork throughout an organization. Sometimes coercive power generates overt resistance from subordinates who won’t tolerate a manager using punishment, manipulation, threats or fear to get things done.
The credibility that comes with years of education and experience in a particular field is a source of power. Expert power can help a manager design effective strategies, assess team member skills, assign appropriate jobs to subordinates, think rationally and critically and guide employees through steps to goal achievement. As a manager, your expertise is a more secure source of power than legitimate, reward or coercive power. Your expertise stays with you regardless of a change in your rank or position.
Charisma, effective communication, trustworthiness and integrity contribute to a manager’s level of referent power. A manager with referent power is admirable enough that subordinates comply because they want the manager’s respect and approval. Through your referent power, subordinates might be drawn to follow your advice and solutions because they trust you, know that you care for the overall picture or have their best interests at heart. With referent power, you can have strong influence over admirers even without a high position, leading-edge expertise or bully tactics. Referent power comes from walking your talk, and by setting an example that others want to follow.
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Leaders and managers are not necessarily the same. For businesses, the distinction is important, since those in charge must marshal employees to work toward a common vision of the future. Leaders have followers they can inspire to action. Managers have resources -- including human resources -- that they can allocate. Understanding leadership and the inspiring role that leaders play allows managers to acquire leadership ability. When supervision and leadership overlap, businesses gain dynamism and direction.
Power gives both managers and leaders the ability to influence the actions of others. In 1959, social psychologists Bertram Raven and John French published research findings regarding power, identifying five types: referent, expert, coercive, reward and legitimate. Some power is assigned to roles, such as the power residing in the office of the president. Other power resides in a person whether that person holds a position of authority or not. By layering different kinds of power, managers can become leaders.
By virtue of an authority position, managers hold three of the five power types, using legitimate, reward or coercive power to influence employees. Legitimate power belongs to those given an authority position, while coercive and reward power refer to the ability to punish subordinates or award them recognition, raises, promotions and other rewards that managers control. Subordinates comply with a manager's directives to avoid negative consequences, gain a reward or because they believe in the legitimate authority a manager possesses. Subordinates do not have to cooperate with a manager's authority, though. Leadership ability inspires willing cooperation.
Referent and expert power can belong to anyone. Those with referent power are liked and respected by others, which gives them the opportunity to persuade people to follow a vision. Others want to associate with and emulate people holding referent power. Because of this, people holding referent power gain followers. Expert power comes from knowing things that others don't. Trusting an expert's judgment, others award experts a leadership role. Managers wanting to increase their own leadership potential should invest in developing referent and expert power within themselves.
In "Management: Meeting and Exceeding Customer Expectations," the authors define leaders: "Leaders are change agents, sensing the need for change and creating strategies that will help to initiate it." To fulfill that role, the authors say, leaders provide vision, garner support for that vision, then keep others focused on actions to achieve it. In management strategy, a company's vision is a grand goal that, when achieved, fulfills the company's mission -- its reason for being. The relationship between leadership and business strategy makes leadership integral to a company's success and even to its very existence.
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With influence, a person can inspire others to follow, commit to a corporate vision and fulfill directives. Such leadership doesn't necessarily require positional power. Instead, influential people combine other types of power with their abilities and skills to gain status in a group. The more status a person has, the more influence and leadership she wields. The best leaders exercise traits such as reliability and communication ability, while judiciously using expert, referent, reward and coercive powers. Supplementing these powers with legitimate authority transforms managers into leaders.
Anyone can develop expert power, which refers to any knowledge, skills and experience valued by a group. In a workplace, it may not be possible for a manager to learn every employee's specialized job, but he could learn enough to understand each job's specific challenges and intelligently relate to employees' concerns. A manager's role as a departmental liaison to upper management and to other departments provides insider information -- expert power that employees don't possess. Becoming an expert at management and leadership tasks such as budgeting, establishing targets and coordinating people also distinguishes a manager, enhancing status and influence.
Referent power is known also as charismatic power because it's based on the personality of the person wielding it. Everyone has some referent power thanks to friends and family. The more referent power someone has, the more others want to emulate and associate with that person. One way a manager can increase referent power is through reliably ethical and professional behavior. Consistently acting with integrity and fairness builds trust, respect and pride in the department, enhancing the manager's charismatic power. It also sets a behavioral standard, making referent power a potentially profound tool in building company culture.
Positional power makes reward and coercive power possible. Good leaders turn these powers into influence. Giving out valuable rewards such as promotions, bonuses and recognition based on a clearly communicated set of standards encourages constructive behavior. Coercive power, the opposite of reward power, encourages appropriate behavior through the fear of consequences. Managers use coercive power by communicating limits and the consequences of not respecting them. Consequences may include getting fired, working undesirable shifts or missing a promotion. Both reward and coercive power must be applied wisely, fairly and consistently. Used this way, managers gain respect and trust, increasing their influence.
Effective communication influences others by inspiring them to follow a vision and directing them in its accomplishment. So important is communication to a leader's arsenal that the American Management Association International issued 10 commandments of good communication. These commandments include the need to clarify ideas before communicating, know want you want a communication to accomplish, consider the people who will receive the message and listen actively when they respond. Improving communication skills allows a manager to effectively use personal power to influence others.