Organizational Behaviour
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Chapter 8
POWER AND POLITICS
Organizational Behaviour
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LEARNING OUTCOMES

Define power
 Explain the difference between power and
leadership
 Describe the bases of power
 Identify the causes and consequences of
political power
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POWER

Power is a crucial ingredient to effective
leadership.
 There are two sources of power:
Formal Power
Personal Power
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POWER VS LEADERSHIP
Power
Used as a means for
achieving goals
Leaders
Focuses on goal achievement
Requires follower dependency Requires goal compatibility
with followers
Used to gain lateral and
upward influence
Organizational Behaviour
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Focuses influence downward
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IMPORTANT FACTORS OF
POWER
Influence
• The person with power will influence other people.
Dependency
• The more people depend on you, the more power
you have on them. The level of dependency is
based on the alternatives available and the level
of importance a person has.
Organizational Behaviour
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FORMAL POWER
 Formal power is based on an individual’s
position in an organization.
 Four categories of formal power:
Coercive
Reward
Legitimate
Information
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COERCIVE POWER

Coercive power happens when a person who
has the control over a situation imposes a
penalty on his followers.
 Examples of penalty or fear are:
– Verbal abuse
– Loss of promotion
– Possibilities that name is dropped from dealing in
mega important projects
– Possibilities of job losses
– Delayed for promotion
Organizational Behaviour
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REWARD POWER

Reward power happens when a leader has the
ability and power to reward or share positive
values with the followers.
 Benefits or rewards can be given through
financial or non-financial rewards.
– Financial reward - pay rates, raises or bonuses
– Non-financial reward - recognition for a job well
done (a box of chocolates or gift vouchers),
opportunity to work in the organization’s mega
projects or trust in relationship
Organizational Behaviour
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LEGITIMATE POWER

Is a combination of both coercive and reward
power.
 It is derived from the position the person holds.
 The person who holds legitimate power is a
person who seats in formal authority to control
and uses organizational resources
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INFORMATION POWER

Information power is when a person has access to
the key information in the organization.
 Under information power, the person is in power as:
– He or she controls the flow of information to
others.
– He or she has the ability to manage and control
environmental uncertainties
• Uncertainties can be managed through prevention,
forecast and absorption
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EXPERT POWER

A person who obtains special skills, knowledge
or is an expert in certain areas. Having the
special skills, knowledge and the expertise
allows him or her to be in control.
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REFERENT POWER

The ability of a leader to influence a follower
because of the follower's loyalty, respect,
friendship, admiration, affection, or a desire to
gain approval.
 This situation happens when followers tend to
like and respect the leaders.
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DEPENDENCY

The key to power is the extent of dependency to
power between the person who wields it and
the person who are influenced by it.
 The power dependency is influenced by three
factors:
– Importance of a resource
– Scarcity of a resource
– Availability of substitute
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ORGANIZATIONAL POLITICS

Organizational politics generate political
behaviour.
 Political behaviour is defined as an activity which
is not required as part of one’s formal role.
 Political behaviour happens when people who
lack power wish to be involved or wish to
influence decision.
 There are two ways to it, either via legitimate or
illegitimate means.
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