In theory, strategic management is a very straightforward process. It involves defining a mission and establishing the tactical goals necessary to achieve the mission objectives. Establishing the tactical plan involves analyzing the internal and external company environment and defining a vision, business model, and appropriate strategy that aligns strengths and weaknesses to the corresponding environmental opportunities and threats (Maxwell, 2007). Key performance metrics are determined and monitored to ensure progress along the intended track and that the organizational structure and systems continually adapt in response to emerging or changing challenges.
In principle, the strategic leader prepares organizations for change and establishes a methodology for responding to changes (Kotter, 2001). In practice, weaknesses in strategic management are typically attributable to lack of skill on the part of leaders in key areas. Generally, the qualities of a good leader include vision, eloquence and consistence; ability to craft a business model with key performance metrics; commitment to the firm; staying well informed; ability to empower; political astuteness; emotional intelligence, and the ability to inspire trust among followers (Goldman, 1998; Maxwell, 2007; Tedlow, 2001). Many of these attributes rely on the executive's ability to understand and wield power effectively and in a manner conducive to enterprise success. However, power as a management skill is a sensitive topic. On one hand, the astute use of power is a significant factor in achieving success, as it is integral to successful strategic leadership (Wrapp, 1967); on the other hand, power is sometimes viewed in the pejorative, almost as a dirty word (Kanter, 1979)
What is power?
Power is the ability of one person to influence the actions and thoughts of another (Boyatzis, 1971; Maxwell, 2007). In 1959, social psychiatrists John French and Bertram Raven studied power and identified five specific bases or sources of power (summarized below). Three of these bases derive from hierarchical position or rank, while the remaining two derive from personal attributes and abilities:
Powers derived from one's position:
1. Legitimate -- The basis of this power comes from the belief that a person in a certain position within an organization has the right to make demands, and expect compliance from others. People holding formal, official positions typically have this power.
2. Reward -- This results from one person's ability to compensate another for compliance. Raises, promotions, desirable assignments, training opportunities, and even simple compliments -- these are all examples of rewards controlled by people "in power." If others expect that you'll reward them for doing what you want, there's a high probability that they'll do it.
3. Coercive -- This comes from the belief that a person can punish others for noncompliance. Implying or threatening that someone will be fired, demoted, denied privileges, or given undesirable assignments -- these are examples of using coercive power.
Powers from personal attributes or accomplishment:
4. Referent -- This is the result of a person's perceived attractiveness, worthiness, and right to respect from others. Referent power comes from one person liking and respecting another, and strongly identifying with that person in some way. Celebrities have referent power, which is why they can influence everything from what people buy to whom they elect to office. In a workplace, a person with charm often makes everyone feel good, so he or she tends to have a lot of influence.
5. Expert -- This is based on a person's superior skill and knowledge. When you have knowledge and skills that enable you to understand a situation, suggest solutions, use solid judgment, and generally outperform others, people will probably listen to you. When you demonstrate expertise, people tend to trust you and respect what you say. As a subject matter expert, your ideas will have more value, and others will look to you for leadership in that area.
Summary excerpted from Gianni Romano! (n.d.) Retrieved from http://giannirom92.blogspot.com/
The five sources of power first described by French and Raven have all withstood the test of time. However, since their original work in this area, the modern business organization has changed from being primarily manufacturing oriented and emphasizing the traditional hierarchal structure to being substantially service oriented and emphasizing high tech function and more of a horizontal management structure. As a result, team building, employee empowerment, corporate culture and knowledge management have emerged as much more important skills within contemporary business management.
Benfari, Wilkinson and Orth (1986) recognized this new direction of the times twenty-five years ago, and identified the emergence of three additional specific bases of power within organizations:
1. Information -- the power of knowledge and access to information.
2. Affiliation -- a borrowed power (i.e. power imparted to a person closely affiliated with a powerful person, such as secretary to an executive with the authority granted by the executive to interpret and enforce organizational rules, regulations and policies within the authority of the true authority).
3. Group power -- individuals who work together problem solving or in conflict management. Synergy results when power of the group surpasses the sum of the individual power of the individuals.
Later, in 1992, Tjosvold, Andrews and Struthers performed a study with one-hundred-forty-three Canadian employees to determine the extent to which employees valued the resources of their manager and the use of directive vs. collaborative management style. They found that managers with cooperative goals and use-of-power styles who relied on collaborative influence were able to utilize their power more effectively, in turn, improving employee performance and commitment to the organization and its mission. These results support the theoretical notions that successful managers empower their employees (Maxwell, 2007), and that the success of leader-influence strategies depends substantially on the relationship between managers and employees. This study provided insight into the emerging importance of understanding interpersonal and power-sharing dynamics within organizations that have since only become that much more important within the context and framework of business globalization and of the emergence of global organizational entities.
Five techniques that facilitate the effective use of positional power
In 1971, Boyatzis described five dimensions that determine the quality of leadership ability. According to Boyatzis, an effective leader must have the ability to make others feel strong and to help them feel they have the ability to influence their future and their environment. Second, effective leaders must be able to gain the trust of colleagues and subordinates alike. Third, effective leaders must be able to structure and maintain cooperative relationships rather than competitive ones. Fourth, effective leaders must be able to resolve conflicts by means of addressing issues directly rather than avoiding them or forcing dictatorial solutions that do not reflect conceptual understanding of the underlying causes of conflict. Fifth, effective leaders must be able to stimulate and promote goal-oriented thinking and behavior. All of Boyatzis suggestions are conceptually valid and they have subsequently been confirmed by other theorists such as John C. Maxwell (2007). However, the concepts outlined by Boyatzis (1971) and Maxwell (2007) still represent the traditional hierarchical perspective in relation to positional power and relationships within organizations.
The primary base of power in organizations
The traditional emphasis on positional power is understandable because it is the foundation upon which other levels of power have always emerged within organizations. That is mainly a function of the fact that authority corresponds to access to information, rewards and recognition. (Kanter, 1982). Generally, the source that power stems from two capacities: first, the ability to access resources (including financial, informational and manpower) necessary to implement tasks; second, the ability to promote cooperation to do what is necessary. Cooperation is typically encouraged through rewards and recognition within the capability of the leader to dispense by virtue of hierarchical position and authority within the organization. However, successfully achieving cooperation is very different from motivating employee commitment and promoting synergy, because those particular abilities depend on personal attributes and capabilities rather than on positional hierarchical power dynamics.
Steps to building personal power
Personal power consists of expert power and referent power. Expert power is developed by constantly keeping up with education, certifications and experience -- that is, keeping informed. This takes time and effort and represents time well spent. On the other hand, referent power is one of the easiest to build, most effective and least used bases of power (Benfari, 1986). The steps to referent power consist of getting to know people; building relationships based on shared interests and experiences; respecting personal differences; using reward and positive reinforcement; inviting reciprocal influence (i.e. communicating to others that their ideas and input are genuinely desired); offering to share expertise to solve problem and provide information; minimizing status concerns to promote the optimal interpersonal relationship and communication dynamics; becoming an expert in communication; mastering the workings of the informal political structure; and understanding how people react to stress and crisis. In that regard, developing the bases of power is one thing but determining which is the most effective is…