Power - A Quick Overview

Brief overview of Power

The "MBA text book" types of power in management include: Reward,Coercive,Legitimate,Expert,Referent.

Whilst this may be a useful introduction to the topic, back in the "real world" applying my own experience and research, I think I can offer you something more useful, more comprehensive, more realistic and applicable in the real world.

However just for completeness sake, here is what is meant by these:

• Reward power needs follower to believe leader will reward them.
• Coercive power needs follower to believe leader will punish them.
• Legitimate power needs follower to believe leader has right to instruct them.
• Referent power need follower to believe leader has desirable qualities.
• Expert power need follower to believe leader is an expert.

Types of Power - my preferred categories

• Posture Power
  This is the power that comes from inner strength, the refusal to be intimidated.
  Generally though its a kind of silent (almost animal like) power that must be cultivated through appropriate mindset.
  (e.g. I don't NEED this deal; If you insult me I'll walk away from this R5million deal even if I'm FLAT BROKE right now.)
• Image Power
  
  Having an intimidating presence or appearance.
  Wearing suites that cost > R15,000, Power Ties etc.
  Armed with work related gadgets that cost 100K+.
  Impressive office buildings.Mechanised blinders that reveal a garden on 4th story roof.
  Ferrari, Vanquish or R8 parked visibly outside.
  Being surrounded by, having every need tended to, by team of hot personal assistants on standby.
  A picture on the wall of you shaking hands with Nelson Mandela.
  
• Relationship/Political Power
  
  This is about who you know.
  Friends with the CEO? Or if you are CEO, other big corp CEOs.
  Politically connected.
  Know serious venture capitalist or private equity guys.(Hint: There's only a handful in SA)
  You are a natural connector (networker) if you have more than 1000 people on facebook or linked-in.
  Belong to exclusive, invite-only organisations.
  
• Personality Power
  
  This is about psychology and personality.
  Are you a master persuader or highly skilled negotiator?
  A natural sales person? High in charisma etc.
  Someone that people cannot help liking? A real people person?
  Can you inspire people or rally them to your cause?
  
• Legal Power
  
  If you have other parties tied up in rock solid legal agreements.
  Do you retain and make regular use of a business savvy lawyer, or are one yourself?
  Do you put clauses in that truly prevents you from getting screwed under any circumstance imaginable?
  E.G. Draconian, yet legally binding penalty clauses that most people willingly sign.
  
• Money & Wealth Power
  
  This is about having deep pockets, high net-worth and liquidity.
  Lesser businessmen tend to cluck around and suck up to those with money.
  There is an unspoken assumption that those that are already rich deserve to make the most money out of every new deal.
  Money can buy nearly anything, and solve nearly any problem.
  Money acts as the ultimate proof that you know what time it is in business.
  Of course if you are stuck in a liquidity squeeze with all your assets tied up, better be sure that no-one knows how tight you are.
  
• Performance Power
  
  Are you one of the best?
  This is for those that possess superior skills, knowledge and ability.
  Do you have a reputation for getting results?
  
• Title/Position Power
  
  In large organisations, its all about title, rank, level, etc.
  Controlling shareholders in smaller outfits can be very powerful since they can remove directors.
  Power games are often played over who has the most direct reports, confusing reporting roles, delineation of roles in matrix management structures etc.
  
• Reputation Power
  
  If you've built up a reputation over many years through consistency, performance and trust worthiness.
  People vouch for you. Doing business with you is a no-brainer. Your reputation precedes you.
  
• Access Power
  
  Access to critical IT systems, information stores, usernames, passwords, know how to use/access.
  This power is most useful when people don't explicitly think about all the systems that you've got access to, or that you control.
  Sometimes a person (like even a secretary/PA) can be a powerful "Gate-keeper" - controlling access to an important person.
  Any form of access,physical keys, safe codes, control over resources, budgets and their allocation...
  
• Deception Power
  
  Some attain power through the art of deception.
  Never underestimate the power of being underestimated!
  Concealed power, game playing, manipulation etc.
  Usually not a long term sustainable source of power.
  

How can an understanding of the dynamics of power benefit you?

• Are you going to be a victim or wielder of power? Too many good people often feel powerless.
• Correctly assess the power of others, and formulate appropriate competitive strategies.
• This can also be the starting point for determining how to increase your own power.
• Avoid suffering losses from dangerous people or being stuck in dead-end positions.

From winning through intimidation

Theory of Intimidation

The problems most people have in reaching their objectives revolve around the fact that they constantly allow themselves to be intimidated.
The results a person obtains are inversely proportional to the degree to which he is intimidated.

Types of Power

a. Money: The ability to walk away — nice if you can get it.
b. Image: The ability to prompt respect.
c. Legal: The law, plus the Law of Universal Attorney-Attorney Respect. Always have everything in writing. Don’t be afraid to ask for it.
d. Performance: Be the best at what you do and deliver. Be fanatical about execution. This backs up your Image and Legal Power.

Don’t let anything get in the way of making the deal. If there are questions, dig out the answers yourself if necessary, rather than waiting for someone else to do it.

Posture Power

It’s not what you do or say that counts, but what your posture is when you say or do it. You need to maneuver yourself into a position of power.

Generating Image Power

Ringer used a spectacular, expensive, hard-bound brochure to intimidate potential sellers. Every interaction was designed to show the buyer or seller that they needed to sell Ringer on working on their deal When he went to meet them, he brought along everything that he might need, from typewriters, to law books, to 2-3 secretaries—so that nothing could hold up the deal, and to intimidate the hell out of people.

Fiddle Theory

The longer a person fiddles around with something, the greater the odds that the result will be negative. Time is always against you when trying to make a deal—any kind of deal.

Boy-Girl Theory and Better Deal Theory

a. If boy plays it cool, then girl wants boy. If boy comes on like hungry dog chasing a squirrel, then girl doesn’t want boy. A man will usually want the deal he can’t have, and won’t want the deal he can have.
b. Before a person closes any kind of deal, he always worries that there may be a better deal down the road.
c. To combat the effect of these factors, bring the deal as quickly as possible to the point where the money is on the table and the papers are ready to be signed. Then it’s put up or shut up time.
i. Don’t let the speed depend on everyone else. If necessary, fly a secretary to the office to pick up the documents and hand deliver them.
ii. You MUST take matters into your own hands and move swiftly once you smell victory. At the crucial moment, the great quarterback takes control of the game.

Attorney Goal Line Defense

Attorneys are not subject to intimidation like normal people, but if you cower, they will smell blood and strike. Instead of being tough or humble, play it cool. Be calm and matter of fact. Adopt an air that indicates you have no concern over the deal, that everyone knew the deal would happen.

i. “Problems” don’t represent obstacles to the closing, but just normal “points” which had to be “handled” as a natural part of every deal.
ii. “That’s a darn good point. I’m glad you brought that up. Here are many ways we can handle that particular point.” The only reason all are gathered is to “handle” the normal “points” that always come up.
iii. As a last resort, indicate the willingness to walk away. “Well, I guess that’s it. It looks like we just can’t make this one happen.”

Dirty Laundry

There will almost always be several major undisclosed deal-killers that pop up at the 1-yard line. Soften the blow by setting expectations with the buyer ahead of time. That way, the dirty laundry reinforces your posture of expertise.

Bluff Theory

a. The best way to bluff is not to bluff. Wealthy people are good bluffers because when they threaten to walk away, they mean it. They can’t be intimidated.
b. If you’re not wealthy, the best substitute is guts. It’s more painful, but it works. Draw a clear line, and stick to it.

Im encouraged