Question

Discuss the differences between legitimate, reward, coercive, referent power. Give an example of each or the appropriate uses of these expert powers. Include responses to the following: Explain how they are similar and how they are different. Describe experiences with these types of power.

Answer 1

Legitimate power comes from a formal position held in the organization's hierarchy of authority. Example, the CEO or a Managing Director of a company has certain powers because of the office he holds in the corporation, to take any legal or business decisions.

Reward power is the power of a reporting manager/ team manager to give some type of reward, tangible or intangible, to an employee to influence the employee to act. Example- It could be a cash bonus or a trophy on good performance in a financial year or on a successful project completion.

Coercive power is used to influence an employee's decision making by taking something away from him/ her, could be as punishment or a threatening punishment if the employee is not follow instructions of the manager/ company. Example- firing or threatening to fire an employee due to misconduct at workplace.

Referent power can be used by a leader to influence a follower because of the follower's loyalty nature, respect, friendship, affection etc. to gain/ a desire to gain approval according to leader’s will. This could be in positive/ negative way. Example- influencing by a CEO to some junior employee to take a demotion or a promotion in the hierarchy.

Similarity- they all are similar in context of use to influence another employee by means of a power or affection or monetary/ non-monetary means to either get some work done or get it more done. They all could be used in positive/ negative ways in any size of a company.

Difference- Reward power is generally done as an employee encouragement practice activity in a company, like Rewards and Recognitions ceremony. While Coercive power actually discourages an employee. Referent power and Legitimate power can actually uplift an employee’s motivation if used in a positive manner or it can damage a company’s business by doing some unethical or unmoral act, like selling company’s trade secrets to another company.