Negotiating … know your power!

Negotiating PowerMost people associate the word ‘power’ with one side exerting dominance over the other. Let’s define power as, the ability to influence people or situations. Using this definition, power is neither good nor bad. It is the abuse of power that is bad.

The quality of a negotiation depends upon two things; the quality of the basic relationship between the parties involved and the quality of the communication that takes place. A good relationship with good communication between parties should enable successful negotiation. A poor relationship with poor communication is likely to lead to poor results.

The nature of a relationship will have an impact upon the quality of the communication therein. Here is the problem: If we distrust someone, we are at risk of either disregarding what they say or looking for hidden meanings that may or may not actually exist. The nature of a relationship affects negotiations and is a major influencing factor on the likelihood of satisfactory outcomes.

So, let’s examine relationships from the aspect of power.

Types of Power

1. Legitimate – This comes from the belief that a person has the formal right to make demands, and to expect compliance and obedience from others. Some measure of power is conferred based on one’s formal position in an organization. People at higher levels have power over the people below.

Subordinates have a primary function in the use of legitimate power. When subordinates accept the power as legitimate, they comply. This means that people will often act on directions, even the ones they don’t like, because it’s the right and proper thing to do, and because they are obliged to do so. This type of power, however, can be unpredictable and unstable. If you lose the title or position, legitimate power will instantly disappear because others were influenced by the position, but not by you.

It is vital to understand that legitimate power only has influence if it is perceived by others and occurs only in a social structure. Some negotiators may try to deny the other party some of their legitimate power by:

• Preventing them from talking;
• Preferring to make reciprocal offers while insisting the other party continue to make concessions;
• Disregarding previous agreements on how to proceed; or
• Preventing the other party from having any legitimate position of significance.

2. Reward – This results from one person’s ability to compensate another for compliance. Reward power is used to support legitimate power, as people in power are often able to give out rewards such as 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. Although rewards often comprise financial remuneration, they can also be intangible.

Some examples of Non-verbal rewards are:

• Giving individuals or the other party more space at the table
• Nodding of the head to signal your acceptance or approval
• Ingratiation and flattery
• Complementing the abilities of the people whom you wish to influence. This tactic, frequently referred to as ‘other enhancement’ often entails the use of flattery.

3. Expert – This is based on a person’s superior skill and knowledge whose expertise is highly valued possesses expert power. Experts have power even though their status might be regarded as being low. Any person may have expert knowledge about technical, administrative, or personal matters. The harder it becomes to replace an expert the more expert power that they possess.

Expert power is sometimes referred to as information power and is frequently a personal trait of the individual. In any negotiation situation, expert power tends to be type of power that is exerted or applied. All experts possess a certain expertise in a particular field, but rarely does their expertise extend to cover the entire field under discussion in the negotiations.

4. Reverent – This is the result of a person’s perceived attractiveness, worthiness, and right to respect from others. This magnetic appeal forms the basis of referent power. This attraction may be due to physical attractiveness, dress, mannerisms, lifestyle, position, friendliness, congeniality, honesty, integrity and many other qualities.

Truly charismatic people possess a distinct mix of physical traits, speech, mannerisms and self-confidence and are capable of influencing a very large group of people by their actions. Referent power stems from the need of individuals to identify with people of influence or attractiveness. The greater a person admires or identifies with an individual, the more referent influence can be exerted by the power holder. This is one of the most potent types of power in a negotiation.

5. Coercive – This comes from the belief that a person can punish others for noncompliance. Coercive power is the opposite of reward power because of the ability of the power holder to remove something from a person or to punish them for not conforming to a request.
Some examples of coercive power are:

• Threatening a work stoppage by a labor union
• Preventing promotion or transfer of a subordinate for poor performance
• Threat of litigation, non-payment or going public
• Physical injury

Power Parity
Most people have more power than they think. I believe there is a link between a person’s self-esteem and the amount of power that person thinks they have. It has been demonstrated that people with high self-esteem feel they have more viable options (and thus more power to act) in negotiations.

In a negotiation, parity of power is the perception by one party that the other side can counter any form of power with a similar or different form of power that would render the further escalation of power useless. Parity in power means that there must be a balance in power deployment. Parity in power is essential to the behavior of a successful negotiator.

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James E. McClain is the author of Successful Career Development: A Game Plan, the book upon which some of our training programs are based. He has over 30 years' experience as a corporate HR executive, small business owner with ongoing experience in career development and as a college instructor. His educational background includes a B.S. and Masters degrees Education and Certification in Financial Planning. Our promise is that "you can pay more for training but you can not buy better training." The mission is to deliver the most effective and cost effective training and development programs.

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Posted in Leadership, Negotiation

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