Impact of Power and Politics on Leadership and Performance

The impacts that Power and Politics have on leadership and performance in contemporary organisations.

In this essay, I will discuss the impacts that Power and Politics has on contemporary organisations including leadership and performance. Power and Politics can be a rather unpleasant issue in contemporary organisations, however, they are both important dynamics and the influences it plays a part in contemporary organisations are important. Power is a complex but a crucial issue in organisational behaviour. Power, defined by Pfeffer (1992, p.30), is the ability to “influence behaviour, change the course of events, overcome resistance and to get people to do things that they would not otherwise do”. On the other hand, politics, also defined by Pfeffer (1992, p.30) are “the processes, the actions, and the behaviours through which potential power is utilised and realised”.

Power
 

In contemporary organisations, to attain and maintain power is probably one of the biggest incentives anyone could have in the workplace and there are generally three different types of people in organisations who are always involved in this (Somoye, 2016). They are: 1.) the owners, 2.) top-level managers and 3.) the employees who perform at the highest level. These three different categories of people have something in common and that is their power/ability to influence the decision-making process. In the world of business, power and politics, to a large extent, determine the development, stability and continuous prosperity of an organisation. Power and politics are two elements which links strongly with leadership of any organisation, and depending on how it is managed, it can either make or break an organisation. Without power and politics, it would be challenging for leaders/people with authority in contemporary organisations to operate. Therefore, it is absolutely crucial for leaders of an organisation to know which type of power is best suited to use in running their business and controlling their employees. In 1959, John R. P. French and Bertram H. Raven (French & Raven, 1959, p.152-156) conducted a study about power, and in their study, they claimed that there are five different types of powers and how each of them affects a person’s leadership in organisations. They are: coercive power, reward power, legitimate power, referent power and expert power (Van Viiet, 2010).

Coercive power is perhaps the most brutal and negative type of power in an organisation. It is pretty much when a subordinate is forced by the person in power to perform tasks that is against their will. In general, this type of power takes place when the leader uses threats and or punishments as an incentive for subordinates to carry out tasks. An example of coercive power in the workplace could be when managers force an employee to work long hours to meet a deadline otherwise they will be fired. Coercive power is the type of power that is communicated through fear, therefore, leaders will not get respect and loyalty of his/her subordinates. On the contrary, reward power is perhaps the most positive type of power. Reward power is when leaders would make their subordinates perform tasks they may not particularly want to do, however, instead of using threats and punishments as an incentive, leaders would use rewards as incentives. An example of reward power in the workplace includes pay increase, promotion, bonuses, compliments, etc.

Legitimate power is about being in power according to the position that you are in within an organisation’s structure. In an organisation’s structure, people with a higher title has more control and “power” over those who are lower than them i.e. people with a lesser title. Legitimate power occurs when subordinates of those who have higher authority follows orders given to them because they have the belief that the person is in that position of power is able to give them such orders. For example, the CEO of a company would have more power over a department director, who would have more power over a manager, who would have more power over a supervisor, who would have more power over an employee, etc. 

Referent power is when someone is in a position of power due a sense of, respect, trust, acceptance and approvals of employees. The leader in this type of power is generally seen as a role model thus subordinates enjoy the presence of them and even aspire to be like them. A leader that has referent power can exert influence because subordinates are eager to give them what they want, sometimes even because they are simply nice (Natter, 2018). Lastly, there is expert power. This is when someone is in a position of power due to their expertise, giving them a powerful presence. When someone is skilful, knowledgeable and experienced in an area, they are often called “experts”. In organisations, employees will naturally respect and follow those who are experts.

In my opinion, the best type of power that leaders in contemporary organisations should exercise to get the best out of their followers, thus improving organisational performance and productivity are expert and referent power. There is no doubt that being respected by your followers and having great expertise in a field is the most influential. Being an expert in a field i.e. being the most skilled, knowledgeable and experienced than the average worker will no doubt gain you respect, and when respect is earned, then influence will follow. Having this type of power means that people will be more willing to be led and guided by you as they trust your expertise. In turn, the team will strive towards performing at the highest level they can, therefore improving performance and productivity within the organisation. Furthermore, I think having expert power implies referent power, which is why it is possible for leaders to exercise these two powers simultaneously. This is because with this type of power, you gain trust and respect from other employees, so they accept you as their leader, which by definition, is what referent power is about.

The worst type of leadership power to exercise in my opinion is coercive power. As mentioned, leaders who use coercive power uses threats and punishments as incentives for their subordinates to carry out tasks. Using coercive may arguably be effective in the short run, since subordinates will perform due to the fear of punishment, which then increases efficiency for the organisation. However, it will also undoubtedly result in lower job satisfaction, lower productivity and lower innovation for employees because it puts them under a lot of stress and pressure and they always have that sense of fear at the back of their mind which would hinder their performance. A leader who constantly exercises coercive power would not only result in damaging the reputation of the organisation, but also to him/herself. If a leader abuses this type of power too much to the point where it goes past the point of which they are entitled to use such power, then based on the situational approach, it results in employees to feel constantly distressed. Instead of working in a friendly working environment, they begin to see it as working in a negative working environment in which their negative feelings are developed to even a greater extent.

In order to get the best out of employees within an organisation to perform at the highest level, all five types of powers must be exercised. The leader(s) of an organisation must know exactly when to exercise each power appropriately, depending on the situation. A good leader would be able to identify situations where coercive power would be effective, whilst also being cautious that they do not abuse this power too much. Additionally, reward power should be exercised to encourage them. Also, legitimate power should be exercised based on the needs of the subordinates, whilst expert power is to be exercised to showcase the skills, knowledge and experience of a leader.

Politics

Organisational politics are the guidelines in which employees and the organisational itself follows to benefit their own interests. They are the rules, procedures and principles that are expected to be obeyed to by all people a part of that organisation. Organisational politics occurs when individuals at work acts upon their own interests without any consideration on how their actions could or would have an effect on the organisation. Their actions could as a result “manifest through power struggles and personal conflicts to obtain power or personal importance” (Ferguson, n.d.). Additionally, Somoye (2016, p.569-570), refers to organisational politics in many ways. He refers to it as “the structure and process of use of authority and power to effect definitions of goals, directions and other parameters of the organisation”. He also states that “Politics is an important function that results from differences in the self-interests of individuals. It is the use of power to develop socially acceptable ends and means that balance individual and collective interests”. He also states that political behaviour is “the getting, developing and using of power to reach a desired result. It often appears in situations of uncertainty or conflict over choices”.

Organisational politics are strongly linked to leadership and management. The actions of a leader influence their subordinates, so they can cooperate to meet organisational goals. How leaders exercise their authority determines the political climate within the organisation. As a leader, the political climate of the company depends on how they treat such situations when they arise (Ferguson, n.d.). Political leadership, as defined by Burns (1978), is “the reciprocal process of mobilising, by persons with certain motives and values, various economic, political, and other resources, in a context of competition and conflict, in order to realise goals of independently or mutually held by both leaders and followers” (Burns, 1978, p.425), cited in (Bryan et al., 2011, p.203). In addition, Burns (1978), conceptualised different approaches to political leadership, in particular, transformational and transactional leadership.

Transformational leadership is a leadership style where the leader uses their power of influence and enthusiasm to motivate their subordinates to work for the benefit of the organisation. Abraham Maslow’s hierarchy of needs is the foundation for transformational leadership, according to Burns (1978). For this leadership style, the leader is a role model and a motivator who offers vision, excitement, encouragement, morale and satisfaction to their subordinates. The leader inspires people to increase their abilities and capabilities, build up self-confidence and promotes innovation in the whole organisation (Surbhi S., 2015). Transactional leadership is a style where leaders are more concerned with steadily maintaining the flow of operations in an organisation. Transactional leaders are about the moment, as they are primarily concerned with how they can improve current situations within the organisation. For this leadership style, the leader uses their disciplinary power and other incentives to motivate subordinates to perform in exchange for rewards, hence the term “transactional”. Both leadership styles in the context of organisational politics and political leadership are important and effective in their own way, depending on the situation and if the leaders know when, where and how to use it.
 

The transformational leadership style is important because it can impact the growth and increase performance levels of individuals at work. As mentioned, this leadership style is based off Maslow’s hierarchy of needs, and at the top of Maslow’s hierarchy of needs is “self-actualisation” which revolves around an employee realising and achieving their full potential. Transformational leadership helps to “transform” employees to go beyond self-actualisation and their own self-interests for the sake of the organisation, along with an employee’s moral development. A good transformational leader would know how to commit themselves selflessly to align their personal principles and values with the organisation, as well as to nurture their subordinates’ moral development to internalise these same values and principles (Schieltz, n.d.).
 

Transactional leaders are effective because it is based on reward and or punishment which works as an incentive for employees in becoming more productive and efficient. This is because they know if they perform at the highest level they can and working extra hard, their effort will not go unnoticed, therefore they will be rewarded for their efforts. On the other hand, they also know that if they don’t work as hard as expected, then that will also not go unnoticed and they will be punished for it. Either way, they both serve as good incentives for employees to perform the best they can.

Although both of these leadership styles sound good, in reality one of the two styles are more favourable than the other in organisational politics overall, and that is the transformational leadership style. According to studies, the relationship that the correlation that transactional leaders have with overall organisation performance has been shown to be negative. On the other hand, it has been shown by a questionnaire conducted by Bernard Bass (1958), that there is a positive correlation between the transformational leadership style and organisational performance. The correlation between the transformational leadership style and organisational performance was shown to be consistently higher than the correlation between the transactional leadership style and organisational performance. (Geyer and Steyrer, 1998; Lowe et al., 1996; MacKenzie et al., 2001; Parry, 2003), cited in (Vigoda‐Gadot, 2007, p.664).

The perceptual link between transformational leadership and organisational politics is different from the link between transactional leadership and organisational politics. Transformational leadership builds a positive working environment that encourages professionalism and excellence, therefore the perception of organisational politics is reduced. According to Bass (1985), transformational leaders can change the views of organisational politics because they have a clear vision, mission and plan to achieve organisational goals. A good transformational leader has the ability to reduce ambiguity in the workplace and reassure their subordinates that there is always a solution to overcome any problems based on justice and fairness. One of the many fundamentals of the transformational leadership style is that it revolves around the moral development of employees and the organisation itself, therefore, this leadership style, according to Kacmar and Ferris (1991), cited in (Vigoda‐Gadot, 2007, p.667), positively contributes to the reduces the feeling of inferiority which derives from a lack of recourse to political alternatives. The transformational leadership style has characteristics that can reduce perceptions of organisational politics among employees.
 

In contrast, the transactional leadership style would increase the perception between the leadership style and organisational politics unlike transformational leadership, which reduces it. Transactional leadership has characteristics that are more appropriate for a political working environment, examples includes management of exchange relationships and a reward and or punishment system which acts as an incentive for employees to work harder. The transactional leadership style is a great way to inspire the growth of interest-based relationships between the leader(s) and their subordinates, which is at the heart of the political process.

In conclusion, the role that power and politics plays on leadership in contemporary organisations is massive, revolving around decision-making, the performance of employees and the organisation and how individuals interact with each other.  All businesses are subject to power struggles which all depends on how leaders exercise their power and leadership style which would either have a positive or negative influence on an employee’s performance. The main effects that power and politics have in an organisation are insubordination, commitment, obedience and resistance. The negative use of power and politics results in insubordination from subordinates, whereas a positive use would result in commitment from subordinates and a balance between both would result in obedience, so it is crucial to find the right balance.

References

• Bryan, A., Collinson, D., Grint, K., Jackson, B. and Uhl-Bien, M. (2011). The SAGE handbook of leadership. p.203.
• Ferguson, Grace. “The Relationship of Leadership to the Politics of the Organization.” [online] Available at: http://smallbusiness.chron.com/relationship-leadership-politics-organization-34221.html. Accessed 12 January 2019.
• Knights, D. (2017). Introducing Organizational Behaviour and Management. 3rd ed. Cengage Learning, pp.296-349, 350-376.- Natter, Elizabeth (2018). 5 Types of Power in Businesses. [online] Available at: https://smallbusiness.chron.com/5-types-power-businesses-18221.html [Accessed 10 Jan. 2019].
• Pfeffer, J. (1992). Managing with Power. Politics and Influence in Organisations, p.30.
• R. P. Jr. French, John & Raven, Bertram. (1959). The bases of social power, pp.151-164.
• Somoye, K. (2016). The Effects of Power and Politics in Modern Organisations and its Impact on Workers Productivity. International Journal of Academic Research in Business and Social Sciences, 6(11), pp.1-9.
• Surbhi, S. (2015). Difference Between Transactional and Transformational Leadership – Key Differences. [online] Key Differences. Available at: https://keydifferences.com/difference-between-transactional-and-transformational-leadership.html [Accessed 11 Jan. 2019].
• Van Vliet, V. (2010). Five Forms of Power by French and Raven, a leadership theory | ToolsHero. [online] Available at: https://www.toolshero.com/leadership/five-forms-of-power-french-raven/ [Accessed 10 Jan. 2019].
• Vigoda‐Gadot, E. (2007). Leadership style, organizational politics, and employees’ performance. Personnel Review, 36(5), pp.661-683.