Referent Power | Types of Leadership Power | Sample Business Plan

Referent Power


 

Referent power occurs when an individual views their goals or objectives as similar to that of another individual. The individual that acknowledges this shared objective may try to influence the other to take action that is mutually beneficial and will lead to results that allows both to achieve a desired objective. Empathy between the individuals must exist for this power to be truly effective and others should be able to identify with the individual exerting referent power to instill confidence. This approach often occurs in an “I’ll scratch your back if you scratch mine” scenario; especially when there is a process involved where one individual relies on another to complete a task.

 

For example, a manager of a sandwich shop operates the cash register and notices about 10% of the lunch crowd comes in and leaves before ordering because of the long line, which affects sales and the tip jar; the tip jar is shared by all employees for that day. The manager also notices that the first line employee is moving exceptionally slow in taking orders. In an effort to speed the process up, and therefore improve sales and tips, the manager pulls the slow line employee aside and points out the lost sales as a result of slow service, which affects their tip jar. Because she knows that tips are generally 10% higher when the slow employee isn’t on shift, she asks him to trust her judgment and pick up the pace, which will be mutually beneficial to both of them by an increase in daily tips. Her conversation is effective and the slow employee picks up the pace, earning an additional 10% in tips.

 


Other Types of Power

 

Reward Power
An approach where an individual in a leadership position attempts to influence the behavior of others by offering something they may desire. For example, money or promotion.

 

Coercive Power
In contrast to reward power, coercive power attempts to influence behavior by implementing punishment for a particular behavior. This type of power places an emphasis on instilling fear to change behavior.

 

Legitimate Power
Legitimate power is a belief that the title of a position, and the individual that holds it, is entitled to exert influence on subordinates solely based on the status of their position within the organization and that subordinates have an obligation to accept it.

 

Expert Power
This power is generally bestowed upon a person based on their years of experience within an industry, their education, or honor’s they may have received for a particular topic.