Using Power Wisely: why how we get results actually matters

Welcome to the No Bullsh!t Leadership Podcast. In a world where knowledge has become a commodity, this podcast is designed to give you something more; access to the experience of a successful CEO who has already walked the path. So join your host, Martin Moore, who will unlock and bring to life your own leadership experiences and accelerate your journey to leadership excellence. 

Hi there, and welcome to episode five of the No Bullsh!t Leadership podcast. This week's episode, Using Power Wisely, a.k.a Why HOW we get results actually matters. Now, to be an outstanding leader, you need to understand power, what it is and how to use it. Knowing what the different types of power are and having awareness of what power you're using when is fundamental to building a high performing team and getting the most from your people. 

We're going to start by exploring what the different types of power actually are. Then we're going to move onto what power looks like at its worst, and that's when leaders abuse their power. We'll discuss how the different types of power affect both us and our people, and then I'm going to bring it altogether with some rules of thumb for exercising the different types of power as a leader in your organisation. So let's get on with it. 

We all exercise different types of power each day in our relationships with others. If you have children, you may have said at some point, "You get $5 pocket money each week, but only if your chores are all done." This is reward power. And when these same children grow up to be teenagers, you may have said something like, "If you don't make curfew, you're going to be grounded." This is what we call coercive power. 

We all have expertise in some areas which we enjoy using. We love it when people seek us out and ask our advice on an area of our expertise, like how to barbecue the perfect steak, which, might I add, is one of my specialties. This is called expert power. Many leaders in some professions, such as police and law enforcement, can get results purely because of the position they hold. Have you ever heard someone say, "Okay, you're the boss"? The power that is vested in your position is what we call legitimate power, but as a leader, getting things done through influence, relationships, and appealing to people's sense of purpose and contribution is the holy grail. This is where you get people doing things for the right reasons. They trust you, they believe in you, or they've signed up to your values and purpose. This is more likely to tap into your people's intrinsic motivation, and it's called referent power. 

Now, these five types of power, reward, coercion, expert, legitimate, and referent, were described by social psychologist John French and Bert Raven in the late 1950s. This work was groundbreaking, and hasn't really changed much in last 60 years, but I'm going to take a slightly more pragmatic view today on how the use of different types of power by a leader can impact themselves and their people. 

So let's talk about what power looks like at its worst, when a leader abuses power. Abusive power is becoming much better understood. Now, it might not be any more prevalent today than it's always been, but I think it's fair to say that it is much more visible, and the awareness of it occupies a greater place in the public psyche. If we've been in the workforce for anytime at all, we've most likely suffered the negative impacts of a leader who abuses their power in some way. But it's important to recognise that it's not just bad people who abuse their power; we are all prone to it if we're not aware of it, which is why, as leaders, we need to be conscious of it all the time. 

In this day and age, through the mass media, we can see leaders in many facets of life abusing their power frequently. So for example, the legitimate power that a teacher or religious figure holds, who then uses that power to abuse their position of trust and respect by assaulting the children in their care. Or the coercive power of an insecure leader, who believes in the command and control model, forcing people to do things that they shouldn't do by preying on their fear of the repercussions. Or the very publicly chronicled abusive reward power by some of the most powerful figures in Hollywood, who used casting couch tactics to abuse women, who presumably submitted in the hope of gaining a big break in the movies. 

Whereas these are the most obvious abuses of power, there are also much more subtle abuses that we need to be conscious of as leaders. So how do the different types of power affect us and our people? In the original study by French and Raven, they're quite analytical and dispassionate, as all good academic researchers should be, about the source of power, and they tend not to make value judgments. Now, as you probably know me by now, I like to be a little more definitive about the positive and negative impacts of the different types of power, and having watched the way leaders choose to treat their people in order to get results, I think I've got a good basis for this. 

I fundamentally believe that some sources of power are intrinsically more valuable and effective for a leader than are others, and needless to say, some source of power are more acceptable than others for the people being subjected to them by their leader. So let's take a tour through how the dynamics of the different types of power play out and see if you recognise these in the people who you're close to at work. 

First of all, let's start with coercive power, and coercive power is exactly as it sounds. It gives the leader the ability to force people to do what they want. People feel as though they're compelled because of a physical, emotional, or economic sanction that can be used against them or held over them. Now, when you wield coercive power as a leader, people might do what you ask them to do, but it will always be begrudgingly, and it'll be a matter of strict compliance, which they will resent you for. There'll be no loyalty towards you as a leader and you will earn no respect. As I like to say, if you force people to do what they don't want to do, you may get a short term result, but they will generally find a way to get even with you, and you won't even know how and when they've done this. Just know that this will happen. 

Importantly, discretionary effort doesn't live anywhere near coercive power. The command and control model relies quite a bit on the use of coercive power, and also on the legitimate power that comes from your formal title. 

So let's move on and talk about reward power. This gives the leader the ability to motivate people through either granting or withholding rewards. Now, some examples of this you'd be familiar with are pay raises and promotions, but also there's the more subtle withholding and giving of praise. Now, there is nothing at all wrong with reward power, and some people you lead are driven more by rewards than others. A lot of people are driven largely by financial results, and this needs to be balanced with the right culture and behaviours, as we see the moral hazard of organisations and leaders that overuse reward power for the what is achieved at the expense of the how it is achieved.

At the very root of the example on the Australian banking industry that I gave in last week's podcast episode, we saw a clear over emphasis on rewarding the what and not the how. But generally, with reward power, there'll be no loyalty to you as a leader and you earn no respect once again. Reward power can be used very effectively for non-financial rewards, and you should always be considering this. 

So as an example, I mentioned in a previous podcast that we set up mechanisms in CS Energy to encourage the right values and behaviour from our people. Each month, every team in the organisation would nominate and vote for the culture and values champion for that month: the person who, through their actions and behaviours, most embodied the culture we were trying to build. This was then rolled up to a site level, and every three months when I did a road show to deliver the quarterly results presentation to the troops, we would recognise the culture and values champions for the quarter in front of the whole site. At the end of the year, each site would choose a culture and values champion for the year, and they would come to Brisbane for a weekend with their partner for a celebration dinner, which my wife Kathy and I, along with a couple of other executives, would host. Now, this assumes that a dinner with Kathy and me is a valuable reward, but this was simple, cheap, and reinforced exactly the right behaviours that we were looking for in our people. 

Now, the next type of power I want to deal with is legitimate power, and this is the power that's derived from your formal position and title. As leaders, we all use this form of power to one extent or another. It's actually implicit in our role within the organisation's hierarchy. Virtually everyone gives their leaders at least some credibility due to their position, and our leaders take some assumed liberties in their role. 

There are some accepted norms that come with a hierarchical relationship, so for example, when a leader calls a meeting, the invitees generally turn up. There's also a mutual expectation between a leader and their people that the leader can assign work. A leader also has the right to undertake performance reviews, and there's generally an accepted norm that an employee is bound to follow a lawful instruction from their leader. So although it's ever-present, legitimate power should not be overused. It's very easy for legitimate power to slip into coercive power if you're not careful. 

Now, I was always very explicit with my people as to when I was using my legitimate power as CEO. I would actually say something to the effect of, "I might need to pull out the CEO card on this one." Now, the subtlety here is, because I was making it so explicit, the implication was that at all other times I was not using my legitimate power as CEO. Now, in reality, this may not have always been the case, but it did make people feel as though they had a very strong say in decision and that they were not living under authoritarian rule. This was just one of many symbols I used to show that power was shared throughout the organisation and did not simply vest at the top. 

So fourth is expert power, and this is all about your skills and experience in a particular field. You will often gain respect for this type of power, so for example, the expert engineer or financial analyst or commercial lawyer, but those who rely exclusively on expert power typically don't get the best from their people. The reason for this is that expert power is all about you being right and being the best, and it's entirely appropriate for a professional or an individual contributor to use their expert power as the dominant means of getting results, but it's not appropriate for a leader to do so. It doesn't leave room for others to grow and develop as they learn to defer to the expert. If you as a leader have all the answers, why should your people bother? They become disengaged, disinterested, and disenfranchised with you and the organisation they work for.

But let's look at the bigger picture. On a broader scale, overuse of expert power creates a knowing organisation rather than a learning organisation. These types of institutions typically get left behind as the world evolves and changes around them. Another issue is that we quite often make the mistake of giving people who are expert in one area more credibility than is due in another area, and this is called the halo effect. For me, expert power is the power I'd probably least rely upon. I'm a generalist, and I'm pretty good at a whole lot of things, but I'm not a really deep expert in anything, and as a senior leader, that plays in your favour. 

Finally, we have referent power, which is what I call the power of the influencer. So much of this power is about who you are. People are influenced to do as you would like them to because they believe in who you are, what you have to offer, and where you're taking them. This is the power that enables people to follow you for the right reasons. However, you got to be a little bit careful as a leader that this doesn't turn into the power of ingratiation. As a mentor of mine said to me when I started my first CEO role, "Mate, you just got to understand that all your jokes are now just going to be a little bit funnier." Relationships are important here, but be careful not to stray into seeking or trading in popularity, and if you haven't listened to episode one of the No Bullsh!t Leadership Podcast, Respect Before Popularity, it's absolutely worth doing so.

But referent power is the most compatible with a high performance culture, where you can genuinely get the most out of your people. To be a great leader, spend most of your time working on who you are rather than what you do, because referent power comes from personal character, and if used wisely, with the strength of your values, convictions, and excellence, it will propel your organisation forward. 

So let's bring this all together with some rules of thumb for exercising the different types of power, and this will be available as a free download that you can pick up from www.yourceomentor.com/episode5. Legitimate power. As a senior leader in an organisation, you'll always have the benefit of legitimate power, but be aware of how you're using it and how often it's your go-to. Don't overuse it, thereby disempowering your people, and don't let it slip to the dark side and morph into coercive power. It's always working in the background, just don't bring it to the foreground too often. 

Coercive power. This is the least effective in the long term if you want to be a great leader. You may be able to make people do stuff, but they will resent you for it. Remember, they'll always find a way to get even. It'll zap the motivation and discretionary effort right out of your organisation. Use this only when absolutely necessary and all other options have been exhausted. 

Expert power is highly appropriate for an individual contributor, but less so for a leader. Your ability to drag out your people's expertise and contribution is massively reduced if you appear to have all the answers, so be highly competent in many areas, otherwise your people may not respect you, but don't be a deep expert in any. Leave space for your people to excel. To quote Jeffrey J. Fox, "You don't buy a dog and then bark yourself." Leadership fallibility and openness relies on you letting go of your expert power. 

Reward power can be extremely positive and extremely powerful, and every leader in every organisation uses it in some way, shape, or form, but just be aware of what actually drives your people at an individual level. So just as a hint, people aren't always driven by the financial reward. If you want a sustainable culture, don't just reward the what, but also the how, and build this into your organisational processes. So for example, compensation and benefits, special awards, and performance standards. 

Finally, referent power. For a leader who's developing and growing, this builds over time. The increase in your referent power is directly proportional to your people's desire to follow you through their intrinsic motivation, and this allows room for respect, and lets your people see the higher purpose, and encourages the collaborative behaviours necessary to deliver that. Just one major caution: don't let this slip into the soft, permissive culture of simply being liked. This will take your organisation nowhere. So if you're in doubt, once again, please revisit episode one, Respect Before Popularity, and episode two, Building a High Performance Team

Okay, so that brings us to the end of episode five. To pick up the free download, The Rules of Thumb for Exercising Power, go to www.yourceomentor.com/episode5. Thanks so much for joining us, and remember, at Your CEO Mentor, our purpose is to improve the quality of leaders globally. So if you liked this episode, please share it with your leadership network so that we can reach even more leaders. I look forward to next week's episode, where we'll deal with one of the hottest topics in leadership, the psychology of delivering tough performance feedback. Until then, I know you'll take every opportunity you can to be a No Bullsh!t Leader.