Understanding Negotiation Power

http://www.mauricekerrigan.com/blog/understanding-negotiation-power/

Most people associate the word ‘power’ with one side dominating or overpowering the other. I define power as the ability to influence people or situations. With 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 unlikely to amount to much.

The nature of a relationship in turn has an impact upon the quality of communication within it. If we do not trust someone, we are in danger of either disregarding what they say or looking for hidden meanings that may or may not actually exist. The nature of a relationship impacts heavily upon negotiation and is a major influencing factor on the likelihood of satisfactory outcomes.

Consequently we are going to look at relationships from another angle – that of power.

Understanding power

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 organisation. 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 can instantly disappear – since others were influenced by the position, not by you.

It is vital to understand that legitimate power only has influence if it is viewed by others because it occurs only in a social structure. A few 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.

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. 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. Non-verbal rewards might comprise: ‘Giving individuals in the other party more space at the table’ or ‘nodding of the head to signal your acceptance and that you approve’. Ingratiation is occasionally referred to as the ‘art of flattery’. The most common tactic of ingratiation in negotiation is to complement the abilities of the people whom you wish to influence. This tactic, frequently referred to as ‘other enhancement’ often entails the use of flattery – the exaggerated praise of others. Such a tactic usually succeeds because people tend to like the flatterer who is praising them.

Expert – This is based on a person’s superior skill and knowledge. Any individual person who has an expertise that 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 higher becomes the degree of expert power that they possess. Expert power is occasionally called information power and is frequently a personal trait of the individual. In any negotiation situation, expert power is the most standard type of power that is applied. All experts possess an expertise in a certain field, but rarely does their expertise extend to cover the entire field under discussion in the negotiations.

Referent – This is the result of a person’s perceived attractiveness, worthiness, and right to respect from others. The magnetic appeal of this individual forms the basis of referent power. This attraction may due to physical attractiveness, dress, mannerisms, lifestyle or position, but can also include friendliness, congeniality, honesty, integrity and so on. People who are truly charismatic are those individuals who possess a distinct mix of physical traits, speech, mannerisms and self-confidence. They are capable of influencing a very large group of people by their actions. Referent power stems from the need of an individual 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 which gives them more control because of this identification. This type of power is often considered as one of the most potent in a negotiation.

Coercive – This comes from the belief that a person can punish others for noncompliance. Coercive power is the opposite of reward power. It is the ability of the power holder to remove something from a person or to punish them for not conforming to a request. Coercive power could take the form of a threatened strike action by a labour union; the threat of preventing promotion or transfer of a subordinate for poor performance; it could be a threat of litigation; it could be at threat of non-payment; it could be the threat to go public; and it could even be a threat of physical injury.

Parity of power

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 he or she has. 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 behaviour of a successful negotiator.

Over two days, Maurice Kerrigan Africa’s interactive, systematic and practical Creative Negotiation Skills training course will give you the confidence and tools to tackle any daily negotiation challenge.

You might be interested in their upcoming 2-day course scheduled for 24 – 25 November 2014 in Johannesburg, South Africa.