STRATEGIC MANAGEMENT

Strategic Management

Strategic Management

Introduction

Power and authority are very important topics in understanding organizations and management, the more so because they tend to be ignored by economic accounts. A standard definition of power is that given by Dahl. The basic idea is that we have power over someone else to the extent that we can get that person to do something that otherwise they would not want to do. That is, we can get someone to act in a way that they consider to be contrary to their interests. 

General Review Of The Theories Relating To Power And Authority

The most obvious source of power is control over some thing of value to someone else. For example, an important source of power for some managers is control over bonuses, influence over promotion decisions, and so on. This is the root of what is sometimes called “dependency theory:” A has power over B if A controls something valued by B which B cannot obtain from another source(Childs Cater 1954). This emphasises the relational nature of power: we can usually only speak of someone being more or less powerful than someone else, rather than of some absolute level of power. When we describe someone as being powerful, what we mean is that he or she has power over many people. The dependency model also points to possibility that power might be balanced. A's control over something of value to B will not confer power if B also controls something that A wants. Normally, both parties will control something of value to the other. If B didn't have something of value to A, why would A be trying to get B to act in a particular way? It might be some skill, knowledge, or simply time that A needs. So B is not totally without power. The question then becomes the relative value of the resources controlled. This is summed up in the phrase “everyone has his price.” This implies that if A has control over sufficiently valuable resources, he will be able to get B to do what he wants. However, this phrase also implies that there are “prices” below which B will refuse to accede to A's demands — most people would have limits beyond which they would not go even at the cost of loosing a bonus, promotion or even their job(Lachman 1989 231-251). Furthermore, there is no guarantee that A will be willing to pay the price that B requires to accede to A's demands. This argument implies that there is no one in an organization who has no power, unless he or she is truly “redundant.” Power is not the exclusive preserve of managers. It is not difficult to think of factors that might affect the power of other employees. For example, the more rare a skill, the more power the possessor of the skill will have. Employees would be expected to have more power when unemployment is low, since labour will be in shorter supply. There are many potential sources of power — these are well described in textbooks, such as Morgan. Dahl's definition of power implies that there is some conflict of interest involved in power ...