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The Five Power Bases of Leadership in Business Management

written by: J. Smith•edited by: Michele McDonough•updated: 12/7/2010

In order to lead an effective business team, you must understand the power bases and their effects on group members.

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    power base In order to be an effective leader in the business world, you must have the ability to influence others during group meetings. There are a number of different power bases that can affect your ability to be a respected team leader. If you do not possess any of these qualities, it is unlikely that you will have much luck persuading other group members to agree with your ideas. By understanding these power bases, you can work on improving your perception and earn the respect of others.

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    Legitimate Power Base

    Legitimate power is the most influential type of power that a leader can have over a group. If you hold this power over a group, it is likely due to the fact that you were previously chosen or elected to be in charge. The group has already recognized your abilities simply by you being elected, so any additional ideas you may have in relation to a business project will often be accepted with little resistance. However, having too much influence can also be bad thing, as others may blindly follow without challenging your ideas.

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    Authority Power Base

    An expert in a given field also tends to hold additional power and influence over business groups because they have more experience with the project. Instead of making the same mistakes again, the expert can guide the group in an efficient direction. This can lead to negative outcomes though, if the information provided by the expert turns out to be unreliable or ineffective. If you are working in a business group with an expert, be sure to verify their information before proceeding with a course of action.

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    Coercive Power Base

    The coercive power base tends to have a negative connotation, as it relies on punishment as a form of power. Group members will tend to side with a person if they have the ability to fire or demote them from their current position in the company. Because of this, it makes for a fairly detrimental group style, as your project’s solution may not be the best fit.

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    Incentive Power Base

    Incentive power is nearly the opposite of coercive power, as it relies on rewarding people in the group for their contributions. If you have the ability to grant bonuses, vacation time, or any other highly desirable reward, you hold a fair amount of power over the group. It is essential that you find an incentive that everyone in the group would enjoy, or each individual may not perform to his or her fullest.

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    Referent Power

    The referent power base is a fairly simple concept to understand, yet a difficult thing to change. It relies solely on how likable you appear to other members of your group. Since different people look for different things, it can be challenging to appeal to everyone at the same time. People who look up to you are more likely to agree with your ideas, even if they do not feel strongly about them.

    Image: renjith krishnan /

Group Decisions in Business

Working as a team is an essential part of the business world. Learn new ideas and prevent common problems by reviewing the information presented in these articles.
  1. Four Ways to Make Group Business Decisions
  2. Five Potential Problems of Team Decision Making in Business
  3. Four Important Task Leadership Roles in a Group Business Setting
  4. The Four Key Process Leadership Tasks in Business Group Communication
  5. The Five Power Bases of Leadership in Business Management