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Reward Power(Organizational Behavior)

Power can be described as the capacity of an individual or a group to exert their will over another or others (French and Raven, 2001) or influence the goals of a relationship. Power is not a characteristic of any one individual, rather, it is defined in terms of relationships and transactions between people. Power is crucial to the achievement of individual goals, the resolution of conflicts, and to communication competency within a group.

Reward Power is the fastest way to persuade. Because it refers to the ability to deliver rewards or benefits to influence others. These can be financial, material, or psychological rewards.

With Reward power you offer incentives. Reward Power is based on utility, which is an understanding that in every transaction there is a potential for exchange. Essentially, utility power recognizes that there is always something I want and something you want. We can meet each other's needs by swapping what we have for what the other wants. Prizes are a form of utility power. They are a way to reward people for doing what you want them to do. The reward becomes the incentive for compliant action. Examples of utilities include sales bonuses, paychecks, incentive clauses on contracts, bonus miles on airlines, and bonus points on credit cards.

Differentiation

It is important to understand some incentives will work well with one person, but not with another. To some people, money is the reward. Still to others, recognition is the reward. As a persuader, you need to find the motivating force or reward for each person you work with - you must understand the desires of the person or group. Reward Power is extremely effective in changing human behavior and in increasing your ability to persuade. You get what you want with minimal effort.

The Law Of Diminishing Returns

There are several inefficiencies to note, however, when using rewards. First of all, the law of diminishing returns quickly takes over when you employ this type of power.

Diminishing return means the more you use the reward, the less powerful it becomes. When people become accustomed to an incentive, they can become bored with it and either expect more or drop performance standards if the incentive is removed. One example is the common practice of offering children rewards for reading in elementary school. They win pizza or other prizes after they have read a certain number of books. These incentives often backfire because many of the children think they need a reward to read. Reward Power ultimately leads to the desired outcome, but the incentive generally has to be repeated each time to get that desired outcome. The reward is only effective as long as the person doesn't see a "better deal." Your incentive will always be compared to the next person's offer. Rewards reinforce behavior, so as long as you are employing them, expect your prospects to keep demanding them.

Reinforcement Theory

Reinforcement Theory has a lot to do with Reward Power.If a person knows a positive consequence will follow a certain action, then they will perform that action. Consequences influence behavior. The type of consequence involved influences what actions people will take and what actions they will avoid. There are three main rules of consequence. They are:

(1) Consequences giving rewards increase behavior.

(2) Consequences giving punishments decrease behavior.

(3) Consequences giving neither rewards nor punishments extinguish behavior.

Remembering these basic rules can be an excellent guide for deciding what to do in certain situations, depending on the desired outcome. Just be sure you take into account some of the Reinforcement Theory's limitations. Some examples of such limitations are listed below.

Limitations of Reinforcement Theory

1. What is considered reward or punishment will vary according to who you're working with and what the exact circumstances are.

2. As mentioned earlier, rewards can lose value over time. Instead of feeling rewarded, the person will feel like you owe her something.

3. Other sources of reward or punishment may interfere. For example, an employee may value the reward of esteem and friendship from other less productive employees more than what you have to offer.

4. If a person is just responding to a reward, then there has not really been an internal change. They will revert back to their old behavior if the reward doesn't remain part of the new routine.

5. Punishment is difficult to deliver well. It is a powerful tool, but it must be executed appropriately. Punishment must have the following elements to be effective: a) immediate, b) strong or firm, c) unavoidable, and d) consistent.

6. Punishment can breed anger, fear, and hopelessness. These negative emotions will be associated with the person inflicting the punishment.

Coercive Power

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 with a request.

For example:

Coercive power could take the form of a threatened strike action by a labor 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.

All of these practices have one vital element in common - the element of fear. The fear that these threats will be used is called coercive power.

It has frequently been noted that the use of coercive power can leave behind its share of casualties. Although this is likely the reason why coercive power can be effective, it is generally of short duration and can also generate a lengthy amount of dispute in its aftermath. Parties to an integrative negotiation pay the costs before the actual agreement is reached, while parties involved in a war often pay the cost later (and in many instances, for centuries after the war has been fought).

In the period from 1933 to 1945, millions of innocent people were executed in Nazi Germany's gas chambers. The demise of this multitude was arranged by a single individual who issued a series of commands to carry out these horrific orders.

The cement that enjoins command to action is obedience. The psychologist Stanley Milgram (1963) states that obedience is the psychological mechanism that links individual actions to political purpose. It is the dispositional adhesive that ties people to systems of authority. Human history has seen a multitude of atrocities because of our tendency to obey orders. Several historians have observed that crimes against humanity has occurred more often as a result of obedience than due to any other form of rebellion.

The trouble that stems from obedience to authority is almost as old as humanity itself. This is one of the reasons why authority figures can be extremely effective when negotiating with subordinates.

Comparing Reward Power and Coercive Power

In spite of how coercive power can have an incredible short-lived effect, it should appear fairly obvious that reward power is, according to Lewicki Et Al (1985:247), far more likely to generate coveted results, with less close observation and control than coercive power.

Yet, the use of coercion in negotiations is a common occurrence. When simple persuasion fails, emotions erupt, when self-esteem is under attack, or when avarice eclipses the understanding of the application of its potential cost, the use of coercion through threats and hostile language will likely increase. During these moments the emotional expression of anger or feelings of frustration and impotence may engulf the rational perception and benefits provided by reward strategies.