Managers Part IV - Reward & Coercion Based Management

In Part III we listed the Five Sources of Management Power:

1. Legitimate Power: The ability to influence other due to one's position, office or formal authority
2. Reward Power: The ability to influence others by giving or withholding rewards such as pay, promotions, time off, etc.
3. Coercive Power: The ability to influence others through punishment
4. Expert Power: The ability to influence others through special knowledge or skills
5. Referent Power: Power that comes from personal characteristics that people value, respect or admire

We looked at #1, "Legitimate Power". Like the name suggests, it's indeed "legitimate", but at some point the rookie manager will realize that the title and the name tag that goes along with it is pretty ineffective by itself at influencing people. A few managers skip these next two methods, but most do not and employ the carrot and stick method of management: Rewards and Coercion. Some amateurs combine both methods, but most enjoy the coercive source of power due to the many opportunities for yelling.

Bosses who lead from the giving side of Source #2 (we'll refer to it as #2a) are often thought of as "good" bosses by many employees. They are free with praise, give them whatever schedule that they want, don't assign them any tasks that they might find unpleasant and generally give employees free reign to do whatever they want. The problem with this kind of manager is that not only is he allowing the employees to manage him but this kind of leadership inevitably generates employees who will take advantage of the #2a manager's "good nature". This engenders feelings that some employees are "teacher's pets" and "get away with murder". Many years ago I worked for one of these managers. He was the head manager and I was the assistant manager. One of the more frustrating aspects of working for him was that he would lay down rules, schedules, expectations, but would not follow up to make sure that his directives were being followed. He was great with the carrot, but never used the stick. To this day he is loved by most of his employees and would be rated a "good" manager by many...but not by all.

The giving or withholding rewards such as pay, promotions, time off, can be an effective tool of management. The expectations and standards for receiving these "rewards" should be clear and attainable and administered consistently. Every employee should know what the standards and expectation is for receiving a raise. The process for promotions should be as transparent as possible (demotions too!). Most employees aren't working their jobs simply because they love the industry they're working in. They need a certain level of pay with reasonable expectation for increases; they want a schedule that works well with their other responsibilities; they'd like to be able to take paid time off -- they have requirements that need to be fulfilled in order to continue working at their job. Providing all of these things is what the manager needs to do for the employee in exchange for the employee following the manager's instructions and meeting their expectations. Ideally the employer-employee relationship will be mutually beneficial and not even look like the exercise of power. 

There are many types of punishment that can be meted out to create the atmosphere of fear that some managers believe is necessary to compel obedience. The "write up" and it's good buddy the suspension, assigning "crap jobs" to trouble-makers, and the ever popular yelling. Rewards are listed as a separate source of power, but the withholding of rewards goes hand-in-hand with coercion. Managers who lead from Source #3 and the withholding portion of Source #2 are universally rated by employees as "bad" bosses, but for all the raised voices and threats, these managers have little more success than Source #1 managers at getting people to do what they want, in addition to the normal slacking off, you now have added employees who will actively undermine and sabotage the boss's efforts.

The problem with depending on either #2 a or b, or #3, as a source of authority is that it's essentially either bribery or blackmail. These managers are not teaching their subordinates to do their jobs well because it's their job, but because they are either getting something (a bribe) or are being threatened with punishment (blackmail).

Since the confluence of the Covid pandemic and low unemployment the last few years, the power dynamic has shifted somewhat. Employees have leveraged their manager's fears that a position will remain unfilled if they quit by allowing employees to get away with not doing the requirements of their jobs without consequences. There are still theoretical standards, but there is no enforcement of those standards. This creates a race to the bottom, where "bad" employees still receive the rewards (regular pay increases, promotions, time off requests) while the "good" employees see no up side to following the rules and eventually become "bad" employees as well. 

Before we get to Sources #4 & #5, let's summarize the first three:

Legitimate Power, #1, is theoretical, in other words, it exists on paper, but doesn't get exercised in practice unless there are some of the other sources to strengthen it. Sources #2 and #3 are methods by which a manager can motivate employees to excel, but they must be applied evenly and fairly, with expectations, consequences, and benefits all communicated clearly. Employees have power too -- they can withhold their labor by quitting, they can push management to honor a union contract or standards laid out in the employee handbook. But once hired, the employee and the manager have agreed to the terms of employment.  

Start with Part I