Page 117 - DMGT519_Conflict Management and Negotiation Skills

Unit 5: Role of Power in Negotiation

Notes

Notes Rules of Power

Knowing the following rules of power comes in handy when entering into a negotiation.
Rule #1: Seldom does one side have all the power. Even the individual who goes to a bank to
ask for a loan has power—the power to decide which bank to apply to, the power to decide
an acceptable interest rate, and the power to decide what to put up as collateral.
Rule #2: Power may be real or apparent. When I was a proctor in the sociology department at
San Diego State University, I knew that cheating was a potential problem. As I was passing
out tests, I announced that I would uphold the university’s “policy” on cheating. One bold
student asked what the policy was. My response was simple: “If you need to ask, you don’t
want to know.” This was the first time I had ever seen all sixty students staring at their
own paper! Does the university have a policy on cheating? I don’t know. But in this
situation, whether the power was real or apparent didn’t matter. The students perceived that
I had the power.
Rule #3: Power exists only to the point at which it is accepted. At the airport on a return trip
from Europe, I noted that all the ticketing agents for economy class had at least a twenty-
minute line to check baggage. Yet the business and first-class agents had not one person in
line. I boldly walked up to the business class agent and got my seat assignment. Of course,
this strategy was successful only because the ticket agent was willing to work with me. But
I never would have known if I hadn’t tried.

Rule #4: Power relationships can change over time. This is one of the hardest lessons I have
ever learned. In my youth, I had the same girlfriend from the seventh to the eleventh
grades. In the beginning, I had the power in the relationship. I chose which activities we
would become involved in and who our friends would be. Then something happened that
sent me into a tailspin. My girlfriend was asked out by the student body president!
Overnight, I was sending roses and begging for a date.
Rule #5: In relationships, the side with the least commitment generally holds the most power. If you
are negotiating to buy a car from a salesman whose boss has warned him that he had
better start making sales, and you are not committed to buying this particular car from
this particular dealer, you are in the driver’s seat in the negotiating process.

5.3 Use of Power in Negotiation

1. He must identify his dependence and the individuals on whom he is dependent. He has to
find ways to minimize that dependence. He does this by finding alternative persons who
can give him the same results. He can then, if it becomes necessary, reduce or eliminate his
dependence on one person and transfer it to another.
2. If dependence cannot be transferred, he tries to neutralize it. He can do this by ‘buying’
loyalty – giving incentives and rewards which bind the person on whom he depends,
closely to himself. This ‘buying’ need not be financial alone. He could build support
among other groups in the organization, which he could use against the person on whom
he is dependent. He could attract to himself the people who are supporting the person on
whom he depends. All this reduces the power of the person on whom he is dependent.

3. The higher he rises in the organization, the more contacts he must nurture with all the
stakeholders, so that he has support above him to be used when necessary, against those
on whom he depends. Stakeholders for a Director in a company would include shareholders,

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