It will be useful to distinguish between authority and power before concentrating on the authority in organization. Power, a much broader concept than authority, is the ability of individuals or groups to induce or influence the beliefs or actions of other persons or groups. Authority in organization is the right in a position (and, through it, the right of the person occupying the position) to exercise discretion in making decisions affecting others. It is, of course, one type of power, but power in an organization in an organization setting.
Although there are many different bases of power, the power of primary concern in this article is legitimate power. It normally arises from position and derives from our cultural system of rights, obligations, and duties whereby a â€œpositionâ€? is accepted by people as being â€œlegitimate.â€? In a privately owned business, authority of position arises primarily from the social institution (a â€œbundle of rightsâ€?) of private property. In government, this authority arises basically from the institution of representative government. A traffic officer who gives you a traffic ticket gets the power to do so because we have a system of representative government in which we have elected legislators to make laws and provide for their enforcement.
Power may also come from the expertness of a person or a group. This is the power of knowledge. Physicians, lawyers, and university professors may have considerable influence on others because they are respected for their special knowledge. Power may further exist as referent power, that is, influence which people or group may exercise because people believe in them and their ideas. Thus, Martin Luther King had very little legitimate power, but, by the force of his personality, his ideas, and his ability to preach, he strongly influenced the behavior of many people. Likewise a movie star or a military hero might possess considerable referent power.
In addition, power arises from the ability of some people to grant rewards. Purchasing agents, with little position power, might be able to exercise considerable influence by their ability to expedite or delay a much needed spare part. Likewise, university professors have considerable reward power; they can grant or withhold high grades.
Coercive power is still another type. Although closely related to reward power and normally arising from legitimate power, it is the power to punish, whether by firing a subordinate or withholding a merit increase.
While organization authority is the power to exercise discretion in decision making, it almost invariably arises from the power of position, or legitimate power. When people speak of authority in managerial settings, they are usually referring to the power of positions. At the same time, other factors, such as personality and style of dealing with people, are involved in leadership.