Chapter 7
Power, Politics, and Conflict
Management
Timothy Hoff and Kevin W. Rockmann
CHAPTER OUTLINE
t
The Uses of Power in Organizations
t
What Is Power and Where Does It Come From?
t
Key Power Relationships in Health Care Organizations
t
The Political Nature of Power
t
The Abuse of Power in Health Care Organizations
t
Power as a Key Source of Conflict
t
Types of Conflict
t
Negotiation as a Conflict Management Tool
t
Common Mistakes in Managing Conflict via Negotiation
t
Negotiation Strategies and Tactics
t
Conclusion
LEARNING OBJECTIVES
After completing this chapter, the reader should be able to:
Identify what power is and how it is used within health care organizations
Describe and compare the major sources of power within health care organizations
Identify the differences between individual and subunit sources of power within organizations
Identify the differences between managerial and professional sources of power within health care organizations
Summarize the interrelationship between power and politics within organizational settings
Describe the demographic and contextual factors that affect how power is distributed within health care
organizations
Classify the various conditions that give rise to power abuses in health care organizations
Identify the different roles played by trust, fairness, and transparency in preventing power abuse in health
care organizations
Describe the different types of conflict and how they might be present in various health care organizations
Describe how emotions affect individuals attempting to manage conflict
Describe the various mistakes relating to how individuals think about negotiation and how they think about
relationships
Identify the difference between interests and positions and describe why understanding that difference is
critical in negotiation
Compare the benefits of compromise, competition, and collaboration as three distinct strategies for negotiation
Describe the tactics to find a better solution, the tactics to acquire information, and the tactics to influence
others
CHAPTER 7 r Power, Politics, and Conflict Management
157
KEY TERMS
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The concept of “value-based purchasing” (VBP) has gained traction as a potential means to better link health care
outcomes to payment. Numerous national demonstration projects are underway, and the concept’s flagship philosophy, “pay-for-performance” (P4P), has been integrated into the majority of physician practices and many hospitals
across the United States. VBP rests on a fundamental principle—that practitioners and institutions that produce the
best outcomes, from both an efficiency perspective and a quality-of-care perspective, should be rewarded financially,
while those who underperform should be subject to earning less. This approach is innovative because traditionally
everyone in health care got paid the same, regardless of their performance excellence, for the services they provide.
However, the VBP approach unleashes the potential for many power dynamics within the health care setting
and for conflict among different stakeholders. For example, the issues of how to measure cost-effectiveness and
quality become front and center to making VBP work. Because there can be substantial disagreement as to the
“right” ways to measure these outcomes, the use of power can become an integral component of making decisions in this regard. When one stakeholder such as the Centers for Medicare and Medicaid Services (CMS) uses
its power to try to influence the kinds of measures used, conflict may erupt. This conflict can undermine the success of pay-for-performance programs by promoting an adversarial relationship among the parties involved. Insurance companies, employers, and government—all of whom pay for health care services—may seek to exhibit
greater influence over the measurement debate because of the dependence by providers such as physicians
and hospitals on that payment for their economic survival. This may cause consternation and resistance among
providers such as physicians and hospitals, especially if they have differing opinions on the measurement issue.
On the other hand, physicians may use their own advantages of control over clinical knowledge and the public’s trust in them to counteract the influence of payers in deciding which measurements will form the basis for
paying on the basis of quality and value. Hospitals, because they possess the infrastructure that everyone in the
system relies upon to deliver complex care, can exert their own influence to shape measures in a way favorable
to their interests and constituencies. Moreover, patients may have little ability to influence the measurement
debate, simply because they do not have a source of power upon which to draw in getting the other stakeholders
to comply with their preferences. In fact, these overall power dynamics have been seen in the current value-based
purchasing movement, where many major decisions around how to measure become drawn-out exercises in power
use and influence tactics (Centers for Medicare and Medicaid Services, 2017).
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PART 2 r MICRO PERSPECTIVE
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(Continued)
The conflict that arises around identifying the best way to measure outcomes in a pay-for-performance incentive
program is often managed through a political process in which different stakeholders attempt to use their power
in shaping how the debate is conducted. For example, health care payers may push for the establishment of
public reporting of clinical outcomes through devices like “report cards,” in part as a means to get consumers on
their side and to put physicians and hospitals on the defensive. They may want measurements reported that they
feel more in control over, i.e., care processes that can be more easily standardized across different providers. The
use of tactics like report cards and care standardization may be promoted overtly as a rational means to achieve
performance transparency. However, these tactics may also be used covertly to exert and enhance the payers’
control over how “value” and “quality” should be defined and measured in the eyes of the general public. Alternatively, health care providers may put forth a message of “we know best because we deliver the care” to patients
and advocacy groups to try to convince them that they should be allowed to exert greater influence over which
measures are used.
This is where conflict management and, more specifically, the process of negotiation can play a role in moving
the use of power and politics to a productive end. By treating the discussion around measurement within a VBP
approach as one in which multiple stakeholders can simultaneously “win,” there is a higher probability that the
outcome will have something favorable in it for everyone (including patients) and, as a result, will be more easily
accepted by all the relevant parties in the negotiation. In this way, negotiations around how to measure “cost-effectiveness” or “quality” that consider multiple viewpoints, provide voice to a diverse group of stakeholders for
input, and seek to achieve a level of acceptance and satisfaction among all constituencies are likely to create
a more favorable climate for implementing pay-for-performance programs and to enhance the chances for their
long-term success. The use of power and politics goes hand in hand with the use of negotiation, simply because
power and politics create the potential for conflict among stakeholders, and this conflict is best managed through
a more rational approach that seeks to find the most optimum outcome that can be accepted by all.
CHAPTER PURPOSE
As the first In Practice example illustrates, perhaps nothing is as potent a force in organizational life as QPXFS.
Power is the ability to exert influence or control over
others. It dictates a significant degree of what goes on
in organizations, from decision making to performance
outcomes. In health care, where there is greater uncertainty around how to best deliver and pay for care, power
looms large as a key variable enabling various stakeholders to control decision making. Power involves two key
dynamics—influence and dependence—and when these
dynamics are present in large quantities, power may be
wielded by individuals, groups, and organizations in ways
that allow them to achieve their preferred vision and
goals. Those at the sharp end of its use may find themselves unable to pursue their own agenda.
The purpose of this chapter is to provide students with
a clearer understanding of what power is, how and where
to look for it, where it comes from, and how it plays
out in health care organizations. In addition, emphasis
is placed on how power relates to the political aspects
of organizational action in settings such as hospitals,
insurance plans, and physician practices, and the conditions and circumstances that give rise to power abuse
are featured as important factors for managers to keep
in mind at all times. The ethics of wielding power effectively should not be understated. A key focus in the
second half of the chapter is on the role of conflict management in managing the role of both power and politics.
A practical guide is offered for how to use the process
of negotiation to achieve mutually satisfactory outcomes
among organizational stakeholders.
Power and politics can be implemented in dysfunctional, self-interested ways by a variety of organizational
stakeholders. This chapter touches upon this issue. But
it also stresses the important and necessary functions
played by power and politics in getting organizations
and workers to perform effectively. In the case of health
care, power and politics are necessary dynamics for getting things done. The use of power and politics heightens the level of conflict that may occur in organizations,
and such conflict is best managed, this chapter argues,
through a more strategic perspective that focuses on an
ethical, rational, and results-oriented process of conflict
management and negotiation. In other words, power and
politics are the forces that move change and enhance
effectiveness in health care, but these forces are managed best through proven tactics associated with skilled
conflict management and negotiation.
CHAPTER 7 r Power, Politics, and Conflict Management
THE USES OF POWER IN
ORGANIZATIONS
Power can be used for different purposes within organizational settings. Perhaps the most ubiquitous use of power
in organizations involves determining the key choices
made at an organizational level to guide overall company
strategy (Finkelstein, 1992). The types of choices in this
regard most amenable to the use of power include those
that involve higher levels of uncertainty and innovativeness (Mintzberg, Raisinghani, and Theoret, 1976). The
use of power by chief executive officers, boards of directors, and other top leadership to guide the direction in
which the organization moves, how it chooses to compete, which products or services to offer, and the type of
business model employed for pursuing profit has existed
as long as the concept of the corporation. Leaders can
and do use power effectively to make strategic decisions
in efficient ways.
Power may also be used to influence the actions of others, be they workers, professionals, other organizations,
or the customers that use the organization’s products. In
this way, power is thought of as a highly coercive mechanism alongside other influence-wielding tactics such as
159
trust, co-optation, and conformity (Hart and Saunders,
1997). Power in this regard is simply another in a toolbox
of tactics individuals in organizations employ to get other
people to behave in desired ways. It requires a certain
degree of effort and resource use like any other influence approach. While it is worth noting that the use of
power in this regard may be no more effective than other
“softer” tactics such as gaining people’s trust to believe
that what is being asked of them is the correct thing to
do (McEvily, Perrone, and Zaheer, 2003), nonetheless, it
is often viewed as a quick, reliable form of control that
can be employed across a diverse array of organizational
situations (Pfeffer, 1981).
Power can control, allocate, and redistribute resources
of all types within organizations (Pfeffer and Salancik,
1978). These resources include human capital such as
clinical staff, financial resources such as budget allocations to hospital departments, and knowledge resources
like innovations or awareness of external markets that
enable a production process to be done better or a competitive advantage to be gained. For example, power can
be used to decide which part of a health care system
should have a fully integrated electronic medical record
to use first in its everyday work. By being the first to use
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Organizations in the health care industry gain a great deal of their legitimacy from accreditation. Many different
types of accrediting processes exist, from the Joint Commission for hospitals and other health providers, to the
National Committee for Quality Assurance (NCQA) for insurance plans, and to more specialized accreditation for
niche providers like laboratories and radiology facilities.
Nothing shifts the power structure more in a health care organization, at least temporarily, than the process
of gearing up for one of these many accreditations. Much of the time, the power shift moves favorably in the
direction of quality improvement (QI) staff and units within the organization. These staff and units are often the
nerve centers of data collection, analysis, and reporting for the kinds of things accrediting organizations request
and verify when they visit. Thus, accreditation offers them an opportunity to gain greater control over scarce
resources, influence strategic decision making, shape organizational culture, and change the manner in which
the organization’s workforce does its jobs.
For example, there may be a particular area or work output of the organization where quality measures lag and
a problem regarding quality is thought to exist. While a QI department may be involved over time in addressing
the issue, if the issue impacts accreditation, greater resources may be made available to QI staff, and greater
freedom provided to them by top management, to try to correct the issue in a timely manner. The resources given
to QI may be taken away from some other part of the organization, lessening the influence of other stakeholders
in the process.
The QI function may be emboldened by the organization to reshape how work is performed in the particular
area, how workers do and think about their jobs, what performance data should be collected, and how that data
must be evaluated. In this way, QI staff come to be relied upon by top management and the organization as a
whole to help ensure that not only are quality problems identified and fixed but also the all-important external
accreditation is not jeopardized in any substantive way. This may also represent an opportunity for the QI function to solidify its influence within the organization, acquire greater resources for itself, and gain greater control
over others competing for the same resources. Thus, even a short-term shift in power and influence within an
organization can have long-term consequences.
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PART 2 r MICRO PERSPECTIVE
such a system, favorable benefits may accrue to that part
of the system earlier and in greater quantity than later
adopters. Resource control and allocation is perhaps the
most widely used application of power within organizations. As the sociologist Charles Perrow asserts, this use
of power deals with “the size of the pie” within organizations and how it is sliced—i.e., who wins and who loses
in getting more of something that they want, while at the
same time preventing others from doing the same thing
(Perrow, 1989).
of subtle influence dynamics to achieve desired goals.
This means that all power brings with it the potential for
heightened tension and conflict within the organizational
setting. This is one of the reasons why the use of power
is often filtered through a political process within organizations (described later in the chapter). It is also a key
reason why negotiation and conflict management, a primary focus of this chapter, are at the center of a more
pragmatic view of how to think about, use, and regulate
power within organizations.
Power may also be wielded for purposes of shaping or
transforming organizational or work cultures in ways top
management desires or to move the organization toward
being more competitive and effective in the marketplace.
For example, leaders of both General Electric and IBM
used their positions and authority, along with that of their
top managers, to help transform these companies during
the 1980s and 1990s into global, innovative firms
(Gerstner, 2002; Slater, 1999). They did this in large
part through a focus on shifting the meaning systems
among employees within each of the organizations toward
beliefs and values that could support a new way of doing
business, one that would enable the companies to meet
the challenges of a changing marketplace.
If influence is at the core of defining power, then this
implies that all power is also relational in the sense
that its existence, magnitude, and use rely upon an
ongoing social exchange between two parties (Dahl,
1957). For example, power can be attributable to a
given individual based on another individual’s perception
of that person’s relative influence. However, that
perception is likely strengthened or weakened over time
as the two individuals interact. The perception of power
gets validated through the social experience within
organizations. In this way, power requires two or more
parties interacting with each other on an ongoing basis
to be fully realized. While it may be understood that one
group or unit has power over another, for example in a
hospital or insurance company, by this definition power
would exist in its fullest form only when the powerful
group or unit behaves with others in a way specifically
designed to control or alter their behavior. In this way, a
group of self-employed surgeons working collectively in
the same practice may be presumed to have the ability
to influence Hospital A’s behavior toward them, such as
better reimbursement rates or preferred operating room
times, because there is an equivalent Hospital B in the
same geographic area where these surgeons can take
their business. But as a relational dynamic, power would
be evident most during moments when the surgical
group, through direct communication or posturing during
contract negotiations with Hospital A, actually convinces
Hospital A to give them higher reimbursement or better
operating room times, and Hospital A complies in this
regard (see the “In Practice” case study “Pay- forPerformance and Power”).
Other companies, particularly in the new gig economy,
have strong leaders who use power to push their companies in directions they believe are necessary for success,
even at the expense of both public and worker approval
(Isaac, 2017; Kantor and Streitfeld, 2015). Using power
to change organizational culture carries risks, because
culture is difficult to change (Martin, 1992). In addition,
the overuse of power by a single leader may stifle a diversity of ideas that may be needed to help the company
grow, change its culture, enhance its workforce, or align
better with the competitive marketplace. Companies
such as Uber and Amazon, while successful because of
strong leaders using their power, nonetheless put themselves at risk if that power crowds out other important
voices in the organization.
WHAT IS POWER AND WHERE
DOES IT COME FROM?
Power has been defined in a variety of ways. However,
common to all definitions is the notion of one stakeholder’s ability to exert influence over others in ways that,
among other things, influence them to do things they
normally would not do (Pfeffer, 1981). In short, power
is defined by the level of control one group has over
another’s behavior (Hickson et al., 1971). Central to this
definition of power is the idea of influence—i.e., that
an individual, group, subunit, or organization has both
the ability and opportunity to control how another acts
either directly or indirectly (Dahl, 1957). In this way,
power by definition involves coercion.Coercion is the use
Power comes from several different sources. Three
major sources of power within an organization are
structural-, cultural-, and individual characteristics.
4USVDUVSBMTPVSDFTPGQPXFS are sources that derive from
the formal or bureaucratic aspects of an organization
(Wilson, 1989). Examples of these aspects include the
organizational chart, written policies and procedures, job
titles and descriptions, and budgets. Structural sources
of power can be used by individuals, groups, or entire
organizations. The potential for power is built into every
organization through the existence of a formal structure that orders social relations and provides a guide
for behaving to organizational actors. In examining how
CHAPTER 7 r Power, Politics, and Conflict Management
161
structure gives rise to power, one need only examine how
one or more of these bureaucratic components instill in
specific people and groups the ability to exert influence
over others.
power deriving from existing norms or beliefs may become
more influential than structural power, in part because it
seeks to influence organizational behavior in ways that are
less visible to public view.
For example, a simple job title and job description
provides insight into the power and influence associated with that position. A job title that includes the
word “manager” or “supervisor” means that the person
filling the position will have formal authority over one
or more persons in the organization. Alternatively, this
authority may be implied in the job title (e.g., medical
director, chief executive officer, vice president in charge
of compliance) and articulated in more detail in the
description itself (e.g., “hires, supervises, and evaluates
all physicians working in the medical group”). From the
title and job description, an individual gains the legitimacy to direct others’ actions, evaluate their performance, and serve as the conduit for information between
higher levels of the organization and the workers under
their direct supervision.
Cultural sources of power cannot easily be identified
through formal artifacts such as organizational charts
or budgets. Instead, they are discerned from an implicit
understanding and appreciation for “how things work” in
the organization. An example of culturally derived power
might be seen in a group of surgeons, where one surgeon
in particular who is widely understood to be “the best
cutter” or “have the best hands” is deferred to by other
surgical colleagues across a variety of work situations, in
large part due to the collective belief that such a surgeon must know and be good at a variety of things if he
or she is perceived as the best in this core skill all surgeons value. In this instance, this surgeon gains power
and influence due to a shared meaning system within the
group that may or may not mirror reality. Similarly, physicians who believe a particular nurse working with them
has great sway with other nurses may defer more to that
nurse across different work situations, giving the nurse
more power to influence not only those physicians but
also her fellow nursing colleagues.
4USVDUVSBMMZEFSJWFEQPXFS gains its stability and legitimacy by creating resource dependencies that place some
individuals or groups in positions to influence others
(Pfeffer and Salancik, 1978). This is seen clearly in the
situation in which one department or unit in an organization is relied upon to help produce the work of other
departments. In health care, such situations abound. For
example, all hospital work from emergency medicine to
surgery relies heavily upon departments like radiology and
laboratory services for its effective completion of work.
The need to test and monitor patient blood levels, screen
for infection and disease, and examine bones and organs
in detail for proper assessment gives both the radiology
and laboratory departments the ability to influence how
other work in the hospital is performed and how other
actors request and get services from these departments.
Without the timely, high-quality assistance of these latter
units, both surgical and emergency services can take longer to do, be of lower quality, and cost more. This creates
a dependency situation in which radiology and laboratory
services, because they are vital to all other work in the
hospital, gain additional ability to determine their own
work patterns and resource needs. In this instance, the
“resource” depended upon is the knowledge and technology associated with radiology and lab work. In other
situations, the resources may be financial.
Power also is derived culturally within organizations.
Culture is defined as the shared meaning systems that
arise out of ongoing interaction between two or more
entities (Schein, 1992). Whereas structure represents
the formal aspects of organization, culture is associated
with the informal aspects, i.e., norms, values, beliefs, and
assumptions. $VMUVSBMMZEFSJWFEQPXFS is power that derives
from these informal aspects and is less visible but no less
potent than structurally derived power. In some situations,
Finally, there are several different JOEJWJEVBMTPVSDFTPG
QPXFS (French and Raven, 1959). These include power
rooted in an individual’s legitimate authority, ability to
reward another, knowledge or expertise, charisma, coercive
ability, and informational centrality. According to French
and Raven (1959), both expert and reference bases of
power involve personal qualities of the individual. In health
care particularly, these two sources of power are commonly
leveraged by professionals. ,OPXMFEHFCBTFE TPVSDFT
PGQPXFS are particularly ubiquitous. Knowledge-based
power derives from an individual’s control over the expertise needed to make key decisions and organize production. This power source is common in health care because
much of the work contains higher degrees of uncertainty
in terms of both processes and outcomes. Some health
care work can be standardized and routinized, but much
of it cannot, providing ample opportunity for those with a
knowledge advantage to assert control.
Knowledge-based power in the health care industry currently plays out in two major ways. Traditionally,
the medical profession has been the primary source of
knowledge power-based. Physicians have been able
to define how clinical work should be performed, how
patients should be treated, and what success and failure
mean in different types of delivery situations (Freidson,
1970). Physicians still remain the most powerful group
of health care workers in large part because they retain
heavy control over the most important forms of clinical
and scientific knowledge available, and others defer to
them in setting the terms under which that knowledge is
applied on an everyday basis.
162
PART 2 r MICRO PERSPECTIVE
More recently, however, knowledge-based power through
structural rather than individual sources has proliferated.
This diffusion is an example of the commodification of
knowledge-based power and the transferring of power
from professionals like doctors to the organization by
standardizing and making it transparent throughout the
organization. In one sense, this modern-day quality movement represents an attempt to garner knowledge-based
power for the organization and its administrators, either
by taking it away from or sharing it with physicians. For
example, a clinical care guideline that is developed to
treat a diabetic or hypertensive patient, where specifics
of the diagnostic process, preferred means of treatment,
and identification of risk factors are all included in it, can
transfer knowledge previously within the exclusive domain
of the physician to the organization, reducing the physician’s power in the process.
Finally, it is important to note that none of these three
power sources acts alone to generate power in an organization. Sources of power can and do interact with each other,
as in the case above where knowledge-based power may be
wielded by individuals even as some of that power is embedded formally in the organizational structure through guidelines, policies, and “best practices.” The concept of OFUXPSL
DFOUSBMJUZ is another illustration of interaction occurring
between knowledge-based and structural sources of power.
Network centrality refers to a situation within an organization in which one work group or unit lays at the intersection
of many other work groups or units, as a result becoming a
repository of knowledge and understanding about how the
entire organization works (Ibarra and Andrews, 1993). This
makes them indispensable sources of information for other
parts of the organization and provides them with a greater
ability to influence the actions of others.
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Managers and physicians working in the same health care organization might draw upon different sources for
establishing and maintaining their power. Managers work in positions typically associated with the formal organization—i.e., the bureaucratic chain of command that exists to help coordinate work in standard and routine
ways. If one examines an organizational chart for a department or the entire organization, it may be clear that
persons occupying management or supervisory positions possess specific degrees of influence over different
organizational functions, budgets, or staff. Physicians, especially those not occupying formal administrative positions, derive their power mainly from knowledge-based and cultural sources. These sources are not specific to
any single organization, as might be the case for management power, which relies upon formal policies or organizational charts. Rather, physician power derives similarly across all organizations from the wider societal belief
that doctors “should be in charge,” possess the most valuable knowledge for effective health care delivery, and
are more likely to represent the views of the customer, i.e., patients and their families.
Within the hospital setting, for example, a “dual hierarchy” still exists that recognizes the power of both
managers and physicians to direct staff, control work, and make decisions for the organization. One part of the
hierarchy recognizes the role played by management personnel in these areas, while the other bestows that same
recognition on physicians. Thus, we have “medical directors” who retain control over clinical staff and delivery
and department or unit managers whose formal domain is overseeing budgets, nonclinical staff, and often quality
improvement reporting. It is this dual hierarchy and its everyday implementation that gives rise to ongoing tension between the two groups within settings such as a hospital. With each having power and influence, and each
seen as legitimate by key stakeholders within the organization, the imperative becomes one of advancing the
positive contributions of each group to organizational functioning while minimizing the conflict and confusion
potentially arising from both groups asserting their power in the same situations.
And assert power they do. Managers may use formal devices to both assert and pursue power, such as the creation of new organizational policies; reorganization; the collection, analysis, and reporting of data around clinical
work; and establishment of new domains of authority such as quality assurance or accreditation. They may not
be viewed as “knowing what physicians know,” but they can seek to offset some of this knowledge advantage by
gaining access to the knowledge, standardizing it, and making it transparent throughout the organization. Physicians may counter in their pursuit and assertion of power by making more overt their knowledge advantage in
specific work situations, moving to make portions of their work more complex, or look more complex, so it is less
subject to management cooptation, and getting others like patients and nurses to believe that they are the most
legitimate group to direct care and make decisions. In each case, different sources are drawn upon to promote
the group’s power and influence. This reality makes health care settings particularly fluid in terms of how such a
dual hierarchy works, how power is distributed between the two groups, and which group accomplishes its preferred goals for the organization and itself at a given period in time.
CHAPTER 7 r Power, Politics, and Conflict Management
The quality improvement (QI) department of a hospital,
insurance plan, or medical group is the clearest example
of this in health care. By collecting and analyzing information on each work process in the organization—e.g.,
what works in one area of the hospital or practice and
could be transferred for use to another part—of the QI
department gains legitimacy and power. Departments and
personnel that require knowledge or understanding held
by other parts of the organization will come to depend on
such a “network-central” entity like the QI department to
help improve their own production processes.
KEY POWER RELATIONSHIPS
IN HEALTH CARE
ORGANIZATIONS
Health care is a service industry. This means that the
key production inputs are the individuals who provide
the services—physicians, nurses, and a variety of clinical and nonclinical support staff. Since all power is
relational, understanding power within a service industry like health care requires examination of the major
stakeholders and their interactions with each other.
There are three key power relationships in health care
organizations: physician–patient, physician–nurse, and
physician–administrator.
The most important relationship in health care involves
that of physician and patient. All health care service delivery is built around this relationship, because
patients are the ultimate consumers of all health care
services. Traditionally, physicians have held great authority over patients, and the main reason for this has been
the significant asymmetries in knowledge, information,
and access. Physicians possess the clinical knowledge
and skills patients seek when accessing care and historically, such knowledge and skills were not available for
access in any manner other than seeing the physician
(Starr, 1982). Society has also granted to physicians
exclusive or near-exclusive rights to prescribe medications, order medical services such as MRIs and physical
therapy, bill insurance for services rendered to patients,
and to serve as the final arbiter for which types of services are appropriate and reimbursable. These rights
bestow on physicians control over medical decision making, giving them a significant power advantage over the
patients they serve.
For a long time, physician power over patients manifested itself in a paternalistic approach that emphasized
the caring doctor to whom the patient must listen and
comply. This approach limited conflict and tension in the
relationship, as patients were expected to obey the physician’s orders and question less. However, this type of
relationship and the one-sided nature of the power and
influence implied in it have been increasingly criticized
163
as unnecessary and a source of lower health care quality
and patient satisfaction (Wachter and Shojana, 2004).
Although the physician continues to maintain a clear
and significant knowledge advantage over patients, some
believe that information and knowledge asymmetries
between doctor and patient are lessening with the advent
of new information technologies, such as the Internet,
which give patients the ability to access and absorb
quick, easy-to-understand medical information (Pew
Internet and American Life Project, 2002). Another reason for a shift in the balance of power between doctor
and patient may stem from increasing patient distrust of
health care institutions, reflected in lower confidence in
our health care system, a growing health care consumer
movement, and sustained emphasis on consumer-driven
issues such as patient safety (Armstrong et al., 2006;
Hoff, 2017).
The physician–nurse relationship is also fraught with
the use of power and influence. Physicians depend
greatly on the skills of nursing staff in order to perform
their work effectively. However, this dependence does not
translate into equal power for nurses vis-à-vis physicians
since the medical profession retains control over key cultural and knowledge-based power sources. This control
allows them to maintain legal privileges and exert direct
influence over nursing work, pay, and employment status. For example, registered nurses (RNs) and licensed
practical nurses (LPNs) are neither allowed to prescribe
their own medications for patients nor diagnose and treat
patients. Training for these occupational groups is limited largely to preparing them for work roles where they
assist physicians in their clinical work. The pay and prestige of nursing as a field also lags behind physicians’ salaries and prestige.
As a result of this relationship, which is based on
mutual dependence but asymmetrical power, the physician–nurse relationship has been characterized historically by high degrees of tension. More recently,
however, because of workforce shortages in medical
fields such as primary care, the nursing profession has
advanced a new occupational subgroup, nurse practitioners (NPs), which puts them more on a par with certain groups of physicians such as family doctors and
pediatricians. In some states, NPs have independent
prescribing power and can diagnose and treat patients
without physician oversight (National Association of
Nurse Practitioners, 2017). Recent studies show that
NPs may provide care on a similar quality level as their
physician counterparts (Stanik-Hutt et al., 2013).
Over time, if a subgroup such as NPs can demonstrate
equality in work performance in areas traditionally the
purview of physicians, they will provide nursing with an
opportunity to acquire new sources of power for themselves that allow them greater self-determination as an
occupational group.
164
PART 2 r MICRO PERSPECTIVE
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There is no potentially more profound development that may shift the balance of power and influence from physician to organization than the introduction of sophisticated artificial intelligence (AI) algorithms that can perform
population health management, more accurately predict the onset of disease, and develop a deeper set of treatment options for certain patient conditions. IBM’s Watson supercomputer is one example of the AI application
in health care. As this supercomputer continues to absorb medical knowledge, and as it gains experience giving
predictions or analyses, it begins to acquire a certain legitimacy that enables those using AI to wield greater
influence within the system. Organizations and even managers then begin to be seen as sources for knowledge-based power that is relevant for helping the system run better. Patients may also see AI as more accurate
than the individual physician, which can shift the power dynamic as well. Population health management, particularly in the area of chronic disease, may become an example of this power shift in action. If the use of AI can
identify deeper patterns of morbidity and service use embedded in a group of diabetic patients, for example, and
use that information to create treatment recommendations for those patients who are more robust, targeted, and
likely to work, third-party payers will start to rely on machine learning assessments of care delivery more so than
the individual primary care doctor. They may shift more of their payment systems toward rewarding the assessments made by AI algorithms. This will weaken doctor influence and increase the influence of the larger systems
within which these doctors are embedded.
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Some argue that the advent of the Internet and advanced forms of health information technology such as the
electronic medical record (EMR) affords patients an opportunity to rebalance the power inequities in their
relationship with physicians. There is no doubt that patients have become more consumer-oriented in their
health care interactions. Anecdotes abound about the manner in which patients may now come to a physician’s office armed with knowledge gained from their smartphone about symptoms and conditions they may
think they have, and the ensuing confusion that can result from the physician trying to explain to the patient
why the patient’s self-diagnosis is inaccurate or incomplete. In a key sense, though, these anecdotes miss the
main point: that the ability of patients to investigate and consume medical information prior to their interactions with the health care system inevitably creates a more proactive, inquisitive, engaged, and thus powerful
health care consumer—a consumer that has to be more respected and addressed in a different, less paternalistic manner.
There are a variety of report cards, rating systems, and performance measures now available online for specific
physicians, hospitals, insurance companies, and others doing the business of health care. If one requires cardiac
surgery in New York State, for example, there is an easily accessed comparison of morbidity and mortality for
all the cardiac surgery programs operating in New York State that helps in deciding which programs are of the
highest quality. In turn, these report cards mean that cardiac surgery programs must openly compete on the basis
of providing the highest quality outcome to patients, giving patients more power to help determine the direction
such programs take in the way of clinical process improvements, resource investment, marketing, and customer
relations.
Whether the types of patient empowerment created by the Internet and health information technology generally give patients more power in their interactions with health professionals or merely create the perception of additional power, the fact remains that much health care performance is now more transparent and
available for consumers to use in comparison shopping. This “information marketplace” levels the playing
field, if only in a small way, between health care consumers and producers, aiding in the transformation of
an entire industry long built on “knowing what is best for the patient.” However, as medical science grows
increasingly complex, it may be far-fetched to presume that the availability of more information for consumers empowers as opposed to confuses them. This confusion, along with the information overload that accompanies a fully transparent health care delivery endeavor, may provide physicians and hospitals additional
future opportunities to gain back any power loss from the consumer-oriented movement occurring in health
care over the past decade.
CHAPTER 7 r Power, Politics, and Conflict Management
165
The physician–administrator relationship is also one
characterized by the acquisition and use of power. As
noted in the “In Practice: The Pursuit of Power among
Managers and Physicians” discussion, physicians and
management tend to derive their power and influence
from different sources, setting up an ongoing competition for power acquisition that may fester and go unnoticed for some time within the organization. In addition,
the continued presence of dual hierarchies in places like
hospitals creates tension between these groups because
it legitimizes the claim to power for both groups simultaneously, while being less specific about where and
when one group should have more authority than the
other. Finally, physicians and administrators often have
performance-related interests that differ, giving rise to
sustained attempts by each to use power across a variety
of situations to gain a specific preferred outcome.
specific conditions that require things done in the same
manner all the time, and payment made on the basis of
showing “value” in care delivery as defined by a complex mix of efficiency and quality metrics (Centers for
Medicare and Medicaid Services, 2017). The shift from
performance “as defined by the individual physician”
to performance based on global, transparent standards
has been profound. It may threaten physicians’ source
of power because it involves transferring knowledge traditionally controlled and disseminated by the medical
profession to the health care organization as a whole,
and also to patients. In addition, as payment systems are
controlled more by health care insurers and government
programs like Medicare, it is more these payers and less
the providers who may acquire more legitimate sources
of power within the health care sphere.
For example, physicians may remain largely concerned
with their individual patients, how they as clinicians or
their immediate departments deliver care, and thus they
maintain less concern about the overall performance of
their peers or that of the organization as a whole. On the
other hand, administrators (even physicians who become
administrators) are hired directly by the organization
to help ensure effective performance at a macro level,
whether that is defined by work unit, department, function, or the entire organization. It is a manager’s job not
to overemphasize individual performance assessment but
instead examine performance from an aggregate or group
level. It should be noted that these different perspectives
do not represent bad and good perspectives. Rather, the
important point is that difference in responsibility itself
sets up differences in how appropriate performance
should be viewed, and this may lead to conflict and the
use of power and negotiation in attempts to reconcile.
THE POLITICAL NATURE OF
POWER
The modern-day quality movement in health care, payment reform, and the increased emphasis on high-cost,
high-tech specialty care are recent examples of trends
that have exacerbated power battles between physicians
and administrators. For example, differing from a decade
ago, these two groups now come into contact frequently
in a health care system that seeks greater and more formalized performance variety, transparency, and measurement. This has led health plans, hospitals, and practices
to build formal administrative systems, using managers
to run them, that provide the resources and authority not
only to evaluate how clinicians perform but also to make
that information available for patients and the rest of the
organization to view.
Related to changes in how health care quality is
defined and measured is the shift in how health care
services are reimbursed. Examples of this shift include
elaborate pay-for-performance programs that provide
financial incentives for clinicians to perform higher-quality care, standardized “bundles” of care delivery for
Power in organizations is often created, maintained, and
transferred through a political process. 0SHBOJ[BUJPOBM
Q PMJUJDT has been defined as an ongoing process of
“managing influence” (Mayes and Allen, 1977), in which
different coalitions of interests or influence vie for the
opportunity to achieve their desired goals. This process of
managing influence often involves the use of nonlegitimate
strategies and tactics, one of which is the exertion of power
(Mayes and Allen, 1977). This definition is consistent with
others that see politics as a process of using dynamics
like power to gain desired ends (Eisenhart and Bourgeois,
1988). These definitions point to organizational politics as
a key crucible in which power use is amplified and gains
greater momentum. For example, the presence of a highly
politicized work atmosphere both denotes and encourages
the use of power, because it gives stakeholders greater
freedom to assert their rights to control work, each other,
and decisions.
The use of politics is characterized by its hidden
nature; i.e., it involves strategies and tactics that are not
transparent to everyone (Eisenhart and Bourgeois, 1988).
This hidden nature also facilitates power use, especially
in situations that are high stakes, are high risk, or involve
activities not immediately sanctioned by the organization
and its workers. An example of one of these situations is
when a company in financial crisis decides it must lay
off workers to help reverse its fortunes. While the layoff
decision may be known at all levels of the organization,
different departments and units will likely engage in a
political process designed to minimize the layoff impact
on their own workers. This process may include a department or unit making veiled or overt threats to management about the negative outcomes for the organization
of the department or unit being included too heavily in
the layoff decision, moving to get key decision makers
166
PART 2 r MICRO PERSPECTIVE
to support their specific department or unit cause, and
undermining the cases made by other departments or
units to top management.
This process can be hidden from view and often involves
only the most senior managers within each department
and unit and top management. The process itself will
likely involve a wide range of power demonstrations and
attempts to control decision making. For instance, the
nursing department in a hospital may threaten to walk
off the job, especially if they are unionized, if too many
layoffs are aimed at them, or they have concerns about
proper staffing. Physicians may side with them and work
on their behalf with administrators to address the issues,
in part because a shortage of nurses might impact physician performance and potentially undermine their own
sources of power with patients. Nurses may attempt to
use their own power through a political process of trying to convince administration to impose fewer layoffs.
Physician may also appeal directly to “one of their own,”
such as the hospital medical director or physician members on the board, and craft arguments geared to what
they feel would resonate most with another physician.
To shift the example to another hospital unit, the QI
department may allude to the breakdown in hospital functioning that would occur should too many of their workers
be fired. That department may attempt to use its influence
to demonstrate using quality data how the hospital would
be impacted by too many layoffs or specific staffing ratios.
Or, alternatively, the QI department might view reduction
in nursing staff as an opportunity to gain greater influence
throughout the hospital, by having access to the types of
data needed to assess the relative care delivery impact of
different staffing ratios. In this way, the QI department
may end up helping or hurting the nurses’ attempts to
use their own influence to stop layoffs. The notion of organizations as negotiated orders or coalitions of different
interests provides a rationale for why politics becomes a
dominant mode of interaction for members. Seen in this
way, conflict and struggles for influence are endemic,
almost natural, in every organizational setting, in large
part because it is acknowledged by everyone that melding different and often competing stakeholder interests
into a single cohesive set of outcomes remains daunting.
Through this lens, much organizational activity becomes
preoccupied with two things: (1) determining whose interests and perspectives should rule in a given situation and
(2) determining which specific organizational outcomes
are preferred and how they should be attained.
Health care organizations are particularly political organizations. This is due mainly to the presence of several
different, powerful stakeholder groups working alongside
each other. For example, physicians, nurses, and administrators each have the ability to exert influence over
their work settings, make key decisions, and gain control over resources. Much of the management imperative
within health care settings revolves around trying to limit
political activity that aims to exert power in dysfunctional
ways—i.e., ways that benefit the group exerting power
without clearly adding value for the organization as a
whole. The use of politics can be inefficient for the organization in these situations, because it requires individuals and groups to expend valuable time and resources
for self-interested ends, which often reduces the overall
time and resources available to pursue collective ends
related to productivity and quality (Pfeffer, 1981).
On the positive side, politics plays a critical role in
organizations by encouraging groups and individuals to
share power and to ally with each other, if only temporarily, to achieve common goals or outcomes. This reality can
be used by the organization to mount collective efforts
aimed at mutually agreed-upon goals. For example, while
physicians and nurses may spend a certain portion of
their collective time in conflict with one another around
different issues in the workplace, or become preoccupied
with exerting influence in part to gain resources at the
expense of the other group, they may come together and
use their political power to help the organization fulfill its
accreditation requirements or to address a quality deficiency that threatens the reputation of the organization
and its workers. They may also, as noted above, unite
to stop the organization from doing things not in their
collective interests. In pursuing these imperatives, physicians and nurses in the same setting use similar informal
tactics, share information and best practices, and advocate behind the scenes for similar changes. The political
activity generated by two such powerful groups working
in tandem may be quite influential.
Generally, the political process creates a fluid power
structure within organizations, making it more difficult to
predict at a given moment which parts of the organization
may exert their influence and whether or not they will be
successful. The fluid nature of power within an especially
political environment makes it somewhat risky for organizational leaders to attempt to manage the use and acquisition of power. Add to this the dependence of both power
and politics on the type of work environment in which
they are embedded, and the ability to harness political
activity and the power it encapsulates remains one of the
foremost management challenges in modern organization.
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Power is never equally distributed within or across organizations. 1PXFSTUSBUJGJDBUJPO means that different stakeholders may have unique opportunities to access power
based upon their particular characteristics or circumstances. One key source of power stratification, particularly with respect to structural sources of power, derives
from the demographic qualities of stakeholder groups.
CHAPTER 7 r Power, Politics, and Conflict Management
For example, historically, males have been afforded
greater chances to assume top management roles in a variety of organizations compared to their female colleagues
(Ragins, 1993). In U.S. medicine, the most powerful,
highest-paying specialties such as surgery have long been
dominated by male physicians, despite an increasing number of female physicians over the past two decades. Much
academic medicine in the United States also remains populated disproportionately with male physicians, giving this
demographic group inordinate power to control the educational and socialization agenda for medical students and
young physicians (Hoff and Scott, 2017).
Age is another key demographic source of power stratification in health care. For example, professions such
as medicine and nursing are built upon the apprenticeship model of training, where experience is the basis
for seniority. In this way, individuals who have the most
work experience, almost always older practitioners, retain
greater influence and authority among their peers. They
set the rules for professional behavior as well as impose
their preferred cultural meaning systems onto the group
as a whole, with sanctions applied for those choosing
to deviate from their norms. Residency and fellowship
programs that form the basis of professional training in
health care implicitly favor age as a determining factor
for which professionals deserve the access to greater
power and control within their profession.
Employment status also serves as a source of power
stratification in health care. For instance, salaried physicians, who work directly for their medical practices or
for a health maintenance organization, generally have
less individual and collective power than physicians who
own their own practices. In the former situation, the
physicians rely on the organization to pay them a salary,
structure their workloads, and set policies that they must
follow. In the latter case, the physicians may negotiate
preferred rates of reimbursement with insurers and hospitals, can better self-manage their work and hours, and
choose the types of patients and services they offer.
Depending on the size and type of organization in
which an individual works in health care, different power
opportunities may also be afforded. Being an executive
in a large insurance plan that controls a majority of the
market share in a geographic area provides numerous
opportunities to acquire and exert power with physician
practices, hospitals, and employer groups—all of whom
may depend on the insurance plan heavily for the
success of their business. In the same way, physicians
in a particular specialty may come together within a
geographic area to form a single practice organization
that dominates care in that market. They may do this in
part to get better payment terms for their services or to
control how they deliver care. This trend has been seen
increasingly in the United States, with specialists such
as orthopedists, cardiologists, and urologists, among
167
others, splitting their practices off from academic
medical centers to form “super-practices” that contain
significant numbers of the available specialty physicians
in that geographical area.
Finally, controlling financial resources stratifies organizational power. Within any organization, the “power of the
purse” means that those individuals maintaining control
over the distribution of resources have additional power
opportunities than individuals who do not have this control. This is being seen now in the move to “value-based”
reimbursement systems that allow health insurers to tie
payment more to outcomes, leaving doctors often in a
reactive state (Hoff, 2017). These insurers can force providers to have to report more quality information, control
costs better, and adhere to standard care guidelines—in
large part because they control disbursement of the financial resources physicians need to run their businesses.
Traditionally, and within the organization, departmental
units such as finance and accounting retain a great deal of
power within the organization because they are sanctioned
to review or approve the decisions made by other units in
areas such as purchasing, capital acquisition, and hiring.
Very often, struggles for power within the organizational
setting revolve at least in part around one group’s desire
for greater fiscal independence or authority over others.
THE ABUSE OF POWER
IN HEALTH CARE
ORGANIZATIONS
Rather than viewing power as inherently negative, it
is important for managers to view the use of power as
at times necessary for their organization in helping
to achieve its goals in an efficient manner. Managers
should, however, balance this functional view of power
with a more critical perspective that views the use
of power as potentially abusive to the organization’s
employees and external stakeholders (Hardy and Clegg,
1996). Unfortunately, there are an increasing number of
examples of power abuse evident in American business
and health care. 1PXFSBCVTF refers to situations where
one or more organizational stakeholders use power in
ways that are not generally acceptable, often involve selfinterest rather than the organization’s best interests, and
can inflict negative outcomes on workers, customers, and
supporters of the organization.
Power abuses occur within organizations for two main
reasons. One reason is the advancement of personal
ends at the expense of the customer, shareholder, or
employee. Examples of power abuses used to pursue
personal ends could involve chief executives creating
boards of directors consisting solely of friends or business partners, executives directing staff to misrepresent
168
PART 2 r MICRO PERSPECTIVE
financial and performance data to outside stakeholders,
and executives using unauthorized company funds or
resources to enhance personal wealth. All these examples have recently been seen in both health care and
other industries.
Power can also be abused to advance organizational
ends. This form of power abuse is not easy to discern,
nor do all groups within the organization necessarily agree that abusing power to achieve organizational
ends in a given situation has negative consequences. In
fact, such abuse may be sanctioned by numerous stakeholders both within and external to the organization.
Examples of power abuses by managers that are used
to pursue organizational ends could include laying off
employees to send positive signals to board members
or shareholders, without attending to the fundamental
organizational problems or bad management decisions
causing poor performance, and manipulating performance measurements for the sole purpose of misrepresenting the organization vis-à-vis other competitors in
the marketplace. In this vein, potential power abuses
can also be tied to company founder attempts to push
a certain image of their organization in the marketplace
or motivate the workforce in particular ways thought to
be necessary for ensuring company success. Recent
news stories on companies such as Amazon and Uber
demonstrate this dynamic (Isaac, 2017; Kantor and
Streitfeld, 2015).
Regardless of the ends pursued, the abuse of power by
managers or leaders elevates the potential for negative
fallout to occur in the organization. Perhaps most important is the crisis of trust that can occur when managers
or executives abuse power. This trust crisis is expressed
in two primary ways: (1) loss of faith by customers and
external stakeholders (e.g., regulators, shareholders,
funders) in the organization (see the case of Uber for
an example of this) and (2) loss of faith by employees
in management. Both crises continue to be prevalent
in light of corporate scandals in health care and other
industries, as well as in the U.S. financial industry crisis
that helped to produce a severe economic recession a
decade ago.
Loss of faith by customers and other external stakeholders can meaningfully affect organizational performance and survival, in the form of lost business for the
organization, reduced financial capital, stricter regulatory scrutiny, and the development of a negative reputation that allows other competitors to gain a long-term
edge over the organization (Fukuyama, 1995; Sitkin and
Stickel, 1996).
Loss of trust by employees toward managers when
power is abused reduces the potential for positive dynamics within the organization to enhance performance.
Examples of positive dynamics negatively affected by
power abuse include teamwork, cooperative behavior,
communication quality, citizenship behavior, and job
satisfaction (Axelrod, 1984; Blau, 1964; Hoff, 2003;
Whitener et al., 1998). Other negative fallout that may
occur includes increased organizational complacency,
decreased work effort or “shirking” on the part of employees, slower organizational adaptation to change, high
turnover, and decreased quality of services or products
(Burawoy, 1979; Kantor and Streitfeld, 2015). While
not a certainty, the abuse of power can seriously impact
organizational performance, lead to lost business, and, in
some cases, facilitate collapse in the form of bankruptcy
or dissolution. Examples of these outcomes are found in
recent American corporate history, including Enron, Bear
Stearns, Countrywide, and Tyco.
Several conditions facilitate the abuse of power within
organizations. These include high uncertainty regarding
how to achieve goals or desired output; an overly centralized decision-making structure; the scarcity of rival
coalitions both internal and external to the organization,
a lack of reliance by key organizational stakeholders on
each other; an existing culture of organizational complacency; and existing pressure to make quick decisions
within the organization (Brass, Burkhardt, and Marlene,
1993; Crozier, 1964; Mintzberg, 1983; Perrow, 1989;
Weber, 1978). Ironically, many of the conditions that create the potential for power abuse derive in large part from
the same general conditions that give rise to power use.
This highlights the paradoxical nature of power within
organizations, in that the factors that allow power to grow
and be used effectively are also those that, when manipulated in certain ways or taken to extremes, provide fertile conditions for power abuse. Given this reality, a key
managerial task is to institutionalize a structural framework and culture within the organization that limits the
probability that power use conditions are manipulated.
For example, the ability to create dependencies in
relationships on the basis of resources like knowledge
or funding is a potential source of organizational power
within organizations. However, too much of an imbalance
in terms of the extent to which a dependency relationship favors one group over another creates the potential
for power abuse (Brass, Burkhardt, and Marlene, 1993).
This situation is exacerbated when the resources in question are scarce, essential, and nonsubstitutable.
Control over information through structural advantages
such as network centrality is another legitimate source
of organizational power that, when taken to extremes,
often results in power abuse. As discussed, individuals
or groups who position themselves at the center of communication and information networks within the organization are in a position to exercise power. Information is
a resource that allows individuals to set decision-making
premises within the organization and control uncertainty
(Crozier, 1964; Perrow, 1989). However, to the extent
that managers or others within the organization gain
CHAPTER 7 r Power, Politics, and Conflict Management
169
exclusive control over information—i.e., to the extent
that specific individuals or groups can create gaps or
ambiguities in understanding within the organization
that only they can fill—a foundation for power abuse is
created.
deviation from the preferred status quo (Salancik and
Pfeffer, 1977). This may hurt the organization in terms
of performance and ability to adapt to changing demands
in the environment.
The building of coalitions and alliances is a source of
organizational power. However, an organizational environment in which there is a single dominant coalition or
alliance provides a foundation for power abuse. Any leader-centered coalition that does not adhere to a diversity of
viewpoints and perspectives can create an autocratic situation in which the leader’s will and preferences become
those of the larger group (Mintzberg, 1983). This leads
to negative outcomes such as groupthink. The absence
of rival coalitions within the organization creates a situation for power abuse, mainly by lessening the capacity
for creative tension and ideas to compete with each other
on the basis of their informational, logical, and strategic
merits. This decreased capacity encourages the dominant
coalition to introduce mechanisms by which to minimize
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Managers can take several steps to guard against the
abuse of power within their organizations. These steps
include structuring communication networks to create
greater transparency in terms of organizational decision
making, implementation, and evaluation; using boards
of directors and advisory groups as counterbalances to
managerial authority; creating a strong code of ethics
within the organization; designing appropriate appraisal
systems; and emphasizing personal integrity in the hiring function (Alford, 2001; Hoff, 2003; Thibodeaux and
Powell, 1985; Westheafer, 2000).
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There have been instances in business and health care over the years in which top managers, a chief executive
officer (CEO), a company founder, or a board of directors have abused their power through the creation and maintenance of a single dominant coalition within the organization that controls decisions and discourages dissenting
viewpoints. For example, if a CEO desires to have more influence over the organization, she or he may create a
board of directors that consists of close friends, business partners, or individuals who share a similar strategic
viewpoint. In the extreme, these types of boards become “rubber stamps” that may fail to carry out their fiduciary
responsibility as counterbalances to executive control within the organization. They also reduce the quality of
strategic decision making because they abdicate their role of critiquing management decisions. In the final analysis, this allows executives to make decisions that potentially benefit their own ends at the expense of customer,
employee, or shareholder interests.
Imagine a CEO of a hospital who helps place on its board of directors a banker with whom the CEO used to
work, a lawyer who frequents the same country club to which the CEO belongs, the head of a local construction
company that has helped perform work on the hospital, and an old college friend who still goes on fishing trips
with the CEO and is one of the top cardiologists in the community. The prior and existing relationships between
the CEO and these individuals, forged through other work and personal circumstances, may taint the ability of
the group as a whole to generate the creative tension and independent thought needed for developing hospital
strategy and evaluating the CEO’s decision making. For instance, one or more of the board members, because
they trust the CEO from other walks of life, may come to rely on the CEO’s “version of the world” and align their
thinking with the CEO’s, leading to unquestioning support for the CEO’s actions and take on the world. By owing
the CEO for their seats on the board, some directors may be remiss to challenge or disagree with the CEO. Other
directors may perceive that if they help the CEO “get his way,” there is the possibility of additional rewards for
themselves. Still others may simply like the CEO, be friends with him, and so be less likely to contradict his
desires or decisions.
Having directors who know the CEO from prior walks of life, or who feel indebted to a CEO for their position,
increases the chances that the CEO may abuse his own power, especially if he wishes to make certain decisions
or impose a particular strategic decision on the organization. Friendship is important in life, but in the case of
a CEO and his board, it may foster a singular alliance of interests at the very top of an organization that crowds
out alternative viewpoints and critical debate, producing a leadership group that becomes insular, self-interested,
and disconnected from true organizational realities. It is these attributes that can then facilitate power abuse
within the group.
170
PART 2 r MICRO PERSPECTIVE
Creating transparency involves making the sharing of
information a “public good” within organizations. This
means, for example, allowing access to performance data
at all levels of the organization so that everyone from line
employees to the chief executive appreciates the logic
by which specific decisions are made. In establishing
greater internal transparency, managers end up becoming more accessible to employees. This enhances trust
within the organization, and while it does not preclude
the use of power as a necessary dynamic, it is likely to
identify instances of abuse in a timely manner. External
transparency also limits power abuse. Providing key constituents such as shareholders, regulators, and customers
with complete, accurate, and timely performance data
prevents executives and boards of directors from making
decisions that are not rooted in strategic logic but instead
derive more from the manipulation of circumstances on
the part of individuals or groups in the organization.
Many recent corporate scandals that involved managerial abuse of power could have been prevented through the
use of independent oversight mechanisms in the form of
boards of directors and external auditors. Many boards are
laden with members who are connected to the organization
in some manner that makes them reluctant to enact their
oversight role (see the “In Practice: Abusing Power at the
Top Levels of the Organization” example). Such characteristics make boards less useful for controlling power abuse
in organizations. Organizations that staff boards of directors with individuals who have the time to fulfill the oversight role, and who have no personal stake involved in the
results of that oversight, place themselves in the best position to allow the use, but not abuse, of power by managers.
Creating a strong code of ethics and institutionalizing
it into the organization’s culture also limits power abuse
(Hatcher, 2002). Recent examples of power abuses within
organizations have been found to result in part from the
presence of work environments that tolerated and even
promoted unethical (not necessarily illegal) behavior in
relation to the use of power. Establishing a code of ethics gives managers and employees formal guidance as to
how to act across different situations where power may be
exercised. This limits individual discretion in using power.
It also conveys a sense that there are risks or potential
sanctions to using power in an abusive way (Thibodeaux
and Powell, 1985). Key to the success of a code of ethics
is the overt dedication of top management to it.
Designing performance appraisal and hiring systems
that emphasize and reward ethical behavior also limit the
potential for power abuse within organizations. For example, power abuse by managers toward employees through
the use of formal position in the hierarchy is minimized
when appraisal systems exist that judge employee performance across a range of objective performance dimensions. Considering personal values and ethical behavior as
important factors in the hiring and evaluation of managers
and employees heightens the probability that the organizational workforce consists of individuals who are less likely
to take advantage of any power at their disposal. Over
time, it creates an organizational culture in which a negative view toward power abuse becomes a shared norm.
POWER AS A KEY SOURCE
OF CONFLICT
The use of power within organizational settings, along with
the political activity that helps manifest it, can give rise
to conflict. Conflict associated with power and politics
derives from two primary organizational circumstances.
First, conflict can occur when two or more parties have different perspectives, ideas, or agendas; they intend to move
them forward in the organization; and each party is willing to behave in ways that require some form of resolution
to avert a suboptimal or dysfunctional organizational outcome. Conflict in organizations can also arise when two or
more interdependent parties draw upon different sources
for their power or have unequal access to power opportunities in the organization. This second circumstance is most
endemic to health care settings, where different groups
have their work highly coordinated and must rely meaningfully upon each other to deliver services to patients. In
these instances—high mutual dependence among two or
more parties that have different power sources—the key
conflict-generating dynamic involves parties trying to figure out who (and therefore also which power source) is
more influential or controlling in a given situation.
One such instance of this second source of conflict
occurs when there is a specific organizational goal that the
interdependent parties are expected to pursue jointly. For
example, physicians and nurses working in a hospital may
be asked to help reduce the incidence of medical errors
occurring to patients during their hospital stays. To accomplish this goal, each group may want the same resource—
more staff positions, technology, or decision-making
autonomy—and the conflict becomes centered on each
group attempting to claim that resource for themselves.
This is the type of conflict we generally think about.
However, conflict often occurs at a second, deeper
level in this circumstance. This conflict involves disagreements about which power source to rely upon in
order to solve the first-level conflict of who should claim
the desired resources. When multiple sources of power
exist in an organization, ideas for how to resolve conflict
are not necessarily shared by all parties. For instance,
those who possess a knowledge advantage might think
knowledge-based power is most relevant, while those
who are in supervisory or high-level positions and who
have structurally derived power might think relying on
administrative mechanisms like formal policies is most
appropriate (Ashforth and Johnson, 2001).
CHAPTER 7 r Power, Politics, and Conflict Management
A related issue is the choice of which conflict management technique to use in a given situation. For
example, in the physician–nurse relationship or the physician–patient relationship, the physician has culturally
derived power from his or her advanced standing in
the medical profession. That power gives the physician
authority over the nurse or the patient. When conflict
arises between the physician and nurse or the physician
and patient, that physician has to decide whether or not
171
to employ the use of power. The physician may draw on
that culturally derived power to say “I’m the physician,
you are the nurse or patient, and I know better” as an
influence attempt, or the physician can take a different
approach that relies less on formal power use and more
on less coercive means of influence. Effective conflict
management is based on appreciating the sources of
power for each party involved and knowing how and
when a particular power source could be used.
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For those who possess some level of professional or organizational power, it can be difficult to know when and
how to use that power in situations that might benefit the organization’s customers. As the chapter notes, not all
power use is bad. In fact, the use of power is necessary and productive in situations where the customer stands
to benefit in the form of a higher-quality or more efficient service provided to them. Often, the carefully planned
use of power can help overcome organizational inertia regarding the best decision to implement, move needed
change forward, resolve infighting between internal stakeholders that may hold up appropriate decision making,
and produce key decisions quickly in situations where time is of the essence. However, knowing the precise
moment and manner in which to begin using one’s power, regardless of the reason for it, is a challenging task for
any health care manager or professional.
When would you use power within an organization? Several considerations should likely guide your decision making. First, consider the type of outcome toward which your use of power would contribute. Is it ethical? Does it benefit
the organization as a whole? Would it help produce an outcome that improves the efficiency or quality of services provided, or directly benefit the customer in some meaningful way? Can it be done in a manner that does not undermine
other important organizational goals or objectives? The answers to these types of questions are critical for establishing
the prerequisite rationale for using power, a rationale that, at some point, others in the organization or external stakeholders may need to hear. Once these questions have been answered, the second consideration is to assess the type
of actions required for using power and how disruptive or potentially detrimental such actions might be for the rest of
the organization. For example, using power in a strictly covert, highly political manner that masks its true nature as
a control or influence mechanism may not be appropriate, regardless of the type of outcome such a use of power is
aiming to achieve. In short, this step requires understanding the right ways to exercise one’s power. What should be
the level of transparency in using power? Should everyone know that the use of power is guiding organizational action
in the given situation? Are certain actions “out of bounds” with respect to how power will be used?
A third consideration involves assessing the potential unintended negative consequences the use of power
might cause within an organization. Such consequences may result even if power use is determined to be necessary and the actions taken to use power are appropriate. These types of unintended consequences are important.
They may include workforce effects like decreased job satisfaction, productivity, morale, and turnover; organizational outcomes like decreased profitability or client dissatisfaction; increased short-term conflict between
different organizational stakeholders or constituencies; and cultural shifts within the organization that might
undermine worker or management cohesiveness. Predicting which types of negative consequences might occur is
not easy. However, it is imperative to at least discuss openly the probability that some of these could happen and
what could be done to limit the damage done to the organization.
Finally, the use of power, even in an appropriate, required circumstance should be short-lived. Clear consideration must be given to the time frame within which power use will occur, when it is no longer appropriate to
use power in a given situation, and agreement on the boundaries within which power will be used and when it
will no longer be used, regardless of whether or not all the desired outcomes are achieved. This consideration is
important precisely because the use of power takes a toll on the organization, and on the individuals within it,
especially the longer its use occurs. Therefore, this dynamic must be used sparingly, strategically, and with careful attention paid to whether or not it is working effectively.
With these things in mind, power may be exercised by individuals and groups within organizations as well as by
organizations themselves. This notion moves us beyond the idea that all power is bad, that its use is immoral, and that
the organization never benefits from its employment as a tactical device to achieve particular outcomes. That said,
it remains a higher-risk, more unpredictable approach to managing and must always be assessed within that regard.
172
PART 2 r MICRO PERSPECTIVE
The TUVEZPGDPOGMJDUNBOBHFNFOU concerns how parties approach, deal with, and resolve conflict and which
personal, social, and environmental factors affect that
process. The focus here is on one conflict management
tool—negotiation—which is presented as a direct way
to resolve conflict. Other strategies to resolve conflict
could include avoidance, whereby one or more parties
refuse to deal with the conflict, or accommodation,
where one party simply concedes to the other(s). While
avoidance may work in a situation where emotions are
high and time is needed to prepare for negotiation, and
accommodation may work in a situation where the outcome is not of great importance, negotiation is a viable
process when there is a vested interest in the outcome
and when each party wishes to manage the situation
as effectively as possible for themselves and their
interests.
TYPES OF CONFLICT
There are generally thought to be two types of conflict that
occur in groups: conflict related to ideas concerning the
task at hand and conflict related to social factors in the
team (Jehn, 1997). The first type of conflict, known as
UBTLDPOGMJDU, reflects differences between parties in understanding and carrying out tasks. This type of conflict,
while detrimental to overall performance or decision making in the team or group, is seen to be the “better” type of
conflict in that it is less personal and somewhat easier to
accommodate. Task conflict on its own can result in better
decision making in a health care situation. For example,
a doctor and a nurse may have differing opinions on a
course of treatment due to their different interactions with
the patient—in an attempt to resolve this conflict, they
may discover that each has unique expertise that should
come to bear in making the treatment decision.
Interdependent parties struggle in terms of both performance and satisfaction when SFMBUJPOTIJQDPOGMJDU, or
conflict regarding some inherent characteristic of the
other party, is present. The causes of relationship conflict can be related to interpersonal styles, personality,
political preference, or other difference beyond the task
at hand (De Dreu and Weingart, 2003). Relationship
conflict is particularly difficult to deal with because
judgments are being made about the characteristics of
someone else—e.g., “I don’t like them” or “I can’t work
with them.” Even when there is a shared understanding regarding how to solve the task, those groups experiencing conflict rooted in the relationship itself possess
heightened negative emotions and perceive a dislike of
the other party.
If the conflict is primarily task-based, the challenge
is in understanding the viewpoints and perspectives of
all of those at the table. If the conflict is more relationship-based, the challenge is how to navigate around
the heightened emotions and perceptions in the group,
which can interfere with the mutual pursuit of a negotiated outcome. Task conflict can also lead to relationship conflict. For example, if we acknowledge that
two different parties can have two different sources of
power, such as with a physician and an administrator,
the knowledge-based power possessed by the physician
might create task conflict with the administrator, who
has control over resources. In this case, each thinks
they know the best way to solve the conflict, which
represents conflict over the task at hand. However, if
they fail to see the conflict from the other side’s point
of view, that task conflict can escalate into relationship
conflict. Once this happens, not only do they hold different views regarding how to solve the task, but they
now also may be judging each other’s values and character, which can lessen mutual trust and respect. This
lack of trust means they do not have a solid relational
base from which to work, which makes the resolution of
conflict more difficult.
5IF/FHBUJWF4JEFPG&NPUJPOT
The threat rigidity effect states that when individuals
feel threatened, their thinking becomes rigid or inflexible
(Staw, Sandelands, and Dutton, 1981). When conflict
results in an individual feeling like his or her resources
are threatened, or that his or her ego is threatened,
threat rigidity results. These heightened emotions produce a decreased ability to cognitively process information, ideas, and possible solutions. The brain goes into
“protection” mode instead of “exploration” mode, and
consequently the negotiators become preoccupied with
protecting their own viewpoint rather than trying to come
to a creative solution with others. Threat also need not be
actually experienced, as even the expectation of threat
can impact individuals. Carnevale and Probst (1998)
found that when participants expected a hostile situation
with high conflict, they showed less cognitive flexibility
and creative thinking than if expecting a collaborative
situation.
Not only do heightened emotions shut down cognitive processing, but emotions can be socially contagious
(Barsade, 2002). The process of FNPUJPOBMDPOUBHJPO
occurs when emotions are transmitted from one party
to another. If one individual becomes angry, others can
“catch” that anger, and a negative spiral ensues where
they then transfer that anger to others. Individuals experiencing conflict who travel through this negative emotional spiral may find themselves with very few options
that would result in a positive negotiated resolution to
the conflict at hand. This is why individuals experiencing
conflict in general, and relationship conflict in particular, need to be acutely aware of the emotional state of
the group.
CHAPTER 7 r Power, Politics, and Conflict Management
173
rrr*/13"$5*$& "/FHBUJWF&NPUJPOBM4QJSBMJO)PTQJUBM)VNBO3FTPVSDFT
In the following example of Mary and her boss Ryan, we can see emotional contagion in action. Mary, an HR benefits administrator in the hospital, has been experiencing a bit of frustration with her career progress. While she
started out in patient advocacy and later moved into advocacy training, her current job has taken her away from
patient contact completely. She feels that her boss, Ryan, has taken advantage of her willingness to work “any
task” and forced her away from her passion. Ryan, as her boss, has been quite pleased with Mary’s performance
and counts her among his top performers. She is conscientious with all assigned tasks and seems willing to do
whatever he asks. This is precisely why he approached her about moving into a benefits position.
Mary has just had lunch with a colleague who was asking about her career, a conversation in which Mary “realizes” that she is not happy about her position. Without thinking through the conflict, she is placing the blame
largely on Ryan and has decided to approach Ryan about this conflict:
.BSZ (already upset): “Ryan, I’d like to talk with you right now about my position.”
3ZBO “Sure, Mary, what’s the problem?”
.BSZ “Why have you put me into this dead-end job?”
3ZBO “What are you talking about? You are one of my best performers!”
.BSZ “You know exactly what I’m talking about—no one else wanted to do benefits and you knew that I wouldn’t
say no to you.”
3ZBO “If you think accusing me of something is going to get you what you want, you are sorely mistaken. I’ve
done nothing but try to help you.”
.BSZ “I want out of this job and a move back to patient advocacy. If I don’t get that, I’m moving to another
hospital.”
3ZBO “If that’s your attitude, then my answer is no.”
In this case, the negative emotions that Mary harbors when resolving this conflict has not only clouded her ability to negotiate effectively, but they have transferred to Ryan. Her anger has become contagious in this discussion. The effect of this is that Ryan, who may have been happy to calmly discuss Mary’s issues, is now unwilling
to work with Mary. We can detect this here by noticing that they do not talk about Mary’s passion—having direct
patient contact. If this were discussed, it is possible that Ryan would agree to try to get her back to what she
loves, especially considering she is a high performer. Good negotiators realize that the actions and emotions they
portray will be mimicked or reciprocated by the other party.
NEGOTIATION AS A
CONFLICT MANAGEMENT
TOOL
Individuals are faced with conflict on a day-to-day basis,
and they need a language for how to resolve those conflicts with the people with which they are interdependent. This is where negotiation comes in. Negotiation
is not a skill to be reserved for special occasions like
major purchases or career transitions, although it is
helpful in those situations. Negotiation knowledge represents understanding that can help us in any aspect of
managing conflict with coworkers, supervisors, clients,
patients, kids, spouses, parents, you name it. Think
about all the current or potential conflict in your life—
each of those situations can be resolved from the perspective of negotiation.
One can think of negotiation potential as the degree
to which a conflict might be resolved effectively through
negotiation. Negotiation is effective when one gets more
or loses less than they would have if they did not negotiate - and getting more of what one wants is always the
objective when negotiating. The formal definition of negotiation is “a process of potentially opportunistic interaction by which two or more parties, with some apparent
conflict, seek to do better through jointly decided action
than they could otherwise” (Lax and Sebenius, 1986).
If we simplify this definition, we can say that the basic
conditions where negotiation might be possible are the
following:
t There is more than one person (two or more parties).
t The people or parties want, or seem to want, different things (apparent conflict).
t The people or parties have to deal with each other
in order to get what they want (joint action).
As seen in the negotiation between Mary and Ryan
(“In Practice: A Negative Emotional Spiral in Hospital Human Resources”), there are actually a wide
variety of situations that fit these criteria, many that
174
PART 2 r MICRO PERSPECTIVE
we typically don’t see as “negotiation.” Mary is not
“buying from” or “selling to” Ryan. These are just two
individuals who have conflict and, more importantly,
have a vested interest in resolving that conflict while
also maintaining their relationship. Thus, when we
think about situations that have negotiation potential
we need to include any situation that involves multiple parties, apparent conflict, and joint action or
interdependence.
COMMON MISTAKES IN
MANAGING CONFLICT VIA
NEGOTIATION
Perhaps the most significant error negotiators make
when approaching conflict, and one easily seen with
Mary in the “In Practice: A Negative Emotional Spiral
in Hospital Human Resources” example, is failing to
plan or think through the conflict before attempting to
deal with it. Failing to plan is more likely to result in a
haphazard approach to negotiation marked by an overreliance on techniques most familiar to the negotiator,
while planning beforehand is more likely to result in a
methodical and well-thought-out approach marked by
negotiation tactics more effective in resolving the conflict. An effective plan for each party to a negotiation will
include a description of one’s own interests or underlying needs, possible positions or offers that can satisfy
those interests, goals regarding specific positions for the
negotiation, and possible tactics to use in reaching the
goals. If there is uncertainty regarding the interests and
positions of the other party, a plan should also include
a listing of questions to ask, as questions will help gain
understanding about the interests and positions of the
other side.
Interests, rather than positions, help a negotiator focus
on what is most important, opening up possibilities for
creative problem solving through the consideration of
multiple positions (see Thompson, 2005). Goals are critical as they increase motivation on the part of the negotiator (Locke and Latham, 1990). When negotiators have
clear goals, they are influenced to keep working toward
reaching those goals, which can increase persistence
and effort toward conflict resolution. Finally, planning
before dealing with the conflict will give each party multiple options for how to resolve the conflict. This will help
the negotiators avoid coming to an impasse or failure to
reach agreement.
A negotiation plan includes a description of the logistics of the negotiation. Where will the negotiation take
place? For how long? Who will be at the table? Who are
the influential stakeholders not present at the table?
What are the issues to be discussed? The logistics are
important for various reasons. First, there must be
enough time to resolve the conflict without a sense of
urgency, as a sense of urgency usually results in parties using compromise—or splitting the difference—as
a strategy, which is not ideal. Second, the environment
can facilitate information sharing if all parties are comfortable and relaxed. Even the ambient level of noise is
important, as a quiet environment will decrease the likelihood of miscommunication. Third, as much information as possible about the parties and issues should be
known beforehand so that each negotiator knows what
to expect. Finally, meeting in one’s own office instead
of another’s conveys power and comfort. Meeting at a
location and time convenient to another may be seen as
a gesture of good faith.
When negotiators fail to plan, they can fall victim to
GVODUJPOBMGJYFEOFTT, which occurs when a negotiator
bases his or her strategy on familiar, rather than the most
effective, methods (Adamson and Taylor, 1954). For
example, imagine that a particular physician has had a
long, contentious relationship with one hospital administrator. Every time they have to negotiate or solve a problem, the interaction becomes emotional, and each party
behaves aggressively toward the other side. Needless to
say, this creates tension for them and for those around
them, and it results in less-than-effective negotiated
agreements—neither side is ever happy. Now imagine
that the administrator is replaced by someone new. Given
his or her past experiences, that physician immediately
begins to rely on those same contentious behaviors with
the new administrator—he or she is fixated on those
types of behaviors as being the way to negotiate with all
administrators. Thus, even though the new administrator may be willing to negotiate in a different way, the
physician never uncovers that possibility because he or
she reverts to those familiar tactics. A negotiation plan,
in this case, could help the physician realize that he or
she knows very little about the new administrator and
should rely on asking probing questions and bu...
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