Formal power is based on an individual’s position in an organization. The coercive power base depends on the target’s fear of negative results from failing to comply. The opposite of coercive power is reward power, which people comply with because it produces positive benefits; someone who can distribute rewards that others view as valuable has power over them. These rewards can be financial—such as controlling pay rates, raises, and bonuses—or nonfinancial, including recognition, promotions, interesting work assignments, friendly colleagues, and preferred work shifts or sales territories.

In formal groups and organizations, probably the most common power bases is legitimate power. It represents the formal authority to control and use organizational resources based on the person’s structural position in the organization. Legitimate power is broader than the power to coerce and reward. Specifically, it includes members’ acceptance of the authority of a hierarchical position. We associate power so closely with the concept of hierarchy that just drawing longer lines in an organization chart leads people to infer the leaders are especially powerful.