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ACCA Strategic Professional · Strategic Business Leader · Qualities of leadership

At Brightwell plc, the chair persuades a reluctant board to approve a restructuring by appealing to the shared vision, personal charisma and the directors' wish to be associated with her. Which statement best classifies this and its main risk?

This is referent power, since directors are influenced by identification with the chair's charisma and vision. The main risk is dependence on one individual and uncritical, passive followership, which may weaken challenge at board level.

  1. AReferent power; the risk is over-dependence on the individual and uncritical followershipCorrect
  2. BLegitimate power; the risk is that followers see the position as unfair
  3. CCoercive power; the risk is legal challenge by the board
  4. DReward power; the risk is that incentives become too costly

Explanation

Influence through charisma and identification is referent power. A key risk is followers deferring uncritically and the organisation depending on one person. No formal position, threats or rewards are the basis here.

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