One secret to success in navigating your career and being effective as a leader is to understand bargaining power and make friends with it.

bargaining power  (ˈbɑːɡɪnɪŋ ˈpaʊə)

noun – the ability of a person, group, or organization to exert influence over another party in a negotiation in order to achieve a deal which is favorable to themselves


That’s because bargaining power is an integral part of influencing, negotiating and advocating for what you want and need.

By the way, this doesn’t have to feel Machiavellian – the “you” can refer to your team within the department, or your organization in the marketplace, and not just to you as an individual.

We had an excellent example of bargaining power this week when Taylor Swift got Apple to change its policy on paying (or rather not paying) for music downloads.

But you don’t need to be a Taylor Swift to have and apply your own bargaining power.

So, how do you get bargaining power, and how can you use it most effectively?

Where to find your sources of bargaining power

When it comes to bargaining power, we all have sources that we can tap. Here are five places to look for your bargaining power – and this will help you recognize when others have it as well.

1. When you have something they want – let’s call them “goodies”. That can mean:

  • Being a value generator (for example, having a talent for making or saving money for the organization).
  • Being a linchpin that holds the effort together or who can prevent others from wreaking havoc (having a key relationship with a difficult but lucrative client, the favorite babysitter who keeps your kids happy and safe for 3 hours while you’re out for dinner).
  • Having “goodies” you can dispense (public recognition, resources, projects, monetary rewards, etc.).
  • Having “goodies” you can withhold (Taylor Swift’s music).

2. When you’ve just had a big “win”

  • Bringing in or closing a big deal puts you in an ideal position to ask for more resources.

3. When you’ve just been dealt a setback

  • The other person feeling guilty/bad about what’s just happened (e.g., telling you you’re not getting promoted) and feeling they “owe you one”.

4. Being in control of your destiny

  • Having “walking away money” (even if it’s not quite Taylor Swift’s $200mm).
  • Having other attractive options (other service providers, other job options).

5. Having public opinion on your side

  • Having an unassailable argument that will stand up in the court of public opinion (as my father-in-law says, “when you’re right, you’re right”).
  • Building a network of connections/supporters/true believers/your “posse” who will support and back you.

How would you add to this list?

Four ways to play it

When it comes to deploying bargaining power, here are four strategies you can employ.

1. Own it

When you have bargaining power, you as a leader have a duty to take ownership of it and use it well.

That means using your power for “good not evil”. Employ it for the benefit of the group and not for purely selfish purposes that may even go against the interests of the team.

It also means using it such a way that your bargaining power is preserved and even enhanced so you can use it again in the future. This is about how you communicate your position and negotiate. Be careful not to win the battle but deplete your effectiveness going forward.

In Taylor Swift’s example, her move was in support of all indie artists and she phrased her “letter” in a professional, respectful and gracious way. Not only did she make it (relatively) easy for Apple to change their position, she did it in a way that preserved both the relationship and her integrity.

2. Reveal it

Sometimes, people don’t recognize that you have bargaining power when you really do have it. In those situations, it’s your responsibility to reveal it. Whether you do it by “baring your teeth” or through a more elegant method will depend on the situation and your style. The important thing is that you find a way that’s to your advantage.

For example, when my husband and I were just starting out and looking to buy a house, the realtors didn’t take us seriously. We weren’t being shown many houses and generally felt ignored.

That’s when we decided to flip the dynamic. Instead of dutifully waiting for the realtors to call us with opportunities, we called them and said we were auctioning ourselves out as buyers. We explained that we would put simultaneous bids on four houses and the first seller to hit our bid would win us as their buyers. Nothing like a little competition to set off a flurry of activity and we soon had our new home.

3. Capitalize on it

There will be times when bargaining power just drops into your lap. The key then is to have the presence of mind to recognize that gift for what it is, and capitalize on it.   Here’s one example.

It was October and I was up for promotion in the group I had just joined at the start of the year.   Most people had gone home for the night when my boss asked me to step into the department head’s office for a minute – let’s call them Elise and Quentin (not their real names).

That’s when Elise gave me the bad news: no promotion for me this year.

While they had pushed hard for me, the committee wanted a longer track record of success than just nine months. Elise and Quentin were disappointed with the outcome and were sorry to have to give me the news. When I left them to go back to my desk, they looked almost as crushed as I felt.

That’s when I remembered my disappointment the previous yearend when my compensation was cut substantially in my old group.

So I went back to the office, knocked on the door and thanked Elise and Quentin for pushing hard for me. I assured them that I would redouble my efforts over the next 12 months so that it would be a clear-cut decision for the committee next time.

Then I mentioned the cut in pay in my previous group.

Before I could say more, Elise and Quentin brightened visibly and said they would be delighted to look into rectifying the compensation situation. This was within their remit, and it would give them a chance to express their strong support for me.

From deep disappointment came unexpected bargaining power – and I had almost missed it!

4. Create it

When you don’t have bargaining power, go out and create it. Here’s an example of what I mean.

When I was graduating from business school, I expected to receive an offer to return to Morgan Stanley as an Associate. After all, I had done well as an Analyst and the rest of my former Analyst group had all just received offers. Days pass and no offer.

It turns out that my having talked about how much I enjoyed my summer job at Boston Consulting Group and the fact that I was even contemplating the full time consulting offer caused confusion: “Is May committed to returning to the Firm or not?”

Not being one to beg, I accepted the invitation to interview at archrival Goldman Sachs. They turned out to be great people and I ended up receiving an offer to join their Private Finance group. Perhaps it was coincidence, but a day later, I had an offer from Morgan Stanley too.

Generating other options for yourself is a great way to create bargaining power, and it will give you more confidence as well.

Another way is to join forces with others who share the same viewpoint or position as you. There’s power in gathering a coalition whereas it’s easier to be ignored if you stand alone.


Recognize that each of us has multiple ways to gain and deploy our bargaining power, and it will vary depending on situation and timing. What matters is that you learn to find it, show it, create it and use it wisely.

And whatever you do, remember to use your bargaining power for good, not evil!

So, how do you use your bargaining power, and what’s worked best for you?