A considerable literature discusses the extent to which power and influence is shared in managerial decision-making. A critical question is whether influence and power sharing (IPS) has positive consequences for the organization. For example, are organizations which practise high levels of IPS more productive or profitable? And, if they are, why?

The thesis of this chapter is that, other things being equal, IPS does increase organizational efficiency. It achieves this result through three related processes: first it makes better use of organizational members' existing competence (experience and skill), secondly it helps develop new competence, and thirdly it liberates dormant motivation. The theoretical framework to describe these relationships is called the Motivated Competence model, which also suggests that attempts to use IPS when relevant experience and skill are absent results in inauthentic or manipulative participation.