The rapid creative destruction of HQ-subsidiary relationships — the power of the less-powerful

The historically prevailing view in the network literature has been that relationships within networks develop gradually and cumulatively over time, with power playing what might be termed a ‘concrete’ role in such a process, based primarily on identifiable resource dependencies. The concept of (Foucauldian) ‘system power’, beginning to emerge in the management and organisation literature, is not explicitly articulated. In short, the less-powerful are seen as facing formidable obstacles in seeking to achieve enhanced network positions and control and it is not clear under what circumstances really rapid network change can be induced, let alone how the less-powerful might be able to induce it. Putting the power literature up against the network literature, helps raise a threefold research question: • what is the significance of ‘invisible’ and ‘impersonal’ discourse-based power within relationships and networks? • can this perhaps be associated with rapid network change? • how can less-powerful actors associate themselves with discourse-based power to increase their network status? To help address these questions, the paper next introduces a case-study of a small Irish subsidiary of a US-based multi-national corporation (MNC). Within only a few years, the Irish company had ‘re-conceptualised’ its role in the MNC network to such an extent that it became effectively the only European subsidiary still in operation, with seven other subsidiaries swallowed up into it and closed down. This arresting case-study is analysed using a four dimensional model of power derived from Hardy (1994) building on Lukes (1974). Most significantly, this analysis highlights the power potential of the less-powerful within networks, as well as the possibility of quasi-instantaneous relationship development and rapid change (pace the network literature) — that may be associated with discourse-based ‘system’ power. The paper concludes by proposing a ‘Political Sensemaking Process’ (PSP) view of network change that allows for the possibility both of rapid network growth on the one hand, and dissolution on the other.