Organizational Power Struggles and Alliances

Organisational Power Struggles

• Internal political conflicts can influence inter-organizational collaborations, transforming partnerships into arenas of political struggle.
• Alliances often create varying levels of value across different internal groups, departments, or individuals within a single organization.

Alliance Value Creation

• Value creation at the organizational level does not equate to benefits for all members, leading to potential power imbalance and dissatisfaction.
• While alliances can enhance capabilities, they can also undermine certain groups by shifting power dynamics and threatening job security.

Case Study: Heavy Machinery and Electrification

• The heavy machinery industry faced a pivotal transition from diesel to electric vehicles due to emerging market trends.
• Top management recognized the knowledge gap regarding electric driveline development and sought partnerships with external suppliers for co-creation and innovation.

Shift in Purchasing Logic

• A significant change in procurement strategy was required, moving from price-focused relationships to collaborative partnerships emphasizing joint learning and development.
• This transformation aimed to cultivate trust-based relationships between the company and suppliers, moving beyond competitive bidding models.

Resistance from Engineering Teams

• Engineers, who historically held crucial knowledge about combustion engines, resisted the outsourcing of technological development to suppliers, fearing job insecurity.
• Engineers advocated for in-house capability development and expressed concerns about their future relevance within the organization.

Diverging Perspectives

• Management was optimistic about the benefits of strategic partnerships, while engineers were cautious and skeptical of the new collaborative approach.
• Engineers engaged in informal resistance, sabotaging efforts and developing competing technologies to uphold their perceived value within the organization.

Impact on Collaboration

• The collaboration became stalled due to the conflicting interests and lack of trust between engineers and top management, leading to a “collaborative twilight.”
• Despite ongoing management efforts to reinforce the partnership with suppliers, the absence of buy-in from engineers compromised the intended outcomes.

Lessons Learned

• Successful alliances require alignment and support from all levels within the organization; neglecting internal stakeholders can derail progress.
• The phenomenon of intra-organizational conflict emphasizes the need for leaders to address and manage differing perspectives among employees effectively.

Importance of Followership

• Effective leadership necessitates active followership; without the support and involvement of key internal stakeholders, strategic initiatives are at risk.
• Understanding the dynamics of both inter-organizational and intra-organizational conflicts is crucial for fostering sustainable collaborative relationships.

Explore the dynamics of internal political conflicts and their impact on inter-organizational collaborations. This quiz delves into value creation from alliances and the shifts in power dynamics, especially in the context of the heavy machinery industry transitioning to electric vehicles.