Two-Step Leverage: Managing Constraint in Organizational Politics

Abstract

Martin Gargiulo INSEAD This paper proposes an alternative to resource-dependence approaches to strategic behavior, which predict that actors seek direct cooptive relations to alleviate constraint. I propose that an actor can gain leverage on a limiting party by building a cooptive relation with a player that may control this party's behavior, thus using two-step leverage. Data on dependence relations, political alliances, and confidential discussion networks among decision makers in a cooperative agribusiness furnish evidence of both direct and two-step leverage and clarify the contexts in which these two strategies are used. As predicted by the resource-dependence approach, leaders build ties of interpersonal obligation with people directly affecting their performance in the organization. When policy divergences or personal frictions make these ties untenable, however, leaders build strong cooptive relations with people who may constrain the performance of the party on whom they depend. Based on these results, I discuss an extension of resource-dependence theory and explore the potential uses of two-step leverage mechanisms in organizational politics.'