As rapid changes in business environment require continuous innovation and creative outcomes, organizations are trying to build a constructive group process which facilitates more creativity, group learning, and members’ proactive behaviors. Work grou ...
As rapid changes in business environment require continuous innovation and creative outcomes, organizations are trying to build a constructive group process which facilitates more creativity, group learning, and members’ proactive behaviors. Work groups are basic elements of organizational structure and central to accomplishing organizational goals. For decades, group researchers have sought to better understand complex intragroup process by examining various factors. Acknowledging this importance, recent group studies have paid increasing attention to subgroups within a group. Subgroups are the key to understanding group power structure because they not only affect the identity or interaction patterns of group members, but also define the structural properties of group process such as status difference, power asymmetry, and resource disparity. In this paper, we study group power structure and intragroup process with a focus on group fautlines and subgroups. Specifically, we investigate the effects of demographic subgroups drawn from faultlines and power imbalance between subgroups on group performance. In addition, we examine positive potential of subgroups. Drawing on the power and mutual dependence theory, we develop the construct of cross-dependency, which refers to the dependence between subgroups across different resources. Based on social network analysis, we examine the conditions for a positive inter-subgroup relationship. Using data from 50 work teams in a manufacturing company, we tested the effects of cross-dependency as well as the negative effects of power imbalance and demographic subgroups. Contrary to previous studies, we found that the existence of subgroups itself does not have a significant effect on group performance evaluated by upper-level managers. Instead, perceived power imbalance between subgroups was negatively associated with group performance. Moreover, consistent with our expectation, cross-dependency between subgroups in task advice and friendship networks had a positive effect. Lastly, results show that LMX differentiation exacerbated the negative effect of power imbalance and mitigated the positive effect of cross-dependency. This study sheds new light on the under-developed topics in subgroup studies, power and dependence. We hope that our results can be applied in practice and we can find the optimal configuration of cross-dependency structure in the future.