Allies or Subsidiaries? Inter-Company Relations in the P&O Group, 1914-39

Alfred Chandler has recently suggested that 'the general failure to develop organisational capabilities weakened British industry and with it the British economy'. However, his view has been criticised as regards British multinational investment, where organisational forms such as mercantile groups were significant. This article examines the organisational links between companies in the P&O shipping group during a period in which it was mainly located within the Inchcape mercantile group. Links were loose and often informal, which facilitated devolution of decision making. Although the financial crisis faced by the P&O group in 1932 may partly have been due to an excessive accumulation of information and control in the hands of a single individual, the organisational structure proved sufficiently resilient to persist after the crisis had been resolved. It is concluded that, in the inter-war years just as in the pre-World War I period, personal capitalism and informal organisational structures benefited from networks of trust and thus cannot be rejected as weak.