There are merits to the current powerplay system in some regards, however I think a huge overhaul is needed.
The factions are not radically different in playstyle, and the overall playstyle of powerplay is very crunchy, unless you would prefer to strategize.
The rewards for doing so don't appeal to the masses, and there's almost no staying draw unless you're bold enough to stick around and feel each power out.
The reward of a permanent module for a temporary pledge is insanely flawed. What was intended to make powers more different from one another is now a joke.
What could be changed?
Allowing players to choose a home base, and receive direct benefits for doing so, plainly and clearly presented, as a "agent of x system" so that they feel attached and that their actions matter.
Allowing players to build rep with a power, by doing power-based missions styled in that powers flavor. Give the player something to do that doesn't require hauling merits and pamphlets around, or fortifying.
Make that rep gained with a specific power "prestige-able" in a way that at the end of every rank they achieve, they receive 3 choices that are power themed that give them permanent bonuses to either actions taken in their home system (chosen earlier), or larger benefits to existing benefits the power provides. Reward the player for their time, more than just "Here's some credits and a list of things you get when you sign up for this power that never changes that much, really".
The whole system of getting your merits gained halved every week is devastating the longer you play. I do agree there should be some attrition to prevent inconsistent players from staying at max level with the power, but the benefits of being at that level really don't match the effort put in. 50 million is nothing to anyone playing for longer than 3 months.
If LYR gives benefits and discounts to modules and ships in systems under him, I should be able to work for the power (by doing power related missions, specifically), and when I rank up, be given the option to further discount ships, or modules, or commodities, by even 0.5% or 1%. This would be a permanent change for my CMDR, as long as I am in a LYR exploited system, and as long as I maintain that rank tha depreciates over time. Obviously each of these choices would have a cap at the end of the day, but seeing visual rewards is powerful and something sorely absent from the current game.
That said, if I am a newbie to LYR, I should see the discounts he provides clearly and plainly on everywhere his discounts apply to. If I'm not looking at the power menu and know he provides discounts to modules, I would have no idea that he is the reason modules are cheaper. That needs to change.