And in the 21st century? not so much. It is a different world now.
Europe is powerful but the Royal Navy couldn't go today to Hong Kong and seize control of it for example.
And military power influences diplomacy.
Negatively. That has always been the problem of the US, it's the reason why they cannot act like the most of the rest of the world. The military has way too much influence on decision making.
And things work like this at every level in every organization. For example people in your line of reporting at work can veto any decision you make unless you are protected by law, which is an entity that can shut down your company by force.