I know you can link to other documents or link to specific places within the same document but can you link to a specific place within another document?

Yes, generally using a bookmark. What kind of link, specifically?

I'm not sure what kind of link (what kinds are there?). I'd like a link in text where you click on that bit of text and it opens another document (or switches window if the document is already open) and goes to a particular subheading. The files are in the same folder. I'm pretty sure it's easy enough to link to subheadings in HTML; that's the sort of thing I hope to do in a Word document.

Is there a way to automatically place a bookmark at every heading?

What you are describing is a hyperlink.

The target heading has to be bookmarked. (Insert Bookmark)

Insert > Hyperlink > Existing Document > Bookmark

That's horrendously time consuming given the number of headings that I want to link to. i don't think that's an option. Thanks anyway.

I want to drag them from the Navigation pane but it isn't possible. I found an existing feedback suggestion here (if anyone reads this and want ths feature then click the vote button) https://word.uservoice.com/forums/30...navigation-pan