Engineering bureaucracy: the genesis of formal policies, positions, and structures in high-technology firms

This article examines the impact of organizational foundingconditions on several facets of bureaucratization - managerialintensity, the proliferation of specialized managerial and administrativeroles, and formalization of employment relations. Analyzinginformation on a sample of technology start-ups in California'sSilicon Valley, we characterize the organizational models orblueprints espoused by founders in creating new enterprises.We find that those models and the social composition of thelabor force at the time of founding had enduring effects ongrowth in managerial intensity (i.e., reliance on managerialand administrative specialists) over time. Our analysis thusprovide compelling evidence of path dependence in the evolutionof bureaucracy - even in a context in which firms face intenseselection pressures - and underscore the importance of the 'logicsof organizing' that founders bring to new enterprises. We findless evidence that founding models exert persistent effectson the formalization of employment relations or on the proliferationof specialized senior management titles. Rather, consistentwith neo-institutional perspectives on organizations, thosesuperficial facets of bureaucracy appear to be shaped by theneed to satisfy external gatekeepers (venture capitalists andthe constituents of public corporations), as well as by exigenciesof organizational scale, growth, and aging. We discuss someimplications of these results for efforts to understand thevarieties, determinants, and consequences of bureaucracy.