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Setting the stage for corporate headquarters: a technological explanation for the rise of modern industrial corporations

Carliss Y. Baldwin ()
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Carliss Y. Baldwin: Harvard Business School

Journal of Organization Design, 2019, vol. 8, issue 1, 1-16

Abstract: Abstract This paper combines theories of organizational design with theories of production to provide a novel perspective, which helps explain the technological forces that led to the rise of vertically integrated “modern” corporations in the late nineteenth and early twentieth centuries. I describe the technology of a flow process with bottlenecks and show how this technology rewards unified governance, a hierarchical organization structure, and the use of direct authority. These properties in turn became the organizational hallmarks of “modern” industrial corporations with central corporate headquarters.

Date: 2019
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DOI: 10.1186/s41469-019-0059-4

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Handle: RePEc:spr:jorgde:v:8:y:2019:i:1:d:10.1186_s41469-019-0059-4