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 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.
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