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Organizational Blueprints for Success in High-Tech Start-Ups: Lessons from the Stanford Project on Emerging Companies
Baron, James N., and Michael T. Hannan
44/3  (Spring 2002): 8-36

Over the last seven years, the Stanford Project on Emerging Companies has tracked a large sample of high-technology start-ups in California’s Silicon Valley. The project has examined how the founders of those enterprises approached key organizational and human resource challenges in the early days of building their companies, and how it affected the evolution and performance of their ventures. This article summarizes the main findings of this research program. It describes five distinctive human resource "blueprints" that high-tech founders embraced in launching their new firms. Those initial blueprints have had important impacts on a wide range of organizational outcomes, including growth in administrative overhead, labor turnover, and bottom-line performance. Moreover, companies that changed their HR blueprint have paid a heavy price, in terms of higher turnover and diminished organizational performance. The results suggest that organization-building and high-commitment HRM "pay" and that changes in human resource models are extremely destabilizing, even in the turbulent "built to flip" environment of Silicon Valley.

 

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