Selznick treats bureaucracy not as a synonym for hierarchy and professional administration but as a species of the wider problem of purposive organization. Drawing on Roethlisberger and Dickson's shop-floor study, Barnard's work on executives, and research into prisons, reformatories and similar institutions, he advances a few hypotheses: organizations spontaneously generate informal structures built on personal ties and oriented toward control, and those structures quietly reshape the aims the organization announces.

The distinction carrying the argument is between the goals an organization professes and those it actually operates on. Running an organization throws up daily problems that stated ideals cannot answer, so procedures get improvised, and in time these substitute for the ideals. Officials, once delegated authority, acquire interests of their own, prestige and security of tenure among them, and act with an eye to internal power rather than declared purpose.

Michels' pessimism comes out largely supported, though Selznick insists the drift can be resisted once its mechanics are understood.