Saerom (Ronnie) Lee

• Saerom Lee and Reuben Hurst (Work In Progress), When Autonomy Backfires: Adverse Selection in Startup Recruitment. Abstract

  While prior entrepreneurship research highlights strong preferences for autonomy among founders and early joiners of startups, little is known about how explicitly emphasizing autonomy in startup recruitment affects the composition of the applicant pool. We propose that such emphasis may inadvertently reduce applicant quality by disproportionately attracting lower-ability candidates while deterring higher-ability job seekers. This adverse selection may arise because individuals with varying cognitive abilities may interpret autonomy-related signals in systematically different ways. Specifically, lower-ability candidates may perceive autonomy at face value as desirable freedom from managerial oversight, whereas higher-ability individuals may infer potential organizational dysfunction, including ill-defined roles, insufficient managerial oversight, and unclear performance evaluation. Using large-scale job posting data, we first document that startups increasingly highlight autonomy in recruitment, particularly when targeting higher-ability talent. We then provide causal evidence for the proposed adverse selection through a field experiment conducted in partnership with a U.S.-based startup. Our findings reveal that, although autonomy is widely considered a desirable attribute that distinguishes new ventures from established firms, its explicit emphasis in startup recruitment may backfire—paradoxically deterring the high-ability candidates most critical to entrepreneurial success.

• J. Daniel Kim and Saerom Lee, Research: When Should Startups Scale? in Harvard Business Review (Online),. Abstract

  Silicon Valley often touts rapid scaling as the best strategy for achieving startup success. However, new research reveals that scaling early, particularly within the first 12 months, significantly raises the risk of startup failure, especially for two-sided platforms. The key takeaway for entrepreneurs: Be cautious with early scaling and prioritize a culture of experimentation. Taking a “slow-and-steady” approach to scaling may provide a more sustainable path to long-term success.

• Reuben Hurst, Saerom Lee, Justin Frake, Research: Flat Hierarchies Can Discourage Women Applicants in Harvard Business Review,. Abstract

  Many firms struggle to attract a diverse talent pool, particularly women. To stand out, companies often tout flatter organizational structures in their recruitment materials, assuming these unique features will appeal to a more diverse group of prospective employees. However, new research uncovers a surprising finding: highlighting a flatter hierarchy may, instead, diminish women’s representation in the applicant pool. Additional findings suggest that women tend to perceive flatter organizations as more difficult to fit into, burdening them with a heavier workload, and offering fewer career advancement opportunities. This research indicates that companies should carefully consider how they present their organizational structure to job seekers to avoid unintentionally discouraging women from applying.

• Reuben Hurst and Saerom Lee (Under Review), Filtering the Right: Diversity Commitments and Political Sorting. Abstract

  Despite growing evidence that the political composition of the workforce shapes key organizational outcomes, the processes by which workers with different personal politics sort into different employers remain underexplored. This study addresses this gap by examining how diversity commitments—an increasingly ubiquitous feature of firms’ recruiting efforts—may cause political sorting in the labor market. We theorize that this sorting occurs through mechanisms based on political ideology (i.e., job seekers’ perceptions of alignment with a firm’s political values) and political identity (i.e., job seekers’ expectations about the representation and treatment of individuals with specific political identities). In a field experiment conducted in partnership with an actual employer, we find that diversity commitments distinctly reduce attraction among job seekers furthest to the political right. Our follow-up survey experiment provides evidence consistent with our proposed mechanisms, showing that these commitments lead partisans to form divergent perceptions about an organization’s political values, political demographics, and likelihood of politics-based discrimination. We discuss how this political filtering effect may complement organizational efforts to cultivate gender and racial diversity, while potentially reducing political diversity—with potential downstream implications for organizational culture, performance, and broader societal polarization.

• J. Daniel Kim and Saerom Lee (Under Review), Target Startup’s Organizational Structure and Acquirer’s Integration-Separation Decision. Abstract

  To reap the benefits of startup acquisition, acquirers strategically choose whether to integrate or separate their targets. This study examines how this post-acquisition organization design choice between integration and separation depends on the target startup’s pre-acquisition organizational structure. Leveraging employee-employer-matched data to construct a novel measure of post-acquisition separation based on employee mobility patterns, we find that acquirers are more likely to separate more structurally complex target startups. Additional analyses are consistent with the view that, as the target firm’s structural complexity can increase the disruptive costs of integrating the two firms but reduce coordination costs when kept separate, post-acquisition separation becomes more suitable. Our results shed light on an important organizational antecedent that shapes the relative appeal of integration versus separation in startup acquisitions.

• Jaeho Choi and Saerom Lee (Under Review), Span of Control as a Dynamic Strategic Lever for Early-stage Firm Growth. Abstract

  The literature on organization design has traditionally viewed the span of control as a static constraint on scalability. This study revisits this perspective by developing a computational model that formalizes how the span of control dynamically shapes early-stage firm growth through two fundamental trade-offs inherent in organizational information processing: (1) between individual-level and organizational-level bottlenecks (arising from cognitive constraint on attention) and (2) between commission and omission errors (arising from cognitive constraint on evaluation). We find that, when either cognitive constraint—and its associated trade-off—operates in isolation, the widest span of control may maximize growth. However, when both constraints are present, an intermediate span of control emerges as optimal. Crucially, this optimum progressively decreases as firms grow over time, reflecting a fundamental shift in growth constraints from a scarcity of ideas to a scarcity of time. This gradual narrowing proves particularly beneficial when firms operate in highly uncertain or more munificent environments or when their employees are more capable of generating or screening ideas. Overall, these findings reconceptualize the span of control as a dynamic strategic instrument for navigating evolving information-processing trade-offs and accelerating firm growth.

• Saerom Lee and J. Daniel Kim (2024), When Do Startups Scale? Large-scale Evidence from Job Postings, Strategic Management Journal, 45 (9), pp. 1633-1669. https://doi.org/10.1002/smj.3596 Abstract

  Scaling at the right time is a crucial challenge for startups. Conceptualizing “scaling” as the entrepreneurial process of acquiring and committing resources to implement the core business idea and expand the customer base, this study examines how scaling early may decrease imitation risk at the expense of increasing commitment risk. As startups typically hire managers and sales personnel when they begin to scale, we propose that this timing can be empirically measured by when startups first post these jobs. Leveraging a dataset of job postings, we find that early scalers are more likely to fail, but no evidence of a countervailing benefit in terms of successful exit. Additional analyses suggest that the commitment risk in scaling early outweighs the benefit of reducing imitation risk.

• Reuben Hurst, Saerom Lee, Justin Frake (2024), The effect of flatter hierarchy on applicant pool gender diversity: Evidence from experiments, Strategic Management Journal, 45 (8), pp. 1446-1484. https://doi.org/10.1002/smj.3590 Abstract

  This article investigates how job seekers’ perceptions of an employer’s formal hierarchy affect the size and gender composition of its applicant pool. Building on the literature on gendered organizations and organizational design, we develop opposing perspectives on these relationships. To arbitrate between these perspectives, we first conduct a field experiment in partnership with a hiring firm. We find that featuring a flatter hierarchy in recruiting materials does not significantly affect the size of the applicant pool, but significantly decreases women’s representation within it. Our follow-up survey experiment identifies several potential mechanisms (e.g., perceptions of career progression, informality, workload, and fit). Our findings imply that firms’ growing tendency to adopt flatter hierarchies could inadvertently undermine efforts to attract a greater proportion of women applicants.

• Saerom Lee and Britta Glennon (Under Review), The Effect of Immigration Policy on Founding Location Choice: Evidence from Canada’s Start-up Visa Program. Abstract

  To spur entrepreneurship and economic growth, an increasing number of countries have introduced immigration policies that provide visas to skilled entrepreneurs. This paper investigates whether these policies influence the founding location choice of immigrant founders, by leveraging the introduction of Canada’s Start-up Visa Program in 2013. We demonstrate that this immigration policy increased the likelihood that U.S.-based immigrants have a start-up in Canada by 69%. Our results show that Asian immigrants (who have a higher representation in Canada than in the U.S.) are disproportionately more likely to migrate to Canada to start their businesses, whereas Hispanic immigrants (who have a smaller representation in Canada than in the U.S.) are less inclined to do so. We also find that this propensity varies with the size of co-ethnic immigrant communities in the origin location. Overall, our study unveils the importance of immigration policies in determining founding location choice and has important implications for countries competing for global talent.

• Saerom Lee (2022), The Myth of the Flat Start-up: Reconsidering the Organizational Structure of Start-ups, Strategic Management Journal, 43 (1), pp. 58-92. https://doi.org/10.1002/smj.3333 Abstract

  There has been an ongoing debate over whether start-ups should be “flat” with minimal hierarchical layers. To reconcile this debate, this paper distinguishes between creative and commercial success (i.e., product novelty vs. profitability), and examines how these outcomes are variously influenced by a start-up’s hierarchy. This study suggests that while a flatter hierarchy can improve ideation and creative success, it can result in haphazard execution and commercial failure by overwhelming managers with the burden of direction and causing subordinates to drift into power struggles and aimless idea explorations. I find empirical support for this trade-off using a large sample of game development start-ups. These findings offer one resolution to the debate by sorting out the conditions under which hierarchy can be conducive or detrimental to start-ups.

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Current Courses

• MGMT2230 - Business Strategy

  This course encourages students to analyze the problems of managing the total enterprise in the domestic and international setting. The focus is on the competitive strategy of the firm, examining issues central to its long- and short-term competitive position. Students act in the roles of key decision-makers or their advisors and solve problems related to the development or maintenance of the competitive advantage of the firm in a given market. The first module of the course develops an understanding of key strategic frameworks using theoretical readings and case-based discussions. Students will learn concepts and tools for analyzing the competitive environment, strategic position and firm-specific capabilities in order to understand the sources of a firm's competitive advantage. In addition, students will address corporate strategy issues such as the economic logic and administrative challenges associated with diversification choices about horizontal and vertical integration. The second module will be conducted as a multi-session, computer-based simulation in which students will have the opportunity to apply the concepts and tools from module 1 to make strategic decisions. The goal of the course is for students to develop an analytical tool kit for understanding strategic issues and to enrich their appreciation for the thought processes essential to incisive strategic analysis. This course offers students the opportunity to develop a general management perspective by combining their knowledge of specific functional areas with an appreciation for the requirements posed by the need to integrate all functions into a coherent whole. Students will develop skills in structuring and solving complex business problems. In addition to prerequisites, enrollment is limited to seniors and juniors that have completed introductory courses in finance, marketing, and accounting.

  MGMT2230001 ( Syllabus )

• MGMT6120 - Management Of Emerging Enterprises

  This course is about managing during the early stages of an enterprise, when the firm faces the strategic challenge of being a new entrant in the market and the organizational challenge of needing to scale rapidly. The enterprises of interest in this course have moved past the purely entrepreneurial phase and need to systematically formalize strategies and organizational processes to reach maturity and stability, but they still lack the resources of a mature firm. The class is organized around three distinct but related topics that managers of emerging firms must consider: strategy, human and social capital, and global strategy.

  MGMT6120001 ( Syllabus )

  MGMT6120002 ( Syllabus )

  MGMT6120003 ( Syllabus )

• MGMT8990 - Independent Study On Case Writing And Research On The Global Beauty Industry

  MGMT8990003 ( Syllabus )

Past Courses

• INSP4999 - Honors Thesis

  The senior thesis course is a capstone for seniors in the Huntsman Program in International Studies and Business. Students in the Huntsman Program should consult with the Huntsman Program advisors for more information.

• MGMT2230 - Business Strategy

  This course encourages students to analyze the problems of managing the total enterprise in the domestic and international setting. The focus is on the competitive strategy of the firm, examining issues central to its long- and short-term competitive position. Students act in the roles of key decision-makers or their advisors and solve problems related to the development or maintenance of the competitive advantage of the firm in a given market. The first module of the course develops an understanding of key strategic frameworks using theoretical readings and case-based discussions. Students will learn concepts and tools for analyzing the competitive environment, strategic position and firm-specific capabilities in order to understand the sources of a firm's competitive advantage. In addition, students will address corporate strategy issues such as the economic logic and administrative challenges associated with diversification choices about horizontal and vertical integration. The second module will be conducted as a multi-session, computer-based simulation in which students will have the opportunity to apply the concepts and tools from module 1 to make strategic decisions. The goal of the course is for students to develop an analytical tool kit for understanding strategic issues and to enrich their appreciation for the thought processes essential to incisive strategic analysis. This course offers students the opportunity to develop a general management perspective by combining their knowledge of specific functional areas with an appreciation for the requirements posed by the need to integrate all functions into a coherent whole. Students will develop skills in structuring and solving complex business problems. In addition to prerequisites, enrollment is limited to seniors and juniors that have completed introductory courses in finance, marketing, and accounting.

• MGMT6120 - Managing Emerg Entrprse

  This course is about managing during the early stages of an enterprise, when the firm faces the strategic challenge of being a new entrant in the market and the organizational challenge of needing to scale rapidly. The enterprises of interest in this course have moved past the purely entrepreneurial phase and need to systematically formalize strategies and organizational processes to reach maturity and stability, but they still lack the resources of a mature firm. The class is organized around three distinct but related topics that managers of emerging firms must consider: strategy, human and social capital, and global strategy.

• MGMT9260 - Sem Strat & Org Des

  This half-semester course examines one of the foundational questions in strategy: the role of organizational structure in both supporting and shaping strategy. As Winston Churchill famously said: "We shape our buildings, and afterwards our buildings shape us." This course examines this proposition from two traditions, the "institutional economics" and "information processing" schools of organizational design. We will examine foundational works from both schools, such as Coase, Williamson, Simon, March, and others, and then proceed to recent work in the area. Some of the questions that we will explore in the class are: why do firms exist? What determines their boundaries? What determines formal and informal structures within firms? How does the strategic context shape the answers to these questions? How might the nature of the firm and its boundaries relate to innovation, human capital, and knowledge creation? The aim of this class is to provide students with a grounding in the fundamental questions and contributions in this area, and to spark ideas for research in their own graduate work.

• Wharton Teaching Excellence Award, 2023
• Wharton Teaching Excellence Award, 2022
• Strategic Management Society Conference Strategic Human Capital Interest Group Best Paper Award, 2022
• Finalist, Strategic Management Society Conference Responsible Research Paper Prize, 2022
• Finalist, Academy of Management TIM Division Dissertation Award, 2022
• Strategy Science Conference Best Paper Award, 2022
• Runner-up, Industry Studies Association Dissertation Award, 2022
• Academy of Management OMT Division Best Paper Award, 2022
• Wharton Teaching Excellence Award, 2021
• Winner, INFORMS/Organization Science Dissertation Proposal Competition, 2019
• Strategic Management Society Best Conference Ph.D. Paper Award, 2019
• Michigan Ross E. G. Flamholtz Award for Academic Excellence, 2018
• Michigan Ross T. W. Leabo Memorial Award for Teaching Excellence, 2018
• Michigan Ross W. A. Spivey/Valerie and W. Hall Award for Academic and Research Excellence, 2018
• Michigan Ross Emeritus Award for the Best Second-year Paper, 2017

Knowledge @ Wharton

• Understanding AI’s Impact on Productivity, GDP, and Federal Debt, Knowledge @ Wharton - 09/19/2025
• Yahoo’s Global Head of B2B Marketing, Sponsorships, and Events, Shannon Shae Montoya, Knowledge @ Wharton - 09/18/2025
• Breaking Down Records, Rankings, and Coaching With NFL Analytics, Knowledge @ Wharton - 09/17/2025
• Google Antitrust Ruling, Market Competition, and the Future of Search, Knowledge @ Wharton - 09/17/2025
• What’s Behind the Endless Breakup-Merger Cycle?, Knowledge @ Wharton - 09/16/2025
• Is Housework Holding Back Wage Equality?, Knowledge @ Wharton - 09/16/2025
• How Subjectivity Affects Stock Prices and Firm Valuations, Knowledge @ Wharton - 09/16/2025
• The Luxury of Counterfeits | John Zhang, Knowledge @ Wharton - 09/16/2025
• A Transformational Gift for Quantitative Finance at Wharton, Knowledge @ Wharton - 09/15/2025
• Expanding Retirement Portfolios With Alternative Investment Options, Knowledge @ Wharton - 09/12/2025