I've always thought that bureaucracy is a natural misfortune that only happens at big corporations and eductional institutions, but it seems to be pervasive among even tech startups and small businesses.  

The shocking part is that it usually comes from smart people with good intentions, who probably hate politicking equally as much as you do.  You might be dealing with bureaucracy at your own startup and not even realize it. 

My first experience with bureaucracy was from within my own company.  A few months ago, I was trying to let go of a hire who didn't work out.  Problem was, he was friends with everyone in the company, and all my partners felt I was making a fatal mistake.  I was determined to pull the trigger and have it over with by the morning after I made the decision, but it took me another two weeks to ultimately make the fire.  I begrudgingly issued a warning about his performance, and took the time to talk it over with each person on my team.  Why should it be this difficult for the founder and CEO to let go of someone she hired?  

Reason was because everyone cared.  Nobody intended to create unnecessary politics.  But since hiring and firing is the most important shared responsibility among everyone in a startup, I had to rationalize my decision better than any other I've had to make.  We discussed ways to prevent this "politicking" from ever having to happen again:  take more time weeding out hires with a bad culture fit upfront, and issue warnings so that every hire has at least a chance to change.  My partners wanted to know that they wouldn't be spontaneously fired "without cause", and I empathize with that.  

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My second experience with bureaucracy was actually caused by me.  A few months ago, my co-founder Andy was on the hunt to hire summer engineering interns.  He started recruiting friends from high school and math camp and wanted to get them offers as quickly as possible.  As we all know, the best candidates receive offers quickly, and hate having their future sit in limbo-land.  But there was a lot of rage from both me and my other partners because we felt that Andy was trying to make intern hires without our consent.  From our perspective, Andy was trying to bypass a "process" of interviewing that we had agreed to.  We wanted to interview every candidate to make sure we weren't making weak hires.  From Andy's perspective, the rest of us were being bureaucratic and taking too much time to give his candidates final hiring decisions.

The ultimate solution ended up being quite simple.  For contract and intern hires, we committed to a 72-hour turnaround timeframe.  This means that intern candidates would given a definitive yes/no decision within 72 hours of the first interview, whether or not everyone had the time to interview the person.  This way, everyone on the team had the ability to approve/veto an intern hire, and Andy didn't feel like he had to deal with bureaucracy from his own company.  Crisis avoided!

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I've come to realize that bureaucracy in and of itself isn't necessarily a bad thing.  Process exists for a reason, and politicking usually does stem from stakeholders who have good intentions for the organization.  Bureaucracy is only a problem when there's no perceived end in sight.  For example, my co-founder originally complained that he had no idea if he'd ever be able to give his future interns a definitive yes/no answer -- and that's just bad form.  With busy engineers with constant fires to put out, they'd never get to intervieiwng his future interns unless we created the 72-hour approval policy.  

Maybe none of this applies to your business.  But I've found that the more entrepreneurial and out-spoken your staff is, the more potential there is for bureaucracy in your company.  If you have a story about dealing with politics from within your small startup, I'd love to hear it.