The Russian government, defined as the cabinet (council) of ministers and the system of ministries, was not designed from scratch. Rather, the government undergoes a continuous process of redesigning, which involves gradual elimination of those Soviet-era institutional forms that do not correspond to the new political realities. The Russian government has always been subordinated to more powerful institutions, be it the Communist Party, parliament or presidency. Therefore incentives to organizational changes come from the external institutions, which may decide to cede part of their authority to the government. The key theoretical argument of this book is that government organization varies with the extent to which the principals are prepared to allow the government to actively develop (rather than just implement) policy. Delegation of power is a crucial factor explaining upward and downward tendencies in government development. Delegation of legislative authority, when the government is granted the right to establish new norms and policy precedents in addition to the executive functions, facilitates government development. Soviet-style institutional forms, incompatible with the legislative role of the government, disappear. The transformation is multi-sided because it affects various aspects of government organization including leadership, structure of the cabinet and of the whole executive branch, cabinet-level bodies, staff, and rules of operation. If the principals cede only limited -regulatory - power to the government, it lacks incentives to redesign its organization or at least to maintain efficient institutional forms.