One inspiration of critical theory is Max Weber. Weber was a 19th century sociologist who did work on the nature of bureaucracies.
Bureaucracies are a means to an end. They are a way of ruling or governing. All societies need them, but their character changes in modern societies, that is, societies that are not run on traditional structures such as extended family or tribal units. Modern societies have different kinds of affiliations, even if ethnic ones are not entirely abandoned. That means that to govern a society like this, you need a more abstract or impersonal bureaucracy, one that governs based on rules and not based on who you are.
Bureaucratic jobs are jobs for life (at least at Weber's time). This is because they take time to learn, or more precisely, to learn to coordinate. If you come into a new, highly bureaucratic place, you know that it takes a great deal of time to learn how to do anything at all. And, a good bureaucrat is one who has not only learned the policies, but also the culture, so that he or she can get things done. Bureaucrats do not own their own means of employment (say, the way a mechanic might own his or her own tools). These are provided, which indicates that this job is not yours in the sense of ownership. You can't transfer it, the way you could sell a business. It is the state's job, which you occupy, because it is the state's rules you are enforcing.
Bureaucracies are highly rational, but in a very specific sense. They have a goal oriented rationality - they can find the most efficient means to reach a goal. However, they do not reflect on that goal. This may come as a surprise to those who think of bureaucracies as inefficient. In fact, they are not. They just have to deal with very large numbers of people, and therefore those who deviate from the norm (and in fact many do) cannot be dealt with in the efficient manner. Therefore, bureaucracies will try to enforce uniformity among those it has to handle. Try (for example) doing much of anything without a Social Security number. Even if you have one, but it hasn't been entered into someone's computer yet, you will find all sorts of road-blocks.
There is also a sense of rationality internal to the structure itself. For example, take a parking-lot attendant. That person's kingdom is that parking lot, and no matter whether you agree or disagree with the policies of the lot, you have to obey the rules when you are there. Bureaucrats are often used to keep a questioning public away from those who make policy. So, people are "only doing their job", and are not responsible for the nature of the job. Holding them responsible because they work for a particular bureaucracy won't work. Indeed, computer programs have now become the ultimate bureaucrats. It may now be that you can't do certain things because the computer won't let you.
What's the problem with bureaucracy? For one, they are technologies, and a technologies of control and compliance, at that. Second, they can be undemocratic - they force you to be a particular way, rather than dealing with you as you are. You also probably don't have a voice in their implementation - you can vote for politicians, but you usually don't vote for bureaucrats. They can be alienating, since you are forced to be like everyone else. You are reduced to a number. A particular kind of rationality is enforced. Those working in a bureaucracy must be amoral to do their job - they must follow the dictates given from above. And, bureaucracies work to undermine freedom.
But perhaps most significant is the fact that seemingly rational bureaucracies can act in the most irrational of ways. Rational decisions made by otherwise decent people in bureaucracies can lead to the most horrifying of conclusions. The most extreme example of this was the administration of the ovens in Nazi Germany that killed millions of people. It is clear that companies, bureaucrats, and many others knew exactly what was going on, and yet participated in the large-scale construction and operation of the death camps. In fact, German companies used slave labour from the camps, the ultimate in efficiency.
A good link on this topic is Max Weber on Bureaucracy, a lecture in a political theory course at Marquette. Some (not all) of the points on this page are distilled from that site. See also the Weber notes from this course