organizational life cycle

 

  • It is also important to note that evolution is not a mechanical event, and organizations must actively seek out new solutions to the current crisis that are also suitable
    for the next stage of growth.

  • [46] Implications for growth phases There are certain implications for managers in organizations with regards to the phases of growth: Recognizing one’s position in the course
    of expansion[edit] Top-tier managers should be aware of their organization’s current stage, to be able to execute relevant solutions to the type of crisis faced.

  • Although Greiner identified expansion through collaboration as the evolutionary phase, he did not specifically identify the succeeding crisis (revolutionary phase), as there
    was little evidence due to most of the organizations still being in the collaboration phase.

  • [50] Limitations According to the organizational life cycle models, growth in size leads to business issues that firms can solve by adopting only one possible organizational
    configuration, following a deterministic organizational approach.

  • The organizational life cycle is a more inclusive term for all kinds of organizations which includes even government organizations, but the business life cycle refers more
    specifically only to for-profit companies.

  • The organizational life cycle is primarily concerned with the internal development and evolution of the organization itself, while the business life cycle is primarily concerned
    with the external development and evolution of the business within its market environment.

  • The decline is identified by the focus on political agenda and authority within an organization,[4] whereby individuals start to become preoccupied with personal objectives,
    instead of focusing on the objectives of the organization itself.

  • [47] However, this leads to a crisis of leadership, as a more structured form of management is required.

  • [15] Examples include the various stages in an organization’s life cycle, phases of growth experienced by an organization during expansion and implications for these phases
    of growth.

  • Complex and formal systems are also made simpler, and there is an increased emphasis on the communication between managers, to solve crucial problems.

  • [12] Shortly after, Mason Haire was among the initial researchers[13] who suggested that organisations may adhere to a certain path of uniformity in their course of expansion.

  • [50] This models identifies seven different stages of organizational growth and uses corporate revenues as the way to define when each stage occurs (begins and ends).

  • However, Greiner predicted that the crisis might involve the exhaustion of members in an organization, due to a strong requirement for innovation and teamwork.

  • [46] Managers should avoid repeating solutions, as this will prevent the evolution of a new phase of growth.

  • [6][7] Other than this, within the scope of business, the organizational life cycle and business life cycle can be distinguished by their primary focus.

  • [2] The relevance of a biological life cycle relating to the growth of an organization, was discovered by organizational researchers many years ago.

  • Stages Generally, there are five stages to an organization’s life cycle[3] • Stage 1: Existence : Commonly known as the birth[42] or entrepreneurial stage,[43] “existence”
    signifies the start of an organization’s expansion.

  • Top and middle-level management specialize in different tasks, such as planning and routine work respectively.

  • [3] • Stage 2: Survival : At this stage, organizations look to pursue growth,[44] establish a framework and develop their capabilities.

  • [43] There is a focus on regularly setting targets for the organization, with the main aim being to generate sufficient revenue for survival and expansion.

  • Recently, scholars challenged this view and propose conceiving of organizational life cycle as an evolutionary process, which calls for a variety of equifinal organizational
    solutions.

 

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