How does your company rank in the Corporate Life Cycle, and where should you go next? Do you balance management and entrepreneurialism effectively?
There are generally ten stages in an organization’s life cycle.
Often, a brainchild is what causes an organization to be born. If the idea doesn’t take off, it is considered a failure and the business will never get off the ground. However, the next step is the birth of the idea.
The third stage in the life cycle is called INFANT. It is essential that an organization survives once it has been established. As the organization grows and becomes stronger, its main concern is to keep it alive. Lack of funds to support its early growth is the biggest threat. This stage is where the organization can fail and cause infant mortality. academic transcription services
Once an organization is able to survive in its infant years, it will begin to achieve success. Customers increase, sales volumes rise and costs go up. As the organization develops a unique personality, it is able to face more difficult challenges with greater self-confidence. Sometimes it is too brazen and makes a huge mistake. Without the financial resources to support it, it eventually fails. Toddler is the fourth stage in the life cycle.
Organizations usually realize there are dangers they need to avoid in stage four but are still growing and succeeding. Stage five of the lifecycle is all about replicating their success and growing and reinvesting into the business.
While the first to fifth stages of the cycle can be dangerous and difficult, they are also exciting years for an organization’s growth. It is the common goal to succeed, rapid response, mutual support, risk taking, celebration of success, informality, and a sense that the organization’s employees are learning and sharing their experiences, which unite them.
There is often resistance to accepting the necessity of self-imposed controls in order to preserve the winning formula. It is often easy to overlook the checks, procedures, systems, and structures that are required to protect an organization from over-trading. To be successful, however the organization needs them as its business is growing and the inherent risks it faces means that the people running it must have more information to make good decisions. Although the organization has always had a need for more management discipline, it is not used to them.
The transition from stage 5 (ADOLESCENT), into the next stage PRIME is the most challenging in an organization’s life cycle. Management skills must be developed and entrepreneurial spirit must be maintained. There will be a clash between values, differing opinions, and fierce exchanges of views when the people who built the business come under fire from their newly appointed managers. It is almost as if the organization is experiencing civil war. PRIME needs to accept that it is necessary to grow and give others the freedom to take on the real responsibilities. This can be a difficult and tedious process. Some don’t believe it or don’t want to be involved and leave. This is perfectly normal. Other people then step in to help make the changes.
Once you have reached PRIME, it is important to continue the organization’s progress. The organization must continue to REINVENT itself at this stage. Slipping back can be very dangerous. Going above and beyond management control can lead to even greater danger. It is not long before BUREAUCRACY or an internal focus are established if the former occurs. Arrogance results in a loss to customers, lower profit margins and the departure of the best employees. The organization is in EXTREME DECLINE.
Without a bold vision, a strategy for change and strong leadership, the organization will eventually fall into TERMINAL ILLNESS. At that point, heavy-weight management consultants are hired to finish the job.
Organizations must find a way to balance their entrepreneurialism with sound infrastructure and managerial skills if they are going to be successful. They will only succeed in the long term if their efforts are constant.