Organizational Life Cycles
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Organizational Life Cycles: What They Are and Why They Matter
Organizations, like living organisms, go through different stages of development from their birth to their death. Understanding the organizational life cycle can help managers and leaders anticipate the challenges and opportunities that arise at each phase and adapt accordingly. In this article, we will explore the definition, models, and stages of the organizational life cycle, and how they relate to the success and survival of organizations.
What is an organizational life cycle
An organizational life cycle is a theoretical model that describes the changes an organization experiences as it grows and matures. The model is based on the analogy of a biological life cycle, which consists of birth, growth, decline, and death. The organizational life cycle also refers to the expected sequence of advancements experienced by an organization, as opposed to a random occurrence of events.
The concept of an organizational life cycle was first proposed by economist Alfred Marshall in 1890, who compared organizations to trees in the forest that struggle for survival and dominance. Later, in 1950, Kenneth Boulding suggested that organizations follow the same life cycle as living organisms. Since then, many researchers have developed different models and stages of the organizational life cycle, based on various factors such as size, age, complexity, innovation, and environment.
Why is an organizational life cycle important to understand
An organizational life cycle is important to understand because it can help managers and leaders plan and implement strategies that are appropriate for each stage of development. For example, a start-up organization may need more creativity and flexibility than a mature organization that has established processes and structures. Similarly, a declining organization may need more innovation and change than a stable organization that has a loyal customer base and a strong market position.
An organizational life cycle can also help managers and leaders anticipate the potential crises and challenges that may arise at each stage and prepare for them accordingly. For example, a growing organization may face problems such as role ambiguity, communication breakdowns, resource constraints, and coordination difficulties. A declining organization may face problems such as loss of market share, customer dissatisfaction, employee turnover, and financial difficulties.
By understanding the organizational life cycle, managers and leaders can avoid complacency and inertia that may hinder their performance and adaptability. They can also leverage the opportunities and strengths that each stage offers and foster a culture of learning and improvement.
What are some models and stages of the organizational life cycle
There is no consensus on the number and names of the stages of the organizational life cycle. Different models may emphasize different aspects or dimensions of organizational development. However, some common models and stages are:
Small business growth model: This model was developed by Neil Churchill and Virginia Lewis in 1983 and focuses on the growth stages of small businesses. The model identifies five stages: existence, survival, success, take-off, and maturity.
Greiner's growth model: This model was developed by Larry Greiner in 1972 and focuses on the growth phases of large organizations. The model identifies six phases: creativity, direction, delegation, coordination, collaboration, and alliances. Each phase ends with a crisis that requires a change in management style.
Adizes' corporate life cycle model: This model was developed by Ichak Adizes in 1979 and focuses on the balance between flexibility and control in organizations. The model identifies ten stages: courtship, infancy, go-go, adolescence, prime, stability,
aristocracy,
recrimination,
bureaucracy,
and death.
These are just some examples of the many models and stages of the organizational life cycle that have been proposed by various scholars and practitioners. Each model has its own strengths and limitations and may not apply to all types of organizations or situations. Therefore,
managers
and leaders should use them as general guidelines rather than rigid rules.
Conclusion
The organizational life cycle is a useful framework for understanding the changes an organization undergoes as it grows
and matures.
By knowing
the characteristics,
challenges,
and opportunities
of each stage,
managers
and leaders
can adopt ec8f644aee