Organization Life Cycle …


After a long break, I got a chance / time to write about something that would be of interest to all of us. I went through an interesting reading on Organization Life Cycle. It describes so nicely the phases and crisis Organizations goes through in its life cycle. Understanding these phases and crisis provides valuable information to self assess where we stand, common pitfalls to avoid and right actions to perform to take your company to the next level

Typically an Organization comes into existence when few like minded people come together with an interesting idea and decide to venture out something of their own. If the idea clicks, the company gets into a growth mode and revenue start flowing in. If it doesn’t it dies there.

After a short period of growth propelled by the interesting idea or product, the first crisis that happens is the “crisis of identification of a leader” who can guide the company to the next level of growth. Typically it can be one of the like minded people who started the company getting a natural endorsement to lead the Organization like Narayana Murthy of Infosys or it could be an external person like Eric Schmidt of Google who was the CTO in Sun / CEO of Novell before bought in as CEO of Google by the founders Google Larry Page and Sergey Bin.

There are many Organizations get dissolved at this stage due to internal conflicts in selecting a leader among themselves / unable to bring in the right leader to take the Organization to next level but if the Organization is successful in this transition of identifying and accepting the leader, the leadership crisis is sorted out and it is ready for the next level of Growth. The newly identified leader sets the right direction / goals for the company and grooms the next set of capable people to take the company to the next level of growth.

The next crisis that can happen at this stage is “crisis of autonomy”. As the organization grows it can no longer be a one man army, it has to be supported by capable / committed next set of people who would be interested to perform independently taking their division / group to the next level, otherwise potentially they may lose their interest and leave the Organization. If the leader is successful in understanding the needs of the capable next set of people and provides the autonomy for them to lead their own operations, the next phase of scalable growth starts

The next crisis that happens after a scalable growth bought in by next set of leaders is to bring in some kind of co-ordination among the autonomous leads of  various divisions in the Organization like Sales, Marketing, Delivery, PMO, Product Lines, Geographies etc by putting Systems and Processes in place to ensure a predictable growth through co-ordination. That is where all your ISOs, CMMs etc comes in place which ensures the predictability of Organization’s outputs

Depending on pure systems and processes may not sustain for a long time if the Organization grows beyond certain size as people (Employees as well as customers) get bogged down by “red tape” of too many processes and procedures in place, hence the next crisis of “red tape” starts. This crisis can only be addressed by efficient collaboration among various departments / their leads of the Organization in a seamless way to achieve the overall Vision of the Organization with strong cultural values as the pillars

If the Organization is successful in the above, the next step could be spin off the matured departments (Product lines / Geographies) as a company by itself and every spun off division going through the above phases to reach the next level.

So does it give some insights on how great Organizations like GE., J&J etc with so many product lines and presence in every part of the world came into existence from nowhere to where they are now? 

By the way where do you think we are and what you think as our current crisis is? Write to postsuggestions@crmit.com

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