Evolution and revolution in organisations

April 18, 2009
2 Comments

Is your current situation making you feel a bit restricted?  Is it a growthphase?  It’s probably not just in your head.  There is plenty of research showing that both you and your company will go through a number of normal and predictable phases of growth over time.   Part of finding the right organisational ‘fit’ is to match where you are in your growth.

Larry Greiner‘s now famous article, Evolution and Revolution as Organisations Grow* highlighted that as organisations grow in size and age, they pass through stages.  The growth (evolution) periods are characterised by certain management styles, while the change (revolution) stages are characterised by a dominant management problem that must be solved before growth can continue.  Greiner outlines the following stages:

Stage

Dominant Evolutionary Style

Problem that must be solved to evolve to next phase of growth

1

Creativity , informal communication and controls

Leadership and the need for more formal communication and procedure

2

Direction – specialised jobs, formal communication and procedure

Autonomy – employees feeling restricted by hierarchy

3

Delegation/decentralisation of responsibility and decision making

Loss of a sense of control over a diverse operation

4

Coordination and centralisation of functions

Red tape and procedures that dim creativity

5

Collaboration using cross-functional teams and matrix structures

Not yet known

 

Do you see the paradox?  The solution to the problem in one phase becomes the problem that must be solved at the next.  As a manager or employee of a growing company, you may find yourself solving new problems by changing the very things you put in place to solve old ones.    And this is while you are doing your own growing, too.  No wonder change is so darn hard in organisations. 

And, remember…if one of you starts to feel restricted, you may very well be at different stages of growth.  If so, you have a choice to make.  You can work to make it fit or you can choose a different size.  Greiner observed that ‘’a good phase 2 manager facing phase 3 might be wise to find a position at another phase 2 organisation that better fits his or her talents.”  I would add that it is just as likely that your own growth can pass that of your organisation, in which case it may be wise to find another company that can appreciate your talents.   Bad organisation/employee ‘fit’ just holds you both back – choose something that matches your size and character.

*Greiner, L. 1998.  Evolution and Revolution as Organisations Grow.  Harvard Business Review.  May-June 1998.

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2 Responses to “Evolution and revolution in organisations”

  1. Lydia on November 14th, 2009 11:47 am

    the question is what is dominant management style characterized by every evolutionary period?

  2. janet on November 14th, 2009 3:17 pm

    Here is what Greiner says about the management styles:

    1. Individualistic. – founders deeply involved and using their mental energy in making and selling product
    2. Directive. Founders have found a trusted business manager who establishes specialised jobs, formal procedure, and formal communication
    3. Delegative. People at lower levels are empowered. Decentralised decision making
    4. Watchdog. Focus on complance. Centralisation of some internal functions (IT, HR, accounting, etc)
    5. Participative. Cross-functional teams and matrix structure

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