Monday, 20 June 2016

Greiner's Organizational Growth Model

When I was studying my undergraduate degree, I had a lecturer who showed my cohort of management 101 students Greiner's Organizational Growth Model (1972).

Being a newbie, I took absolutely no notice of whose model it was. I remembered the stages - they were, in fact, emblazoned on my memory - but I had no recollection whatsoever of who had done the thinking.

Last year, I was explaining 'crisis of control' in organisations to some of my leadership students, who appeared completely ignorant of the concept that different crises could strike an organisation at different stages of its development (rather like the product life-cycle, in fact). In realising that, I also realised that I had no idea of whose developmental work this had originally been.

So I went looking, but was unable to find what I was looking for: despite fairly thorough Google and GoogleScholar searches.

Then, as serendipity would have it, I recently attended a webinar on peer coaching in the workplace. One of the presenters mentioned what sounded like "Griner's model", and "crisis of control", and I had enough to find what I hadn't even realised that I missed, all those years ago. And Google knitted the two into a solution for me.

Larry Greiner (1972) originally observed that organisations appear to go through different stages of development at different times in their 'lives', with each of those stages needing different strategies, tactics and actions to manage and develop the organisation appropriately, readying it for the transition to the next stage. 

Greiner later added a sixth stage (1998), but didn't indicate a crisis for that one - a fact which I find interesting.

The growth - or development - stages are (Value-Based Management, n.d.):
  • Creativity: characterised in a company start-up, entrepreneurship, informal communication, hard work, and poor pay; ending with a crisis of leadership
  • Direction: characterised by sustained growth, functional organisation structures, accounting, capital management, incentives, budgets, and focusing on process standardisation; ending with a crisis of autonomy
  • Delegation: with decentralised organisational structures, decentralised operational and decentralised marketing, profit centres, financial incentives, decision-making based on periodic reviews, senior management acts by exception, and using formal communication channels; ending with a crisis of control
  • Co-ordination and monitoring: having a product group structure, in-depth formal planning reviews, supporting function centralisation, corporate staff overseeing co-ordination, corporate capital expenditures, accountability for ROI at product group level, and motivating through lower-level profit sharing; ending with a crisis of red tape
  • Collaboration: taking a new evolutionary path, using problem-solving teams and cross-functional task teams, decentralising support staff, adopting a matrix structure, simplifying control mechanisms, team behaviour education programmes, advanced information systems, and team incentives; ending with a crisis of internal growth
  • Extra-organisational solutions: mergers, holdings, networks of organisations.
One of the key aspects of Greiner's model is that it flags which management theories or leadership styles will work at the various stages: which then shows us by omission which won't

I wonder, if he were still thinking about this now, whether Greiner would have come up with a crisis for the 'extra-organisational solutions' stage? Perhaps, in considering the GFC, a crisis of hubris?


Sam

References:
  • Greiner, Larry E. (1998). Evolution and Revolution as Organizations Grow. Harvard Business Review, May/June 1998, Volume 76, Issue 3 (pp. 55-68)
  • Greiner, Larry E. (1972). Evolution and Revolution as Organizations Grow. Harvard Business Review, July-August 1972, Volume 50, Issue 4 (pp. 37-46)
  • Mindtools (n.d.). The Greiner Curve. Retrieved 18 February 2016 from https://www.mindtools.com/pages/article/newLDR_87.htm
  • Value-Based Management (n.d.). Organisational Growth Model. Retrieved 18 February 2016 from  http://www.valuebasedmanagement.net/methods_greiner.html

    4 comments :

    1. Well then there is the next stage we are supposedly in the midst of now and that is digital disruption, or if you are following the Singularity University exponential technological innovation. My observations so far are of a naive ethical wonderment at change for the sake of change from this camp of thinking. I'm not sure what leadership skills will interplay well here Sam, because we may be crossing some sort of work/reward boundary/expectiation as a society.

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      Replies
      1. Thanks very much for the reply, James: and I am so sorry to take so long to acknowledge your feedback! Good point about the digital disruption phase: Greiner's model was too early for that :-)

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    2. Perfectly composed content, Really enjoyed looking at.

      ReplyDelete