9.1h Greiner's Growth Model Flashcards
What does Greiner’s growth model describe?
Different phases of company growth
What are the two axes on the model?
- Business size
- Time
What does Greiner’s growth model identify?
That as a business grows it is forced to change and adapt because it will encounter a crisis
What is the period between each crisis known as?
Evolutionary development
What does each crisis produce?
A revolution - a different way of doing something
What does the model measure?
- Age of the organisation
- Size of the organisation
- Stages of evolution
- Stages of revolution
- Growth rate of the industry
What are the phases of growth?
- Creativity
- Direction
- Delegation
- Co-ordination
- Collaboration
- Alliance
What are the different crises?
- Leadership
- Autonomy
- Control
- Red-tape
- Growth
What crisis can occur during phase 1?
Leadership crisis
What are the features of phase 2?
- Sustained growth
- Strong directional leadership
- Improved efficiency of operations
What crisis can occur during phase 2 and what is the solution?
Autonomy crisis - solution is delegation
What are the features of phase 3?
- Decentralised
- More responsibility delegated
- Managers have greater authortiy
What crisis can phase 3 result in?
Control crisis
Why do companies that survive phase 3 do so?
Because they use special co-ordination techniques
What crisis can phase 4 lead to?
Red-tape crisis
What are the features of phase 5?
- More flexible approach to management
- Growth slows as business runs out of ideas
- Alliances are sought
What is phase 6 done through?
External growth
Key messages from the model:
- Growth is hard
- Leadership and organisational structure have to evolve to reflect the growth of a business
- Businesses that don’t adjust as they grow will experience lower growth than those that do
Criticisms of Greiner’s growth model:
- It is simplistic
- Not every business will suffer crises as it grows
- Doesn’t take account of the pace of growth
