BUS P3 MUSIC (business growth and objectives in the music retail and distribution sector) Flashcards
What is the Greiner five stage growth model?
The greiner five stage gorwth model is a well known growth model which was introduced in the havard business review in 1972.
It stated that businesses go through five stages of growth or business development.
The model is used to explain the stages of growth within large organisations
What are all the stages in the greiner five stage growth model?
- Growth through creativity
- Growth through direction
- Growth through delegation
- Growth through coordination
- Growth through collaboration
- Growth through alliances
What is growth through creativity?
Growth through creativity considers the entrepreneur who is the founder of the firm.
Initially there may be few members of staff and the entrepreneur undertakes most managerial and leadership roles.
Eventually, as the firm grows, new managerial staff are required.
The entrepreneur need to manage the injection of new ideas and possibly alter the leadership style.
What is growth through direction?
The business grows further, with increasing formality in terms of structures and communication chains.
Eventually, the business becomes too big for the founder to manage alone.
Greiner called this an autonomy crisis, there is need for delegation and new management strucutres
What is growth through delegation?
At this stage the business will have senior and middle managers.
The middle managers are developing new markets and spotting opportunities in the market.
Senior managers take on a strategic and monitoring role.
What is growth through coordination?
At this stage the business often has a head office and there are clear departmental lines of hierarchy.
Often motivational schemes are established to enhance staff productivity.
Diseconomies of scale could become an issue.
What is growth through collaboration?
The stage is characterised by product portfolio being delivered using a matrix structure with cross-departmental teams.
Team-based financial benefit schemes may be established
What is growth through alliances?
Typically the business can only grow further by working with partner organisations.
This could include a merger or joint venture.
Specialist firms may be employed to help devise complex business solutions via outsourcing.
