Larry E. Greiner Flashcards
Greiner’s Theory
An organization’s growth is characterized as a series of developmental phases
Evolution and revolution
Management practices that work well in one phase will bring on a crisis in the next stage
Key aspects to consider for Greiner’s theory
Organization’s age
- Same practices aren’t maintained for a long lifespan
- Problems are rooted in time
- employee behavior becomes predictable and harder to change
Organization Size
- Problems and solutions change as the number of employees and sales volume increases
- companies that don’t get larger have the same management issues over a larger period of time
Growth rate of its industry
- Growth rate of industry is different than growth rate of company
- Growth rate of industry determines how fast the company will go through phases. Not GR of industry.
Stages of evolution/revolution
Creativity Leadership Direction Autonomy Delegation Control Coordination Red Tape Collaboration ?
Creativity
Birth stage of organization, frequent informal communication, long work hours and modest salary with promised of ownership benefits. Market feedback drives decisions and motivations
Crisis of leadership
Informal communication becomes in feasible. Additional functions must be implemented. Need strong business manager
Direction
Functional organizational structure. Different departments. Formal communication, more employees, increased efficiency, need of systems (accounting, inventory)
Crisis of Autonomy
Impersonal environment. Lower level employees have more knowledge about markets and machinery than management; want to take initiatives on their own. Need a decentralized hierarchy of management.
Delegation
Decentralized organizational structures. More responsibility given to lower management, bonuses are used to motivate employees, diversification of products.
Crisis of Control
Lower level management begins to run their own show without coordinating with the rest of the organization. Management must focus on control.
Coordination
Strategic business units are formed. Top level management takes responsibility for the initiation and administration of the new system.
Red Tape Crisis
Procedures take precedence over problem solving. Company has become too large and too complex to be managed through formal programs and rigid systems. Conflict between line and staff; line managers resent direction from those who are not familiar with local conditions. Management must promote interpersonal collaboration.
Collaboration
Strong interpersonal collaboration. Social control and self-discipline replace formal control, rewards are geared for team performance.
?? Crisis
Psychological saturation of employees who grow exhausted from the intensity of teamwork and innovation. May perhaps be solved through new structures and programs that allow employees to periodically rest, reflect and revitalize themselves.
After phase 5?
Company must start looking outside the organization for partners or for opportunities to sell itself to a bigger company.
