Change is a common factor in human life and also in organizations. Based on this similarity several researchers and managements have studies the growth and development of various organizations. Organizations go through different phases of growth. Different researchers have put forward several stages of development linking it to growth and development of a human being. Some of them have classified these stages into 4 stages and others have divided it into 5 stages. It is very essential for leaders in any organization to understand this concept of life cycle (Johannsen n.pag). This paper discusses various aspects of organizational life cycle.
As in the case of human beings who go through infancy, child-hood, early-teenage and adult-hood, organizational development is also characterized by similar phases. During the early stages of development lots of rapid growth occurs and often the founders of the organization or program and its various members have to do whatever is necessary just to stay in business. There will be several strategies formulated to accomplish the goals and leaders make highly hasty, half-baked decisions.
This kind of activities can sometimes be productive or it can be counterproductive. This analogy is pretty clear as it can be compared to the human life cycle as children make several mistakes while growing up and through several success and failures they learn the facts of life. Leaders in the initial stages may fear taking the time to slow down and plan may delay or reduce the productivity (McNamara, 2007).
Just as we go through different life stages the organization also do the same. And industry or a organization have a start-up or the birth, a time of growth and development, a period of maturity, then either stagnation and demise, or renewal. The only difference here is that if an organization continues to replenish itself, it can continue to perform till the mission is significant and the company is sustainable. This mean to say that there are several companies that at the stage of stagnation. closed down and undergo the process of death, but there are several companies that do not give up at that stage and try to restart all over again. Therefore not all the organization undergoes a complete death or stagnation.
Organizations grow, mature, decline, and eventually pass away in a normal case. There are also some differences from the human pattern of life cycle such as the duration of each stage is less precise than that of human beings. In human beings, physiological growth reaches its climax at about the age of 25 on the other hand the growth phase of an organization can vary to a greater extent. Besides the mechanics on which the changes are based are different (Information systems foundations n pag.).
Organizations are at a higher level of complexity than living organisms (Boulding 1956 cit. in. Information systems foundations). For instance, any organism have a set of genetic factors and resources that influence their growth and development and this programmed or predetermined genetic code determines a process termed ‘ontogenic development’ (Ayres, 1994 cit. in. Information systems foundations).
Apart from this, it is also necessary that the organism acquire sufficient necessary resources from the environment to sustain its life and remain viable. Even though the perception of ontogenic development may not be directly applicable to the growth of an organizations due to the difference in basic constituents and mechanisms, there is a similar idea upon which the description of growth in organizations can be based. With the goal of growth, the organization is required to pass through various phases or stages of development and crisis, which is somewhat comparable to the concept of ontogenic development.
Greiner’s model of organizational development gives a good picture of how organizations grow, but this model gives the basic reasons behind the growth process and not the mechanics. In the case of any living organism or a human being the growth is a result of the interplay between the ontogenic factor and the environment. Wherein, the positive feedback plays an important role in formulating changes in a living system. Although both positive and negative feedback work simultaneously in any living system, in order to grow the positive feedback is most important (Skyttner, 2001 cit. in. Information systems foundations).
If we look at the resources that are required for growth and development of an organism starting at birth, it can be said that the importation of materials and energy from the environment not only sustains life but also contributes to growth. As they keep growing, the ability to acquire resources also increases. This growth and the increase in resource acquisition capabilities provide a positive feedback loop, which continues until the organism matures.
In a similar way the organization also grow using the resources. If the resources in a niche or a domain are abundant, a business organization in that niche is likely to gain profit that intern improve the return on investment (ROI), which in turn again attract more funds from the investors. The organization uses these funds to reinvest for expansion, to gain more market control, and make even more profit. Unless there is a problem or a limiting factor that appears in this cycle the positive feedback will continue. Limiting factors may include competition or depletion of resources in a niche.
After maturity, the organism gradually and continuously loses its ability to keep its integration and organization under control which finally leads to its demise. Though this phenomenon is normal in biological systems, organizations in general may experience decline and death but the entropic process in organizations is less definite and more complicated than in the case of organisms. It depends on the leadership and the management practices and also the adaptation to change that determine this.
Kiel (1991 cit. in. Information systems foundations) tries to explain this dissimilarity in terms of systems’ divergence in their expertise to extract and utilize energy, and the capacity to reorganize as a result of unplanned and unorganized contextual factors. This suggests that biological systems are less flexible and capable than social systems in terms of natural decline. This may be one of the main reasons for the difference in timing and duration of each of their developmental phases.
In other word it can be said that while the duration of each phase in the life cycle, and the life expectancy, are predictable or definite for an biological organism, predicting the duration or life expectancy is very difficult for any organizations (Information systems foundations). Researchers have defined the process of death and its impact variedly. As death is a natural process it is nature’s way to bring in new innovations. Similarly, birth, growth, decay, and death of an organization or a team are critically important functions (Lee, 1996).
Finally, it can be said that though the life cycle of an organism and an organization may undergo similar phases or stages of growth and development, the duration and its life expectancy is not similar. In today’s world of competence, organizations face tremendous change and challenges that can either reduce the life span or even increase it. The increasing complexity of work, managing a diverse workforce, the need for higher levels of productivity and employee commitment all combine to perform in ways different. Leadership is the most important aspect. All organization weather it is large or small, public or private sector needs strong and competent leaders to succeed.
Leadership is not just for the top leaders, but it is a need for each segment of an organization. Managers, supervisors, employees and volunteers, all of them need to lead and lead well. This is because the world is changing too rapidly and the environment is too complex for strategic intelligence, decision making and initiative to come from the top alone. The life span of an organization depends of the growth and development and also on the success and profitability.
Work cited
Ayres, R. U. 1994, Information, Entropy, and Progress: A New Evolutionary Paradigm, American Institute of Physics, NY.
Boulding, K. E. 1956, ‘General System Theory – The Skeleton of Science’, in Schoderbek, P. P. (ed.) 1967, Management Systems, John Wiley & Sons, New York, NY.
Information systems foundations Chapter 11: Organisational life cycle: growth, maturity, decline and death In: Information Systems Foundations: Constructing and Criticising [2008] Web.
Johannsen, M. Five Phases of The Organizational Life Cycle Legacee Management Systems Inc. [2008]. Web.
Kiel, L. D. 1991, ‘Lessons from the Nonlinear Paradigm: Applications of the Theory of Dissipative Structures in Social Sciences’, Social Science Quarterly, vol. 72, no. 3, pp. 431-42.
Lee, E. (1996) Life Cycles of Executive Teams. Web.
McNamara, C. Basic Overview of Organizational Life Cycles. Free Management Library. (2007). Web.
Skyttner, L. 2001, General Systems Theory: Ideas & Applications, World Scientific Publishing, Singapore.