Shabbun OSPD Article

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Evolution & Revolution As

Organization GrowsSubmitted to:

Dr. Janaki Naik

Submitted By:

Shabbun Bhatia - 1024


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(From Harvard Business Review, July-August, 1972)

Mr. Greiner was Associate Professor of

Organizational Behaviour at the Harvard Business

School and was the author of several previous HBR

articles on organization development.

Author

Larry E. Greiner


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Definitions:

Evolution The term evolution is used to

describe prolonged periods of growth where

no major upheaval occurs in organizationpractices.

Revolution

The term revolution is used todescribe those periods of substantial turmoil

in organization life.


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Model Of OrganizationDevelopment


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Key Elements

Age of the organization

Size of the organization

Stages of Evolution

Stages of Revolution

Growth Rate of the Industry


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Large

Small

Size OfOrganization

Age Of

OrganizationYoung Mature

Low-growth

Medium-growth

High-growth


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Phases Of Growth


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1.

Entrepreneurial

Stage

2.

Collectivity

Stage

3.

Formalization

Stage

4.

Elaboration

Stage

Crisis:

Need to deal

with too much

red tapeCrisis:

Need fordelegation

with controlCrisis:

Need for

leadership

Creativity

Provision of clear direction

Addition of internal systems

Development of teamwork

Crisis:Need for

revitalization

Decline

Continued

maturity

Streamlining,small-company

thinking

S

I

Z

E

Large

Small

Organizational Life Cycle


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Evolutionary Stage:

Growth Through CREATIVITY

Revolutionary Stage:Crisis of LEADERSHIP

Phase 1


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Evolutionary Stage: Growth Through Creativity

Personal control systems

Innovation by owner/manager

Goal: Survival

Management style: Entrepreneurial

Phase 1


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Revolutionary Stage: Crisis of Leadership

- Require knowledge about the efficiencies.

- Increased numbers of employees cannot be

managed.

- New accounting procedures are needed for

financial control.

Phase 1


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Evolutionary Stage:

Growth Through DIRECTION

Revolutionary Stage:Crisis of AUTONOMY

Phase 2


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Evolutionary Stage: Growth Through Direction

Personal rewards aimed at individuals whocontribute to organizational success

Innovation from employees and managers

Goal : Growth

Management style : Charismatic, directive

Phase 2


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Revolutionary Stage: Crisis of Autonomy

- Centralized Hierarchy.- Difficult for top managers who were

previously successful at being directive to

give up responsibility.- Lower-level managers are not accustomed to

making decisions for themselves.

Phase 2


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Phase 2


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Evolutionary Stage:

Growth Through DELEGATION

Revolutionary Stage:Crisis of CONTROL

Phase 3


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Phase 3

Evolutionary Stage: Growth Through Delegation

Much greater responsibility is given to managers

Profit centers and bonuses are given

The top executives at headquarters restrain

themselves to managing by exception

Management style : Delegation


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Phase 3


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Revolutionary Stage: Crisis of Control

- Autonomous field managers prefer to run

their own shows.

- Freedom breeds a parochial attitude.

Phase 3


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Evolutionary Stage:

Growth Through CO-ORDINATION

Revolutionary Stage:Crisis of RED TAPE

Phase 4


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Phase 4

Evolutionary Stage: Growth Through Co-ordination

Formal planning procedures.

Certain technical functions are centralized while

daily operating decisions remain decentralized.

Management style : Decision - Making


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Revolutionary Stage: Crisis of Red Tape

- organization has become too large and

complex to be managed through formal

programs and rigid systems.

- Line managers resent heavy staff direction.

- Staff people complain about uncooperative

and uninformed line managers.

Phase 4


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Evolutionary Stage:

Growth Through COLLABORATION

Revolutionary Stage:Crisis of ?

Phase 5


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Phase 5

Evolutionary Stage: Growth Through Collaboration

Builds around a more flexible.A matrix-type structure is frequently used.

Educational programs are utilized to train

managers in behavioural skills for achieving better

teamwork and conflict resolution.


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Phase 5


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Revolutionary Stage: Crisis of ?

- crisis will centre on the psychological

saturation of employees who have grown

emotionally and physically exhausted by the

intensity of teamwork and the heavy pressure for

innovative solutions.

Phase 5


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Implication of History


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Phase 1 Phase 2 Phase 3 Phase 4 Phase 5

Management

Focus Make & Sell Efficiency ofoperations Expansion ofmarket Consolidationof organizationProblem

solving &

innovation

Organization

Structure Informal Centralized &functional Decentralized& geographical Line-staff &product groups Matrix ofteams

TopManagement

StyleIndividualistic&

entrepreneurial Directive Delegate Watchdog Participative

Control SystemMarket results Standards &cost centers

Reports &profit centers

Plans &

investment

centersMutual goal

setting

Management

Reward

Emphasis OwnershipSalary & merit

increases Individualbonus Profit sharing& stock optionsTeam bonus


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Guidelines for Manager


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Recognize these stages

Ready to work with the flow of the tide rather

than against it

Each phase results in certain strengths and

learning experiences

Limited Range of Solutions


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Mapping


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Organisation Life Cycle

Organization Development

Red Tapeism

Leadership

Training & Development

Delegation

Performance Appraisal

Line & Staff Managers


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Levels of Hierarchy

Span of Control

Formalization

Specialization

Centralization

Decentralization

Team Development

Mechanistic vs. Organic


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