GREINER CURVE

GREINER CURVE

Knowing When Your Organization Needs to Rethink Itself

• Emphasis on content (what we do)

• Marketing and sales departments carry power

• Success comes from seeking risk

• Emphasis on package (how we do)

• Power transferred to accounting

• Success comes from avoiding risk

Sources

Larry Greiner

<http://ru.scribd.com/doc/59928445/Larry-Greiner>

Organizational Growth and Crisis

<http://disc-report.com/wp-content/uploads/2010/09/OrganizationalGrowthCrisisEDS5-8.pdf>

Agenda

• Dr. Larry E. Greiner
• Strategic Growth Model for Organizations
• The Greiner Curve
• The 6 phases of the Greiner Curve
• How to use the Greiner Curve
• The "S" Curve by Will Phillips

The "S" Curve by Will Phillips

Dr. Larry E.Greiner

• Professor Emeritus of Management and Organization at the University of Southern California

• Lecturer at: Harvard Business School, University of Oxford, the University of Kansas and INSEAD in Fontainebleau

• Independent consultant (Coca Cola, Pacific Bell, Olivetti etc.)

Causality and Viscosity: Concepts For Understanding Organization

1st assumption about the world is to have a link between cause and effect.

2nd assumption is a hysteresis (period of time) in cause and effect relationships.

The "S" curve depicts a paradox of growth, - a paradox, which sets a

trap for the unwary.

Strategic Growth

Model for Organizations

The "S" Curve

• 1972 - original article in the Harvard Business Review

• Explains why company's mechanisms work or do not work

• Descriptive framework consisting of growth and 'crisis' phases

• Helps to anticipate problems before they occur

How to use

the Greiner Curve

Think about where your organization is now

Is your organization near to a crisis?

What will the transition mean for you personally and your team?

Plan and take preparatory actions to make the transition as smooth as possible

Revisit Greiner's model again every 6-12 months

The Greiner Curve

Phase 6:

Growth Through Extra-Organizational Solutions

Phase 3:

Growth Through Delegation

Phase 4:

Growth Through Coordination and Monitoring

Phase 1:

Growth Through Creativity

Phase 5:

Growth Through Collaboration

Phase 2:

Growth Through Direction

• Each growth phase has a period of evolution and stability

• Each grophase ends with a revolutionary period of organizational turmoil and change

Successful resolution

The sixth phase was added in 1998

• Mergers & Acquisitions
• Creating holdings

It suggests that growth can continue through:

Merger, outsourcing, networks and other solutions involving other companies

• Decentralized structure
• Rare & formal communication
• Top management acting by exception

Control Crisis

Managers act more independently -

Top Management feels loss of control

Autonomous business units are not working together effectively

• Creating products and opening up markets
• Few employees
• Informal communication

Leadership Crisis

Founders struggle to both run and manage business

• Team action for problem solving
• Cross-functional task teams
• Matrix type organizational structure
• Supported by a information system

Crisis of Internal Growth

Only way to grow is through collaboration with other organizations

• Reorganization into product groups
• Supervision of coordination
• Centralization of support functions

Red-Tape Crisis

Work becomes submerged under increasing amounts of bureaucracy: A new culture and structure must be introduced.

• More formal communication
• Capable Business Manager installed
• Focus on separate activities e.g. production or marketing

Autonomy Crisis

Increasing complexity -

Top Management unable to oversee all tasks: New structures based on delegation are needed.