This model created in 1972, by Larry Greiner, identifies the 6 phases of growth associated with an organization. It is a detailed framework that explains why certain management techniques and organizational structures work at particular stages in the growth model and why some can be unsuccessful.
What are the Five Phases of Growth?
Growth through Creativity – (Phase 1) – Identified as a start-up company, entrepreneurial structure with hard work and informal communication. This phase comes to an end by having a leadership crisis.
Growth through Direction – (Phase 2) – Identified by sustained growth and a functional (formal) organizational structure. This phase come to an end by an autonomy crisis.
Growth through Delegation – (Phase 3) – Identified by a decentralized organizational structure, market level responsibility, profit centers, formal communication. This phase comes to an end by a control crisis.
Growth through Coordination – (Phase 4) – Identified by the formation of product groups/divisions, formal planning, centralization of support functions, corporate staff oversight, accountability at the product/ division level, motivation through lower level profit sharing. This phase comes to an end by a red tape crisis.
Growth through Collaboration – (Phase 5) – Identified by matrix organizational structure, decentralized support staff, advanced information systems, team functions and incentives. This phase comes to an end by an internal growth crisis.
Growth through Alliances – (Phase 6) – Identified as a network of organizations, holding companies and/or mergers.