Essay About Management Crisis And Next Stage

Evolution Of Business
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Evolution and Revolution as Organisations Grow
17th October 2006
Five phases of development – calm period ending in management crisis.
Problems rooted in history (past decisions). Organisations are too forward looking and overlook where it has been and where it is now.
Inability of management to understand development problems can result in the company remaining static.
Evolution – prolonged periods of growth.
Revolution – substantial confusion and disturbance.
Managements solution will determine if the next stage is reached.
Market opportunities determine a companys strategy and hence its structure.
From an analysis of recent studies, five key dimensions emerge as essential for building a model of organization development:
Age of the organization – Management problems and principles are
rooted in time.
Size of the organization – change markedly as the number of
employees and sales volume increase.
Stages of evolution – The term evolution seems appropriate for describing these quieter periods.
Stages of revolution – Smooth evolution is not inevitable; upheaval of management practices. Companies fail that cant change.
Growth rate of the industry – related to market.
Each phase is both an effect of the previous cause and a cause for the next
phase.
Phase 1 – Creativity
Create product and market
Communication frequent, long hours and modest salaries
Management acts as customers react – market determines control
Volumes increase and so does management responsibilities.
Phase 2 – Direction
Period of sustained growth
Formal Structure and process is implemented
Becomes inappropriate and lower levels feel restricted
Delegation to lower level managers who are not used to it. As a result,
many companies flounder
Phase 3 – Delegation
Decentralised structure
Greater amount