Strategy Tools: Greiner growth phases model

The Growth Phases model by Greiner gives you the different phases through which a growing company will go. Initially, this model defined 5 phases, the reworked version added so called “extra-organizational solutions” as a sixth phase.

This framework is often used to understand why and how you should implement different management-styles, organizational structures and coordination methods. In a sustainable context, the model can be used in a different way.

growth model

The six phases

  1. Growth through Creativity: Focused on creating new products and services. When still in a small team, discussions on vision, future projects etc. can be held informal. As the company grows, the call for a more professional approach grows stronger. This phase often leads to a Leadership Crisis.
  2. Growth through Direction: With new management, there’s more clarity on goals and objectives, which (often) will lead to further growth. This growth might lead to a Autonomy Crisis that calls for a clear structure and hierarchy.
  3. Growth through Delegation: This phase is characterized by mid-level managers that pursue opportunities in their markets and the top management that takes up a broader strategic role. The managers of phase 1 who workes in a very direct manner first, might find it hard to let go of projects. A Crisis of Control might come in, asking for a more sophisticated approach.
  4. Growth through Coordination and Monitoring: A better monitoring- and coordination-system ensures further growth of the organisation. At the end however, the complexity of these systems might lead to a Red-tap Crisis.
  5. Growth through Collaboration: In order to gain more flexibility in the organisation, a more project-oriented approach is chosen. This phase will give an initial boost to both productivity and growth, but have a big chance in ending in a Crisis of Internal Growth, in whcih we have to recognize that certain opportunities should better be pursued outside the firm.
  6. Growth through Alliences: The latest phase added by Greiner recognizes the fact that, at a certain point, organisations will have to work together to reach their respective goals.

Using this tool in a sustainable context

There’s a consensus in the green movement that in the end, our economy should evolve towards a steady state economy (more on this in my series on the foundations of the green movement). Keeping this in mind, you might ask yourself how a model on growth might help you in an environmental minded organisation.

  1. Determine your size in advance: In a previous post I wrote about economies of small. This model can be useful to determine what scale is best for you to operate in. You can also use this model to see how you want to work. If your goal is to be a creative, flexible organisation, the best way is to stay in phase 1 and limit the amount of people you’re hiring.
  2. Define upcoming industrial needs: If you’re in a business-to-business environment, knowing this model can help you in defining what your customers need. Every crisis will ask for a different approach with different tools. Analyzing the scale of your customer can help you to come up with better, tailor-made solutions.
  3. Skip a phase: Also called learn from others’ mistakes. It’s perfectly possible to stay in phase 1 while avoiding the leadership crisis and extending with for example collaboration. In this way you can customize you organisation without needing to grow through every phase (and crisis).

I’m pretty sure you can come up with different uses for this model as well, feel free to share them!

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About leyssensjan

WHY I DO WHAT I DO As a designer and entrepreneur, I want to develop systems that have a strong impact on short term and will guide society towards a more sustainable, social and economically different system in the long term. WHAT I DO I blog about and do projects with people and organisations driven by passion. I'm always on the look for new projects, ideas and people to meet, contact me!

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