session13_EVOLUTION AND REVOLUTION AS ORGANIZATIONS GROW

2024年2月6日发(作者：)

Management practicesthat work well in onephase may bring ona crisis in TIONORGANIZATIONASGROWBY LARRY E. GREINERThe problems at these companiesare rooted more in past decisionsKthan in present events or marketEY EXECUTIVES of a retail storedynamics. Yet management, in itschain bold on to an organiza-haste to grow, often overlooks suchtional structure long after itcritical developmental questionshas served its purpose because tbeas, Wbere has our organizationstructure is the source of tbeir ? Where is it now? and What doTbe company eventually goes intothe answers to these questions meanbankruptcy,for where it is going? Instead, man-A large bank disciplines a "rebel-agement fixes its gaze outward onlious" manager who is hlained forthe environment and toward the fu-current control problems, when theture, as if more precise market pro-underlying causes are centralizedjections will provide the organiza-procedures that are holding back ex-tion with a new n into new markets. ManyIn stressing the force of history onyoung managers subsequently leavean organization, I have drawn fromthe bank, competition moves in, andthe legacies of European psycholo-profits who argue tbat the bebavior ofindividuals is determined primarilyTbis article originally appeared inby past events and experiences,the fuly-August 1972 issue of than hy what lies ahead. Ex-For the article's republication as atending that thesis to problems ofClassic, the author has removedsome outdated material from theLarry E. Greiner is a professor ofopening sections. He has also writ-ten a commentary, "Revolution Ismanagement and organization atStill Inevitable," to update his ob-the University of Southern 's Marshall School of Business inLos D BUSINESS REVIEW May-June 199855

HBR CLASSICEVOLUTION AND REVOLUTION AS ORGANIZATIONS GROWorganizational development, we canidentify a series of developmentalphases through which companiestend to pass as they grow. Each phasehegins with a period of evolution,with steady growth and stahility,and ends with a revolutionary periodof suhstantial organizational tur-moil and change - for instance, whencentralized practices eventually leadto demands for resolution of eaeh revolutionaryperiod determines whether or not aeompany will move forward into itsnext stage of evolutionary COMPANIES GROWlargeCompany inhigh-growth industryCompany inmedium-growth industryA Model of HowOrganizations DevelopTo date, research on organizationaldevelopment has been largely em-pirical, and scholars have not at-tempted to create a model of theoverall process. When we analyzethe research, however, five key di-mensions emerge: an organization'sage and size, its stages of evolutionand revolution, and the growth rateof its industry. The graph "HowConipanies Grow" shows how theseelements interact to shape an orga-nization's of the Organization. The mostobvious and essential dimension forany model of development is tbe lifespan of an organization (representedon the graph as the horizontal axis).History sbows that the same organi-zational practices are not main-tained throughout a long life demonstrates a most basicCompany inlow-growth industryI evolution: stages of growthrevolution: stages of crisissmallyoungAge of OrganizationmatureManagerial problems andpractices are rooted in do not last throughoutthe life of an : management problems andprinciples are rooted in time. Theconeept of deeentralization, for ex-ample, can describe corporate prac-tices at one period hut can lose itsdescriptive power at passage of time also eon-tributes to the institutionalizationof managerial attitudes. As these at-titudes become rigid and eventually56outdated, the behavior of employeesbeeomes not only more predictablebiit also more difficiilt to of the Organization. This di-mension is depicted on the chart asthe vertical axis. A company's proh-lems and solutions tend to changemarkedly as the number of its em-ployees and its sales volume in-erease. Prohlems of coordination andcommunication magnify, new func-tions emerge, levels in themanagement hierarchymultiply, and jobs be-come more , time is not the onlydeterminant of structure;in faet, organizations thatdo not become larger eanretain many of the samemanagement issues andpractices over long of Evolution. As organiza-tions age and grow, another phenom-enon emerges: prolonged growththat we can term the evolutionaryperiod. Most growing organizationsdo not expand for two years and thencontract for one; rather, those thatsurvive a crisis usually enjoy four toeight years of continuous growthwithout a major economic setbackor severe internal disruption. Theterm evolution seems appropriatefor describing these quiet periodsbecause only modest adjustmentsappear to be necessary for maintain-ing growth under the same overallpattern of of Revolution. Smooth evo-lution is not inevitable or indefi-nitely sustainable; it cannot he as-sumed that organizational growthis linear. Fortune's "500" list, forexample, has had considerableturnover during the last 50 years. Infact, evidence from numerous casehistories reveals periods of substan-tial turbulence interspersed betweensmoother periods of ean term tbe turbulent timesperiods of revolution because theytypieally exhibit a serious upheavalof management practices. Traditionalmanagement practiees that were ap-propriate for a smaller size and earliertime no longer work and are broughtunder scrutiny by frustrated top-levelmanagers and disillusioned lower-level managers. During such periodsof crisis, a number of companies fallshort. Those that are unable to aban-HARVARD BUSINESS REVIEW M;iy-|une 1998

HBR CLASSiCEVOLUTION AND REVOLUTION AS ORGANIZATIONS GROWdon past practices and effect majororganizational changes are likelyeither to fold or to level off in theirgrowth critical task for managementin each revolutionary period is tofind a new set of organizational prac-tices that will hecome the basis formanaging the next period of evo-lutionary growth. Interestinglyenough, those new practices eventu-ally sow the seeds of their own decayand lead to another period of revolu-tion. Managers therefore experiencethe irony of seeing a major solutionin one period hecome a major prob-lem in a later at which an organization expe-Growth Rate of the Industry. Theriences phases of evolution and revo-lution is closely related to the mar-ket environment of its industry. Forexample, a company in a rapidly ex-panding market will have to add em-ployees quickly; hence, the need fornew organizational structures to ac-commodate large staff increases isaccelerated. Whereas evolutionaryperiods tend to be relatively sbortin fast-growing industries, muchlonger evolutionary periods occur inmature or slow-growing ion can also be prolonged,and revolutions delayed, when prof-its come easily. For instance, com-panies that make grievous errors ina prosperous industry can still lookgood on their profit-and-loss state-ments; tlius, they can buy time be-fore a crisis forces changes in man-agement practices. The aerospaceindustry in its bighly profitableinfancy is an example. Yet revolu-tionary periods still occur, as one didin aerospace when profit opportu-nities hegan to dry up. By contrast,when the market environment ispoor, revolutions seem to be muchmore severe and difficult to of GrowthWith the foregoing framework inmind, we ean now examine in deptbthe five specific phases of evolutionand revolution. As shown in thegraph "The Five Phases of Growth,"each evolutionary period is charac-THE FIVE PHASES OF GROWTHPhase 1largectoOoevolution: stages of growthrevolution: stages of crisissmallyoungleadershipmatureAge of Organization58HAUVARD BUSINESS REVIEW May-June 1998

HBR CLASSICEVOLUTION AND REVOLUTION AS ORGANIZATIONS GROWsorbed entirely by making and sell-ing a new product.• Communication ainong employ-ees is frequent and informal.• Long hours of work are rewardedby modest salaries and the promiseof ownership benefits.• Decisions and motivation arehighly sensitive to marketplacefeedback; management acts as cus-tomers the foregoing individualisticand creative activities are essentialfor a eompany to get offthe ground. But as theCreative activities are essentialcompany grows, thosevery activities becomefor a company to get off thethe prohlem. Larger pro-duction runs requireground. But as the companyknowledge about tbe effi-ciencies of manufactur-grows, those very activitiesing. Increased numbersbecome the employees cannot bemanaged exclusivelytbrough informal communication,dustries encounter only two or threeand new employees are not moti-phases over many by an intense dedication to tbeIt is important to note that eachproduct or organization. Additionalphase is at once a result of the previ-capital must be secured, and newous phase and a cause for the nextaccounting procedures are neededphase. For example, the evolution-for financial control. Tbe company'sary management style in Phase 3 isfoimders find themselves burdeneddelegation, whieh grows out of andwith unwanted management re-becomes tbe solution to demands forsponsibilities. They long for tbegreater autonomy in tbe preceding"good old days" and try to act asPhase 2 revolution. Tbe style of dele-they did in the past. Conflicts ainonggation iised in Phase 3, however,harried leaders emerge and groweventually provokes a revolutionarycrisis that is characterized by at-more to regain control over the di-At this point, a crisis of leadershipversity created through increasedoecurs, which is the onset of the tion. Who will lead the com-For each phase, managers are lim-pany out of confusion and solve theited in what they can do if growth ismanagerial problems confrontingto occur. For example, a companyit? Obviously, a strong manager isexperiencing an autonomy crisis inneeded-one wbo bas the necessaryPhase 2 cannot return to directiveknowledge and skills to introducemanagement for a solution; it mustnew business tecbniques. But find-adopt a new style-delegation-ining that manager is easier said thanorder to move . The founders often resist step-ping aside, even though they arePhase 1: Creativity. In the birthprobably temperamentally unsuitedstage of an organization, tbe empba-to the joh. So here is the first criticalsis is on creating hoth a product anda market. The following are thechoice in an organization's develop-ment: to locate and install a strongcharacteristics of the period of cre-business manager who is acceptableative evolution:to the founders and who can pull the• The founders of the company areorganization y technically or entrepreneuri-ally oriented, and they generally dis-Phase 2: Direction. Those com-dain management activities; theirpanies that survive the first phase byphysical and mental energies are ab-installing a capable business manager60terized hy the dominant manage-ment style used to achieve growth;each revolutionary period is charac-terized by tbe dominant manage-ment problem that must he solvedbefore growth can continue. Thepattern presented in the chart seemsto be typical for companies in indus-tries with moderate growth over along period; companies in faster-growing industries tend to experi-ence all five phases more rapidly,whereas those in slower-growing in-usually embark on a period of sus-tained growtb under able, directiveleadership. Here are the eharacteris-ties of this evolutionary period:• A functional organizational struc-ture is introduced to separate manu-facturing from marketing activities,and job assignments become in-creasingly specialized.• Accounting systems for inventoryand purebasing are introduced.• Incentives, budgets, and workstandards are adopted.• Communication becomes moreformal and impersonal as a hierar-ehy of titles and positions grows.• The new manager and his or herkey supervisors assume most of theresponsibility for instituting direc-tion; lower-level supervisors aretreated more as functional special-ists than as autonomous decision-making gh the new directive tech-niques channel employees' energymore efficiently into growth, theyeventually become inappropriate forcontrolling a more diverse and com-plex organization. Lower-level em-ployees find themselves restrictedhy a cumbersome and centralizedhierarchy. They have come to possessmore direct knowledge ahout mar-kets and machinery than do theirleaders at the top; consequently,they feel torn between followingprocedures and taking initiative ontbeir , the second revolutionemerges from a crisis of solution adopted hy most com-panies is to move toward more dele-gation. Yet it is difficult for top-levelmanagers who previously were suc-cessful at being directive to give upresponsibility to lower-level man-agers. Moreover, the lower-levelmanagers are not accustomed tomaking decisions for a result, numerous companiesfounder during this revolutionaryperiod by adhering to centralizedmethods, while lower-level employ-ees become disencbanted and leavetbe 3: Delegation. The next eraof growth evolves from the suceess-ful application of a decentralizedorganizational structure. It exhihitsthese characteristics:HARVARD BUSINESS REVIEW May-fune 1998

HBR CLASSICEVOLUTION AND REVOLUTION AS ORGANIZATIONS GROW• Much greater responsibility isgiven to the managers of plants andmarket territories.• Profit centers and bonuses are usedto motivate employees.• Top-level executives at headquar-ters limit themselves to managingby exception based on periodic re-ports from the field.• Management often concentrateson acquiring outside enterprises thatean be lined up with other decentral-ized units.• Communication from the top isinfrequent and usually occurs bycorrespondence, telephone, or briefvisits to field delegation phase allows com-panies to expand by means of theheightened motivation of managersat lower levels. Managers in decen-tralized organizations, who havegreater authority and incentives, areahle to penetrate larger markets, re-spond faster to customers, and de-velop new produets.A serious problem eventuallyemerges, however, as top-level exec-utives sense that they are losing con-trol over a highly diversified field op-eration. Autonomous field managersprefer to run their own shows with-out coordinating plans, money, tech-nology, and personnel with the restof the organization. Freedom breedsa parochial , the organization falls into acrisis of control. The Phase 3 revolu-The delegation phase bringsa new period of growth,but freedom eventuallybreeds a parochial is under way when top manage-ment seeks to regain control overthe company as a whole. Some top-management teams attempt a returnto centralized management, whiehusually fails hecause of the organi-zation's newly vast seope of opera-tions. Those companies that moveahead find a new solution in the useof special coordination 4: Coordination. The evolu-tionary period of the coordination62phase is characterized hy the use offormal systems for achieving greatercoordination and by top-level execu-tives taking responsibility for theinitiation and. administration ofthese new systems. For example:• Deeentralized units are mergedinto product groups.• Formal planning procedures are es-tablished and intensively reviewed.• Numerous staff members are hiredand loeated at headquarters to initi-ate companywide programs of con-trol and review for line managers.• Capital expenditures are carefullyweighed and parceled out across theorganization.• Each product group is treated as aninvestment eenter where return oninvested capital is an important cri-terion used in allocating funds.• Certain technical functions, suchas data processing, are centralized atheadquarters, while daily operatingdecisions remain decentralized.• Stock options and companywideprofit sharing are used to encourageemployees to identify with the orga-nization as a these new coordination sys-tems prove useful for achievinggrowth through the more effieientallocation of a company's limited re-sourees. The systems prompt fieldmanagers to look beyond the needsof their local units. Although thesemanagers still have a great deal ofdecision-making responsibility, theylearn to justify their ac-tions more earefully toa watehdog audience atheadquarters.A lack of confidence,however, gradually buildsbetween line and staff,and between headquar-ters and the field. Themany systems and pro-grams introdueed begin to exceedtheir usefulness. A red-tape crisis isin full swing. Line managers, for ex-ample, increasingly resent directionfrom those who are not familiar withlocal conditions. And staff people,for their part, complain about unco-operative and uninformed line man-agers. Together, both groups criti-cize the bureaucratic system thathas evolved. Procedures take prece-dence over prohlem solving, and in-novation dims. In short, the organi-zation has become too large andeomplex to be managed through for-mal programs and rigid systems. ThePhase 4 revolution is under 5: Collaboration. The lastobservable phase emphasizes stronginterpersonal eollaboration in an at-tempt to overcome the red-tape cri-sis. Where Phase 4 was managedthrough formal systems and proce-dures. Phase 5 emphasizes spontane-ity in lnanagement action throughteams and the skillful confrontationof interpersonal differences. Socialcontrol and self-discipline replaceformal eontrol. This transition is es-pecially difficult for the experts whocreated the coordination systems aswell as for the line managers who re-lied on formal methods for Phase 5 evolution, then,builds around a more flexible and be-havioral approach to are its characteristics:• The focus is on solving problemsquickly through team aetion.• Teams are combined aeross func-tions to handle specific tasks.• Staff experts at headquarters areredueed in numher, reassigned, andcombined into interdisciplinaryteams that consult with, not direet,field units.• A matrix-type structure is fre-quently used to assemble the rightteams for the appropriate prohlems.• Formal control systems are simpli-fied and combined into single multi-purpose systems.• Conferenees of key managers areheld frequently to foeus on majorproblems.• Educational programs are used totrain managers in behavioral skillsfor achieving better teamwork andconflict resolution.• Real-time information systems areintegrated into daily decision-mak-ing processes.• Eeonomic rewards are geared moreto team performance than to indi-vidual achievement.• Experimenting with new practicesis encouraged throughout the will be the revolution in re-sponse to this stage of evolution?Many large U.S. companies are nowin the Phase 5 evolutionary stage, soHARVARD BUSINESS REVIEW May-June 1998

HBR 5ICEVOLUTION AND REVOLUTION AS ORGANIZATIONS GROWthe answer is critical. Althoughthere is little clear evidence regard-ing the outcome, I imagine that tberevolution arising from the "?" crisiswill center around the psychologicalsaturation of employees who growemotionally and physically exhaust-ed from the intensity of teamworkand the heavy pressure for innova-tive hunch is that the Phase 5 revo-lution will be solved through newstructures and programs that allowemployees to periodically rest, re-flect, and revitalize themselves. Wemay even see companies with dualorganizational structures: a habitstructure for getting the daily workdone and a reflective structure forstimulating new perspective andpersonal enrichment. Employeescould move back and forth hetweenthe two structures as their energiesdissipate and are European organization hasimplemented just such a reflective groups have beenestahlished outside the company'susual structure for the purpose ofcontinuously evaluating five taskactivities basic to tbe groups report directly to themanaging director, although theirfindings are made public throughoutthe organization. Membership ineach group includes all levels andfunctions in the company, and em-ployees are rotated through thegroups every six concrete examples now inpractice include providing sahbati-eals for employees, moving man-agers in and out of hot-spot jobs, es-tablishing a four-day workweek,ensuring job security, huilding phys-REVOLUTION IS STILL INEVITABLEI wrote the first draft of this articlewhile I was felled by a bad leg dur-ing a ski vacation in the time, the business worldwas buzzing with numerous fad-dish techniques. Perhaps it was thesize and height of the mountainsthat made me feel that there weredeeper and more powerful forces atwork in basic points still seem validabout the model. First, we continueto observe major phases of develop-ment in the life of growing compa-nies, lasting anywhere from 3 to 15years each. Although scholars de-bate the precise length and natureof these phases, everyone agreesthat each phase contains its ownunique structure, systems, andleadership. The growth rate of theindustry seems to determine thephases' , transitions betweendevelopmental phases still do notoecur naturally or smoothly, re-gardless of the strength of top man-agement. All organizations appearto experience revolutionary diffi-culty and upheaval, and many ofthese organizations falter, plateau,fail, or get acquired rather thangrow further. IBM before Lou Gerst-ner and General Electric beforelack Welch both suffered badly atthe end of the fourth phase of coor-dination, when sophisticated man-agement systems evolved into , the logic of paradox un-derlying the model continues toring true, although it often hauntsand confuses the managerial psy-che. Managers have difficulty inunderstanding that an organiza-tional solution introduced hy thempersonally in one phase eventuallysows the seeds of , the greatest resistance tochange appears at the top hecauserevolution often means that unitsunder each senior executive will beeliminated or transformed. That iswby we so often see new chiefexecutives recruited from the out-side and why senior managers fre-quently leave companies. Execu-tives depart not because tbey are"bad" managers but because theyjust don't fit with where the com-pany needs to for the differences that I haveohserved since the article's originalpublication^ there is obviouslymuch more "death" in the life oforganizations today. Few organiza-tions make it through all the phasesof growth. If they don't fail, as mostdo in the initial phase of creativityand entrepreneurship, they oftenget acquired by companies that arein a later phases are not as cleanlymarked off as I depicted them. Thevestiges of one phase remain asnew approaches are overlaps are most notable inthe case of tbe first-phase entrepre-neur hanging on when professionalmanagement is added in the sec-ond phase of are also miniphases with-in each evolutionary stage. Thedelegation phase, for example, doesnot typically hegin with the com-plete decentralization of the entireorganization into multiple productunits, as the article implies. Usuallyone product group is launched, andthen others are added over , as delegation-or decentral-ization, as I now prefer to call thisphase-advances, senior managersat the corporate office are not asbands-off as I depicted them. Theaddition of multiple product orgeographic units over time requiresa sophisticated level of involve-ment by senior management to re-view strategies, evaluate results,and communicate the organiza-tion's values-but not to micro-manage the units under them.I would change some of thethings I said about the fifth phaseof collaboration. My original de-scription of this phase suggeststhat the entire organization is64HARVARD BUSINESS REVIEW May-June

EVOLUTION AND REVOLUTION AS ORGANIZATIONS GROWHBR CLASSICical facilities for relaxation duringthe workday, making jobs more in-terehangeable, creating an extrateam on the assembly line so thatone team is always off for reeduca-tion, and switching to longer vaca-tions and more flexible work Chinese practiee of requiringexecutives to spend time periodicallyon lower-level jobs may also heworth a nonideologieal too long, U.S. management hasassumed that career progress shouldbe equated with an upward path to-ward title, salary, and power. Couldit be that some viee presidents ofmarketing might just long for, andeven benefit from, temporary dutyinfield sales?Implications of HistoryLet me now summarize some impor-tant implications for practicingmanagers. The main features of thisdiscussion are depicted in the table"Organizational Practices in theFive Phases of Growtb," whichshows the specific management ac-tions that characterize each growthphase. These actions are also thesolutions tbat ended each precedingrevolutionary one sense, I hope that manyreaders will react to my model byseeing it as obvious and natural fordepicting the growth of an organiza-tion. To me, this type of reaction is auseful test of the model's at a more reflective level, Iimagine some of these reactionscome more from hindsight thanfrom foresight. Experienced man-agers who have been through a de-velopmental sequenee ean identifythat sequence now, but how did theyturned into a matrix of teams. Inow see the matrix as confinedlargely to senior management,where the heads of geographicareas, product lines, and functionaldisciplines collaborate as a team inorder to ensure that their decisionsare coordinated and implementedaeross global markets. The mostsignificant change in this phaseoccurs when the previously bureau-cratic Phase 4 control-orientedstaff and systems are replaced by asmaller number of consulting staffexperts who help facilitate, ratherthan control, speculation that "psycholog-ical saturation" is tbe crisis endingPhase 5 now seems wrong. Instead,I think the crisis is one of realizingthat there is no internal solution,such as new products, for stimulat-ing further growth. Rather, the or-ganization begins to look outsidefor partners or for opportunities tosell itself to a bigger company.A sixth phase may be evolving inwhich growth depends on the de-sign of extra-organizational solu-tions, such as creating a holdingcompany or a network organiza-tion composed of alliances andcross-ownership. GE may have de-veloped a similar model in whieha periphery of companies is builtaround a core "money" companyor bank (GE Capital) that attractscapital, earns high returns, andfeeds the growth of other units.I doubt tbat the advancement ofinformation technology has mademuch of a difference in the basicaspects of the model. Informationtechnology appears useful as a toolthat evolves in different forms tofit each phase. For example, thePhase 2 functional organizationalstructure requires data that reflectrevenue and cost centers, whereasPhase 3 deeentralization needsdata that measure profit centerperformance.I wrote the article mainly aboutindustrial and consumer goodscompanies, not about knowledgeorganizations or service businesses,which bad yet to come into promi-nence. After recently studying anumber of consulting, law, and in-vestment firms, our researeh teamfound that tbose organizations alsoexperience evolution and revolu-tion as they the first, entrepreneurialphase, the professional service firmpursues and tests a variety of mar-ket paths. The phase ends with thepartners arguing about whether ornot to stay together to concentrateon one partner's vision for the fu-ture. In the second phase, the firmfocuses on one major service andeventually finds itself with a de-bate among the partners aboutwhether to continue focusing onthe current practice or to open an-other office or add additional ser-vices. A third phase of geographicor service expansion typically endswith a struggle over ownership;how much equity are the originalpartners willing to share with theyounger partners who led the ex-pansion and brought in newclients? The fourth phase involvesinstitutionalizing tbe firm's name,reputation, and its standard way ofoperating, and ends in a crisisof cultural conformity in the face ofwhich the firm must restore inno-vation and y, as a strong caveat, Ialways remind myself and othersthat the "ev and rev" model de-picted in this article provides onlya simple outline of the broad chal-lenges facing a management eon-cerned with growth. It is not acookie-cutter solution or rate of growth, the effectiveresolution of revolutions, and theperformance of the company with-in phases still depend on the funda-mentals of good management:skillful leadership, a winning strat-egy, tbe heightened motivation ofemployees, and a deep concern D BUSINESS REVIEW May-June 199865

HBR CLASSICEVOLUTION AND REVOLUTION AS ORGANIZATIONS GROWORGANIZATIONAL PRACTICESIN THEFIVE PHASES OF GROWTHCATEGORYPHASE 1PHASE 2PHASE3PHASE 4PHASES •m Management1 ; FocusOrganizationalStructure^ Top-ManagementMake and sellEfficiency ofoperationsCentralized andfunctionalDirectiveExpansion ofmarketDecentralizedand geographicaiDelegativeConsolidation oforganizationLine staff andproduct groupsWatchdogProblem solvingand innovationMatrix of teamsInformalI StyleControl 5ystemIndividualistic andentrepreneurialMarket resultsParticipativeStandards andcost centersSalary and meritincreasesReports and profitcentersIndividual bonusPlans and invest-ment centersProfit sharing andstock optionsMutual goalsettingTeam bonus-ManagementReward EmphasisOwnershipreact when in the midst of a stage ofevolution or revolution? They canprobably recall the limits of tbeirown developmental understandingat that time. Perhaps they resisteddesirable changes or were evenswept emotionally into a revolutionwithout heing able to propose con-structive solutions. So let me offersome explicit guidelines for man-agers of growing organizations tokeep in where you are in thci devel-opmental sequence. Every organiza-tion and its component parts are atdifferent stages of development. Thetask of top management is to beaware of the stages; otberwise, itmay not recognize when the time forchange has come, or it may act toimpose the wrong s at the top should be readyto work with the flow of the tiderather than against it; yet theyshould be eautious because it istempting to skip phases out of impa-tience. Each phase produces certainstrengths and learning experiencesin the organization that will be es-sential for success in subsequentphases. A child prodigy, for example,may be able to read like a teenager.66but he cannot behave like one untilhe matures througb a sequence ofexperiences.I also doubt that managers can orshould act to avoid , these periods of tensionprovide the pressure, ideas, andawareness that afford a platformfor change and tbe introduction ofnew ize the limited range ofsolutions. In each revolutionarystage, it becomes evidentthat the stage can come toa close only by means ofcertain specific solutions;moreover, these solutionsare different from thosethat were applied to theproblems of the precedingrevolution. Too often, itis tempting to choosesolutions that were triedbefore but that actually make it im-possible for the new phase of growtbto ment must be prepared todismantle current structures beforethe revolutionary stage becomes tooturbulent. Top-level managers, re-alizing that their own managerialstyles are no longer appropriate, mayeven bave to take themselves out ofleadership positions. A good Phase 2manager facing Phase 3 might hewise to find a position at anotherPhase 2 organization that better fitshis or her talents, either outside thecompany or with one of its y, evolution is not an auto-matic affair; it is a contest for sur-vival. To move ahead, companiesmust consciously introduce plannedToo often, it is tempting tochoose solutions that weretried before but that actuallymake it impossible for thenew phase to ures that not only solve a cur-rent erisis but also fit the next phaseof growth. That requires consider-able self-awareness on the part of topmanagement as well as great inter-personal skills in persuading othermanagers that change is e that solutions breed newproblems. Managers often fail to rec-HARVARD BUSINESS REVIEW May-June 1998

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