In this article we describe Greiner's Growth Model, six successive long term phases of an organisation.

What is Greiner’s Growth Model?

According to Greiner, an organisation goes through six successive long term phases that are changed by a short crisis during its growth. Insight into the phases of growth and crisis helps organisations respond to it. The model is often applied on relatively young and fast-growing businesses.

Why Greiner’s Growth Model?

By gaining insight into the problems of the phase a business is in, the entrepreneur/manager becomes able to address it. There are various ways to put this to work. In fact, there are various management styles and organisational structures effective during the different phases.

How does the model look like?

Fase 1 – Creativity

Developing Product and Market. Pioneers work hard, have the leadership and takes only few gains. Growth → organisation gets more complex → Crisis → owners can not lead it anymore.

Phase 2 – Directing

There is a new leadership. Often there is a question of administration, top-down management. Growth → organisation gets more complex → Crisis → administration can not lead it anymore (too much activities)

Phase 3 – Delegating

There is a new organisational structure, decentralised. Decisions are taken by the competent persons in the operational area. The administration is strategic and rarely intervenes. Growth → administration looses control (because everyone takes their own decisions) → Crisis → there is no more control

Phase 4 – Coordinating

There are rules put in place that are maintained by staff members and centralised supporting functions. An example for this is a certain gain for a product group. Growth → organisation becomes rigid and only focuses on the rules, too bureaucratic → Crisis → the rules have made the company rigid and inflexible.

Phase 5 – Cooperating

Everything via the group. Functions exceed each other and there comes a form of matrix organisation. The supervision and control to a large extent are gone. Growth → until end point is reached. → Crisis → The organisation can only keep growths with external parties.

Phase 6 – Alliances

Growth by fusions, alliances and networks of companies. Everything external.