ORGANIZATIONAL

GROWTH, CHANGE
AND DECLINE

PREPARED BY: DANNY A. HINAY JR.

 -Organizational growth is essentially a
quantitative process. A process through which
the structure of a multiligent system
organization increases the number of its roles
ORGANIZATIONAL and links. Growth is something for which
most companies strive, regardless of their
GROWTH size. Small firms want to get big, big firms
want to get bigger.
-Larry Greneir contends that every
organization has an ideal structure that
corresponds to its stage in the growth
process.
 STAGES OF
GROWTH CRISIS
Growth through creativity

Growth through direction

Growth through delegation

Growth through coordination

Continued growth through collaboration

THE FIVE PHASES
OF GROWTH
 GROWTH THROUGH
CREATIVITY

Creatives energies will

At birth, organizations
help to carry With growth, nature of
First stage are loose in structure
organization through problems changes. 
and informal
its birth process.
 GROWTH THROUGH
DIRECTION

Formalization is Bureaucratization occurs

Specialized divisions are
2nd stage introduced by in departments to mange
created.
professional managers organizations.
 GROWTH THROUGH
DELEGATION

The crisis of autonomy is

overcome by delegating
greater decision-making
Third stage A crisis of control 
power to middle- and lower-
level managers focusing on
long-range, strategic planning.
 GROWTH THROUGH
COORDINATION

Consultants may be hired to
assess the extent of
The crisis is resolved via
coordination needed and to
Forth stage greater coordination between The crisis of red tape.
suggest ways of improving
departments.
efficiency and
reducing redundancy.
 CONTINUED
GROWTH TROUGH
COLLABORATION

Goal is to teach managers how

Simplification of programs,
to cope with the organization's
and reliance of self-control
Fifth stage structures without giving in to
and social norms eventually
impulse to create additional
solve crisis of red tape
structure, to collaborate.
 • The process in which an organization
changes its structure, strategies,
ORGANIZATIONAL CHANGE operational methods, technologies or
organizational culture to affect change
within the organization and the effects
of these changes on the organization
 • The Economic Climate
• Consumer Demand & Behaviour
Drivers of
• New Technologies
Organizational • The Competitive Marketplace
Change • Government Policy
1. Economic Climate  - It refers to the state of overall economy. 

2. Consumer demand & behavior - It refers to the people's lifestyle.

3. New Technologies - It appears at an accelerating rate. New hi-tech systems

and devices completely change how companies do business.

4. Competitive Marketplace -  It is a new rival can suddenly appear on the

scene with completely different commercial behaviors. The other player
must adapt rapidly.

5. Government Policy - It introduces new laws that can affect the company or

a business.
 It occurs when companies don't
anticipate, recognize, recognize,
ORGANIZATIONAL DECLINE neutralize, or adapt to the internal
or external pressures that threaten
their survival.
 Blinded

Inaction
5 STAGES OF
DECLINE Faulty Action

Crisis

Dissolution
In the blinded stage, decline begins
because key managers fail to
recognize the internal or external
changes that will harm their Blinded 
organization.
In the Inaction stage, as
organizational performance
problems become more visible,
management may recognize the Inaction
need to change but still take no
action. 
In the faulty action stage, faced
with rising cost and decreasing
profits and market share,
management will announce belt- Faulty Action
tightening plans designed to cut
costs, increase efficiency, and
restore profits.
In this stage, Bankruptcy or
dissolution(breaking up the Crisis
company and selling its parts.
In this stage, after failing to make the
changes needed to sustain the
organization , the company is
dissolved through bankruptcy Dissolution
proceedings or by selling assets to
pay suppliers , banks, and creditors.