Is your business in its prime?

All living creatures progress through stages of growth and decline, beginning with birth and ending in death. However, organisations do not have to decline and age. Indeed, they can remain at the high point of their vitality for a very long time.  They can even return to those peaks from stages of decline. This article is not about achieving eternal youth, but about practical methods to pursue and maintain perpetual vitality for your business.

As organisations change and transform themselves, moving from one stage of the lifecycle to the next, they develop problems. Some are passed over quickly, but others can stymie an organisation, causing serious or terminal illnesses. ‘Prime’ organisations passionately nurture both their expansive, creative energy and their need for structure and discipline. That is the dynamic of truly successful organisations.

So says Ichak Adizes in his book ‘The Pursuit of Prime: Maximise Your Company’s Success with the Adizes Program’ . Within this text, Dr Adizes gives company leaders a ‘how to’ guide to reach and keep their companies at maximum vitality, creativity, profitability, performance and commitment, which he calls “prime”.

In a series of posts over the coming months I will summarise how Adizes describes the steps in seeking, and staying in, this phase of business development.

Will you be able to recognise the stage of your business? Will you agree? What steps will you take so your business can reach or stay at optimum level?

What follows is the first topic of eleven, introducing the nature of different problems encountered during business growth, and how to tackle them appropriately.

1. Business Vitality and it’s Problems

Problems come with change. Rejoice. As change is a necessary characteristic of growth, and no company has ever achieved peak performance – prime – without changing. The struggle for success is a struggle with problems, but we can make a distinction between problems that threaten and problems that beckon.

Although we need to carefully observe the filter through which we view problems, we need to be aware that some problems are abnormal and require attention. For an infant organisation, for example, cashflow problems – if they are anticipated, confronted, and handled – are normal. Cashflow problems are abnormal in an organisation that, in spite of its experience and maturity, is unprepared to handle such crises. When CEO’s don’t or can’t deal effectively with the normal problems that confront their growing businesses, their problems will persist as chronic, recurring abnormalities. When an abnormal problem begins to develop, no red flag pops up on the CEO’s desk. An abnormal problem insidiously creeps up, and when it is almost too late, it generates a crisis. Abnormal problems are not so from the outset; they are extensions of normal problems that people ignored, treated too late, or handled incorrectly.

“We are continually faced with a series of great opportunities brilliantly disguised as insoluble problems.” John W. Gardner

In a company beset with too many problems, leaders can succumb to being overwhelmed and are tempted to slow down the process in order to deal with each new generation of difficulties. They are effectively saying though, that they cannot handle the pace of change, or the pace of life. But slowing down change only leads to death; life is change. Rather, pro-active leaders are required to anticipate the rate of change. If you adapt to changes only as fast as they happen, you will be doing just enough to survive. This regular section will assist readers know ‘the road ahead’ and gain an advantage in accelerating advances. Managers must make sure that their organisations focus on gaining optimal control and/or flexibility for their company’s stage of development. Companies in prime have both flexibility and control in balance.

When we consider normal (appropriate) and abnormal (inappropriate) problems, it begs the question, appropriate and inappropriate for what? What is assumed in this discussion is the notion of lifecycles for organisations. The theory of organisational lifecycles has been charted and researched over decades. The stages within this discussion will be named:

1. Courtship – the stage of dreaming and committing to the dream, focusing on ideas and future possibilities. This ends when the founder assumes risk.
2. Infancy – attention shifts to results. Sales drive this action-oriented, opportunity-driven stage. During infancy nobody pays much attention to paperwork, controls, systems, or procedures. Go-go starts when an organisation’s cashflow stabilises and is predictable and positive.
3. Go-go – a rapid-growth stage. Here founders believe they can do no wrong, leaving the business vulnerable to flagrant mistakes. They see everything as an opportunity, and too many opportunities can present big problems. Companies are organised around people rather than function, but the founders usually still make all the decisions. Go-go ends when it gets into serious trouble.
4. Adolescence – uncontrolled growth and it’s problems. Founder hires a COO but finds it difficult to hand over the reins. An attitude of us (old-timers) versus them (new upstarts) hampers operations. Company goals languish while battles rage. Companies can enter prime if they can establish controls without losing flexibility.
5. Prime – vision and discipline are balanced. The business innovatively continues to meet customers’ changing needs. If it does not work at staying in prime, it will commence to age.
6. Stability – still strong but without the eagerness of earlier stages. Instead of getting what it wants, it wants what it gets. Financial people often impose controls for short-term results, and marketing and R&D wanes.
7. Aristocracy – not making waves becomes a way of life. Outward signs of respectibility (dress, office decoration, and titles) take on enormous importance. It’s culture emphasises how things are done over what’s being done and why.
8. Recrimination – decay sets in, cost reductions take precedence over efforts to increase revenues. Executives often fight to protect their ‘turf’, with fingers quickly pointed at who did something wrong, rather than what was done wrong and how to fix it.
9. Bureaucracy – if the organisation has survived the last stage, it becomes politically protected, somehow satisfying not customers but those who supply it’s resources.
10. Death – the final stage may linger for years, or it may arrive suddenly with a massive blow.

I’ll be summarising each of these in a series of 1o related posts, plus one more post summarising Adizes recommended action steps.  So stay tuned.  And if there is anything you would like to comment on, please click the ‘Leave a comment’ button at the top of this post.

If you’d like help to address any of the matters raised in this article, just give me a call on 0412 921 292 for a confidential discussion.  Even if I can’t help you myself, I’ll probably know someone who can!  As a TEC Chair (www.TEC.com.au) I have access to a worldwide network of resources and consultants.