What are the Stages of Business Growth?
The Organizational ReWilding Stages of Growth, formerly known as the 7 Stages of Growth, is a business growth methodology based on the distinct stages businesses grow through. Each Stage has rules of growth, which, if followed, create the environment for sustainable, profitable growth.
What is the research that supports the Stages of Growth?
The Stages of Growth was developed over 30 years of research and observation of more than 1,500 small and midsize businesses across dozens of industries. The focus of this research was on understanding and deciphering the patterns, the behavior, and the characteristics of growth these businesses experienced. The goal was to understand how some businesses successfully grow and most do not. The research uncovered discrete, identifiable, and predictable patterns that directly impacted a company’s ability to sustain growth. These observations fueled the creation of Stages of Growth — a business growth methodology founded on the idea that every company goes through specific stages of growth based on the complexity of the organization.
How does the Stages of Growth help businesses?
Since its introduction, this revolutionary concept has been recognized for its uncanny ability to diagnose, prescribe, and predict what occurs in businesses. It provides business leaders the ability to understand the pulse of their business — whether navigating rapid growth or knowing reasons why it’s stagnant or why the business keeps oscillating back and forth. Essentially, the Stages of Growth provides a roadmap for the business owner to follow.
Why are there 7 Stages of Growth?
The research identified 7 distinct stages that businesses go through where the rules of growth are uniquely suited to the level of complexity in the organization. Each Stage spans a specific number of employees; and within each of these Stages, there are rules that create the optimal environment for business growth. When a business fails to follow the rules of growth, the business often gets stuck or regresses.
Why are the Stages of Growth based on the number of employees, not annual revenue?
The research found that the complexity in an organization is derived, not from revenue generated, but from the number of human beings in a company. So as a business adds employees, it grows in complexity. A 200-person organization is different, and more complex, than a 10-person organization. What the businesses focuses on, the types of structures that need to be in place, and the opportunities for growth all look very different for these two sizes of organizations.
How do I know what Stage of Growth my business is in?
Your business’s Stage of Growth is dependent on the number of employees (full-time equivalent employees) in the organization. Use the Stage Calculator to find out your Stage of Growth. Read through this list to learn more about each Stage:
STAGE 1 - START-UP: 1 - 10 EMPLOYEES
Companies with 1 to 10 employees are in Stage 1, the Start-Up Stage. In this stage, passion and guts are the fuel. To envision a company where none existed before and to transform that vision into a living reality is not a simple task. Read more about Stage 1.
STAGE 2 - RAMP-UP: 11 - 19 EMPLOYEES
Companies with 11 to 19 employees are in Stage 2, the Ramp-Up Stage. In this Stage, survival is quickly replaced with growth as the top priority. The business owner is starting to worry about the management of their growing staff and many other issues that can arise as a company begins to ramp up. Read more about Stage 2.
STAGE 3 - DELEGATION: 20 - 34 EMPLOYEES
Companies with 20 to 34 employees are in Stage 3, the Delegation Stage. In this Stage, the leader is no longer in control of the organization entirely on his or her own. Work and decision-making authority must now be delegated. Read more about Stage 3.
STAGE 4 - PROFESSIONAL: 35 - 57 EMPLOYEES
Companies with 34 to 57 employees are in Stage 4, the Professional Stage. The CEO at this Professional Stage must invest the time and money to either hire or train strong professional managers. Having a strong management team in place will help the company through this Stage of complexity, as well as set the company up for future success. Read more about Stage 4.
STAGE 5 - INTEGRATION: 58 - 95 EMPLOYEES
Companies with 58 to 95 employees are in Stage 5, the Integration Stage. In this Stage, the CEO must take the independent group of managers from Stage 4 and get them to work together as a harmonious, synergistic team. Read more about Stage 5.
STAGE 6 - STRATEGIC: 96 - 160 EMPLOYEES
Companies with 96 to 160 employees are in Stage 6, the Strategic Stage. In this Stage, the risk of not seeing the larger strategic picture could cause the ‘too little, too late’ syndrome. The planning horizon must go beyond a year in order to compete in the marketplace. Read more about Stage 6.
STAGE 7 - VISIONARY: 161 - 350 EMPLOYEES
Companies with 161 to 350 employees are in Stage 7, the Visionary Stage. In this Stage, the CEO’s mission is to improve performance by stimulating higher levels of innovation and employee authorship. It is the stage of growth wherein the CEO makes an internal entrepreneurial “call to arms.” Read more about Stage 7.
Your business’s Stage of Growth is determined by the number of employees in the organization. People drive complexity in an organization, and ultimately, the rules that organization needs to follow in order to grow.
What are the rules of growth for my business?
The rules for growth at each stage are organized into 8 dimensions, listed below. Click on the links for each dimension to access a free assessment that tells you how that dimension applies to your company’s Stage of Growth.
The Gates of Focus – All activity in an organization boils down to three Gates: People, Profit, and Process. Each of these areas is important for the organization, but their ideal priority changes as your business grows.
The Classic Challenges - There are five key challenges most businesses routinely face in each Stage of Growth based on research and observation of small and midsized businesses. There are 24 Classic Challenges that show up as being the most prominent across the seven Stages.
The Builder-Protector Ratio - The Builder-Protector Ratio measures the overall organizational mindset as it relates to the levels of confidence and caution within the company. You can think about this as how confident or cautious the organization feels as a whole. Is there much more confidence than caution?
Modality - The three modalities or roles each organizational layer can perform are Dominant, Supportive, and Facilitative. For a given Stage of Growth, each layer assumes an ideal modality for the organization.
Leadership Style Blend – It’s critical to understand that there is not just one “right” style of leadership. In fact, research shows that the optimal leadership style changes as your organization grows. The challenge is that our natural leadership style isn’t always the one our business needs. As leaders, we must be willing to adapt our leadership from what may be natural to what meets the needs of our organization.
Three Faces of a Leader - The Three Faces are Visionary, Manager, and Specialist. The Three Faces of a Leader measures the proportion of time and energy a leader spends embodying the three primary leadership roles, or faces, within an organization.
Non-Negotiable Rules - Like the tides of the ocean, the Rules are Non-Negotiable, and exist in your business whether or not you acknowledge them. Failure to abide by the rules results in stunted growth, backward movement, or worse. Non-Negotiable Rules cover the areas of:
Elements of a Business - Elements are principles, methods, and tools that form key structures within an organization. Infusing an element into an organization helps to create an exceptional business. A resilient, growth-oriented organization is built upon these elements.
The Stage of Growth Cards document the rules of growth for each of the 7 Stages. Take the Stage of Growth assessment to get your Stage Card.
How has the Stages of Growth changed over the years?
In 2017, The ReWild Group initiated the first major update to the time-tested 7 Stages of Growth methodology. While preserving the integrity of the 7 Stages of Growth’s ability to accurately diagnose, prescribe, and predict what occurs in businesses, The ReWild Group has released the first major new advancements known as Organizational ReWilding Stages of Growth (“Organizational ReWilding”).
The methodology has developed over the years, and is more powerful and applicable today than ever. Read the entire history here.
