The Stages of Growth clarifies the optimal number of managers and leaders for a business. This blog post shows what that ideal number looks like across the seven Stages of Growth. This framework serves as the ideal for businesses to follow, with the management and leadership teams growing in proportion to the needs of the organization. In reality, however, many leaders miss these transitions.
The Position Role Sheet is a management tool that organizes the work through Positions, Roles, and Types of Work. It is a fundamental way to accomplish the goal of first organizing the work before organizing the people doing the work. As a building block for departments of all sizes, Position Role Sheets break down the roles and responsibilities of each position within a department.
This natural tendency to focus on the immediate needs of one’s department can work against the success of the enterprise. Due to daily challenges, needs, and opportunities, departments can become self-focused and lose sight of the big picture. The outcomes of this silo mentality are a lack of cooperation and hoarding of information. What works for one department might make things difficult for another. Departments begin to compete for resources without understanding or even caring about the needs of the enterprise.
Dr. W. Edward Deming is recognized as the father of the modern Quality Movement that ignited new ideas and focused energy on process improvement. He contributed to Japan’s economic recovery after World War II, largely through his influence over manufacturing processes.
Dr. Deming was a champion of systems and processes. At one point, he made this poignant statement: “If you cannot define what you are doing as a process, you do not understand what you are doing.”
In Stage 1, the ideal Builder-Protector Ratio is 4:1, which means there is four times the amount of confidence as there is caution in the organization. The other way to understand the 4:1 Builder-Protector Ratio is that 80% of the team are Builders, while 20% are Protectors. An organization with a 4:1 Builder-Protector Ratio exhibits a very high level of confidence.
This natural tendency to focus on the immediate needs of one’s department can work against the success of the enterprise. Due to daily challenges, needs, and opportunities, departments can become self-focused and lose sight of the big picture. The outcomes of this silo mentality are a lack of cooperation and hoarding of information. What works for one department might make things difficult for another. Departments begin to compete for resources without understanding or even caring about the needs of the enterprise.
We’ve recently posted about the significance of process and the five steps of process development. Creating and implementing a strong process is only half the battle, though. What happens when you can’t get buy-in from the people who are responsible for using the process?
Consider for a moment how many times an organization has implemented a new process only to have it ignored or performed inconsistently, rendering it useless. The success of a process depends on the people involved having both the Will and the Means to complete it.
Known as the Visionary Stage, one of the top five challenges Stage 7 businesses struggle with is a marketplace that is rapidly changing. With between 161-350 employees, the business has grown to a point where it is no longer quick and nimble like it was when it was smaller. To remain competitive, the organization must be able to methodically identify and pursue market opportunities.
A Stage 3 leader mentors the team, fosters a collaborative environment of trust and respect, and upholds high standards of success. This blend of leadership styles mixes strong people-focused styles (Coaching and Democratic) with enough Pacesetting to keep the rapidly growing team moving forward in the right direction.
Known as the Strategic Stage, one of the top five challenges Stage 6 businesses face is hiring quality people. With between 96-160 employees, the business has two or three times as many employees as the prior Stage. Hiring the people to enable this massive growth is always difficult but can be even more challenging when labor markets are tight. A company that distinguishes itself with clear, compelling values becomes a magnet to people looking for a rewarding place to work.
Dr. W. Edward Deming is recognized as the father of the modern Quality Movement that ignited new ideas and focused energy on process improvement. He contributed to Japan’s economic recovery after World War II, largely through his influence over manufacturing processes.
Dr. Deming was a champion of systems and processes. At one point, he made this poignant statement: “If you cannot define what you are doing as a process, you do not understand what you are doing.”
A Stage 5 business has between 58-95 employees. Known as the Integration Stage, one of the top five challenges businesses of this size face is inadequate sales. A big reason why increased sales are so important at this Stage is the need to cover growing organizational expenses. The company can no longer expect to keep growing through word-of-mouth and must establish Business Development strategies and structures that are repeatable and can scale with the organization.
A Stage 1 leader guides their team with a strong vision, focuses on people’s potential, and takes charge to lead the organization through chaos. This ideal blend results in an organization that has a picture of where it is headed, is comprised of high functioning, engaged team members, and pushes through chaos with decisive decision making.
A Stage 4 business has between 35-57 employees. Known as the Professional Stage, one of the top five challenges businesses of this size face is weak project management. A Stage 4 business must focus on implementing scalable processes and systems in order to keep pace with growth. That’s why it’s common for this challenge to arise at this point.
Most people recognize that there are benefits to holding one-on-one meetings with employees. Even so, it’s not easy to make time for them given all the demands of day-to-day work that go along with running a business.
When business owners and leaders understand the true value of these meetings, though, it’s hard to deny that they might be one of the most important things they can do for the long-term health of their business.
A Stage 3 business has between 20-34 employees. One of the top five challenges businesses of this size face is the existence of a gap between leadership and staff. A Stage 3 business now has too many people for the leader to directly oversee, which is why the leader needs to focus on delegation to managers. This new organizational layer can create an environment of inadequate communication with the staff.
Climate refers to the prevailing attitudes and standards in a group. Based on what employees observe and experience, climate develops from what people sense is valued or treated as important in their workplace. Whether intentional or not, there is a climate at every level in your organization.
All too often, the climate of a work environment is one that has come about over time without intentional effort. It has been set by the leader, through actions taken and values displayed, both positive and negative.
A Stage 2 business has between 11-19 employees. One of the top five challenges businesses of this size face is hiring quality people. A Stage 2 business is beginning to move away from hiring generalists to hiring more specialized talent. This marks a significant shift in procedures which can be difficult to get right—especially if the company is growing rapidly.
A Stage 1 business has between 1-10 employees. One of the top five challenges businesses of this size face is destabilization stemming from chaos. As a business owner, you don’t want your employees to be overly stressed or unsure how to go about doing their work. Nor do you want the burden of unclear processes slowing everyone down.
Transition zones are periods of change a business goes through as it exits one Stage of Growth and enters the next. Transition Zones happen to every business as they move from one Stage into another.
During this period of change, businesses commonly experience a period of chaos where things feel disconcerting and overwhelming. Transition Zone are like rough waters. These periods can be especially perplexing because the organization is often experiencing positive advancement and growth right up to the point the transition begins.
