Organization Size, Life Cycle, and Decline

Which is Better? Large Firm Large Firm Huge resources Huge resources Economies of scale Economies of scale Hierarchies/ Mechanistic Hierarchies/ Mechanistic Complex products Complex products Stabilize the market Stabilize the market Careers at one company Careers at one company

Which is Better Small firm Small firm Responsiveness Responsiveness Internet= Expanding reach Internet= Expanding reach Flat structure/Organic Flat structure/Organic More commitment More commitment

Hybrids Divisional Divisional Front/Back Approach Front/Back Approach Other Other

Life Cycle Entrepreneurial Stage Entrepreneurial Stage Collectively Stage Collectively Stage Formalization Stage Formalization Stage Elaboration Stage Elaboration Stage

Bureaucracy Good or bad? Good or bad? Formalization Formalization Centralization Centralization Personnel ratio Personnel ratio Administrative ratio Administrative ratio

How to Combat Bureaucracy Incident Command System Incident Command System Give frontline workers more power Give frontline workers more power Cut layers of hierarchy Cut layers of hierarchy Increase professionalism of workers Increase professionalism of workers Professional partnership Professional partnership

Three Control Strategies Bureaucratic control Bureaucratic control Market control Market control Clam control Clam control

Bureaucratic Control What is it? What is it? Rational Rational Traditional Traditional Charismatic Charismatic

Market Control Market exerts force Market exerts force Modular companies Modular companies

Clan Control Small and informal Small and informal Works in high uncertinty Works in high uncertinty

Organizational Decline Factors Factors Organizational atrophy Organizational atrophy Vulnerability Vulnerability Environmental decline or competition Environmental decline or competition

Stages of Decline Blinded Stage Blinded Stage Inaction Stage Inaction Stage Faulty Action Stage Faulty Action Stage Crisis Stage Crisis Stage Dissolution Stage Dissolution Stage

Implementation of Downsizing Communicate more Communicate more Provide assistance Provide assistance Help “survivors” Help “survivors”