Organizational Life Cycle Stage Research Articles

Organisational resilience: the role of organisational culture from an organisational life cycle perspective

PurposeThis study examines the influence of organisational culture on organisational resilience from an organisational life cycle (OLC) perspective.Design/methodology/approachAn online survey questionnaire was used to collect data from 410 middle-level managers in Australian business organisations using Qualtrics, a well-known international data collection organisation.FindingsThe findings reveal that the respect for people/teamwork cultural dimension is positively associated with organisational resilience across all OLC stages (i.e. birth, growth, maturity and revival stages). In addition, the outcome-oriented (innovation) culture dimension enhance organisational resilience in the growth and revival (maturity) stages.Originality/valueThe findings contribute to the limited literature by providing empirical evidence on how specific organisational cultural dimensions can enhance organisational resilience across different development stages of organisations (i.e. the birth, growth, maturity and revival stages).

Investigating happiness at work along the organizational life cycle: Moderating role of locus of control

This study used business units in different stages of the organizational lifecycle (OLC) and tested employee job satisfaction, affective organizational commitment, and work engagement to understand the relationship between OLC and happiness at work. Furthermore, this study investigated Person-Organization (P-O) fit by testing for a locus of control (LOC) as a moderator to this relationship. Based on the significance of LOC for accountants, online surveys were launched in an accounting firm across twelve locations in South Africa. For the first survey, 32 partners (91%) positioned their business units onto specific stages of the OLC. In the second survey, employees (62%) completed self-evaluations of their level of job satisfaction, affective organizational commitment, work engagement, and their LOC. Spearman’s rank-order correlations revealed the range of ρ of –1.22 at a 10% significance to –1.67 at a 5% significance, concluding earlier stages of OLC to support greater levels of happiness at work.Additionally, hierarchal regression found R-squared changes of 2% to 4%, confirming LOC as a moderator. Simulation tests found the strongest correlations with early stages of OLC for externals (range of ρ of –0.374 to –0.352 at 5% significance), moderate for internals (range of ρ of –2.12 at 10% significance to insignificant), and no relationship for those with a balanced expectancy (all insignificant). Contrary to dominant voices in the literature that support internality as a superior expectancy, this study concludes that those with a balanced LOC are more resilient to organizational factors for their happiness at work.

The Influence of the Organizational Life Cycle on the Violation of Financial Covenants

Purpose – To investigate how the stages of the organizational life cycle influence the probability of violation of financial covenants. Theoretical framework – Companies in different stages of the organizational life cycle present different incentives when assuming a position regarding profitability, investment, dividend distribution, the evolution of sales, indebtedness, strategic planning, information disclosure, and earnings quality, and these factors are directly related with the inclusion and violation of financial covenants in debt contracts. Methodology – We used 1,328 observations of 197 non-financial Brazilian companies listed on the B3 in the period from 2010 to 2018. The accounting data were collected from the Economatica database and the financial covenant information was obtained from analyzing more than 2,400 company footnotes. To analyze the results, we used logistic regressions with year-controlled data. Findings – The results highlight that companies in the maturity stage present a lower probability of violating some limit stipulated in the financial covenants in their debt contracts than companies in the other stages, that is, introduction, growth, turbulence, or decline. Practical & social implications of research – In regulatory terms, the results presented further reinforce the need to revise CPC 26 (R1), making it obligatory to disclose the limits of restrictive clauses in explanatory notes for corporations. Originality/value – These results extend the literature by presenting evidence that it is not only the turbulence and decline phases that cause operational risks that can culminate in an increased probability of violation of financial covenants, but also the initial introduction and growth phases of companies.   Keywords – financial covenants; organizational life cycle stages; violation of covenants.

Life cycle analysis of Brazilian startups: characteristics, intellectual capital, agents and associated risks

PurposeThe purpose of this paper was to present the stages of the Brazilian startups' organizational life cycle (OLC), identifying and describing the main factors related to the entrepreneurial and organizational perspectives, as well as the factors related to external relationship agents and the associated risks at each OLC stage. In addition, the variables that comprised the three perspectives above were used for a descriptive reading of the evolutionary process from the perspective of intellectual capital during the stages.Design/methodology/approachThe type of research used was quantitative with a descriptive character. For data collection, the authors have used the survey method and two complementary questionnaires were used as research tools. The measurement scale used in these instruments was the 11-point Likert scale. In total, 100 Brazilian startups registered in the STARTUPBASE and residents in São Paulo comprised the sample of this research. For the data processing, it was used the exploratory factor analysis techniques, to identify the analysis factors, and the cluster analysis, to identify the OLC stages.FindingsBased on the results obtained, four stages were identified and described to build the OLC model of this research: Stage I – conception and development; Stage II – organization and traction; Stage III – growth and scale; and Stage IV – consolidation and transition. In addition, the authors described the main lines of evidence found at each stage.Practical implicationsThis research contributes to academic studies of the OLC in startups and the evolution of risks that originate from the relationship between external agents in the business environment and startups. Thus, a management map is built, which helps entrepreneurs and managers construct these businesses since such a management map allows identifying the risks and challenges that a startup needs to overcome to grow and develop.Originality/valueThe originality of this research lies in the adaptation of the OLC approach, which is widely used in studies analyzing the growth and development of mature organizations. The authors used this adaptation to analyze the growth and development of startups in Brazil. In addition, the identification and analysis of external agents that make up the business environment, as well as the analysis of the risks, originated from the relationships between the startup and these agents, brought original and essential results and discussions, both for OLC studies and for risk analysis studies in startups.

Does Liability of Newness Matter for Digital Startup on Early Stage of Organizational Life Cycle?

This study aims to test and analyzes the relationship between organizational life cycle characteristics and survivability of a digital startup in the early stage. In establishing new startup and managing early stage, founders have been facing two-fold pages. On one side, the opportunities exploration and exploitation require freedom to acts. On the other side, newly organization faces liability of newness traps that consider organizational formalization and organizational capability. The relationship among aspects is formulated as two-paths mediating roles on the impact of liability of newness and startup survivability. Questionnaires were distributed to 415 respondents in Greater Jakarta City, Indonesia. The study considered Jakarta represented Indonesian digital startup ecosystem. This newly established and still developing startup ecosystem that characterizes the early stages of OLC is considered relevant to the study. The data was analyzed quantitatively using SEM method. The result shows the linkage between the two-paths of mediating role. Since the opportunities are central of mindset for survivability, external legitimacy becomes antecedents of external opportunities as well as reliability and accountability required from organizational formalization and capability. Founders need to understand and translate the impact of liability of newness to establish an appropriate and better organization formalization and organization capability for startup survivability. This study contributes to enrich the early stage of organizational life cycle theory as well as to enhance startup founders’ managerial practices.

Financial and economic characteristics of the organization's life cycle

One of the most acceptable scientific and methodological approaches to work in difficult economic conditions is regular and targeted management of the life cycle of a business organization as an open social and economic system. Any system develops and changes, passing through typical stages or cyclic states of its development. Studying the enterprise from the point of view of the life cycle allows to increase efficiency of financial and economic activity exactly at the specified stage and in due time to develop measures on prevention or weakening of negative and increase of positive results. The analysis of scientific researches has allowed to define the "life cycle of an enterprise" as a quantitatively limited set of stages or states within which the enterprise is during its existence and development. With regard to the functioning of a business organization, the following stages of its life cycle have traditionally been identified: creation, growth, maturity and crisis. Depending on the stage of the life cycle, a business organization should focus on various aspects of its financial and economic activities. Development of a business organization is to ensure the transition from the first and second stages to the third, and the longest possible retention (maturity stage) with timely identification of signs of the fourth stage (crisis) in order to prevent it by retaining the existing positions, returning to the second stage, diversification or transition to a new life cycle. Each stage of development has its key aspects on which management should focus to achieve and maintain positive financial and economic performance. Correspondence of life cycle stages and financial and economic priorities gives grounds for development of the system of financial and economic indicators and formation of limits of their permissible fluctuations within each stage. Based on the values of financial and economic indicators and their dynamics, it is possible, firstly, to contribute to more accurate diagnostics of the life cycle stage of a business organization; secondly, to improve the efficiency of a business organization at each stage by adjusting the values of indicators within the optimal ranges and applying adequate managerial impacts.

IMPACT OF ORGANIZATIONAL LIFE CYCLE STAGES ON QUALITY OF CORPORATE GOVERNANCE: EMPIRICAL EVIDENCE FROM PAKISTAN’S CORPORATE SECTOR

The purpose of this research study is to determine the influence of the different organizational life cycle stages in modeling the quality of corporate governance. The study employs data of 46 companies listed with the KSE 100 index and uses a governance prediction model to determine the nexus between the organizational life cycle and the quality of corporate governance. The longitudinal data on corporate governance may help to identify the changes within a firm over time. However, of this time series data has compelled us to use the variations in corporate governance between-firms at distinct life-cycle stages. The study finds that mature firms as being high in resources are better governed overall. Transparency, responsibility, and accountability are higher in growth firms, whereas discipline and independence improve as firms mature. The results of the study recommend that governance functions such as monitoring/control and resource/strategy are significant and relatable at different life-cycle stages. Keywords: Corporate governance, organization life cycle, corporate sector, regression analysis, governance prediction model JEL Classifications G0, G3, G34 DOI: https://doi.org/10.32479/ijefi.10279

The media roller coaster: The Dawn and evolution of Multimedia Ventures in Middle East and beyond

Learning outcomes Upon completion of this case study analysis, students should be able to: perform a detailed diagnosis of an entrepreneurial venture, applying relevant strategic management tools and techniques; evaluate the effectiveness of managerial actions and decisions at different stages of organizational lifecycle; and demonstrate the importance of strategic adaptation of organizations through the deployment of viable decision-making skills. Case overview/synopsis This case describes the story of Multimedia Ventures, a small business located in the UAE that provides media solutions to cleaning and hygiene-related technology sectors. The company was founded through a partnership arrangement and later transformed into a family enterprise. The case study illustrates the firm operations from its grass root stages to being a well-known name in the cleaning industry, both within the Middle East and beyond. Since its establishment in 2008, Multimedia Ventures has embarked on a path of continuous growth with the ambition of globalizing activities to offer various media solutions to customers worldwide. To achieve this objective, the company engaged in collaborations with many international partners to facilitate the exchange of expertise and increase the scale of operations. Yet, the Managing Director of Multimedia Ventures, Mr Arjun Khatri, was currently faced with two difficult strategic decisions that were critically important for the future development of his enterprise. Complexity academic level Undergraduate courses. Supplementary materials Teaching Notes are available for educators only. Subject code CSS 11: Strategy.

Interplay of Leadership Styles, Employees' Performance and Organizational Life Cycle

The study investigates the moderation role of Organizational Life Cycle (OLC) stages on the relationship between leadership styles and employees' performance. The study remained restricted to four basic leadership styles, namely authoritative, democratic, transformational and transactional styles. The findings of the study are (1) OLC stages have no significant impact on the relationship between transformational style and performance employees and on the relationship between transactional style and performance of employees (2) OLC stages have a significant impact on the relationship between authoritative styles and performance employees and on the relationship between democratic leadership styles and performance of employees. Findings can be used in the hiring of new leadership by organizations and in the deciding priorities of leadership development as per the stages of OLC. It is expected that the findings of the study are generalizable due to the size of the sample and the extensiveness of the study.

Organizational lifecycle and strategic management accounting

PurposeThis study aims to examine the relationship between organizational lifecycle stages, the adoption of strategic management accounting (SMA) practices and the performance consequences of SMA adoption.Design/methodology/approachThe analysis is based on survey data from 377 firms operating in German speaking countries.FindingsThe author finds that the firms’ adoption rates of SMA increase from the birth to the revival lifecycle stages and drop at the decline stage. Firms that deviate from the optimal SMA profile have lower performance compared to the firms that do not deviate. The negative performance effect, however, is only significant for firms that have too little SMA practices and is not significant for firms that adopt too much SMA practices.Research limitations/implicationsThese results suggest that firms that fail to implement a sufficient level of SMA suitable for their development stage will not develop as fast as their competitors. This study is subject to general limitations of survey research, particularly with respect to the operationalization of the variables, the number of contextual variables in the empirical model and sample coverage.Practical implicationsThe implication for managerial practice is that greater efforts should be directed toward eliminating underfit than overfit regarding the implementation of management control systems.Originality/valueThis is the first analysis of the adoption of SMA at different life cycle stages and the consequences of misfitted adoption.

The Levers of Management Control System in Organizational Life Cycle

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PERSPEKTIF SIKLUS HIDUP PERUSAHAAN DALAM HUBUNGAN ANTARA INVENTORI DAN KINERJA FINANSIAL

Research regarding the relationship between inventory management and financial performanceis so far inconclusive: some found it to be positive, others found it to be negative. One ofthe many factors that influence the variance, the organizational life cycle, will be exploredin this research. Organizational life cycle might influence the relationship between inventorymanagement and financial perfomance due to the different strategies and designs pursuedby the organizations along each of their life cycle stages. This study use a sample set of 33manufacturing companies listed in BEI, with 7 years observation period. A regression analysisis performed with dummy variables of organizational life cycle, resulting from a cluster analysiswith k-mean method. Regression analysis and cluster analysis are all done with Stata. Theresult shows that the relationship between inventory and financial performance is positive inthe early growth stage of organization life cycle and turns to negative at late growth stage. Therelationship is inconclusive at the conception and stability stage of organizational life cycle.Therefore, we can conclude that in making decisions about inventory, firms should considerwhat stage of organizational life cycle they are currently in so that the decisions made canimpact the financial performance positively.Keywords: Organizational Life Cycle, Financial Performance, Inventory Management

The Open Innovation Model of Coaching Interaction in Organisations for Sustainable Performance within the Life Cycle

Organizations need innovation to be competitive and sustainable on their marketplace. Sustainable performance is an important precondition for growth and development. In spite of a body of literature, non-financial factors of sustainable performance remain an open issue. Coaching has gained considerable attention in the business world for its impact on sustainable performance. The current research investigates the use of coaching interaction to facilitate organizational sustainable growth and development in the context of Miller and Friesen’s five stage life-cycle model. The expert opinion survey is chosen as a central method of research. The questionnaire is developed on the literature review that is focused on the drivers for sustainable development throughout the life cycle, and the features of coaching that accelerate these driving forces. Fifteen experts took part in the survey conducted from November 2017 to January 2018. The results are estimated by considering the competence coefficient for each expert. The findings led to creation of an open innovation model, which displays relationships between the appropriate coaching forms and types and the organizational life cycle stages. The developed model enables choosing the optimal way of coaching delivery at any life cycle stage. This model is particularly valuable for the coaching support programs.

Strategic cost management, contingent factors and performance in services

The purpose of this paper is to investigate the relationship between contextual factors identified from contingency-based research, the extent of the use of strategic cost management (SCM) techniques and business performance in services. An empirical survey was conducted on a sample of 88 services in Greece. The analysis of the survey data indicates that the use of strategic cost management techniques in services can be considered quite satisfactory. By drawing on the grounds of contingency theory, five factors were identified as potentially exhibiting an emergent relationship with strategic cost management. The five factors are; (1) Perceived environmental uncertainty, (2) Structure, (3) Organizational life cycle stage, (4) Strategy and (5) Size. The survey revealed that SCM usage is positively affected by these five contingent factors, while SCM usage, in turn, positively affects performance. A significant mediating effect of SCM usage on performance is evident.

The need for requisite variety to support growth: an organizational life cycle perspective

PurposeDrawing on the “Giffoni Experience” case study, the purpose of this paper is to establish a conceptual link between requisite variety and organizational life cycle. The law of requisite variety states that – to be viable – a system should be able to achieve the minimum number of states which are required to deal with environmental uncertainty.Design/methodology/approachA descriptive case study approach was taken, which allowed a holistic analysis of the subject being investigated. Multiple sources and different techniques were used to collect relevant data, including: document analysis, unstructured interviews with key informants, and participant observation.FindingsThe development of requisite variety is intended to fill the gap between organizational adaptability and increased environmental complexity. The process of requisite variety generation is influenced by the organizational life cycle stages, turning out to be reactive in the early phases of life and proactive in the maturity ones. Ultimately, the development of requisite variety makes the organization able to establish a co-evolving relationship with the environment, which paves the way for greater organizational adaptability and effectiveness.Research limitations/implicationsThe research findings are not generalizable; besides, the exploratory nature of this study did not allow to point out a consistent relationship between requisite variety and the organizational life cycle.Originality/valueTo the authors’ knowledge, this is one of the first attempts to examine requisite variety adopting the conceptual lenses of organizational life cycle. Empirical research works dealing with requisite variety are uncommon and generally overlooked by management scholars and practitioners.

How innovation climate drives management styles in each stage of the organization lifecycle

PurposeOrganizations that offer services based on knowledge and innovation consider their recruitment process as strategic. The purpose of this paper is to consider that organizational lifecycle is related with the management styles through innovation climate and human dimension of recruitment.Design/methodology/approachThe authors utilized two methods proposed by Adizes (1976, 1979, 2004). The first one is an inductive, exploratory method with a quantitative approach. The second one utilizes a qualitative approach through semi-structured interviews. The quantitative approach was performed with a questionnaire via internet. The target was executive managers from organizations with more than ten employees, which are offering professional, scientific and technical services. The authors obtained 170 responses.FindingsResults show that the majority of organizations balance open innovation and control, trending to the first one. During the first stages of the organizational lifecycle, decision-making principally relays on the founder’s open innovation strategies, whereas in the last stages administrative-based control is predominant.Research limitations/implicationsThe authors must highlight that this study has been performed for the case of services companies placed only in Mexico. Then, the extrapolation and generalization of results should be dealt carefully.Practical implicationsThe authors consider the questionnaire very useful for the introduction of open innovation strategies for human resources managers, since it takes into account organizational lifecycle in their human dimension of recruitment processes, it helps to design training and retention programs for employees, and avoids premature aging of the company.Social implicationsGiven that today, knowledge management and innovation have become strategic assets of companies, it is necessary a change of mentality in many organizations that facilitates a new perception on the development of innovation. This will only be possible with the firm support of the management of the company and the involvement of all employees in this new task.Originality/valueSeveral studies analyze management styles in each stage of organization lifecycle, although they do not link the obtained information to open innovation and human dimension of the recruitment process. The authors work applies the questionnaire of Adizes (1976, 1979, 2004), which relates the organizational life cycle and the management style and discloses the proper management styles with recruiting, training and retention programs to keep flexibility above control to nurture open innovation.

Assessment of manual assembly complexity: a theoretical and empirical comparison of two methods

There are several theoretical methods for assessment of assembly complexity but there are few practically applicable methods. One of the methods, CompleXity Index (CXI), aims at assessing operators’ perception of manual assembly complexity in running production. Another recently developed method, Basic Assembly Complexity (CXB) is intended for predictive assessment of basic manual assembly complexity in early product and production development. Both CXI and CXB aim to improve assembly conditions for operators, reduce assembly-related errors and the costs for corrective measures as well as increase assembly quality although in different ways and at different organisational levels and life cycle stages. The purpose of this study was to compare the two methods to obtain feedback and learn from operators experience in order to develop better predictive assessment criteria. The method comparison showed that about 50% of the CXB assessment approaches were similar to CXI but other covered different aspects. In comparison of the complexity values of the methods no significant results were obtained. However, some CXI issues that were not taken into account in CXB should be considered. CXB and CXI could be used in conjunction but further assessment criteria are probably needed.

Management control systems

PurposeThis paper aims to examine the association between the interactive and diagnostic approaches to using controls and Miller and Friesen’s (1984) organizational life cycle (OLC) stages (birth, growth, maturity, revival).Design/methodology/approachData were collected from a random sample of 343 general managers in Australian manufacturing organizations.FindingsThe results indicate that both approaches are used to a greater extent in the growth and revival stages than the birth and maturity stages, whereas the interactive and diagnostic approaches are used to a similar extent in each of the four OLC stages.Research limitations/implicationsThis study contributes to the management control system literature by examining the use of the interactive and diagnostic approaches from an OLC perspective. The findings highlight that the complementary nature of the interactive and diagnostic approaches applies in each OLC stages, and suggest that similar attention should be placed on the use of both the interactive and diagnostic approaches in each OLC stage.Practical implicationsThe study provides managers with an insight into the prevalence of the use of interactive and diagnostic approaches across the birth, growth, maturity and revival stages.Originality/valueThis study contributes to the management control system literature by adopting the configuration approach to examine how multiple contingent variables simultaneously affect the approach to using controls. Specifically, this study examines how organizations adjust their emphasis on Simons’ (1995) interactive and diagnostic approaches to using controls as they move across different development stages. These development stages were labelled as OLC stages and are determined based on the simultaneous consideration of multiple contingent factors.

The Role of Interactive Controls at a Later Stage of Organizational Life-Cycle

The Role of Interactive Controls at a Later Stage of Organizational Life-Cycle

Identifying Effective Online Service Strategies: The Impact of Network Externalities and Organizational Lifecycle Stage

Identifying Effective Online Service Strategies: The Impact of Network Externalities and Organizational Lifecycle Stage