Organization Decline Stages of Decline and Behaviors Essay

  • Length: 6 pages
  • Sources: 6
  • Subject: Business - Management
  • Type: Essay
  • Paper: #64147270

Excerpt from Essay :

Organization Decline

Stages of Decline, and Behaviors Leading to decline

According to Collins (2001), success does not happen miraculously companies know this, and they work hard to achieve. A flywheel constantly rolls by momentum, and energy is required to keep it rolling. Applying energy in the same direction makes it roll even faster, and if energy keeps on adding, it keeps rolling in the same direction until it hits a barrier, or a negative force falls on the flywheel. For a company to keep moving there has to be a focus. Consistent effort on the focus leads to growth of the company. On the way to success, there are many setbacks, but if the focus remains, success is necessary on the mission.

Leaders should work together to align the workers in one direction of success. This way, teamwork and working towards the same goals will make it easier to meet these goals. A leader of a company knows the company has reached growth when efforts applied are less. These small efforts are the same ones that accumulate, and make the company reach its current growth level. Companies should invest in long-term projects. Short-term projects are hectic, a waste of time and likely to fall.

Collins (2001) asserts that the doom loop is all about stopping the momentum of a company. When momentum stops because of bad decisions, these decisions lead to changes resulting in more bad results. When a company's drive or focus declines due to bad decisions, the company is likely to fall. Leaders at times lose the drive they have to align workers such that they work towards a common goal. When this happens, a different force prevails in the company leading to different goals, decisions and lost momentum. Alteration of the momentum of the company causes all the problems that lead to decline of a company. The good thing, doom loop is easy to recognize. Companies with no set focus and goals will not succeed.

Collins (2009) asserts that every organization faces vulnerability of stage decline. To be successful, failures is a rite of passage and to reach the top, the bottom is necessary pass. In most cases, stage decline is self-inflicted; ironically, the power to recover from decline is within a person or the affected company. Falling is inevitable, what matters is what to do to recover after an organization has fallen. The mighty fall and rise again and when they do, they never fall again. Collins (2009) discovered why companies fail and how the failure came to be. The results were that there are five stages of decline for an organization. The stages include Hubris of Success plus Pursuit of More and rejection of Risk and Peril, Grasping at straws and Capitulation (Collins, 2009).

However, the company does not have to encounter all stages of decline if they realize the stages early enough. If this happens, some effort and attention directed towards recovering from the slightest stage encountered will result to turning the decline. Collins (2001) argues that not all companies should survive decline, and it is good if some fail. A company's success lays the tools of their own destruction. For example, Motorola Company experienced enormous success, their success led to arrogance and neglect. The success blinded them that they forgot their early struggles before they succeeded. By understanding the stages of decline, the leaders will reduce chances of failure for organizations (Collins, 2009).

Making it big in an organization does not mean that organizations have reached a risk free level. The mighty fall because of ignorance, neglect, and losing focus. Most importantly, the success they currently are in, blind them into noticing the decline stages. Theses stages might lead a company right into the bottom from the top, and there is nothing hard than mending something that falls with a thud because it breaks into minute pieces. Reconstructing and finding the pieces might take forever.

The stages of decline as described by Collins (2001 & 2009) are five. Hubris born success is the first stage of decline. This is a stage where organizations become reluctant. When organizations start, their humble beginnings make them work very hard to grow. At this point, the organizations have a goal, focus and a will to make it into greater heights. Efforts accumulate and the workforce drive is determined, everyday they work consistently until they finally succeed. At this current state of success, things change for the worse. Pride comes in, humility vanishes, and they suffer fallen behavior. The loss of direction makes the management forget their starting point. Again, the management feels the success is a longtime state.

The second step of decline is the undisciplined quest for more (Collins, 2001). In some way, this is greed. At this stage, a company wants more success. It wants to dominate every other business in sight even if it is not their area of expertise. Companies want to grow in disciplines they are not good at thinking of recording growth. The management ignores competitors in the discipline they are venturing, and fail to recognize the competitors as being experienced in that area. This is not a disciplined way of finding success and the companies are likely to fall. Also, getting wrong people on key seats of an organization is a risk of falling. These people will not know how to execute important roles in the organization (Collins, 2001).

The third stage of decline is the rejection of risk and peril. This stage involves ignoring warning situations observed in organizations and wrong interpretation of data. When companies face warning situations such as setbacks and troubles, the management should react in order to solve the problem. Instead of leaders accepting responsibility of the setbacks and finding solutions, they blame the setbacks for the trouble incurred. In the same stage, leaders misinterpret data. Leaders reduce unconstructive data, augment positive data, and place a spin on uncertain data (Collins, 2001).

Grasping for a savior is the fourth stage of decline. This is a critical stage in a company whereby the leaders respond to setbacks by searching for someone to save the company from falling. Instead of being calm, deliberate, and disciplined, the leaders exhibit panic, haste, and reactive behavior. Again, the leaders do not want to try to turnaround the difficulties faced by the organization, instead, they lose hope and visions. They give up on the company paving the way for declining of the company. When an organization is declining, workers come to work to witness its failure instead of upholding the core values and helping the company to recover. The organization finally lacks financial strength and this leads to failure (Collins, 2009).

Capitulation or death is the last stage. This is the final stage. In this stage, the leaders have lost hope completely. The company deprives off its resources so it lacks financial support. Making short-term decisions will only fully cripple the company. According to Collins (2009), a company that goes through all the stages without making a working decision and helping the company back to life, is worth the fail. It is a sign of inadequacy and stakeholders should invest elsewhere.

Most companies put efforts to expand their companies and extend their growth. In this plan, a global workforce grows. Managers should work on their workforce; coordinate them in a holistic manner because the workforce is a powerful asset to the company. Workers come from all backgrounds including ethnic grounds, race, and culture. Leaders should keep this in mind in their bid of expansion, and address these issues to show appreciation of their workforce as being cultural and ethnic. Addressing this will build a company that understands and appreciates their workforce leading to favorable working environments.

Companies should seek professionals to guide them in issues of culture competency. Understanding culture competency in the workforce is very important in growth of the company. It leads to respect of culture, race, and ethnicity. In order to deliver effective consulting psychology one should have unlimited knowledge, training, and supervised practice in dealing with cultural, racial, and ethnic issues. Companies are multicultural meaning any consultation should be diverse. Diverse consultation makes the workforce feel they are participants in a company and social justice has effectively prevailed (Cooper & Leong, 2008).

According to Woolard (2010), companies should adopt processes that allow them to deliver human resource services to their workforce. In respect of a cultural, ethnic, and heritage are many in the workforce, and management may be affected. In a bid to enforce effective management, companies should adopt ways to effective manage the workforce. Leveraging of data will play a role; in addition, adoption of technology will help balance the global workforce. Technology helps to from a global workforce, which not affected by traditional geographic and company boundaries. This leads to the creation of shared service centers and consolidated management practices.

Companies should also work on having basic information of their workers. This is the basic management start in a company to take center…

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