Flamholtz and Randle's six key developmental tasks for organizational growth

¶ … Long-Term Success

Six key developmental tasks (Flamholtz & Randle 2012: 11-18)

Identify a market and create a niche

Regardless of whether the market niche is small or large, it is essential for an emergent organization to define the needs of the customer base to distinguish the new product from its competitors. Getting to know the target customer (and the target customer's price point) is an essential component of this stage.

Develop products and services

Defining market needs is only the first step: an appropriate product or service that the likely consumer will desire and can actually use must also be created.

Manage the corporate culture

An organizational culture clearly influences the output of the institution but it is important not to mistake the articulated corporate culture for what actually exists and how employees perceive they are valued: employees must actually be treated with respect as valued players if they are to truly believe that management cares about their welfare. Actions by management, not slogans create the culture.

Q2. Discuss the keys to success in developing Stage I and Stage II organizations

A Stage I company is still in the pre-functional stage of organizational development. There is often a lack of specialization in terms of the organization's capabilities such as marketing and advertising (Flamholtz & Randle 2012: 211). A good example of a successful organization still at this stage is the popular Internet website BuzzFeed. A relatively new company, the BuzzFeed staff writes the majority of the content while performing other capabilities such as editing and content management for the organization.

A Stage II company has more revenue than a Stage I company and is accruing more income (up to $10 million annually) and has a more refined and specific functional structure (Flamholtz & Randle 2012: 211). Regional restaurant chains which have yet to make it nationally like Texas Subs might fit under this category.

Q3. Stage III represents the professional management phase

One of the critical differences between an entrepreneurship and a professionally-managed organization is the role of its leader: if an organization becomes incorporated, the former president must take on the new role of CEO to fulfill his or her required duties (Flamholtz & Randle 2012: 212-214). "The Merriam-Webster dictionary defines entrepreneur as 'one who organizes, manages, and assumes the risks of a business or enterprise' and manager as 'one that manages: as a: a person who conducts business or household affairs or b: a person whose work or profession is management'" (Reh 2014). An entrepreneurship is by definition driven by a single personality and the vision is generated from that one individual. Also, the individual assumes the financial and personal risks for the success or failure of the venture and personally works to accrue the capital from investors. A manager is at the helm of an organizational, bureaucratic structure with impersonal procedures that govern his or her actions. Also corporate entities are fictional 'persons' under the law and the organization is viewed holistically when it is treated as a legal entity, versus an entrepreneurship which is solely associated with the leader at the helm of the organization. Quite simply, when an organization becomes bureaucratic and corporatized, it needs management.

Q4. Keys to success in developing a Stage III organization

Most organizations evolving into Stage III are confronted with the need to ensure adequate attention is given to all products and services being produced by the entity: this usually requires a divisional structure with specialized managers heading the different components of the organization (Flamholtz & Randle 2012: 211). "What has happened is that the size of the organization and the corresponding complexity of its operations have combined to make it extremely difficult for a single individual to hold everything together" (Flamholtz & Randle 2012: 212). The president must shift to taking on the responsibilities of CEO and also employ a COO (Chief Officer of Operations) to coordinate the necessary procedures to keep the organization running smoothly.