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organizational life-stages

One source of organizational heterogeneity that is often overlooked in our theories is life-stage variation. If you believe that organizational structure, character, institutionalization, and other important features vary by age or level of development, then the life-stage of an organization matters. From the 1960s to the 1980s understanding processes of “growth and decline” in organizations was an important part of the organizational theory agenda, but over time the theme itself has declined. This may in part be due to the mechanistic nature of early explanations (e.g., first stage A, followed by stage B). These theories became seen as incompatible with the increasingly dominant open systems perspectives, and issues surrounding life-stages became irrelevant. The exception to this was that organizational age concerned ecologists during the 1990s, but I think it’s a stretch to say that ecologists were explicitly explaining differences in organizational life-stage.

So why should we care about life-stage variation? One reason is that the current wave of research on entrepreneurial organizations could use a good theory to explain why and how new organizations (like those they study) are different than older organizations. When you study entrepreneurs you’re not just studying creative individuals, you’re also studying a special type of organization. Better theoretical explanations for life-stage variation would help us understand in what ways they’re different (and consequently how our theories need to adapt their scope conditions when considering entrepreneurs). Another reason to care about life-stages is that it’s an important source of variation when trying to explain larger process like diffusion, institutionalization, etc.

Philip Selznick, in his excellent book Leadership in Administration, talks about how the development of organizational character is a life-cycle process (similar to the formation of a personality in an individual actor). He argued for explicit attention to the developmental processes in organizations, suggesting that several processes were consequential in the early stages of an organization’s life. While it’s not clear that they have to unfold in this order, these three processes necessarily take place in organizations that make it past this early stage.

  1. Selection of a social base – organizations must find an audience. If they’re going to be recognized by others as a legitimate social actor, a new organization must commit to a particular membership group, set of clients or customers, or set of donors. Until organizations find that base, their designs are malleable.
  2. Building the institutional core – by “institutional core” Selznick meant that organizations had to select particular personnel or individuals to guide the organization. Organizations had to selectively recruit future leaders that would be able to imprint (although he didn’t use this word) their identity on the organization. Further, leadership needed to set up training procedures that reproduced this core.
  3. Formalization – Organizations needed to develop the rules, procedures, routines, etc. that would make operational maintenance and internal communication possible. Selznick was fairly clear that this process usually occurred after the other two. “Premature formalization, sometimes reflecting an overemphasis on the quick achievement of clarity in communication and command channels, may seal off leadership during the early stages of organization building, when it is most needed.” Organizations that formalize too quickly can ossify before they have the chance to adapt sufficiently to their environment.

See pages 102-112 of the book for more about life-stages. Also, see my earlier post on why this book is underrated.

Written by brayden king

July 4, 2008 at 10:19 pm

4 Responses

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  1. Your series on Selzknick’s “Leadership” is extremely interesting and I would be very interested in reading more on the topic, Brayden, thanks for a second very informative post from an enthusiastic reader who bought his copy of LIA three weeks ago (hence coincidentally rather than consequentially).

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    Fr.

    July 5, 2008 at 12:40 pm

  2. Add. Please correct to “Selznick” in my post.

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    Fr.

    July 5, 2008 at 12:40 pm

  3. Ditto. I didn’t know of this book, but I’m going to have to get a copy.

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    mikemcbride

    July 5, 2008 at 8:42 pm

  4. […] and ethics, institutional thinking, authentic values, and a humanist science; Selznick on the formation of character as a life-stage process;  Selznick’s great Leadership in Administration; Omar on why Selznick is due for a revival; […]

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