A rollercoaster rideMike Williams: Where does your organisation sit on the lifecycle?
In the 1950s a new marketing theory hit the mainstream. The PLC, or Product Life Cycle, was introduced to explain the typical lifecycle of a product from introduction and growth to maturity and decline.
The idea was that if you better understood where your product sat in its life journey, then you could accurately market it to your target audience in order to maximise value and profitability at each stage. For most businesses now, the PLC is a fundamental part of business strategy.
I recently read an article that took the concept of the PLC one step further and as an HR professional it got me thinking. Management consultant Lawrence Miller argues that there’s a strong relationship between the business lifecycle of an organisation and the nature of its leadership. In his book Barbarians to Bureaucrats, he asserts that the PLC is true of cultures as well as organisations.
He suggests that the lifecycle is similar to a bell curve that goes through a number of distinct phases, each one requiring a different style of leadership in order to maximise the opportunities presented during that time.
Birth/Introduction – an entrepreneur spots an opportunity or gap in the market. Here they, and their potential team, need to be flexible, agile and innovative
Growth – values, people and creativity come to the fore and so does the ability to work at pace. This means people skills, communication and decisiveness are fundamental
Maturity – the business looks to adapt, try new ideas and ways to connect with customers. Innovation, creativity and future vision are powerful tools here
Decline – is where process, efficiency and employee relations kicks in requiring resilience, honesty and objectivity
So what does this mean for HR Directors?
First, it’s important for us to keep an eye on the skills of senior leaders within our organisations. We need to ensure they match the skills required as the business moves through its life journey.
Running regular comparisons of your leadership team to leadership teams externally is a great way to understand what you have now, and what you could have or will need in a different phase.
For example, while an organisation’s in Birth/Introduction phase, there’s unlikely to be a dedicated HR function. Someone (most likely the founder) must take responsibility for ensuring the individuals they recruit are right for the job now but will also be right in six to twelve months’ time (say) when the organisation enters the growth phase.
In a fast growing organisation, it’s foolish to wait until the last minute to consider the leadership team of the future. There are no set time periods for how long a business will sit in each of the phases. To extend and grow sustainably, you need to look at what lies ahead and think about what skill set you will need two, three years ahead.
Avoiding early decline
In maturity phase, the quality of leadership, influence and values of the organisation are absolutely vital in order to reconnect with the hearts and minds of a larger workforce and to make sure things continue to move forward and not dip into an early decline.
And in decline, the leadership team needs to be experienced at reducing an organisation’s overhead, whether that’s through organisational restructure, redundancies or closing less successful outlets. Efficiency is critical.
And second, though most importantly, it’s useful to understand the flows of a business as HR professionals, so we can really think about what sort of HR we enjoy and understand where our skill sets are best placed within the flow.
There’s nothing worse than an HR Director clinging on for dear life when there’s nothing wrong with her skills – she’s just applying them at the wrong stage of the cycle.