The renewal stage
The renewal stage of the organizational lifecycle is distinctive in that it requires change or management turnaround for the business to survive. This requires a situational analysis be performed on the business to determine if it is salvageable, then a turnaround plan must be in place to try to save the company.
Organizations in the renewal stage
Apple is a an organization that seems to be in the renewal stage. With the advent of digital music players and music downloads they are shifting their technology to meet these demands. Another organization that is in the renewal stage would be the automobile and airline industries. These companies have rapid changing environments making it difficult for them to stay in the mature staege. Their success is based upon the fuel economy, cost advantages to the customers, as well as, high levels of competition. According to the acticle for Strategic Intent in our readings states,." for smart competitors, the goal is not competitive imitation but competitive innovation, the art of containing competitive risks within manageable proportions." This suggestion speaks volumes for a competitive advantage.
Leaders in the Renewal Stage
Effective leadership during the renewal phase must make smart financial and strategic decisions. An effective leader must prosess strategic thinking skills, be articulate and be a strong change advocate. They must inspire and empower the business to take new actions for turnaround.
Recognizing the Need for Renewal
Business in decline are in need of change or renewal. This become evident when there becomes a lack of communication between managers and their employees. The culture of the business becomes that of secrecy, denial, and lack of respect. The employees begin to think there is little they can do to make a difference.
Conceptual Tools
I personally likes the situational analysis tool as a way to view a company's situation to help the leader to determine the root causes for decline. Porter's Five Forces and looking at competitive advantages is a great place to start for advocating change.
Ideas For Renewal
Recognizing that a company may be in the renewal stage gives me a better understanding of what to look for in a company that may need change. After completing this module, it is clear to me my workplace is definately in need of turnaround management. Clearly, there should be reorganization and a situational analysis performed at my current workplace. Once the root causes are determined then a successful plan should be executed to manage the turnaround.
