Organizational Life Cycles and Shifting Criteria of Effectiveness: Some Preliminary Evidence

Abstract

This paper discusses the relationships between stage of development in organizational life cycles and organizational effectiveness. We begin the paper by reviewing nine models of organizational life cycles that have been proposed in the literature. Each of these models identifies certain characteristics that typify organizations in different stages of development. A summary model of life cycle stages is derived that integrates each of these nine models. Next, a framework of organizational effectiveness developed by Quinn and Rohrbaugh is introduced. This framework organizes criteria of effectiveness into four models—rational goal, open systems, human relations, and internal processes models. We hypothesize that certain of the models are important in evaluating the effectiveness of organizations in particular life cycle stages but not in others. The analysis of a state agency's development over five years provides some evidence to support these hypothesized relationships between life cycle stages and criteria of effectiveness. We conclude that major criteria of effectiveness change in predictable ways as organizations develop through their life cycles. Some shifts in state of development are resisted by the organization much more than are others, and intervention into organizations may be needed to help make the transitions less painful and costly. We also discuss why the predictions of contingency theory often are not substantiated by research because the responses of organizations to the external environment vary in different life cycle stages.