1. Stabilizing

When a firm reaches the point where phase one behavior is no longer effective, former strengths (such as being aggressive, fast, ad hoc, depending on just one or two leaders) become threats to the continued healthy development of the organization, even to its survival. Quite frequently pioneers grow into extinction due to internal complications, while the market potential remains out there, unrealized. It is hard, and quite often painful, to say goodbye to the pioneer characteristics (and, more often than not, also to the pioneer himself).

A pioneer actually overdue for change, might describe his firm thus:

“We are expanding continuously. Our turnover has tripled again. We opened our fifth business this year and increased our work force by another forty employees. What bothers me though, is that our profit could be higher. We could make much more from our present turnover than we are doing now.

The problem is management – they should be sharper, quicker. See to it that we sell, deliver and get paid on time. Acquire new clients, the right kind, not get stuck in guarantees and fuss around. Grab the market and make money. They just don’t get the point – what is essential here – let themselves be distracted.”

“And what is essential here?”

“Well, everything, really… in this market, you need to get as many balls rolling as possible. That’s the way I’ve always done it – and with success.”

“But in the past, your firm was smaller, and your portfolio was simpler”

“OK, but these people are well paid, and they fall into a ready-made bed… that’s a lot easier than I had

  1. Anyway, even if you have a point, where would that lead me?”


To enable real growth and lead this firm out of the stalemate, the stabilization strategy is indicated.

The most important aim of this strategy is to bring focus and consistency into the organization’s way of acting, in order to manage the risks of over-expansion. The wild and undirected expansion needs to become more selective and converge into focused growth.

The organizational climate evolves from aggressive to smart.

Clear-cut choices are made determining the business strategy regarding markets, products, and the approach towards clients and target groups.

The structure of the organization is brought in line, personnel planning and recruitment are balanced, the greatest risks (usually in quality, finance and logistics) are tackled by implementing and guarding basic procedures. Goals are defined in terms of output and monitored consistently.

The dependency on only one or a few people is lessened by broadening the top of management and by investing in the quality of middle management.