Nonprofit leaders are busy acting on what they believe to be the best investment of their time, and theory about stages of growth doesn’t always seem particularly useful. This article is focused on how leaders should prioritize their time and important decision-making considerations at each stage.
There are decades of management articles on organization stages. The terms used to describe the stages in this article come from Susan Kenny Stevens. Stevens argues that these stages are not always sequential, and my 25-plus years of experience working in the sector affirms this. The stages are important because many management gurus assert that the future of an organization is determined more by internal structure than by outside forces. Certainly, outside forces have an impact, but whether an organization grows, evolves, and weathers a storm well is impacted by internal factors over which leaders have much more influence.
Since the stages are not always sequential, reality is not always as neat as the stages that follow. For example, sometimes organizations can take off quickly and encounter the growth stage while still in start-up mode. Also, “mature” organizations often encounter a need to change their focus to better respond to community needs and they then pivot back to the growth phase.
I am currently working with an organization that has existed for decades, but I would argue is somewhere between successfully turning around and the very early growth stage. They have never been able to build adequate capacity and have relied heavily on volunteers throughout their long history. As a result, clear systems have never developed, and their hours/ability to grow their impact remains limited. For them, the maturity stage never involved the creation of needed capacity and processes, but they hovered for more than a decade between growth and decline with maturity characteristics being only that they continued to offer the same set of programs in a similar way for many years, using the same staffing structure. Often, when this is the case, organizations remain small and move toward decline more quickly. In fact, in the last five to ten years there were some early signs of entering the decline stage for this organization. However, this organization currently has creative and innovative leadership and is seeking ways to build momentum and capacity toward growth.
The seven stages pictured below are summarized from Stevens’ work. As you read, consider where the organization you serve is currently, and what that says about your needed focus.
| Organization Characteristics | Potential Problems Encountered | Needed Leadership Focus |
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Conceptual problems with the service framework likely in this stage and include:
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Asking a diverse group questions like: what am I missing? What am I failing to ask? Is this a valuable investment of time to explore? Is there a better way to go about it? Is anyone else doing it?
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2. Start-Up: This is a key stage that sets the history/foundation for the organization and can dictate future success.
| Organization Characteristics | Potential Problems Encountered | Needed Leadership Focus |
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Asking questions like: what characteristics and skills do we need in our board? What can we accomplish with our current resources? How might volunteers be involved in communication? What do we need to communicate, when? How do we build a plan for long-term financial stability?
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2. Growth: This is when the community starts to embrace the vision and program growth begins.
| Organization Characteristics | Likely Problems Encountered | Needed Leadership Focus |
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Asking questions like: How do we best share our impact? How do we measure our impact? What structure will be best to meet our big goals? What resources (staff and systems) do we need to realistically accomplish our goals? How do we get those resources?
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3. Maturity: The organization is more stable and capacity begins to catch up with program growth. Systems and processes develop, and these typically have both some positive and negative impacts. This stage can last many years or even decades and looks very different in the early stages of maturity than a decade later. Some organizations stay here until growth or a pivot is needed and then they go back to the third stage. Others become very rigid and unresponsive to community needs and move toward stage five, decline.
| Organization Characteristics | Likely Problems Encountered | Needed Leadership Focus |
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Asking lots of people questions like: what am I missing? What am I failing to ask? Is this still a valuable investment of our time? Is there a better way to go about it? How can we be more responsive to those we serve? To our staff?
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- Decline:
| Organization Characteristics | Likely Problems Encountered | Needed Leadership Focus |
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Asking questions like: what is working and what is not? Is what we offer still relevant? What is the most efficient and impactful way to meet our mission? Where can we cut resources and still have impact? Is someone else doing this better? Should we let them do it or support them in their work?
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- Turn-Around:
| Organization Characteristics | Likely Problems Encountered | Needed Leadership Focus |
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Asking questions like: what can we do right now to ensure we stop any ongoing financial shortfall due to how we are operating? What do we need right now in our leadership? How can we be more innovative? Are there ways we can partner with others to hone what we do best? What does the community need most?
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- Terminal:
| Organization Characteristics | Likely Problems Encountered | Needed Leadership Focus |
| Begin the process of closing doors and gifting any remaining resources to a similar mission in compliance with bylaws. |
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Ask: How do we make the best use of remaining funds for the good of the mission?
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Heightened Development loves working alongside leaders as they ask these questions, re-focus their perspective, and develop a structure and plan that propels them to greater impact.