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Business Maturity Evaluation
In July of 1996, The Journal of Light Construction published my article entitled "Evolution and Revolution: 3 Stages of Growth for Construction Companies". This article was directly provoked by reading "The Five Stages of Small Business Growth" in the May 1983 issue of The Harvard Business Review.
Simply put, each stage of growth consists of two predictable phases: evolution and revolution. Companies "evolve" systems to manage at each stage and, if successful, experience a revolution whereby current systems become insufficient. The evolutionary phase tends to be profitable, predictable and smooth. The revolutionary phase is, as the name implies, difficult: profits fall, chaos reigns and everyone works harder with fewer successes.
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| Stage 1: |
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owner does it all |
| Stage 2: |
owner delegates some field and office functions |
| Stage 3: |
owner delegates all functions except sales & estimating |
| Stage 4: |
owner delegates all functions including sales & estimating and develops systems and measurements for all components of the business |
| Stage 5: |
plans and executes strategy, including devising personal exit strategy |
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5 Stages
of Business Growth
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