From Startups to Giants: Tailoring HR Practices Across the Organizational Journey in Sri Lanka

Introduction

As businesses grow, their Human Resource (HR) requirements alter dramatically. Startups, small firms, and major organizations all confront unique obstacles as they go through their organizational lifecycles. In Sri Lanka, where businesses are quickly expanding and adapting to global trends, knowing how human resource practices should change at each step is critical to long-term success. Organizational Lifecycle Theory (OLT) provides useful insights into how firms may modify their HR strategies to meet the unique demands of each stage of growth.

Figure 1

Decoding Organizational Lifecycle Theory

Organizational lifecycle theory highlights the stages that organizations go through as they grow and evolve. Ichak Adizes proposed the theory in the 1970s, and it has since become extensively accepted by corporations and organizations of all kinds. (Innvocon, 2023) The organizational lifecycle hypothesis specifies five stages that businesses pass through:

Figure 2 Source: https://tsttechnology.io/blog/organizational-life-cycle

      1.     Infancy
2.     Growth
3.     Maturity
4.     Decline
5.     Death                             

As the corporate structure, culture, and processes change, various HR approaches are required at each level. Understanding these stages will help Sri Lankan firms execute the proper HR strategies at the right time, since they frequently confront the challenge of managing fast expansion and adjusting to global market demands.

Infancy: HR strategies are centered on establishing a solid foundation, recruiting entrepreneurial talent, and cultivating a flexible, inventive culture. This is critical for entrepreneurs in Sri Lanka, which frequently favour flexibility and cultural fit over formal qualifications.

Growth: During the growth stage, HR systems become more scalable. Structured recruiting, performance management, and employee development programs are becoming increasingly important for firms like Dialog Axiata, who aim to professionalize HR operations in order to accommodate larger teams while keeping corporate values.
 
Maturity: Organizations like MAS Holdings standardize human resource processes, such as established remuneration, training, and career development systems, to ensure operational efficiency and employee happiness in a competitive global market.

Decline: When experiencing a downturn, HR must prioritize revitalization and efficiency. HR strategies are altered to promote innovation, agility, and address organizational inefficiencies.

Death: During the death stage, human resources plays an important role in assisting the organization with substantial restructuring or wind-down operations, perhaps moving into new initiatives, or supporting corporate exit strategies. (Avendaño, 2021) (Wellhub Editorial Team, 2024)

 

 

CARNAGE, a prominent Sri Lankan garment manufacturer, provides a convincing illustration of how Organizational Lifecycle Theory (OLT) influences HR practices. During its early stages, CARNAGE concentrated on building a flexible and creative culture by hiring entrepreneurial talent and valuing cultural fit above formal requirements. This enabled the firm to handle the fast-paced fashion sector with creativity and flexibility. The company's HR processes got increasingly organized as it grew. Formal recruitment processes, performance management systems, and employee development programs were implemented to manage the rising personnel, allowing the firm to scale successfully while maintaining its basic principles.

By the time CARNAGE achieved maturity, HR practices had been standardized to assure operational efficiency and employee satisfaction. The corporation set up official compensation systems, career development plans, and performance reviews. In the decline stage, if the brand faced market issues, HR would prioritize revival through reskilling programs and innovation. If the firm enters the dying stage, HR will handle restructuring, layoffs, and employee transitions. CARNAGE maintains alignment between its staff and its company goals by adjusting its HR strategy to each development cycle.

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Conclusion

In Sri Lanka's changing economy, firms must tailor their HR strategies to the unique requirements of each stage of their lifecycle. Businesses of all sizes, from startups to major companies, must adjust their HR strategies to recruit, retain, and develop the best staff at the appropriate moment. Understanding the ideas of Organizational Lifecycle Theory enables Sri Lankan businesses to establish successful HR policies that promote growth and assist them overcome the obstacles of each phase. Finally, HR is crucial in steering firms through their lifecycle stages, guaranteeing long-term success and viability.

 

 

References

Avendaño, D., 2021. Organizational Life Cycle (Adizes). [Online]
Available at: https://www.toolshero.com/strategy/organizational-life-cycle-adizes/
[Accessed 21 11 2024].

Innvocon, 2023. Understanding Organizational Lifecycle Theory: Navigating Stages of Growth and Renewal. [Online]
Available at: https://www.linkedin.com/pulse/understanding-organizational-lifecycle-theory
[Accessed 21 11 2024].

Wellhub Editorial Team, 2024. Organizational Life Cycle Stages: How to Identify Which One You’re In Overcome Its Challenges. [Online]
Available at: https://wellhub.com/en-us/blog/organizational-development/organizational-life-cycle/
[Accessed 21 11 2024].