No Change, No Growth

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January 3, 2013
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Aliza Mazor

In the business of building an organization, the only constant is change. Nonprofit start-ups and post-start-ups are quintessential works in progress. They are constantly questioning, tweaking, revising, revisioning, and reinventing; if not, it may be the signal to close shop.

In her book Nonprofit Lifecycles, Stage-based Wisdom for Nonprofit Capacity, Susan Kenny Stevens succinctly identifies seven lifecycle stages of organizations: idea, start-up, growth, maturity, decline, turnaround, and terminal. Within each stage are numerous elements of growth, evolution, and change. Just moving from one stage to the next is not a guarantee of survival (let alone impact). And the trajectory is not always linear. So what does a healthy organization look like? How does one distinguish productive flux from uncontrolled frenzy? What follows is a summary of some of the adaptive changes that organizations make in the early stages of growth.

Idea Stage

In this stage, there is an idea and a champion (or group of champions), but barely an organization. To move from idea to implementation, the innovators must be extremely nimble to avoid getting bogged down by organizational structure. Ideas are tested, feedback is integrated, and improvements are made; the model is improved and the circle of stakeholders is enlarged. The greatest organizational tasks at this stage are to become a learning organization and to figure out how to integrate the feedback and input of others. Holding onto and sharpening one’s vision and, at the same time, letting others own the idea and influence it, require maintaining a delicate balance. As a work in progress, the leadership must both maintain and communicate the vision clearly and be open to changes that would improve the idea and enable others to champion it.

Start-up

In this stage, the entrepreneurs build scaffolding around the idea: They enlist volunteers or staff to implement the idea and a leadership team or board to drive it forward with funding and other resources. One of the challenges in this stage is to allow the innovative idea to become popular while continuing to cultivate and develop it. While the the entrepreneur is in this business to catalyze change, he or she needs to manage the tension between honing the idea, spreading it, and protecting it. The greatest organizational tasks at this stage are figuring out when to collaborate and how to play in a larger field. Here, the work in progress is to figure out how to advance the big vision as a small player.

Growth Stage

In this stage, the organization must contemplate whether or not to grow and, if the decision is to grow, how to do so. Far too often, organizations presume that growth is inevitable, or that it is a response to external pressures. But some organizations should not continue to grow; they should be structured as time-limited interventions that inspire new approaches to doing business. Some organizations should merge or restructure to increase their effectiveness. Some organizations should stay small, serving their target population and meeting their intended need without significant growth. Some organizations should sunset if market demand for their product or funder support for their efforts is lacking.

Only a select few organizations must grow to realize their full potential. They understand that the same behaviors and strategies that were highly adaptive as a start-up may become counterproductive as the organization grows. The hallmark of a start-up — doing “a lot with a little,” attracting a team of talented generalists who work endless hours for little remuneration, populating the board with the founder’s friends, and investing the bulk of resources in program rather than infrastructure — no longer leads to success. Growth readiness requires infrastructure, stability, predictability, specialized functions, and a capacity to measure success.

Organizations should always be works in progress. And as they enter the growth stage, they may slow their frenetic pace in order to evaluate how their growth is changing the structure of the organization and its people.

In celebration of the tenth anniversary of Bikkruim: An Incubator for New Ideas, the nonprofit (in collaboration with five funders and Wellspring Consulting), commissioned a study to chart the growth trajectories of start-up and post-start-up organizations and to learn more about how these cycles of growth and change play out over time.1 Bikkurim not only sought to understand the trajectory of new organizations, but it also wanted to understand its own next life phase. We had successfully incubated dozens of organizations. We had witnessed a field spring up around us and join us in the task of sparking and shepherding innovation in the Jewish community. Although we had no external pressures to grow (neither funders nor the marketplace insisted on change), we felt restless; we wanted to explore new frontiers. In the coming months, we will launch a new initiative to help post-start-up organizations achieve growth readiness. Bikkurim, a twelve-year-old stable organization, will rock its own boat and set off on a new adventure because in organizational life, the only constant is change.

1 Copies of the study, ‘From First Fruits to Abundant Harvest: Maximizing the Potential of Innovative Jewish Start-Ups,’ can be downloaded at bikkurim.org.

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Aliza Mazor is the executive director of Bikkurim: An Incubator for New Jewish Ideas (bikkurim.org). She has been involved with nonprofit start-ups in Israel and North America for more than two decades.

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