Life cycle of organization

New organizations are created every day as a result of the shifting economic climate. Hundreds of organizations are permanently liquidated every day at the same time. The activities of more adaptable and stable organizations continue as a result of these changes and adaptations, whereas dependent ones cease to exist. There are certain businesses that are growing more quickly than others and developing their potential more effectively than competitors. In order to evaluate whether the chosen strategy complies with the organization's financial policy and the stage of its formation, it is advised to ascertain the enterprise's stage of development and current location. Consequently, the idea of an enterprise's "life cycle" is used to plan a specific series of adjustments in the existing condition and gain market share (Eliseeva, Mottaeva, 2021).

Stages of an organization's life cycle

Based on an analogy with the lifespan of biological objects, the idea of the life cycles of an enterprise's position in the market is developed. The following stages are part of an organization's life cycle:

1. the development of an idea, establishment of an organization, entry into the market, and formation
2. the expansion of potential, positioning in the market, and image
3. the culmination of development, maturity, and market visibility
4. the decline in demand and activity, the gradual loss of potential
5. either bankruptcy, liquidation, or revival (Eliseeva, Mottaeva, 2021)

References

• Eliseeva E., Mottaeva A., (2021) The life cycle of an organization in a changing economic environment. E3S Web of Conferences, Vol. 244, 10028, p.1-7

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