Craig Groeschel - How to Grow a Healthy Organization
Hey, it's great to have you back for another episode of the Craig Groeschel Leadership Podcast. We're on a mission. We want to help you become the leader that others love to follow. We believe that leadership matters. When the leader gets better, everyone gets better. We have a ton of new subscribers, and I just want to welcome you to our leadership community. I'll tell you a little bit about what we do on the first Thursday of every month. We release a brand new teaching just for you. If you would like more information, perhaps you want to go over the information with your team members. You can go to life.church/leadershippodcast. You can download a leader's guide that has all sort of detailed notes. It has questions in it. You can also subscribe and the podcast will come to you every month.
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Let's dive in to one of the most important concepts for every leader to understand. We're going to talk about how to grow a healthy organization. How do we grow a healthy organization. In this episode and next month we're going to talk about organizational life cycles. They're very very important. All organizations have life cycles. Your home business, your church, your restaurant franchise, your tech company, your 13 year olds lawn business, your non-profit ministry, your consulting business all have life cycles. They'll go through different phases, or cycles, just like people.
Think about it, people, a person is born, they're an infant, they're a toddler, they're a teenager. They move out of the house, they start an adult life, they might move back into the house, the boomerang kids, many of us have them. They get married, they reproduce, they hit a mid-life crisis perhaps, they age, and then they die. Everybody goes through life cycles. Your organization, whatever it is, is no different. You'll have the start up phase, hopefully you'll grow, you'll mature, where you're peaking out or you're in prime. You might start to decline, and one day unfortunately, all organizations tend to die.
Let's think about this. Never before in history has it been possible for a business or ministry to scale up as quickly as it is possible today. At the same time, never before in history can a business become obsolete as quickly as one can today. This is why it's so important to do the right things in the right season to move our organization to the peak point of performance. What you do in each stage of your organization will determine you health or your potential in the next.
If you want to read more about organizational life cycles, let me recommend a couple of sources to you. Adizes, many people consider him the expert, he wrote Corporate Life Cycles. It is very academic, in other words, you won't want to sit by the beach and have a vacation reading, this is going to take some work but it's incredibly helpful. A more layman's version is by McKeown, a book called Predictable Success. There are lots of other resources. You can Google organizational life cycles, but those are two that have been helpful to me. Let's talk about the seven organizational phases. It's important to understand which one you're in, so that you'll behave properly in this to move to the next and then hopefully stay in the right zone for the longest amount of time.
At phase one, it's called different things, I call it getting started. Others might call it the launch phase, the take off phase, whatever. But it's when your business or your organization is getting started. The most common phrase you're going to say or think in the start up phase is, man, I sure hope this works. I hope this works. This is the single most scary phase in the life of your organization, because the reality is you're starting out, you probably don't have a real clue what you're doing. You're almost always under resourced. You have a very difficult time attracting staff, and you likely don't have the resources to pay them if you could. You believe in your idea, but a lot of other people don't, and it's a really, really scary phase.
We know that about 80% of start up businesses fail. Well, of those, 2/3 never make it out of the start up phase. 2/3 of the 80% that fail do so in the first stage. This is every important. So, what do you do in the getting started phase. What should you be doing? There's three basic things that you want to be doing if you're launching a podcast, launching a ministry, whatever.
Number one, you want to obsess about the why.
Number two, you want to work on the what.
Number three, you want to search for the who.
Obsess about the why, work on the what, search for the who. Let's talk about the why. You want to obsess about the why you're doing the what. You want to keep the why front and center. The why is going to keep you from giving up when you want to quit. The why is going to drive you to do the what. You have to keep the why the mission, front and center.
Then work on the what. What is the what? And I can't answer that, that's for you to answer. The what for you might be developing a workable business model, it might be raising money, it might be finding office space. It might be finding a place to have church and getting enough people in the building in order to have a real worship service. It might be selling your first water filter to your grandma. I don't know what it is. But you want to work on the what.
Then, what's really, really, really important is to search for the who. Who you are with will determine what you can do. Bringing the right people on early is really, really critical. The challenge is you're not going to be able to find the perfect people. I want to encourage you, don't settle for the wrong people. In the start up phase, if you can't find someone that's right it's better to have no one than really bringing someone with the wrong culture or the wrong heart early on. What are we doing? We're starting. We're obsessing about the why, we're working on the what, we're searching for the who.
The next phase is what I call blowing and going. Others have called it go go or they call it the fun stage. The thing you're going to be saying in this stage is oh my gosh, this is actually working. We're getting somewhere. Things are starting to happen. You start to grow. Maybe you're closing deals, you've got a core group for your ministry, you've signed your first contract, whatever it is. In this phase you're taking risks because you have to. And honestly, you don't have much to lose anyway. You're extremely focused because you don't have any options. The good news is you start to get buy in from what some have called early adopters.
Some people start to believe in what you're doing and they come along to help you. The people that you attract during this season, they are incredibly important. It's often the most difficult to attract the people, but the people that you do attract, they are the most important for your future. Those who come in now, they're usually a different breed. They're risk takers, they have high capacity to believe in something they don't yet see. For me, it was Jerry Hurley. I was 29 years old, he was a district manager for Target. He took an enormous pay cut to come in, to take the risk, when we literally had nothing to build on. The people you attract in this season, they're difficult to attract, but they're incredibly important.
During this phase, this is when the myths about your organizations and the legends are born. Years later, you're going to look back and you're going to talk about this time. This is when we pulled off the impossible. This is when we did something nobody thought that we could do. You do stupid crazy stuff, and oftentimes it seems to work. What's fun about this phase, is your team that's starting to gather, they don't care about what's nice, they're not here for the perks or the benefits, they're all in mission minded, building the organization. You're often innocent, sometimes you're kind of naive. You don't know what can't be done.
Phase one, you're getting started. Phase two, you're blowing, you're going, you're getting there. Phase three I call hanging on, hanging on. Others have called it the adolescence phase, or white water phase, things are crazy. The most common thing you're going to say or think during this phase is oh my gosh, this may be too much. This may be too much. This is fun, but it's overwhelming. It's kind of like an awkward teenager that has a growth spurt. Like, you look like an adult but you still act like a kid all the time. You're kind of awkward. What happens in this phase is that your success has typically outgrown your systems, if you have any systems at all. You're not sure which way your business or ministry is going to go. It could go big, or it could go away. You're literally on the edge.
It feels like it's too much. You love the growth, but you're overwhelmed. It's exciting, but you're incredibly stressed. Typically in this phase, you have more opportunities than you do resources. You think if I had more people, more money, more time, we could explode with growth. But it's frustrating, because you don't have all the resources that you feel like you need. You can see where you want to be, but you don't know exactly how to get there. Let's camp out on this phase for a minute. This is often the most difficult phase for the founding leader.
If you're the entrepreneur start up leader, this is where it gets really, really difficult, it's really critical to do the right things. It's difficult for many reasons, I'll talk about two. One is during this phase you've generally outgrown some of your original leaders. They were good in the start up, but now that things are getting more complicated, they're not equipped, they haven't grown with the business. In other words, your bookkeeper who was great managing $50,000 of revenue is lost at 500,000. Your volunteer kids pastor, who was incredible when there was one room, is not equipped now that there are seven rooms. Your first sales person was good when you had one project. One product that was local. Now that you've got seven products that are regional, you've outgrown her and she's not getting it done.
The problem for the leader is that we feel so loyal to the people that helped us start. And this is where you have to start making some really critical decisions. If you cannot help them grow, and you're going to want to try, you have to have the courage to let them go. You have to make the right people decisions. It is in this phase that we tend to start having the first stages of turnover. We hate it, we agonize about it. But this is part of it. You have to embrace it if you're going to grow to the next stage. Remember, what you do now determines your capacity for growth later. It's difficult for the founding leaders, because we love the people that started with us.
The second problem is that entrepreneurial leaders are generally rebellious by nature, I know I am. I want to break the rules, I want to break barriers. I don't tend to appreciate systems, I just want to go, grow, grow, grow, grow, grow. What happens often is the founder knows how to start something but doesn't always know how to sustain it. This is why bringing the right people around you in this phase is absolutely and completely critical. If you don't surround yourself with the right people in this phase, you will not go to the next. You have to empower the people, you have to allow them to build systems, or you create systems. If you do not, you become the lead to progress. This is why like in my world, working with churches, many of them don't grow above where they are. It's not because the pastor can't preach or doesn't have vision, it's because they don't have the right people around them.
This is what happened to my church when we started 20, almost three years ago. We grew to 234 people on our first Easter, and we dropped to 130 people and stayed there right after it. The reason is because I didn't have the right people, I didn't have the right systems around me. I was the lead to this. What are you doing in this phase. Well, you're upgrading people. If your staff's not making it, you're helping find the right people to grow with you. You're creating systems. This is really, really important to create the right systems to bring about the right outcome. And you're reorganizing for growth. What you did in the start up phase you cannot continue to do. You're growing into a real business, and you have to start thinking differently about moving forward. Again let me say it, what you do in this phase determines if you go big or if you go home. You have to get it right.
Let's talk about the fourth of seven phases, I call it the zone. Other writers have called it the mature phase or the prime phase. This is when the most common thing you are going to say is finally. This is what we were working for. This is as good as it gets. What happens in this phase is you're growing, but not too fast. You're making money or you're making a difference, whatever your mission is. Your team is the right size, your people feel valued. What do you have? You have the right people, you have the right systems, and you have the right resources. You are in the zone, you're in the flow. You have the right balance between flexibility, your people have freedom, but control, you're making sure things are done appropriately.
You have the systems to eliminate problems, but you're not so structured that you slow the process, duplicate efforts, or stifle your leaders. Your leaders lead with a high degree of transparency and trust. There's great organizational alignment. What you do aligns with what you value. Your team members, they feel valued, they feel appreciated, they feel loved. So there's full heart buy in to what you're doing. This is what you've been working for. Enjoy it, but do not take it for granted. Even though you may be in the zone, you are as vulnerable as ever. Here's what happens. When you're successful, it's so easy to become complacent. It's easy to lose a sense of urgency. That's why I've often said nothing fails like success.
If you're not looking forward, your competition will pass you by. If you're not careful, you will get in the way of what was working. Someone might make a mistake, and so you create a policy, and then another policy, and then another policy, and before long you over complicate something that should be simple. In the next episode what we're going to do is we're going to talk about how do you stay in that zone. When you're in the flow, how do you keep your organization healthy and not tip over to phase five.
Let's talk about phase five. I call it the treadmill. What do you say in the treadmill? The most common thing you say in the treadmill, is oh my gosh this is getting more difficult. We're working harder and we're not getting as much done. There's three problems that are always present in the treadmill, what are they. Decisions take longer, progress is slower, and frustration is higher. Oh my gosh, we're working harder, we're doing more, and we're not getting the results we used to get. It used to be when we push this button, we got these results. Now we're pushing this button and we're getting smaller results. What happens in the treadmill.
Well, management starts to avoid risks. Instead of innovating for growth like we did early on, we start playing it safe and guarding what we have. There's always a loss of efficiency. Too many policies, too much bureaucracy. What happens? The missional buy in of the early adopters, it starts to fade. They don't believe in the mission quite as much. People start caring more about themselves than they do the organization. And then, some long tenured staff members that you thought would always be with you, they care a little bit less, and they often end up leaving and going somewhere else.
You look back and you start to regret it. You think, oh my gosh, in the old days when we were starting up everybody cared. Everyone carried their weight, there was team work, there was collaboration, now in this phase there's more territorialism. People start saying that's not my job. Instead of saying what's best for the mission or what's best for the organization, people start saying what's best for me. It used to be we had the highest standards for our team members. Now we've got a higher tolerance for average employees. And suddenly, average employees or even subpar employees start to hide in the organization because they can do it.
During this season, there's always a loss of clarity, a loss of focus, a loss of progress, there's a loss of efficiency. The bottom line is there's a loss of purity of mission, and it's painful. It gets worse if you don't correct it. Next month we'll talk about how to correct it. Phase six is the mud, I call it the mud. This is when you're saying this isn't fun anymore. I'm not going to spend a lot of time here, but there's six things that happen in the mud.
Number one, administration complicates and strangles progress.
Number two, policies tend to become more important than people.
Number three, values and actions no longer align. We say we value this but we do something different.
Number four, trust fades.
Number five, the leaders start denying the problems.
And number six, the focus shifts from growing to protecting. It's the mud, it's no fun, you don't want to be there.
Number seven, I call it the titanic. And that is when you're thinking the ship is sinking. What do you do? If you find your organization in the treadmill or in the mud you have to have the courage to acknowledge it and do something about it. During these phases, you're not tweaking, you are recreating. It often means a change of approach, a change of product, a change of thinking. It might mean a change of leadership. If you are the leader, do you have to go away? And the answer sometimes is yes, if you can't lead out of it. Or what you need is a complete change of mindset.
I read about one CEO who found herself in the mud and the article said she quit on Friday and said I'm no longer the CEO, and on Monday she said she came back and she was the turn around specialist. I like that. What she did was she changed her mindset. You have to have the appropriate mindset in the appropriate season to do the appropriate thing to try to get to the zone so you can maximize efficiency and really deliver.
Now, I want to take a moment to point out one more big idea. In larger organizations, you're going to have different life cycles for different departments, or products, or stores, or teams, or locations. For example, in my world, I lead a church that's in 32 locations in 10 different states. So I've got 32 different life cycles. Then I have the central organization with about 300 or so employees that have multiple teams. In other words, I might have 50 or 60 smaller groups that are in different cycles. What we have to do is we have to look at where each department or each team is on the life cycle so that we'll come in and not treat everybody with a one size fits all approach, but do the right things in the right seasons. I've got some churches that are in the start up phase, some that are in decline. We have to approach them with a little bit different mindset.
The bottom line is this, if you don't know where you are in the life cycles, you're not going to know what to do. This is something you're going to want to go over with your teams, you're going to want to review and listen. Normally I would review, but for the sake of time, I'm going to move straight into one application question. Here's the question. Of the seven stages, which one are you currently in. I want you to define that, and actually, this is a compound question.
What is the appropriate action for your current stage? This is so important. You might need to upgrade staff, that's what you need to do. It might be you need to shut down a program. It might, maybe you need to relocate headquarters. Maybe you need to establish systems to bring about the desired result. Maybe you need to staff up for growth, or maybe you need to right size your team to get costs down. The only guarantee I have for you is this is that what you are experiencing today will change soon. You have to do what's right in this season. What you do now will determine your potential to move forward, to reach more people, to grow more profitable, or whatever your mission is.
Another way to ask the question would be this. Acknowledging where you are and anticipating what is ahead, what do you need to do now to prepare for what you want in the future. Let me ask it again. Acknowledging where you are now in the life cycle and anticipating what is ahead, what do you need to do now to prepare for what you want in the future. In the next episode, we're going to talk about staying in the zone. How do you keep your organization healthy. If this podcast is helpful, please rate it, please review it. Thank you for sharing on social media. Hey, be yourself. You don't have to be perfect, you don't have to know it all. Be who you're created to be, because people would rather follow a leader who's always real than one who's always right.