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Internal Factors Lead to Organizational Growth Issues

Posted, by Deborah Merkin
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Organizational growth issues exist in some form at almost every company. There can often be a “chicken or the egg” mentality between two opposing factors that often lead to a scramble instead of a steady positive growth curve. Most companies blame this on external factors like funding, the market, or even a competitor move. However,
new research from Bain & Company shows that most organizational growth issues actually stem from within the organization. According to the survey of 400 executives:

  • Only 15% cite lack of opportunity as a growth barrier
  • 85% believe their biggest organizational growth issues are internal in nature
  • 94% believe that their most difficult challenges of any persuasion begin from within

And then there’s this “squishier” stat. Most of these growth barriers are a result of bureaucracy and organizational complexity. For example, it’s tough to be agile and come up with an innovative, quick solution to a problem when you need 5 layers of approvals from busy folks who may not check their emails until 10 p.m.
Harvard Business Review calls this the Growth Paradox. As growth creates organizational complexity, that complexity can stifle growth. It’s also important to consider how these changes and organizational growth issues can affect employees. If someone had a lot of autonomy in a position, and as the company grows they lose that autonomy, your organization risks losing their talent. Balancing bureaucracy with necessary layering is critical to balancing growth with turnover. This also becomes an issue of balancing employee satisfaction and employee loyalty. If as you grow, you also grow a reputation as a place where great talent simply passes through, rather than sticking by and investing in the mission, your internal issues will endure. Organizational growth issues can quickly grow into not only revenue issues, but HR and employee/management relationship issues. Knowing the signs and understand your company’s specific issues can help minimize and even avoid them.

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