Life cycle

According to Webster’s New World Dictionary, life cycle is “the series of changes in form undergone by an organism in development from its earliest stage to the recurrence of the same stage in the next generation.” In business, life cycle is the series of stages individuals, products, and organizations go through from the beginning to the end of its existence. Individuals go through stages of career development involving formal education and training, on-the-job education, or training and continuous career development. Recent studies suggest American workers will change careers on average seven times during their lifetime. Many professions have developed licensure or appropriate certification to practice in addition to instituting continuing professional education requirements that help professionals remain current and sustain the knowledge and skill sets expected by the profession. PRODUCT LIFE CYCLEs include introduction, growth, maturity, and decline. During the introduction stage, businesses face little COMPETITION but also have to educate customers about product features and benefits. During the growth stage, firms expand sales and PROFITs but begin to see competition. During the maturity stage, sales begin to decline and profits drop as increased competition creates added price competition. During the decline stage, managers decide whether to discontinue existing PRODUCTs or revive market interest through revisions and improvements. Organizational life cycles are analogous to products. Many dynamic, leading companies of 50 years ago no longer exist today. Statistics from the Dow Jones Industrial Average (DJIA), a composite of the leading companies in the United States, demonstrate this. In the 1980s, service companies like McDonald’s were added, while U.S. Steel and Gulf Oil were eliminated as they were taken over by other companies. In the 1990s, technology companies were added to the DJIA as they became major contributors to the economy. To avoid decline, organizations often engage in redesign (restructuring/reengineering), repackaging (PUBLIC RELATIONS), or creative destruction/obsolescence/ termination (relocation or merger). According to James A. Champy, changes in the marketplace in the 1990s created needs for restructuring, reengineering, management specialist or other organizational alternatives in order to manage customer-driven needs and in response to increased competition due to GLOBALIZATION. These factors have reduced the length of the organizational life cycle, forcing organizations to rethink how they deliver their products or SERVICES. The solution, according to Champy, is to utilize X-engineering principles, including concepts like HARMONIZATION, “know what your customers are going through,” and “fish upstream.” Some enlightened enterprises, described as learning organizations, even build into their organizational processes opportunities for employee learning in order to prevent employee obsolescence (referred to by economists as structural UNEMPLOYMENT).