The 7 Stages of Enterprise Growth

An enterprise growth development modes created by James Fischer based on a nine year national research project with over 700 CEO’s. The study recognized that companies grow in complexity and that the complexity level is created by people, not profits or revenue. The model identifies 7 stages of growth based on the number of people and introduces a concept called The Stages of Growth.

Stage 1

Start Up: 1 – 10 Employees

What does a Stage 1 company look like?

A Stage 1 company has 1-10 employees, and at this stage of growth, it’s all about survival.

A Stage 1 company is CEO-centric — meaning the CEO is likely the ‘specialist’ who has created a product or service and is now getting his/her idea to take shape. It’s the energy, passion and vision of the CEO that is the driving force behind the company’s success today. The CEO also makes all the decisions and brings in all the sales. Therefore, 50% of the CEO’s time should be spent as the technician, or the specialist, while only 10% of his/her time should be spent as a manager. The other 40% of the leader’s time should be in creating and fine-tuning the vision of the company.

More Information on Stage 1 

Stage 2

Ramp Up: 11 – 19 Employees

What does a Stage 2 company look like?

A Stage 2 company has 11 – 19 employees. CEOs of Stage 2 companies are still the center of the business. They need to stay calm and thoughtful, and before they react to the increases in activity and workload, CEOs should ask themselves these questions:

  • Am I still focused on driving profits and revenue?
  • Am I beginning to let go of critical aspects of the company to capable people?
  • Am I watching the key indicators of success every day?

More Information on Stage 2

Stage 3

Delegation: 20 – 34 Employees

What does a Stage 3 company look like?

A Stage 3 company has 20-34 employees. At this stage of growth, it’s typical to experience a staff revolution. The first indicator that a company has hit Stage 3 is the certainty that the leader can no longer hold all the strings and be in control of the organization entirely on his/her own.

More Information on Stage 3

Stage 4

Professional: 35 – 57 Employees

What does a Stage 4 company look like?

Stage 4 is all about internal focus and internal processes, whereas Stage 3 was all about delegation and the CEO letting go. The necessity of that lesson will become painfully clear if the leader heads into Stage 4 still micromanaging — he/she has to let go.

More Information on Stage 4

Stage 5

Integration: 58 – 95 Employees

What does a Stage 5 company look like?

Stage 5 has the CEO focus back on profit as the Gate of Focus for one simple reason. The company has many more moving parts and requires a consistent source of fuel — sales! In Stage 5, the company must start integrating teams and processes — it’s important that the divisions have their own budgets. With upwards of 95 employees, the CEO has to rely on key managers to help direct the business.

More Information on Stage 5

Stage 6

Strategic: 96 – 160 Employees

What does a Stage 6 company look like?

There’s a rhythm now. Patterns of behavior have been established, processes are in place, and the morning walk through the company has an air of familiarity that feels good. It feels comfortable. The CEO’s confidence in his/her staff is strong. If the CEO has captured the imagination of the managers, they now provide the stability of making good decisions, connecting with their direct reports and providing sound input that keeps the leader updated on critical issues.

More Information on Stage 6

Stage 7

Visionary: 161-500 Employees

What does a Stage 7 company look like?

A CEO’s challenge in Stage 7 is all about transitioning into a large organization without losing what made it such a successful entrepreneurial business. Management’s efforts to professionalize the company often crush the entrepreneurial spirit that is so necessary in order to not to be left behind by newer entrepreneurial firms. A Stage 7 company has between 161–500 employees. Because of its size, the company has started to form layers of bureaucracy that quickly impede performance and growth. Stage 7, called the visionary stage, is a very different world than what’s been encountered in the first six stages.

More Information on Stage 7

Learn More:

The 7 Stages of Growth – Definitions

The Growth X-Ray Process