Influence of life cycle stages of the small and medium enterprise on creation of the efficient organizational structure

Abstract

Introduction. In modern economics, small and medium enterprises are the majority of all functioning enterprises and a basis of each industry and sphere of economy. Therefore, they are relevant to the research of the activity of these enterprises by an organizational component as basic element of the general management. It is noted that development of these enterprises happens continuously, dynamically with the cyclic character, which demands continuous improvement of approaches to the organization of its activity and structure. Creation and development of it needs to be correlated depending on the current life cycle stage. The question about the expediency of change or improvement of the existing organizational structure at the small and medium enterprises depending on the stage of their lifecycle is raised.

Aim and tasks. The purpose of the article is to form the approach to interrelation of development of small and medium enterprises and their organizational configuration at different stages of their life cycle. According to the aim, the tasks are to analyze the current level of these enterprises’ development and to investigate interrelation of the cyclical nature of their development with creation of effective organizational structure depending on a life cycle stage.

Research results. It is reasonable that a certain type of organizational configuration corresponds to each life cycle stage, and is optimal for it: it gives an opportunity to consider dynamics of its development, priorities and features, simplify the choice of organizational structure to the management of small and medium enterprises. This research showed the necessity to gradually integrate the process approach to the existing organizational structure on the 2nd lifecycle stage. Such approach creates anti-crisis flexible organizational structure taking into account features of the whole enterprise’s life cycle. Thus, project life cycle was defined. Its successful completion is necessary to correlate with the enterprise’s life cycle. The carried-out analysis displayed the 4th stage as critical for development of the enterprises. To prevent this, it is necessary to use the development strategy on the 3rd stage already, implementing the innovation technologies, which define the new processes. The result is the renewal of organizational structure on the basis of process-functional approach.

Conclusions. The formation of the enterprise organizational structure depending on the current life cycle stage and its features, taking into account cycles of its development, simplify the choice of an organizational component for the management of the small and medium enterprises with use of the principles of the recognized in management and the most efficient process approach. It also provides certain flexibility of the organizational component of these enterprises in need of new product development, the organization of the project teamwork, determination of the beginning and termination of the project life cycle.

Keywords:

project life cycle, life cycle of enterprise, organizational structure, small and medium enterprises, process - functional approach