The document discusses different patterns of growth that can be modeled after patterns seen in nature, such as trees, insects, and weather phenomena. It describes the growth patterns of oak trees, banyan trees, bee hives, tornadoes, and viruses. For each pattern, it provides examples of companies that have exhibited similar growth and discusses implications for managing organizations that grow in these ways. The document concludes that choosing a growth model aligned with a company's environment, leadership, and business needs leads to more effective management as the organization scales over time.

1. Patterns of Growth<br />We all want to grow, grow, grow. But is there only one way to grow? How does an oak tree grow? A honeycomb? Are they all the same? Clearly, Nature has found many different ways, different patterns, of growth.. But we think companies can grow only one way. <br />Let us look at some (for it is impossible to exhaust them all!) in turn.<br />The Oak Tree<br />The oak tree grows by accretion – every year, it adds a ring to its trunk and becomes thicker and thicker, until it becomes a giant. <br />This is actually the most common way a company grows.. become bigger but essentially along the same lines, always. We add markets, add products, the way an oak tree adds rings, over time, without changing anything in the basic architecture of the organism.<br />What are the special issues of managing such a growth pattern? What makes an oak tree strong?<br />A strong trunk: i.e., a strong sense of ‘core’, great clarity on what is our business and what isn’t<br />An equally strong sense of values<br />And operating processes<br />As more and more businesses are added, the older businesses should not require attention.. their environment should be stable and unshakeable.<br />The Banyan Tree<br />The Banyan’s pattern of growth is totally different from that of the mighty oak. It creates replicas of itself, increasing its span, until, in the end, you cannot even tell the daughter from the mother tree. Each tree is self-sustaining, yet bound to its mother and its siblings, and ever ready to spread out again.<br />To follow this model, a company would keep creating self-sustaining businesses over time, and yet retain a strong sense of connectedness. Perhaps a company like Matsushita would answer to this description, with its penchant for spinning off new divisions, each held together only by finance, and a shared value system.<br />How does one manage such a growth?<br />Creation of an infinite pool of entrepreneurs, each of whom can run a business independently<br />Who are yet held together by shared values<br />A commitment to support each spin-off with nourishment from the center until it stabilizes<br />When would such a model make sense? Clearly, where the environment creates new opportunities, each of whom are unrelated to each other, yet need to be part of a common ‘umbrella’ brand. Perhaps GE is another example of such a model.<br />The Beehive<br />More accurately, the Swarm of Bees. The beehive is created by hundreds of independent workers – no one of them has the knowledge and capability or even intelligence to build a hive, yet, together, they do it effortlessly. Where, in business, do we see this model in action? Perhaps the now-famous dabba wallas of Mumbai. Some religious organizations have this capability, perhaps Al Qaeda does, for all I know!<br />In a company, the closest I have seen to this model, is Polaris Software’s Lakshya process – a visioning exercise involving every last employee in the firm (all several thousand of them!), which tries to tap the collective consciousness of all of them. The result is not a business plan or even a written document, it is simply a collective consciousness.<br />Consulting companies like McKinsey may be another example – the collective knowledge and capability of ‘the firm’ is several orders of magnitude greater than that of any one set of consultant. <br />A ‘knowledge economy’ enterprise should probably look like this. Knowledge management is a very key management process in such companies. Like the Queen Bee of the beehive, whose role is really largely symbolic, the CEO or head of such a company should learn to be a good figurehead, symbol and role model, rather than attempt to direct and govern. <br />The Tornado (or Cyclone)<br />A tornado grows by gathering everything in its path, and somehow generating more and more energy as it roars along. A company that grows by furious acquisitions may be patterning itself after a tornado. It must be very uncomfortable to be swept up in a tornado, but it did transport Dorothy to the Land of Oz, remember! A tornado succeeds by its very fury, if it stops, it is lost. A company that grows like this cannot afford to pause and consolidate, it needs to keep moving, and roaring along.<br />A Virus<br />Perhaps the most successful creatures on earth are viruses. They grow by multiplying at a dizzying speed – once a single virus gets a host to grow in, it soon takes over the entire organism by producing millions of copies of itself – an illustration of the power of compounding if ever there was one.<br />What are the secrets to its success? Simplicity of structure is surely one – the simpler the structure, the easier it is to produce a full-blown copy, and faster. Can a business organization ever be simple enough to replicate like this? Perhaps communities of Indians who have settled down in far off shores like Kenya or Latin America have shown the ability to grow like this.<br />There are many ways to grow, each of them has a different implication for the organization.<br />Choosing the Model that is Right for You<br />If we open our eyes to the world around us, we could find the model that could work for us. But how to choose between them? Primarily, 3 criteria can be applied:<br />Your own self-image:<br />The business environment<br />The appropriate business model<br />These are, of course, related, yet they may be independent considerations in their own right. For instance, a stable environment, where technology (therefore products) and customer behavior (therefore markets) are stable, may be the right soil for an Oak Tree model of growth. However, what if the founder/CEO’s desire is to constantly do new things, try out new business models? Then the banyan tree may be more appropriate. <br />A software services company founder who pines to do products, a manufacturing company founder who wants to ride the infrastructure boom, would do well to emulate the banyan tree.<br />What is the business is promoted by a family with more than one obvious heirs/successors? Again, the banyan tree suggests itself.<br />Again, what if the environment is so unstable (as it was in the days of the dotcom bubble, for instance), that speed of replication is the most important survival trait? The virus model looks attractive. <br />The appropriate business model comes into play when certain structural conditions become necessary. For instance, the business model may require enormous up-front investment, in which case the virus model becomes virtually impossible to execute.<br />Again, if the business is knowledge-intensive, the need to manage knowledge could push us towards the beehive model, rather than, say, a command and control model like the Oak Tree, or a chaotic model like the Tornado or even the Virus.<br />The earlier we choose the growth model, the easier it will be to manage it later. Systems, processes, corporate culture, can be built from the beginning to suit the growth model. Else, there will be confusion later as the company tries to treat the banyan daughter like an oak tree, or the virus like a bee. Sounds odd when we put it like that, but that is what it will be, in fact!<br /> <br />