I first learned about these “operating states of an organisation” years ago. I’ve recently been reminded of them as I am in a stage of reformulating my own business.
These principles are among the most effective frameworks I’ve encountered for understanding where you are in managing and scaling a project, or indeed a whole business.
Each state represents a distinct phase of organisation development, with specific characteristics and actions required to move forward. Understanding where your business currently stands can help you make the right decisions to progress and avoid setbacks.
1. Formulation – setting the foundation
This is the planning and preparation phase, where you define the vision, set expectations, and establish accountability.
Key actions:
- Announce the project: Define what needs to be achieved, by when, and who is involved.
- Have team members commit: You and each other person (if applicable) must declare what you can be counted on for.
- Create a structured plan: Outline timelines, dependencies, and required resources.
- Establish clear communication: Set up committed listening and speaking practices.
- Lay the groundwork for collaboration: Build relationships, agree on ground rules, and set standards.
- Focus on action: Identify what is needed today and deliver it.
- Avoid overthinking: Look at the facts rather than opinions or assumptions.
2. Concentration – the push for progress
This phase is about overcoming inertia, building discipline, and proving that results can be achieved.
Key actions:
- High input, low output – ‘10 in, 1 out’.
- Commit fully: No spectators, no excuses – just action.
- Create accountability: Make public promises and stick to them.
- Follow through relentlessly: Keep your word no matter what.
- Maintain intense focus: Prioritise what’s necessary, one step at a time.
- Enforce discipline: Push through discomfort and grind out results.
- Encourage leadership: Everyone must step up and take ownership.
- Economise: Eliminate unnecessary actions, distractions, and conversations.
- Balance resilience with care: Stay healthy, connected, and compassionate while maintaining high standards.
At the end of this stage, the organisation emerges stronger, more coachable, and results-driven.
3. Momentum – high output and growth
Once past the initial grind, the organisation moves into an accelerated phase where results multiply.
Key actions:
- High output – ‘1 in, 10 out’.
- Increase activity: Take more action, involve more people, and take bigger risks.
- Shift from managing to inspiring: Create energy and enthusiasm.
- Leverage opportunities: Identify and focus on actions that create the greatest impact.
- Expand communication: Foster a culture of openness and encouragement.
- Promote success: Share progress and celebrate wins.
- Clean up any lingering issues: Resolve past difficulties to maintain a positive culture.
- Maintain discipline: Avoid complacency – nothing is truly “handled” yet.
- Encourage self-determination: Move from externally imposed objectives to collective commitment.
Momentum is about scaling efficiently, ensuring that growth is both rapid and sustainable.
4. Stability – creating reliable systems
At this stage, results become predictable, and the focus shifts from intense effort to structured efficiency.
Key actions:
- Define roles and responsibilities: Establish clear accountability across the organisation.
- Structure and delegate: Organise operations as if preparing to franchise.
- Standardise best practices: Identify what works and systematise it.
- Develop people: Invest in training to build a capable team.
- Introduce performance metrics: Track and measure success.
- Plan for the future: Anticipate growth and prepare accordingly.
- Balance strategy with execution: Understand the big picture while managing the details.
- Strengthen communication: Ensure alignment between intentions and outcomes.
With stability comes sustainability, but the organisation must remain adaptable to avoid stagnation.
5. Breakthrough – redefining possibilities
This is the transition from competence to innovation, where the organisation moves beyond conventional thinking to create new possibilities.
Key actions:
- Shift focus from results to the structures that enable them.
- Challenge assumptions: Treat the ‘impossible’ as an opportunity for transformation.
- Reinvent processes: Recognise when old methods are no longer effective.
- Operate from a place of vision: Declare what will be, rather than debating what is feasible.
- Remove self-imposed limits: Make bold requests and challenge existing structures.
- Maintain vigilance: Keep attention on what produces success, not just the success itself.
- Increase agility: Act with confidence and speed, without overanalysing.
- Minimise self-focus: Resolve personal concerns so they don’t become distractions.
Breakthrough requires a willingness to let go of what’s familiar and embrace entirely new ways of working.
6. Mastery – teaching and scaling beyond yourself
Mastery is not just about sustained success – it’s about creating a self-sufficient organisation that thrives beyond the founder’s direct involvement.
Key actions:
- Train others: Pass on your knowledge and skills.
- Systematise success: Ensure that results can be replicated without your direct input.
- Step back: Delegate fully and trust others to lead.
- Start new ventures: Move into the Formulation phase of a new project.
True mastery means the organisation no longer depends on you – it has the structure, leadership, and vision to continue evolving independently.
Navigating setbacks: emergency & danger states
While the goal is always to move forward, setbacks can occur:
- Emergency: A slip back by one operating state. You must take quick corrective action to regain your footing.
- Danger: A slip back by two operating states: requires a more significant intervention to rebuild momentum.
Recognising these states early can prevent a deeper decline and help restore progress faster.
Final thoughts
Understanding these six operating states allows you to diagnose where your project or business stands and take the right actions to move forward. Whether you’re laying the foundation, pushing through resistance, or scaling to meet new challenges, each phase requires a different mindset and strategy.
Where is your organisation today – and what’s your next step?
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