Managing Decline

Abstract

This article argues that organizational decline is often caused by a divergence between an organization and its environment; to remain viable, the organization must evolve with its environment. Based on this precept, two lessons on the management of decline in public sector organizations are drawn from the experiences of the automotive industry during the 1970s. First organizations must understand the nature of changes taking place within their environment and translate these perceptions into plans for future action. Second, organizations must develop and implement strategies that are consistent with the underlying nature of decline occurring.