A multi-stage model of governance in ... - Cass Knowledge

Cass Centre for Professional Service Firms – Working Paper 004 - 2010
professional management group. At this point management and ownership become
separated within the firm and more comprehensive management systems and
structures are introduced. Power and accountability, therefore, shift from the owners
to the professional managers, though benefit continues to reside with the owners.
The reality in professional service firms is more complex. In the move from the
Founder-focussed to the Collegial phase (following the crisis of Exclusion) power,
benefit, and accountability remain densely interconnected and the preserve of feeearning
senior professionals active in the business. Before the professional service
firm can start to experience the concentration of power that Greiner highlights, a
professional service firm will pass through an additional stage, the Committee
phase. During this phase management responsibilities, systems and structures
become more explicit. However, power, benefit, and accountability remain
contiguous and widely diffused among the fee-earners/owners/senior professionals.
The professional service firm develops a cadre of professional managers at a
relatively advanced stage in its development (compared to Greiner’s generic model).
In a professional service firm a crisis of Frustration leads to the formal ‘Delegation’
of authority by the partners/directors to a small group of peers. When Greiner speaks
of the Delegation phase, however, he is referring to something quite different – the
stage at which management find that they are overloaded and must delegate
responsibilities to middle management.
The term ‘middle management’ is not widely used within professional service firms, in
part because the focus on flat hierarchies and project-based working gives rise to
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