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This thesis entitled "Theory of the organization life cycle and its use in small business' handles in the theoretical part with two well known theories of organizations, dealing with development and monitoring of common characters in their lives. In the practical part there is application of chosen theory to selected small engineering-oriented business, and also practical knowledge compared with those described in theory. Due to the special characteristics of the firm is then the next part of the work devoted to devising of appropriate strategies that could be used if a company will continue in development to avoid a crisis period, which may occur in its life cycle. The last part is the specification of possible risks that should the company expect during the development and also devising of preventive measures.

The content of my bachelor thesis is a theoretical description of basic terms relating to strategic management and kinds of strategic analysis to be applied especially in times of economic instability. In the practical part, I tried to propose changes in the strategic management of a particular small engineering firm, affected by the current economic crisis.