Contingency Theory: An Overview of Its Use in Management Contingency theory is one of the many theories that help to shape managerial practice, define the way that managers make decisions, and form solutions to problems. Contribution of Situational (Contingency) Approach to Management by Syndicate 6. In the contingency perspective, managers are faced with the task of determining which managerial approach is likely to be most effective in a given situation. Lars Groth 8 . A contingent leader effectively applies their own style of leadership to the right situation. Although some might view that we do not manage disasters, there is an overlap between the contribution of management theory and emergency management. [4+3] 2003 Fall Q.No. According to the contingency approach, there are no plans, organisation struc­tures, leadership styles, or controls that will fit all situations. Firstly, the managers need to decide which way to pursue for changing the situation. Theory of Bureaucracy . (5) Emphasises the synergistic effect of organisations and recognises the external inputs. Limitations of Contingency Theory: Motivation through financial incentives can work wonder if the environment is favourable. Undertaking 1Measure the parts, strengths and failings of the following three major schools of idea in direction and organisational theories: ( E1 – PC 1.1 )Answer:Classical direction theory:The classical direction theory is a school of idea which direction theoreticians delved into how to happen the best possible manner for employees to execute their responsibilities. contingency approach to the management of organisations. The classical ideas and behavioural modifications are not rejected, but they are viewed as incomplete and not suited for all organisations. Contingency or Situational approach These contributions are at times referred to as theoretical schools (laegaard, J. and Bindslev, M. 2006). Such skills will help managers find out important contingency factors that influence their approach to managing. Contingency approach states that there is “no one best way” to manage an organisation. The contingency school of management is based on the idea that there is no one best way to manage and that to be effective, planning, organising, leading, and controlling must be tailored to the particular circumstances faced by an organisation. The contingency approach to management is based on the idea that there is no single best way to manage. Mana­gement variables such as management process, organisation structure, organisational behaviour, management style, mana­gement control are dependent variables. Instead, it must offer, in precise terms, what a manager should do in a given situation. Still others care only about protecting their egos. Contingency approach in nigeria management system. According to it, the managers should take decisions not according to principles but according to the situations. It is also known as situational approach. Henri Fayol . Similarly effective leadership style is expected to match a given set of circum­stances. Another management approach is style-based app Contingency theory is beneficial to organisations because of the potential for learning from specific situations and using these lessons to influence future management of the same or similar situations. Actually this contingency approach to the management is not law. Some employees are most often motivated by economic gains while others have greater need for challenging work. Disclaimer Copyright, Share Your Knowledge For example, in order to improve productivity, classical theorist may pre­scribe work simplification and additional incentives; the behavioural scientist may recommend job enrichment and democratic participation of the employees in the decision-making process. Table 1. According to the Contingency Approach, management is situational; no one best approach to management exists because each situation the manager faces is too different. It advocates that the managers should develop situation sensitivity and practical selectivity. The perspective originated with the work of Joan Woodward (1958), who argued that technologies directly determine differences in such organisational attributes as span of control, centralization of authority, and the formalization of rules and procedures. CONTINGENCY APPRAOACH OF MANAGEMENT G.KRISHNA VAMSY 2. For a given organisation, super system constitutes environment and management can be applied to supra-system also. The basic idea of this approach is that number management technique or theory is appropriate in all situations. The contingency view of management lead to – (1) Recognition of situational nature of management (2) Response to particular characteristics of situation. If nearly suggests what managers can do in a given situation. The behavioural scientist may seek to create a psychologically motivating climate and recommend the opposite- work enrich­ment. This approach, also known as the situational approach or "if-then" approach… (ii) Contingency theory attempts to determine the predictable relationships between situations, actions and outcomes. The … If the workers are unskilled and training opportunities and resources are limited, work simplification might be the best solution. It integrates theory with practise in a systems framework. They are constantly interacting with their environment. So one best way or universally applicable management is not possible. Managers with a contingency view use a flexible approach, draw on a variety of theories and experiences, and evaluate many options as they solve problems. The appropriate fit between the organisation and its environment and the appropriate internal organisational design will lead to greater effectiveness, efficiency, and participant satisfaction. Contingency Theory: An Overview of Its Use in Management Contingency theory is one of the many theories that help to shape managerial practice, define the way that managers make decisions, and form solutions to problems. Simple or complex control and coordination mechanisms? Everyone knows his or her place, and there is a place for everyone. As a way of correction, the contingency approach provides a pragmatic method of analysing organisation sub-systems and tries to integrate these with the environment. The contingency school of management can be summarized as an “it all depends” approach. A mechanistic structure typically rests on Theory X assumptions, and an organic structure typically rests on Theory Y assumptions. It means that there cannot be any single principle / formula / managerial activity which can be suitable in all the situations. Reactive not Proactive. In 1970s, it is recognized as a key to effective management. All managerial actions will depend upon particular prevailing circumstances and-situational factors. Instead, every management situation must be approached with the ‘it all depends’ attitude. A particular action is valid only under certain conditions. Welcome to EconomicsDiscussion.net! Recognition of Situational Nature of Management: This theory argues that there is no ‘one best way’ of doing things. Although some might view that we do not manage disasters, there is an overlap between the contribution of management theory and emergency management. At present contingency theory is considered to be the practical approach of management. So functional, behavioural, quantitative (management science) and also systems’ approach should all be applied together. Advantages of Contingency Approach to Management Contingency approach is dynamic in nature. Management theory stresses the need for effective planning to ensure that organizational goals are obtained. However, an organic structure is generally more expensive to operate, so it is used only when needed—when the organisational environment is unstable and rapidly changing. it allows managers to change the policies according to the situation. 3. Managers are, therefore, required to be pragmatic and also open-minded or adaptive. (ii) The goals of the organisation are well defined and enduring. It also allows the management to modify the roles of employees who are already working on the project to ensure success. Departments are encouraged to take a cross-departmental or functional perspective, and, as in Mary Parker Follett’s model, authority rests with the individuals and departments best positioned to control the current problems the organisation is facing. It emphasises the multivariate nature of organisations and attempts to understand how organisations operate under varying conditions and in specific circumstances. Contingency approach advocates that managerial actions and organisational design must be appropriate to the given situation and a particular action is valid only under certain conditions. It is helpful to the managers in performing their functions of planning, organising, direction and control. In short, ‘it all depends’ on a number of interrelated inter­nal and external variable factors. Socio-technical approach 3. How is it different from contingency approach? There are many definitions of leadership. Contingency theory is theoretically complex. Click Contribution of Situational (Contingency) Approach to Management Syndicate 6.pdf link to view the file. National social indicators and a pro­gramme of social accounting and auditing will be developed. Likewise other factors would have their role in determining the organisation structure. A systems approach highlights the complexity of the interdependent components of organisations within equally complex environments. While Henry Fayol is an ardent proponent of the unity of command, F.W. Contingency theory may also produce more well-rounded leaders who are able to develop their skills in multiple areas. Based on the above discussion, we can highlight the following contributions of contingency approach: (i) Contingency approach is action-oriented as it is directed towards the application of systems concepts and the knowledge gained from other approaches. They are, however, of the view that situations are often similar to the extent that some principles of management can be effectively applied. Features of Contingency Approach: Firstly, the contingency approach does not accept the universality of management theory. In general, the more quickly the organisational environment is changing, the greater are the problems associated with gaining access to resources and the greater is the manager’s need to find ways to coordinate the activities of people in different departments in order to respond to the environment quickly and effectively. If this is the way my situation is, then this is the best way for me to manage. But if the environment is dynamic, organic structure would be more appropriate. 2. There are few, if any, universal truths, concepts, and principles that can be applied under all conditions. Before publishing your Articles on this site, please read the following pages: 1. It means that there cannot be any single principle / formula / managerial activity which can be suitable in all the situations. CONTRIBUTORS: L.W. One Size Does Not Fit All—A Contingency Approach to Data Governance KRISTIN WEBER, BORIS OTTO, and HUBERT OSTERLE¨ University of St. Gallen Enterprizes need Data Quality Management (DQM) to respond to strategic and operational challenges demanding high-quality corporate data. Management is situation, and managers should explain objectives, design organisations and prepare strategies, policies and plans according to prevailing circumstances. Contributions and Limitations of Contingency Theory Contingency theory offers a fluid approach to management that is more realistic in the modern world where organisations must constantly adapt to their external environments (Donaldson 2006). Even bureaucracy can work under certain circumstances and it has not totally outlived its utility. In other words, there is no one best way (as advo­cated by Taylorism) to organise and manage. Thus, the right thing to do depends on a complex variety of critical environmental and internal contingencies. (1) Organisation-environment rela­tionship not explained clearly. (ii) Second, it highlights the importance to managers of developing skills in situational analysis. A systems approach highlights the complexity of the interdependent components of organisations within equally complex environments. Merits 6. The approach of Taylor is termed as Engineer’s approach. The basic idea of this approach is that number management technique or theory is appropriate in all situations. Some of the major limitations of contingency approach are as follows: 1. Overview of theories on organizations and management. It is an improvement over the systems theory in the sense that it only examines the relationships between sub-systems of a specific organisation in a given environment, but also offers solutions to particular organisational problems. Thus, management depends upon the situation and should act according to the situation. Contingency theory is attacked by several theorists on the following grounds: Contingency theory suffers from inadequacy of liter­ature. Implications 5. Important Elements of Contingency Theory: Contingency Approach to Management – Explained! (iv) There are routine activities; and productivity is the major objective. Features of Contingency Theory: 1. Contingency or situational approach seems better suited to lead management out of the present management theory jungle. Organisation structures will be designed not around functional specialisation but around projects and information decision systems in future. Management cannot have ready-made univer­sally applicable and patent principles to be applied in all situa­tions as everlasting truths. Everything you need to know about the contingency approach to management. Content Guidelines 2. It varies from situation to situation. When the environment surrounding an organisation is stable, managers tend to choose a mechanistic structure to organize and control activities and make employee behaviour predictable. In contrast to the vague systems termi­nology and perspective, the contingency approach allows us to specifically identify the internal and external variables that typically influence managerial actions and organisational performance. For example, they point out that even classical theorists like Fayol cautioned that management principles require flexible application. Complex 3. This approach originated in around 1970. It also allows the management to modify the roles of employees who are already working on the project to ensure success. (5) Relates environments to specific organisation structure and design. It states that organizations and even the units within the same organization are diverse –in size, goals, work activities, etc. A contingent leader effectively applies their own style of leadership to the right situation. It is based on the detailed examination of the various sub-systems of the organisation and also the relationship of the organisation and the environment. The Contributions of Management Theory and Practice to Emergency Management John C. Pine is the Director of the Disaster Science and Management, Professor-Research with the Department of Environmental Studies and Interim Chair of the Department of Geography and Anthropology at Louisiana State University in Baton Rouge, LA. There is no “best way to manage.” There is no unique technique to solve every problem because every problem situation is unique in itself. Different situations require the application of different management techniques. and. 1910 . It states that organizations and even the units within the same organization are diverse –in size, goals, work activities, etc. Emergency … For example- if an organisation structure has to be decided, there should be an appropriate response to a number of variables, or contingencies, which influence both the needs of the organisation and how it works. A contingency approach to management is logical. Critics also argue that there is really not much that is new about the contingency approach. All environmental variables are independent variables. According to contingency theory, the characteristics of the environment affect an organisation’s ability to obtain resources. Contingency theory is also criticised on the ground that it suggests a reactive strategy in coping with environmental complexity. Managers with a contingency view use a flexible approach, draw on a variety of theories and experiences, and evaluate many options as they solve problems. Organisation design and managerial actions most appropriate to specific situations will have to be adopted in order to achieve best possible result under the given situation. (iii) The technology is complex and dynamic. Modern management will have to recognise the nature of technology, the variations in human participants, and the wide diversity in environmental relation­ships. Contingency approach. This approach rejects universality of management concept. management approach, the transferability and usage of these western-developed management approaches in Nigerian organisations, the relevance and limitation of each approach in Nigerian organisations and challenges thereof. In the contingency theory, a leader’s ability to lead is contingent upon various situational factors. The Contingency Theory states that the leader’s ability to lead is contingent upon various situational factors. The contingency theory, on the other hand, is concerned with achieving a ‘fit’ between organisation and its environment. The systems approach takes a general view of organisational variables, i.e., technical, social, personal, structural and external variables. Secondly, managerial policies and practices to be effective, … Man is just a subsystem of the universe and his actions may have adverse effects on his environment, e.g., problem of pollution and deterioration of natural environment. Congruence between Organisation and Environment: An underlying assumption of the contingency view is this there should be a congruence between the organisation and environment and among the various subsystems. 1b State and explain the “system approach” and “contingency approach” of management as the integrating approach of managing an organization. 1. Contingency views are ultimately directed towards—suggesting organisational designs and managerial actions more suitable for specific situations. Systems approach provides a basic frame of reference for the new situational or contingency view of management. Wide or narrow spans of management? Secondly, the adaptive-organic structure is more appropriate when the following conditions are fulfilled: (i) The environment is relatively uncertain and turbulent. (6) Merely outlines interdependencies among systems and sub-systems. In contrast, Fayol’s approach is accepted as manager’s approach. For example, the approach used to manage a group of teenagers working in a fast‐food restaurant would be very different from the approach used to manage a medical … Research Methodology This study is based on a qualitative approach and it is analysed using a narrative method that will lean more towards the interpretivist approach … 1 Contributions of Pre-classical … (A) True (B) False Answer : (B) 22. (b) Organisational efforts should be based on the behaviour of actions outside the system so that the organisation gets smoothly integrated with the en­vironment. Because tasks and people in organisations differ, the contingency theorists (Selznik, Burns and Stalker, Woodward, Lawrence and Lorsch, James Thompson and others) argue that the method of managing them must also differ. The scientific management approach was put forward by Fredrick W. Taylor (1947). According to it, the major premise is that there is no one best way to handle any of the management problems. Contingency refers to the immediate contingent circumstances. Contingency theory is based on the premise that situations dictate managerial action; that is, different situations call for different approaches. Fred Fiedler’s contingency model focused on individual leadership. In fact, contingency approach has been termed as a common sense approach. Instead, a proactive strategy is needed where managers would be able to steer the organisation through complex environments with their creative and innovative efforts. 1. They suggested that previous theories such as Weber’s bureaucracy and Taylor’s scientific management had failed because they neglected that management style and organisational structure were influenced by various aspects of the environment-the contingency factors. Share Your PDF File Managers have always asked questions such as “What is the right thing to do? Similarly, democra­tic or participative managerial style may not be fit in certain situations and we may have to adopt tight control under cer­tain circumstances. 1900 . [8] 2003 Fall Q.No. See also classical school of management, quantitative school of management, and systems school of management. Emergency … A mechanistic or bureaucratic ap­proach to management is appropriate when: (3) Emphasis is on routine jobs, many rules and procedures. According to it, the managers should take decisions not according to principles but according to the situations. System approach theory consists of general principles for understanding the physical, mechanical, biological and social entities and the relationship among them. The contingency view seeks to understand the interrelationship within and among subsystems as well as between the organisation and its environment and to define patterns of relationships or configurations of variable.”. Information in depth was gathered from books, course texts and various reviews and articles. The contingency approach is a management approach which adapts based on situations. Scientific Management and . It helps the managers to broad-base their approach in solving day-to-day management problems. Contingency approach is less prevalent than change management approaches: Contingency approaches have remained less prevalent than change management approaches. Managers must find different ways that fit different situations. Wholesale import of Western philosophy and practice of management is not welcome. From this paper, you will learn what the contingency approach to management is and the key elements of contingency management. It requires the ability to analyse and diagnose a managerial situation correctly. It helps to devise motivational and leadership approaches to motivate the workers. With skilled workers driven by pride in their abilities, a job enrichment program might be more effective. Several contingency approaches were developed concurrently in the late 1960s. Kast and Rosenzweig have analysed the appropriateness of two kinds of structures under different circumstances. This would help the classicals view lack of judgment and use of universal solutions. In addition, as a sort of refinement, it seeks to identify the exact nature of interrelationships and interactions. 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