4.4 Contingency Theory

 About Contingency Theory

• contingent Factor
• Studies and Findings
• Relevance
• Comparison between System Theory and Contingency Theory
• Weakness
• Comparison between classical contingency theory and strategic contingency theory
• Conclusion.

About Contingency Theory

Question-Classical Theory subscribes to Newtonian Principles(constant/close). System Contingency Theory Subscribe to Darwinian Principles( Evolving System).Comment.

Q2-The relationship between systems and contingency theory is the same as that of the relation between a classical theory and Human relations theory. Critically Examine.

Q3.-Contingency theory is based on the philosophy that Taylor's one best way of doing things will not work in all situations. Critically Comment.

Q4.System's Contingency theory explain the fit in the relationship. Elucidate.

It is considered an extension of system theory as it overcomes its weaknesses of not explaining the specific relationship between the organization and environment ie..contingent theory explains fit in the relationship between organization and environment. This theory has empirical validity as it is based on many studies.

The most important aspect of contingency theory is that it considers management as entirely situational and it rejects Taylorism's one best way. It emphasizes Human beings are social beings motivated in all situations ie..managerial effectiveness depends upon contingent variables and management must have many contingency plans.

CONTINGENT FACTORS-

The factors which influence managerial effectiveness are considered as contingent factors.They are-

i)Technology(simple or complex)

ii)environment(stable/unstable, simple/complex)

iii)People in organisation

According to Fred Fielder following factors are the contingent factor-
a)task Structure
b)Leader's position and power
c)Leader-member relationship

There can also other such contingent factors such as Power, certainty, uncertainty in the environment, substantially according to strategic contingency theory.

 Studies and Findings

There are three important studies-

John Woodward-Technology and Span of control
Lawrence and Lorsch-Environment-Classical and Behavioural
Burns and Stalker-Mechanistic vs. Organic

Relevance of Findings

1. They show that management should adjust and adapt according to the situation. It is fit in the type of relationship, that if the environment is complex, it will have a different impact than a simple environment:

2. Classical And Behavioural thinker did not explain about the application of their in particular situation.rather they consider them applicable in all situation.

3.The organisation which face complex unstable environment and technology they cannot survive or be effective if they are structured on the classical pattern.

4. The fact due to ICT and Globalisation which has created complex environment organisation have become organic and fluid type rather than pyramid type.

Relevance between Systems Theory & Contingency theories

Similarities and Dissimilarities 

Classical Contingency theory and strategic contingency theory

Strategic Contingency Theory(Hickson)-Change is contingent upon

1.Power

2.Certainty/uncertainty

3.Substitutability

Ie..power means suppose organization wants to discontinue some position in the organization as they are not relevant as of now but people at those positions are powerful and if they are not willing to change the, there will not be any change.

For instance -

2.Certainly-what guarantee that change will be better than present situation.for ex-Big bang reform.

3.Substitutability- There may not always the suitable replacement for ex-changing B manager By NPM  which later we find it is not a suitable replacement. There are many others Faults, consistency, stability, overscaling, speicalisation, especially in B. Like the weather, we should move to performance linked.

Startegic contingency theory can said to have overcame the weakness of contingency theroy ie..organsiation should have a contingent plan. Plan A, B, C...

It is also relevant for scenario planning which being now appeared for planning and policy making in today's world that even 12th five year plan based on scenario planning.