Contingency Approach

The company benefits from open systems theory because it takes into account modern cultural changes and needs.

The contingency approach, founded in the 1970’s differs from the behavioral approach. “Examining various situational variables is central to understanding leadership in organizations, according to the contingency theorist” (Stojkovic, Klofas & Kalinich, 2012). Fiedler’s Contingency Model is one of those contingency theories.

Open system: the perspective views organizations as complex organisms that “live” within an external environment.

It is depicted that modern organizations tend to incorporate the aspects of the open systems with those of the natural and rational perspectives. Examples include the institutional, transaction cost, and the contingency and the contingency theories. Organizations adopt the open system that accommodates the other two theoretical perspectives for it to exist (Davis & Scott, 2006). These organizations tend to have structures that are based on the processes, the products, and the function.

Kessler, E. H. (Ed.) (2013). Encyclopedia of management theory (Vols. 1-2). Thousand Oaks, CA: SAGE Publications Ltd. doi: 10.4135/9781452276090

We can safely state that no single theory of management is universally accepted today. To provide a useful historical perspective that will guide our study of modern management, we shall discuss five different approaches to management : (1) the universal process approach, (2) the operational approach, (3) the behavioral approach, (4) the systems approach, and (5) the contingency approach. Understanding these general approaches to the theory and practice of management can help you appreciate how management has evolved, where it is today, and where it appears to be headed. Each of the five approaches to management represents a different conceptual framework for better understanding the practice of management.

Effective contingencies that function as punishers have some basic principles that distinguish them from other ineffective contingencies. Punishment is a response or a contingency that suppresses the future occurrence of a similar response. It is a consequence that causes pain or discomfort and teaches an individual not to repeat what caused the punishment. In the third section of Punishment on trial, Ennio Cipani summarizes six basic principles of effective punishment. These principles are:

It is evident that both positive and negative aspects of both approaches exist in the current climate, and from a basic understanding it can be drawn that varying aspects of each approach can nullify the negatives of the other in some manner. Consequently I believe the works of the Burns and Stalker (as cited in Grey, 2012) should be considered, in which it is suggested organizations can be seen as mechanistic and organic (roughly translated to bureaucratic and post-bureaucratic) depending on contingencies. This contingency approach would see organizations exhibiting differing behaviors based on the environmental factors that they work within and the assets that they have so that they may better suit the needs of workers, employers, consumers

In what ways are management of companies different or how are they similar to one another? And what is the importance of management in how a company runs nowadays? Many of us question about why knowing the history of management is important to Managers? According to (Samson et al, 2012, Page 53) “A historical perspective provides a broader way of thinking; a way of searching for patterns and determining whether they recur across time periods.” In the history of management, many trends have appeared. Many argue that the new techniques being introduced may not have a permanent solution. Others think that managers adapting to new techniques for continuous improvement in this ever changing world. It is important to know the background of how these management perspectives evolved and who and how is it being used now.

The Contingency theory, developed in 1950s, argues that there is no 'one best way ' to structure an organization and we face different possibilities when determining how it should be structured and how it should be managed. Successful organizations adopt structures that are an appropriate response to a number of variables, or contingencies (Enoch, 2006).

The General Systems Theory (GST) came about as an effort to describe the systems approach, born from the biological concept of the organism developed in the first part of the 20th century (Von Bertalanffy, 1972). In contrast to the mechanistic systems which are closed and have a direct relationship between a cause and its effect, a biological or social system is open, operating on a principle of equifinality, where regardless of the starting point, the objective can be achieved (Kast & Rosenzweig, 1972). Any system will achieve equilibrium, but an open system can reach a steady state by accessing resources from outside itself (Kast & Rosenzweig, 1972). The underlying assumptions of GST rely on the organization of a company resembling the inner workings of an organism. However, subgroups within organizations can act independently of the the whole, in

Kessler, E. H. (Ed.) (2013). Encyclopedia of management theory (Vols. 1-2). Thousand Oaks, CA: SAGE Publications Ltd. doi: 10.4135/9781452276090

Compare and contrast the management theories of Frederick Taylor, Henri Fayol, Elton Mayo and Douglas McGregor. In what sense(s) are these theories similar and/or compatible? In what sense(s) are these theories dissimilar and/or incompatible? How would a contingency theorist reconcile the points of dissimilarity and/or incompatibility between these approaches?

Both the Contingency and the Resource Dependence Paradigms play a vital role in business. Though they have similarities, the also have differences. The following essay will describe these components.

Thus, strategy changes are inevitable in all organizations leading to structure and designing changes. Along with the changing policies the theories of organizational behaviour keep evolving. Hence we have traditional classical theories on one hand while modern contingency approaches on other hand. In this essay, I will explore and discuss classical and contingency theories along with their contributions and limitations with the help of contemporary organizational practices of businesses like McDonalds and Walgreen. The conclusion will be the result of evaluation of various theories and thus answering the question which is the best structure and designing approach for an organization?