Contingency

Examples of Contingency in the following topics:

• The Contingency Viewpoint

  • The contingency viewpoint of management proposes that there is no standard for management; instead, management depends on the situation.
  • Instead, the optimal course of action is contingent or dependent upon the specific internal and external situation management may find itself in.
  • Debating which one of the previous approaches to management is the "best" approach is irrelevant in contingency theory, since the heart of the contingency approach is that there is no "one best way" for managing and leading an organization.
  • By its nature, contingency theory avoids static rules.
  • An example of the contingency viewpoint in action is a manager facing a situation with an employee who regularly shows up late to work.

• Four Theories of Leadership

  • Theories of effective leadership include the trait, contingency, behavioral, and full-range theories.
  • Experts have proposed several theories, including the trait, behavioral, contingency, and full-range models of leadership.
  • According to this approach, called contingency theory, no single psychological profile or set of enduring traits links directly to effective leadership.
  • In other words, contingency theory proposes that effective leadership is contingent on factors independent of an individual leader.
  • Fiedler's contingency model of leadership focuses on the interaction of leadership style and the situation (later called situational control).

• Leadership and Situational Context: Fiedler

  • This situational contingency understanding of leaderships suggests, for instance, that a leader in a strict, task-oriented workplace would have different qualities than a leader in a more open, idea-driven workplace.
  • The Fiedler situational contingency model measures leadership traits with a test that provides a leadership score corresponding to the workplace where the leader would be most suited.
  • Fiedler's contingency theory has drawn criticism because it implies that the only option for a mismatch of leader orientation and unfavorable situation is to change the leader.
  • Also, the contingency model does not take into account the percentage of situations that might be somewhat favorable, completely unfavorable, or even extremely favorable.

• Internal and External

  • The control process can be hindered by internal and external constraints that require contingency thinking.

• Employee Compensation and Benefits

  • It is often contingent on performance or results achieved.
  • Variable pay is contingent on discretion, employee performance, or results achieved.

• Forecasting

  • The practice helps businesses create plans for different situations, in addition to contingency plans for adapting if and when necessary.
  • As the management team implements the broader strategy, it must continuously monitor the current environment for deviations and use forecasting to adapt both the primary strategy and contingency plans for potential shifts.

• Overview of Strategic Planning Tools

  • Contingency planning can be simply described as the back-up plan, while participatory planning is the primary plan.
  • An excellent tool for strategists pursuing a particularly risky venture is to develop the primary objectives and strategy while simultaneously constructing a contingency plan that will limit the negative effects of failure.

• Leadership and Task/Follower Characteristics: House

  • In 1971, Robert House introduced his version of a contingent theory of leadership known as the Path-Goal theory.
  • According to House's theory, leaders' behavior is contingent upon the satisfaction, motivation, and performance of their subordinates.

• What is Organizational Behavior?

  • "Macro" strategic management and organizational theory studies whole organizations and industries, especially how they adapt, and the strategies, structures, and contingencies that guide them.

• Taking Corrective Action

  • It is useful to have some contingency plans in place, as employees, customers, or vendors may have unique perspectives on the problem that management lacks that can lead to a more effective solution.