Contingency Approach For Understanding Organization
Prepared byPratishtha Agrawal MBA Ist sem, RTU ,Kota(Raj.)
Contingency Approach Defined as
Also sometimes called the situational approach.
There is no one universally applicable set of management principles (rules) by which to manage organizations.
Organizations are individually different, face different situations and require different ways of managing.
Contingency Characteristics
An open-system perspective
Subsystems combine to interact with outside systems
A practical research orientation
Translating research findings into tools and situational refinements for more effective management
A multivariate approach
Many variables collectively account for variations in
performance.
Two Contingency Theories
Burns and Stalker (1961)
Organizational systems should vary based on the level of stability in the environment Two different types of management systems Mechanistic systems - appropriate for stable environment Organic systems - required in changing environments (unstable conditions) Management is the Dependent Variable Variations in environmental factors lead to management
Lawrence and Lorsch (1967)
Key Issue is environmental uncertainty and information flow Focus on exploring and improving the organizations relationship with the environment Environment is characterized along a certainty-uncertainty continuum (contingency factors)
Contingency Variables/Factors
The contingency approach to management is based on the contingency variables: size of firm environment resources technology
group dynamics
individual differences
Kodak Goes Digital
Changed its main Business Photographic Film making to Digital photography after realizing that their profit is declining day by day
Companys business had been significantly affected by the quicker than expected shift of consumer to the film less digital cameras
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