Contingency Approach and Recent Contributions

The Contingency Management theory evolved out of the System Approach to managing organizations. According to the Contingency approach, management is situational; hence there exists no single best approach to management, as situations that a manager faces is always changing.

However, situations are often similar to the extent that some principles of management can be effectively applied by identifying the relevant contingency variables in the situation and then evaluating them.

Peter F. Drucker, W. Edwards Deming, Laurence Peter, William Ouchi, Thomas Peters, Robert Waterman, and Nancy Austin are some of the most important contributors to management thought in recent times. This has emerged perhaps as the best approach as it encourages management to search for the correct situational factors for applying appropriate management principles effectively.

On the basis of the Tom Peters and Robert Waterman’s research focusing on 43 of America’s most successful companies in six major industries, the following 9 principles of management are embodied in excellent organizations:

Managing Ambiguity and Paradox: The ability of managers to hold two opposing ideas in mind and at the same time able to function effectively.

A Bias for Action: A culture of impatience with lethargy and inertia that otherwise leaves organizations unresponsive.

Close to the Customer: Staying close to the customer to understand and anticipate customer needs and wants.

Autonomy and Entrepreneurship: Actions that foster innovation and nurture customer and product champions.

Productivity through People: Treating rank-and-file employees as a source of quality.

Hands-On, Value-Driven: Management philosophy that guides everyday practice and shows the management’s commitment.

Stick to the Knitting: Stay with what you do well and the businesses you know best.

Simple Form, Lean Staff: The best companies have very minimal, lean headquarters staff.

Simultaneous Loose-Tight Properties: Autonomy in shop-floor activities and centralized values.