Contingency Theory

This theory is a type of behavioral theory which assert that there is no better way to prepare a corporation, to extend a company or to do decisions. An  leadership / decision making / organizational style that is efficient in some conditions, may not be productive in other conditions.

1. Contingency Theory on the organization

•   There is no best way or comprehensive way to deal an organization.
•   The pattern of an organization and its systems must meet with the environment.

2. Contingency Theory of leadership

In this theory, the success of the leader is a aim of various factors in the form of task, subordinate and group variables. The effectuality of a given form of leader conduct is contingent on the demands enforced by the condition. These theories stress employing different styles of leadership befitting to the needs created by different organizational conditions. Some of these theories are:

•   Contingency Theory (Fiedler): This theory is the most former and most comprehensively researched. This theory states that group performance is a outcome of interaction of two components. These components are known as leadership style and situational positiveness.
•   Situational Theory (Hersey & Blanchard). Situational theory is the prolongation of Reddin's 3-D management style theory and Blake and Mouton's Managerial Grid Model. This model elaborated the notion of task and relationship dimensions to leadership and a forwardness dimension was summed.

3. Contingency Theory of decision-making

The Normative Decision Theory or Yetton and Vroom's Decision Participation Contingency Theory : As per this model, the effectualness of a decision procedure relies upon a number of faces of the condition:

•       The significance of the decision acceptance and quality.
•       The amount of applicable information owned by the subordinates and leader.

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