CONTINGENCY THEORY OF MANAGEMENT

Howard University professor Paul Lawrence and Jay Lorsch(1967) popularized the term Contingency Theory. The contingency theory was developed by managers, consultants, and researchers who tried to apply the theories and principles of the major schools to real life situation. It is based on the notion that the proper management technique in a given situation depends upon the nature and conditions of that situation. Hence, it is also called the situation approach.

Contingency theory recognizes that all the sub-systems of an organization and environment are interconnected and interrelated. By analyzing their interrelationships help management in finding solutions to specific situation. Different situations demand different solution. The basic idea of the contingency theory is that there is no best way to plan, organize or control. A technique that works in one situation will not necessarily work in all situations. There cannot be universal principles of management appropriate to all situations. The contingency theory seeks to match different situation with different management methods.

According to contingency theory, the correct management practice or managerial behavior in a particular situation and at a particular time depends on a many variables. It is the task of the manager through study and practice to develop a wide range of alternative management behaviors.

At present contingency theory is considered to be the practical approach of management. The major contribution of this theory to management reminds the manager that there is no one best way to do anything in the world of management.This theory seems to hold a great deal of promise for the future development of management theory and practice.