Contingency appraoch and system approach of management

“Effective management is always
contingency or situational
management”.
How does systems management differ
from contingency approach?
Presented By:- Group B
Neha Kumari Das
Pratistha Acharya
Shristi Karki
Sujan Poudel

Outline
● Management Definition
● System Approach of Management
● Contingency approach of management
● Effective management is always contingency or situational management- Why ?
● Contingency Theory
● Assessment of situational favorability
● Contingency approach vs Systems management
● Learning Reflections
● References

 Can be defined in a variety of ways hence a precise definition
is difficult
 Derived concept, theories and principles for a variety of
discipline, hence called interdisciplinary
 Can be used in different perspective
 As a discipline
 As a process
 As a group of people
MANAGEMENT

• “Management is the process of planning,
organizing, staffing, directing and controlling
human efforts to achieve stated objectives in an
organization with minimum efforts and resources
involving active decision making in all efforts.”
• “Management is a set of activities (including
planning and decision making, organizing,
leading and controlling) directed at an
organization’s resources (human, financial,
physical and information). With the aim of
achieving organizational goals in an efficient and
effective manner.” (Giffin)
MANAGEMENT

System Approach of management
An organization is a system or collection of subsystem
that operate together to achieve a common purpose.
Interaction with the
environment
No or little
interaction with the
environment

Major
parts
of
a
system
Input
The physical,
financial human
and
informational
resources
Process
The
methods/techni
que by which
the inputs are
utilized; e.g.
managerial and
technological
process
Output
Various types
and natures viz.
products and
services, profit
and losses,
employee
behavior and
productivity,
etc.
Feedback
The system
for further
improvement

FEATURES OF A SYSTEM APPROACH
 A system is basically a combination of parts, subsystems. Each part may have various sub-
parts. When a subsystem is considered as a system without reference to the system of which it
is a part, it has the same features of a system.
 Parts and sub-parts of a system are mutually related to each other, some more, some less;
some directly, some indirectly.
 A system is not merely the totality of parts and subparts but their arrangement is more
important. It is an interdependent framework in which various parts are arranged.
 A system can be identified because it has a boundary. The boundary maintains proper
relationship between the systems and its environment.
 The boundary of the system classifies it into two parts- closed system and open system.
 System transforms inputs into outputs. This transformation process is essential for the
survival of the system

Abstract Approach
Not Universal
This approach is too abstract to be
of much use to the managers. It
merely indicates that various
parts of the organization are
inter related.
The precepts of this approach
cannot be applied to all
organizations. This approach is
mainly suitable for large and
complex organization and not
the small ones
LIMITATIONS

Contingency Approach of management
 Each organization is unique
 Environment is dynamic
 There is no any universal theories that could be applied in each
and every situation and for all organization.
 It suggests an active interrelationship between the variable in a
situation and the managerial actions devised.
 Depending upon the situation of environment and nature of
employees, appropriate managerial decision would be taken

FEATURES OF
CONTINGENCY
APPROACH

FEATURES OF CONTINGENCY APPROACH
Different situations require the application of different management techniques
Management should, therefore, match or ‘fit’ its approach to the requirements
of the particular situations.
There is no “best way to manage.” There is no unique technique to solve
every problem because every problem situation is unique in itself.
It emphasizes the need of analyzing situation
Managers have to devise methods and to learn when and how to apply each one.

IMPLICATIONS
Management is entirely situational and there is nothing like
universal principles of management.
The approach suggests suitable alternatives for those
managerial actions which are generally contingent upon
external and internal environment.
This approach suggests that since organization interacts with
its environment, neither the organization nor any of its
subsystems is free to take absolute action.

Inadequate Literature Complex
It has not adequately spelled out
various types of actions which can be
taken under different situations.
When put into practice, this approach
becomes very complex.
Determination of situation in which
managerial action is to be taken
involves analysis of large number of
variables.
LIMITATIONS
Reactive not Proactive
This approach is basically reactive in
nature. It merely suggests what
managers can do in a given situation.

Contingency appraoch and system approach of management

Effective management refers to the extent to which managers achieve their targets with
the assistance of organizational resources.
Effective managers are responsible for performing certain key functions, such as:
 Setting targets and deadlines for their employees;
 Making financial forecasts;
 Organizing work in an efficient manner;
 Coordinating and making use of organizational resources sensibly;
 Controlling organizational activities and helping improve the efficiency of employees.

CONTINGENCY THEORY
● The contingency viewpoint of management proposes that there is no standard
for management; instead, management depends on the situation. The contingency
viewpoint is a more recent development of organizational theory that attempts to
integrate a variety of management approaches by proposing that there is no one
best way to organize a corporation or lead a company. Instead, the optimal course
of action is contingent or dependent upon the specific internal and external
situation management may find itself in.
● The contingency theory is similar to situation theory in that there is an
assumption that no simple way is always right. Situation theory, however, focuses
more on the behaviors that the leader should use. The contingency theory takes a
broader view that includes contingent factors about leader capability and also
includes other variables within the situation.

CONTINGENCY THEORY
● Contingency theory advocates that the managers should develop
situation sensitivity and practical selectivity. It emphasizes the
multivariate nature of organizations and attempts to understand how
organizations operate under varying conditions and in specific
circumstances.
● The theory states that task or relations motivations are contingent
upon whether the manager is able to both control and affect the
group's situational favorability, or outcome

Assessment of situational favorability
• This factor addresses the manager's perception of his cooperative
relations with his subordinates. In other words, is the cooperation
between you and your employees good or bad?
Leader-member
relations
• This factor relates to whether the structure of the work task is highly
structured, subject to standard procedures, and subject to adequate
measures of assessment. Certain tasks are easy to structure, standardize
and assess.
Task structure
• This factor asks if the manager's level of authority is based on punishing
or rewarding behavior. For example, does the manger derive his authority
from providing bonuses for meeting sales goals or terminating employees
for failure to meet the goals?
Position power

Contingency approach vs Systems management
Contingency approach Systems management
It emphasizes the impact of environment on organizational
design and managerial style.
The emphasis is on interdependence and interaction among
sub-systems.
The focus is on external environment of the organization. The focus is on the internal environment and sub-systems of
the organization.
Each organization is taken as unique entity. Different
organizations have different nature and face different
situations.
It treats all organizations alike and the background of the
organization is not taken into account.
The impact of the environment on organization structure and
managerial style is the major concern of contingency
approach.
The organization interacts with the environment and adjusts
as per the changes.
It suggests practical solutions to organizational problems. It provides a theoretical model of understanding the
organization and its sub-systems.
It rejects the blind application of classical principles of
management.
It is silent on the validity of classical principles of
management.

System Theory vs Contingency Theory
Definition
Focus
Structure
Means
Results
Approaches
System theory is a theory that
focuses on the internal environment
and subsystems of the organization
Contingency theory is a theory that acts
as an addition to system theory as it
considers the relationship between
organization and external environment
Open system view of the
organization
Conceptual skills
System theory as well as design
Simple
Interrelationship Situational Variables
Environmental determinants of
organizations
Environmental scanning
Dynamic management style
Complex

Learning Reflections
● Working as a team
● Managements approaches
● Equal work division and equal participation in drafting presentation
● Using Google Scholar and different search engine to search
documents.
● Regular communication and discussion via. virtual methods
● Learning continues while we stay at home (COVID-19 context)

References
1. scribd.com/doc/68367375/System-and-Contingency-Approach-of-Management
2. https://www.lsbf.org.uk/blog/opinion-features/the-golden-rules-of-effective-
management#:~:text=Effective%20management%20refers%20to%20the,the%20assistance%20of%
20organisational%20resources.&text=Coordinating%20and%20making%20use%20of,improve%20t
he%20efficiency%20of%20employees.
3. https://study.com/academy/lesson/contingency-approach-of-management-definition-example-
quiz.html#:~:text=A%20contingency%20approach%20to%20management%20is%20based%20on%
20the%20theory,change%20depending%20on%20the%20circumstances.
4. https://www.hrzone.com/hr-glossary/what-is-a-contingency-approach
5. https://www.mbaknol.com/management-principles/contingency-approach-to-management/
6. https://commercemates.com/advantages-disadvantages-contingency-approach/
7. “Contingency Approach to Management.” Bizcovering 20 Mar 2007.Available
from:http://www.bizcovering.com/Business-and-
8. Society/Contingency-Approach-to-Management.27102
https://courses.lumenlearning.com/boundless-management/chapter/modern-thinking/

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