CONTINGENCY APPROACH, a development of the Systems view of organisations Falkné dr. Bánó Klára...
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Transcript of CONTINGENCY APPROACH, a development of the Systems view of organisations Falkné dr. Bánó Klára...
CONTINGENCY APPROACH,
a development of the Systems view of organisations
Falkné dr. Bánó Klára
BGF Külkereskedelmi Főiskolai Kar
Summary of Management theories
The Systems View of Organisations
The Contingency Approach
is an extension, or operationalisation of the systems approach
• IT RELATES THE ENVIRONMENT TO SPECIFIC STRUCTURES OF ORGANISATIONS.
• IT STATES THAT THERE IS NO ONE BEST UNIVERSAL STRUCTURE, BUT THERE ARE A NUMBER OF VARIABLES, OR ’SITUATIONAL FACTORS’ WHICH INFLUENCE ORGANISATIONAL DESIGN AND PERFORMANCE.
• THE CONTINGENCY APPROACH IS DIAGNOSTIC RATHER THAN PRESCRIPTIVE.
• CONTINGENCY THEORISTS REFLECTED THE FINDINGS OF EMPIRICAL RESEARCHES.
• THEY FOUND THAT THE MOST APPROPRIATE STRUCTURE IS DEPENDENT UPON THE CONTINGENCIES OF THE SITUATION FOR EACH ORGANISATION.
Contingency approach can be seen as an IF – THEN Matrix Relationship
Situational factors, e.g. size; technology; environment
The Best-known Contingency Models
Size and economic performance
The larger the company, the greater the association between more bureaucracy and better performance.(2,000 employees and above) Among small firms (100 or so employees) the better performers managewith very little formal organisation. (Child, J.)
Summary of levels of management and span of control in different production systems (Woodward, J.)
Characteristics of production systems (Woodward, J.)
The main conclusion drawn from Woodward’s study
Industrial organisations which design their
organisational structures to fit the type of
production technology, are likely to be
commercially successful.
Two major dimensions of Technology: Variability and Analysis of technology (Perrow, C.)
Characteristics of mechanistic and organic organisations (Burns and Stalker)
Hybrid organisations
Many organisations are hybrid, i.e. they represent a mix of
mechanistic and organic structures. This may lead to tension
and conflict. - Need for a senior member of staff who has the
respect of both groups to act in a bridging role.
E.g. a university or a college: academic staff – non-teaching
staff; typical between ‘production’ and ‘service’ functions of
an organisation. E.g. hotel – kitchen (production,mechanistic)
and front reception office (more organic structure)
Lawrence and Lorsch: differentiation and integration
• Differentiation - describes the difference among managers in different functional departments with respect to: goal orientation, time orientation, different aspects of the environment, interpersonal relations, formality of structure
• Integration – describes the degree of coordination and cooperation between different departments with interdependent tasks.
Different demands of the environment - individual departments may develop different structures. (E.g. research, production and sales)
Lawrence and Lorsch study: Conclusions• The extent of differentiation and integration in effective
organisations vary according to the demands of the environment. The more diverse and dynamic the environment, the more the effective organisation will be differentiated and highly integrated.
• In more stable environments less differentiation is required but a high degree of integration is still required.
• Differences in the environment require different methods, integrating mechanisms. In mechanistic structures: rules, procedures; In organic structures: teamwork and mutual cooperation.
Contingency approach-main influences on organisation and management
Parkinson’s Law
the Rising Pyramid, ‘Work expands so as to
fill the time available for its completion.’
• An official wants to multiply subordinates, not rivals.
• Officials make work for each other.
Other features of organisational practice Parkinsondiscusses include
The Law of Triviality
In a committee the time spent on any agenda
item will be in inverse proportion to the sum
involved.
The Peter Principle
is concerned with the study of occupational incompetence and
the study of hierarchies.
‘In a hierarchy every employee tends to rise to hislevel of incompetence.’
Two main means by which one can affect promotion rate: 1. ‘Pull’ – an employee’s relationship with a person above
him in the hierarchy (by blood, marriage or acquaintance) 2. ‘Push’ – manifested by an abnormal interest in study,
vocational training and self-improvement
The Peter Principle cont.
‘Pull’ is likely to be more effective than ‘Push’.
‘Never stand when you can sit; never walk when
you can ride; never Push when you can Pull.’(Peter and Hull)