Paper Summary:

This paper explains that contingency theory assumes that the successful management of an organization depends on, or is contingent to, the environment in which it performs; every decision, which managers undertake in order to achieve the organizational goals, is influenced by the specific environment. The author points out that differentiation and integration in the organizational structure are contingent on contextual factors such as size and technology of the organization and external factors such as its market with its competitors, customers, suppliers, stakeholders and the environment. The paper relates that contingency thinking affects leadership because leadership implies that managers need a certain degree of power and control in order to exert influence on their followers.

Table of Contents
Introduction
The Contribution of Contingency Thinking on the Knowledge of Management
Contingency Thinking and Organizational Design
Environment
Technology
Size
Contingency Thinking and Leadership
Conclusion

From the Paper:

"The contingency approach on organizational design is of great importance as it was this field of management whose detailed research led to the foundations of general contingency thinking. Organizational design, often referred to as organizational structure is regarded as the key to good organizational performance. Like the classical management view it also assumes that organizational "performance and structure are inextricably linked" (Fincham, et al., 1999:355). The main difference between both ways of thinking, however, is that classical management research tried to find the most efficient structure for universal use, i.e. a structure appropriate for every kind of environment. Max Weber, for example, defined bureaucracy as the most efficient mean for managing an organization. His theory was characterized by job specialization, strict hierarchy, plenty of rules and much impersonality."

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