The art of adaptability: using contingency theory for effective management

Ever noticed how some people thrive under pressure while others crumble? Or how some prefer solo work while others do better in a team? Managers are much the same. In simple terms, contingency theory states that what makes a great leader depends on the situation. 

While we can all agree that good leaders have certain qualities, the fact is, there isn’t one set of criteria to quantify this. Contingency theory leans into this notion, acknowledging the fact that different scenarios require different leadership styles. Or in other words, there’s no such thing as a ‘good’ or ‘bad’ manager, but just a correct leadership style for the situation.

Whether you’re a manager looking to improve your organization’s performance, or just someone interested in understanding organizational behavior, you’ll find the answers here. Let’s begin! 

What is contingency theory?

At its core, contingency theory is about matching the leadership style to the specific situation. It takes into account various situational factors, such as the complexity of the environment, the capabilities of the team members, and the nature of the task at hand.

Imagine you’re leading a team of highly experienced professionals who know their job inside out. In this case, a more hands-off leadership style might be more effective, allowing team members to take the lead in their areas of expertise. But, if you were leading a team of inexperienced individuals, you may need to be more directive in your approach.

One of the benefits of contingency theory is that it encourages leaders to be flexible and adaptable. It allows them to adjust their leadership style based on the situation rather than trying to force a one-size-fits-all approach.

Different contingency theory models

The beginnings of contingency theory trace back to the work of management scholars like Fred Fiedler, who first proposed the contingency model of leadership. 

Over time, researchers continued to develop and refine the theory, proposing a wide range of models that emphasized the importance of adapting management approaches to the specific needs of each situation. Some of the most influential models within contingency theory include:

Fielder’s contingency model

Pioneer Fred Fiedler’s contingency model proposes that a leader’s effectiveness depends on their natural leadership style and situational factors, such as leader-member relations, task structure, and leader position power. The model suggests that different leadership styles are effective in different situations and that leaders should adapt their style to fit the situation.

Situational leadership theory

Proposed by Paul Hersey and Ken Blanchard, situational leadership theory believes that a leader’s effectiveness is dependent on the maturity level of their followers. The theory suggests that there are four leadership styles: telling, selling, participating, and delegating.

The path-goal theory of leadership

Proposed by Robert House, the path-goal theory of leadership suggests that the effectiveness of a leader’s style is dependent on the followers’ characteristics and the task’s demands. The theory proposes that there are four leadership styles: directive, supportive, participative, and achievement-oriented.

Vroom-Yetton-Jago model of decision-making

Developed by Victor Vroom and Phillip Yetton and later modified by Arthur Jago, this theory proposes that the most effective decision-making style is contingent on the situation. The model considers the nature of the decision, the level of information available, and the degree of follower involvement in the decision-making process.

The contingency model of conflict resolution

Developed by Mary Parker Follett, this model suggests that the most effective conflict resolution strategy is dependent on the situation. The theory proposes that there are three types of conflict: latent, perceived, and felt. The most effective strategy for resolving each type of conflict is dependent on the situation.

The contingency approach to organizational design

Created by Joan Woodward, this model suggests that an organization’s structure should be contingent on the organization’s technology. It theorizes that different technologies require different organizational structures for maximum effectiveness.

Why is contingency theory important in leadership?

Contingency theory recognizes that there is no one-size-fits-all approach to leadership. 

In the business world, change is constant, and leaders who can adjust their approach are more likely to succeed. By acknowledging the importance of situational factors and emphasizing the need for flexibility and adaptability, the contingency theory of leadership can help leaders stay ahead of the curve.

Contingency theory also highlights the importance of decision-making in leadership effectiveness. By matching the decision-making style to the situation, leaders can make better decisions that lead to more positive outcomes for their team or organization. It requires managers to be adaptable and vulnerable (it’s not easy to admit you have weaknesses), but the result is a more self-aware, well-rounded leader who’s able to pivot their approach depending on the situation. 

What are some different types of management styles?

Good managers flex their management style to the situation. Managers should have an understanding of the different styles available to them, as well as when to use them. Let’s take a look at the range of management styles before diving into when and how to apply them.

Autocratic management

The leader makes decisions without input from subordinates. They set policies and goals and expect employees to follow them without question. It’s a top-down approach.

Democratic management

The leader seeks input and feedback from subordinates when making decisions. They still ultimately make the final decision, but employees have a say in the decision-making process.

Laissez-faire management

The leader provides little guidance or direction to employees. They let employees work independently and make their own decisions.

Transformational management

This style of management involves a leader who inspires and motivates employees to achieve a shared vision. The leader encourages creativity and innovation and fosters a culture of teamwork and collaboration.

Transactional management

A leader using transactional management rewards employees for meeting specific goals while also creating consequences for not meeting them. The leader focuses on achieving specific outcomes and ensuring that employees follow established procedures.

Servant leadership

This management style involves a leader who focuses on the needs of employees and works to support their growth and development. The leader serves as a mentor and coach to employees and emphasizes collaboration and teamwork.

Coaching leadership

Coaching leadership is when a leader provides guidance and support to employees to help them achieve their goals. They focus on developing the skills and abilities of employees and helping them to identify and overcome challenges.

Charismatic leadership

This style involves a leader who has a compelling vision and uses their personality and communication skills to inspire and motivate employees. The leader creates a sense of excitement and enthusiasm among employees and encourages them to follow their lead.

Bureaucratic management

The leader follows established rules and procedures to achieve goals. They focus on maintaining order and consistency, ensuring that employees follow established policies.

Situational leadership

This style involves a leader who adapts their management style to the specific situation they are facing. The leader assesses the needs of employees and the organization and adjusts their approach accordingly.

Putting contingency theory models into practice

Now let’s dive into four of the main contingency theory models. While each has its own distinct approach, there’s overlap — and managers might want to draw from more than one. The goal here isn’t to define but to work out areas for improvement. 

1. Fiedler’s contingency model

Developed in the 1960s by Austrian psychologist and professor Fred Fiedler, this model is based on the idea that life experiences shape leadership styles and that leadership styles tend to be largely fixed.

As such, his model involves comparing the individual’s natural style to three situational factors to determine if they can be an effective leader in a given situation. 

First, you use something called The Least Preferred Coworker (LPC) scale, which is a chart that helps you describe a coworker with whom you would least enjoy working (it’s all fictional; no need to get personal here!). 

High scores indicate high LPC leaders, who tend to be relationship-oriented, while low scores indicate low LPC leaders, who are more likely to be task-oriented.

Task-oriented leaders tend to excel at admin, project management, logistics, and other organizational jobs. Relationship-oriented leaders are better at team cohesion, morale, solving conflict, and other relationship-building areas. Of course, some people fall somewhere in the middle, and even those who fall at either end of the relationship-task spectrum are able to span both. 

The next step is to assess the situation and see how well their leadership style fits. There are three factors to take into account: 

Leader-member relations

This refers to the strength of the relationship between a leader and their team members. The more positive the relationship, the more favorable the situation is for the leader. For example, if team members trust and respect their leader they are more likely to follow their direction and work more effectively as a team.

Task structure

This refers to how clear and well-defined the tasks and goals of the project or team are. The more structured the task the more favorable the situation is for the leader. For example, if team members have a clear understanding of their roles and responsibilities they’re more likely to work efficiently and effectively.

Leader position power

This refers to the amount of authority a leader has over their team or organization. The more power a leader has, the better. For example, if a leader has a high degree of control over their team’s budget and resources, they are more likely to be able to implement their vision effectively.

While Fiedler’s model encourages self-awareness and self-reflection when evaluating leadership styles, it can be biased due to the perceived nature of the LPC scale, leading to unreliable results. Additionally, it may not be as clear how moderate LPC leaders (with scores between 50 and 70) should handle situations.

Pros

• Encourages self-awareness and self-reflection when evaluating leadership styles
• Provides a straightforward way to check one’s leadership style and determine when and how one’s skills suit a situation
• Focuses on the situations at hand and not the leaders themselves
• Helps combat interpersonal conflict, boost team cohesion and morale, and build relationships among teams for high LPC leaders
• Helps with project management, organizational skills, and logistical team management for low LPC leaders.

Cons

• The LPC scale is a perceived score, which can result in biased results and can be unreliable
• It’s not as clear how moderate LPC leaders (with scores between 50 and 70) should handle situations
• Its application is pretty black-and-white, as leaders can either address a situation or replace themselves.

2. The Situational leadership model 

The Situational Leadership® model, aka the Hersey-Blanchard model, was developed by Dr. Paul Hersey and Ken Blanchard in the 1970s.

The model proposes four leadership styles — directing, coaching, supporting, and delegating — and four levels of development: D1 (Beginner), D2 (Developing), D3 (Experienced), and D4 (Advanced). 

Here’s a breakdown of each management style:

Delegating

When delegating, the leader assigns tasks to team members and trusts them to complete the work independently. It’s best used with team members who are highly skilled and experienced. However, it’s important for the leader to still be available for guidance and support as needed.

Supporting

The leader provides support and encouragement to team members while still allowing them to make decisions and take ownership of their work. It’s best used with team members who are experienced and capable but may lack confidence or motivation.

Directing

The leader provides clear direction and guidance to team members and closely supervises their work. Use it when with team members who are new to a task or project and need a lot of direction and support.

Coaching

The leader provides feedback and guidance to team members and works with them to develop their skills and improve their performance. It’s best used with team members who are developing their skills and need support to reach their full potential.

Once you’ve defined your leadership styles, match them to the level of development of each team member, with the goal of helping each person achieve their full potential.

• Use the directing style with team members who are at the beginner level of development and need a lot of guidance and direction
• The coaching style is for team members who are developing and need more support and feedback. 
• The supporting style works best with experienced team members who need less guidance and more autonomy. 
• The delegating style is for team members who are at an advanced level of development and are able to work independently.

Pros

• The model allows for flexibility in leadership style based on the needs of each situation and team member
• It emphasizes the importance of personalizing leadership to the unique needs of each team member, which can improve motivation and performance
• It helps team members develop their skills and reach their full potential
• The model has been widely used and has proven to be effective in improving leadership effectiveness

Cons

• The model can be complex and difficult to understand and apply
• It relies on subjective assessments of a team member’s level of development, which can lead to bias and inaccuracy
• It can be time-consuming to implement and may require significant effort to apply effectively
• The model may not be as effective in certain situations or industries that require more structured leadership approaches

3. The path-goal model 

The Path-Goal model focuses on the importance of a leader’s behavior in guiding and motivating their team.

Developed in the 1970s by Robert J. House and based on the work of Martin G. Evans, this model proposes that a leader’s primary goal is to provide their team with a clear path to achieving their objectives.

The Path-Goal model suggests that a leader’s behavior should be tailored to the needs of their team members and the specific situation. By understanding their team members’ needs and goals, a leader can choose the most effective leadership style to guide and motivate them toward success.

The model proposes four leadership behaviors — directive, supportive, participative, and achievement-oriented — each of which can be combined with others to create an effective leadership approach.

Directive

The leader provides clear guidance and specific instructions to their team members. Use it with inexperienced team members or those who are uncertain about how to proceed.

Supportive

The leader shows concern for their team members’ well-being and provides emotional support. Use it when team members are under stress or lack confidence.

Participative

The leader involves their team members in decision-making and encourages them to contribute their ideas and opinions. Use it when team members are experienced and capable of making significant contributions.

Achievement-oriented

The leader sets challenging goals for their team members and encourages them to strive for excellence. It’s best used when team members are motivated by achieving difficult goals.

Pros

• The model allows for flexibility in leadership style based on the needs of each situation and team member.
• It emphasizes the importance of personalizing leadership to the unique needs of each team member, which can improve motivation and performance.
• The model has been proven effective in improving team performance and achieving goals.
• It provides a clear framework for leaders to guide and motivate their teams towards their goals.

Cons

• The model can be complex and difficult to understand and apply in practice.
• It can be time-consuming to implement and may require significant effort to apply effectively.
• The model relies on subjective assessments of a team member’s needs and the specific situation, which could lead to bias and inaccuracy.
• It may not be as effective in certain situations or industries where more structured leadership approaches work best. 

4. The decision-making model

The Decision-Making model, aka the Vroom-Yetton contingency model, proposes that leaders use a rational approach to decision-making based on leader-team relationships.

The model suggests that effective decision-making involves several key steps, including identifying the problem, gathering information, evaluating alternatives, choosing the best alternative, implementing the decision, and monitoring and adjusting the decision as needed. 

Within this model, there are five leadership styles: 

Autocratic (A1)

Using this style, the leader makes the decision alone without consulting with team members. It’s used when the decision needs to be made quickly or when the leader has more expertise or knowledge than their team members.

Autocratic (A2)

Here, the leader obtains information from team members but still makes the decision alone. It’s used when you need a fast decision, but the leader wants to consider some input from team members.

Consultative (C1)

Using this approach, leaders share a problem with team members and solicit their ideas and opinions, but ultimately make the decision themselves. It’s best suited when the decision is complex or when the leader wants to get some buy-in from team members.

Consultative (C2)

This is when a leader shares the problem with team members and solicits their ideas and opinions but still makes the decision alone. It’s best used when the leader wants to get buy-in from team members but still feels they have the most expertise to make the decision.

Collaborative (G2)

Here, the leader and team members work together to make the decision collectively. It’s used when the decision is complex and requires multiple perspectives and expertise.

Pros

• Provides a clear and systematic approach to decision-making
• Emphasizes the importance of involving team members in the decision-making process, which can increase buy-in and commitment 
• Recognizes that different situations may require different decision-making styles or approaches and encourages leaders to adapt accordingly
• Allows leaders to make more informed and effective decisions by gathering information and evaluating alternatives.

Cons

• Can be time-consuming and may not work well for quick or simple decisions
• Involving team members in the decision-making process can be challenging and may lead to conflicts or disagreements
• The model assumes that the leader has all the necessary information to make an informed decision, which may not always be the case
• It may not account for external factors that may impact the decision-making process, such as political or economic factors

How to apply contingency theory 

Now that you know all of the different types of contingency theories, and the pros and cons of each, there are a few things to consider before putting theory into practice.

Assess your leadership style

First, take note of your own strengths and weaknesses. Are there some tasks you excel at more than others? Think about how you respond to various work situations and interactions. Once you’ve taken note, you can use tools like Fiedler’s Least Preferred Coworker scale or the Situational Leadership® model to help you identify your strengths and weaknesses as a leader. 

Evaluate situational factors

Once you understand your own leadership style, it’s time to evaluate the situational factors that impact your team and organization. Consider things like team member relationships, task structure, and leader position power to determine how these may impact your approach.

Adapt your leadership style

Based on your assessment of your own leadership style and the situational factors at play, you can adapt your leadership style to fit the situation. For example, if you’re leading a team with a high task structure, you may want to take a more directive approach (or a more participative approach for low task structures). Also, think about the skills you need for various situations and nurture them. 

Monitor and adjust

It’s important to monitor and adjust your approach as needed. Continuously evaluate the situational factors impacting your team and organization and adjust your leadership style accordingly.

Develop your team

In addition to adapting your leadership style to fit the situation, focus on developing your team members. Provide them with the support, resources, and training they need to be successful and empower them to take ownership of their work. 

Use project management tools

Project management software helps by providing real-time data, analytics, and insights, enabling leaders to make informed decisions and tailor their approach to the unique needs of the project, team, and organization. It’s also ideal for managers opting for a hands-off approach because they can check progress in real-time rather than micromanage. The better your collaboration tools, the easier it is to flex.

Final thoughts

Using contingency theory in the workplace can be an effective way to understand and improve management practices. By recognizing the importance of situational factors, managers can develop strategies that are tailored to their organization’s unique needs and challenges. While there are pros and cons to each contingency theory model, they all have a unique and useful framework for understanding the complexities of organizational management. As managers continue to look for ways to work better with their teams, contingency theory will give them the ability to become more self-aware, well-rounded leaders, who are able to pivot their management style depending on the situation.