1.4. Contingency approach in organizational theory

Theoretical inputs for research concerning the “embedding/adaptability”-approach ifib applies mainly come from the “contingency approach” in organizational theory (Kieser & Kubicek, 1983): While classical management theorists such as Taylor and Fayol, were looking for the one best way in management and organization design, in the late 50s and early 60s a shift of paradigm arose, claiming that the organizational structure of a company or administration has to fit to the situation in which it finds itself. As these situations vary, different structures turn out to be most effective. In other words the optimal organizational structure is contingent, depending on certain contextual factors. Therefore this approach is labelled Contingeny Approach, in German the context is termed “situation“; and the approach is called situational approach (“Situativer Ansatz“).


Different researchers focussed on different contextual factors and investigated their influence in empirical studies. Joan Woodward (1958) looked into the production technology, Blau and Schoenherr (1971) into the size of the organizations, Burns and Stalker (1961) as well as Lawrence and Lorsch (1967) into the economic environment, in particular market competition and technological change. A broader approach was developed by a British team of researchers at the University of Aston by developing a conceptual scheme for the comparative analysis of organizational structure which took account of several contextual factors at the same time (Pugh & Hickson et al., 1963). In a survey of more than 30 organizations, seven contextual variables such as size, technology, geographical dispersion as well as five dimensions of organization structure (specialization, centralization of decision making, standardization, formalization and configuration) were operationalized by more than 80 indicators. Statistical analysis was directed towards identifying correlations, which were found, for example, between the size of an organization and the degree of specialization and formalization, as predicted by Max Weber. Later John Child joined the Aston Team and added variables describing the role structure and behaviour of organizational members and the performance of the organization, which are considered to be the relevant criteria for judging the fit between the structure and its context.


The Aston research programme was adopted in studies in more than ten countries. The whole research is summarized in four volumes (Pugh/Hickson, 1976; Pugh & Hinings, 1976; Pugh & Payne, 1977; Hickson & McMillan?, 1981). Kieser and Kubicek summarized this and related research in a German Textbook in 1976, using the following conceptual model (figure 1):





Figure 1: Conceptual model of the contingency approach developed by Kieser and Kubicek (1983)

According to this model, the formal structure of an organization defines the roles of its members in a specific way and thereby directs their behaviour to a certain degree. The performance of the organization depends on the degree to which these role definitions enable members to cope with the requirements resulting from the context of the organization. For example if there is strong competition and a high degree of technological change, decisions about new products and marketing strategies have to be changed frequently and be taken close to the market. A formal structure with a high degree of centralization, specialization and formalization would not fit to the requirements resulting from this situation, rather roles defined by a low degree of these structural dimensions would enable members to act in the required flexible way.


The method to analyze and assess these kinds of relationships is the comparative quantitative analysis, in the most advanced stage a multi-level quantitative analysis, assigning data to the level of the context, the organization and its members. These variables are operationalized in quantitative indicators, and data are collected by standardized questionnaires distributed to several members of each organization under investigation and afterwards aggregated to different indices for each level (for more details see Kubicek, 1975).


Empirical studies conducted according to this model could identify some interesting relations but did not show very high correlations and clear cut patterns. Kubicek and Kieser in later editions of their textbook suggested to take into consideration additional factors such as the management philosophy and strategic aspects of top management as well as the broader socio-cultural context (Kieser & Kubicek, 3rd ed., 1992). But the introduction of additional variables did not increase the level of the correlations. The fit of an organizational structure with its context depends on too many aspects and seems to be too complex, to be precisely captured by linear quantitave relations.


However, the basic idea of the situational contingency of a particular object on its context as well as the idea that the performance of an institution depends on the fit between its properties and its relevant context is still valid and of great heuristic value as it suggests the critical examination of too early generalizations and asks for situational differentiation.


This analytical approach can be found in other areas of management theory too (e.g. leadership styles or strategic management) as well as in studies on the social shaping of technology. For example Mayntz and Schneider in a comparative study of the introduction of videotex in the United Kingdom, France and Germany used a conceptual framework according to which the final design of the technical system and its institutional arrangement was influenced by different constellations of actors in each country which acted in different contexts, defined by the respective legal system, political system, market structure and a different technological pool (Mayntz & Schneider, 1988, p. 282). Kubicek and Westholm used a contingency model of the deployment of e-democracy tools in their scenarios of the future use of this kind of tools (Kubicek & Westholm, 2005). The map of the socio-technical research landscape employed to map different subjects of research in DEMO-net is based on a contingency approach as well.





References

Blau, P.M., & Schoenherr, R.A. (1971). The Structure of Organizations. New York.

Burns, T., & Stalker, G. M. (1961). The Management of Innovation. London

Hickson, D.J., & McMillan?, C.J. (eds) (1981). Organization and Nation. The Aston Programme IV. Westmead – Farnborough.

Kieser, A., & Kubicek, H. (1983). Organisation, (3rd ed. 1992), Berlin – New York

Kubicek, H. (1975). Empirische Organisationsforschung. Stuttgart.

Lawrence, P. R., & Lorsch, J. W. (1967). Organization and Environment. Cambridge, Mass.

Pugh, D. S., & Hickson, D. J. et.al (1963). A Conceptual Scheme for Organizational Analysis. Administrative Science Quarterly, 8, 289 – 315

Pugh, D. S., & Hickson, D. J. (eds) (1976). Organizational Structure in its Context. The Aston Programme I. Westmead – Farnborough.

Pugh, D. S. & Hinings, C. R.. (eds) (1976). Organizational Structure. Extensions and Replications. The Aston Programme II. Westmead – Farnborough.

Pugh, D. S. & Payne, R. L. (eds) (1977). Organizational Behavior in Iis Context. The Aston Programme III. Westmead – Farnborough.

Woodward, J. (1958). Industrial Organization. Theory and Practice. London.

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