Leadership Chapter 6 - Contingency Theory Northouse, 4th edition

Overview Contingency Theory Approach Perspective Leadership Styles Situational Variables Research Findings of Leader Style Effectiveness How Does the Contingency Theory Approach Work?

Contingency Theory Approach Description Perspective Contingency theory is a leader-match theory (Fiedler & Chemers, 1974) Tries to match leaders to appropriate situations Leader’s effectiveness depends on how well the leader’s style fits the context Fiedler’s generalizations about which styles of leadership are best and worst are based on empirically grounded generalizations

Contingency Theory Approach Description Definition Effective leadership is contingent on matching a leader’s style to the right setting Assessment based on: Leadership Styles Situational Variables

Leadership Styles Leadership styles are described as: Task-motivated (Low LPCs) Leaders are concerned primarily with reaching a goal Relationship-motivated (High LPCs) Leaders are concerned with developing close interpersonal relationships Leader Style Measurement Scale (Fiedler) Least Preferred Co-Worker (LPC) Scale High LPCs = Relationship-motivated Low LPCs = Task-motivated

Situational Variables/3 Factors Leader-Member Relations - Refers to the group atmosphere and the degree of confidence, loyalty, and attraction of followers for leader Group atmosphere – Good – high degree of subordinate trust, liking, positive relationship Poor – little or no subordinate trust, friction exists, unfriendly

Situational Variables/3 Factors Task Structure Concerns the degree to which requirements of a task are clear and spelled out High Structure – requirements/rules - are clearly stated/known path to accomplish - has few alternatives task completion - can be clearly demonstrated limited number - correct solutions exist

Situational Variables/3 Factors Task Structure, cont’d. Concerns the degree to which requirements of a task are clear and spelled out Low Structure – requirements/rules - not clearly stated/known path to accomplish - has many alternatives task completion - cannot be clearly demonstrated/verified unlimited number - correct solutions exist

Situational Variables/3 Factors Position Power Designates the amount of authority a leader has to reward or punish followers Strong Power – authority to hire or fire, give raises in rank or pay Weak Power – no authority to hire or fire, give raises in rank or pay

Situational Variables/3 Factors 3 Factors - determine the favorableness of various situations in organizations Situations that are rated: Most Favorable - good leader-follower relations, defined tasks (high structure), & strong leader position power

Situational Variables/3 Factors 3 Factors - determine the favorableness of various situations in organizations Situations that are rated: Least Favorable - Poor leader-follower relations, unstructured tasks (low structure), & Weak leader position power Moderately Favorable – Fall in between these extremes

Contingency Model

Research Findings of Leader Style Effectiveness Favorableness of Situation LPC Score Definition Low Very Favorable Very Unfavorable Situations going smoothly Situations out of control Situations with some degree of certainty; not completely in or out of leader’s control High Moderately Favorable

Research Findings of Leader Style Effectiveness Reasons for leader mismatch ineffectiveness: LPC style doesn’t match a particular situation; stress and anxiety result Under stress, leader reverts to less mature coping style learned in earlier development Leader’s less mature coping style results in poor decision making and consequently negative work outcomes

How Does the Contingency Theory Approach Work? Focus of Contingency Theory Strengths Criticisms Application

Contingency Theory Approach Focus By assessing the 3 situational variables, any organizational context can be placed in one of the 8 categories represented in the Contingency Theory Model After the nature of a situation is determined, the fit between leader’s style and the situation can be evaluated Overall Scope By measuring Leader’s LPC score and the 3 situational variables, it is possible to predict whether a leader will be effective in a particular setting

How Does Contingency Theory Work? Low LPCs – Task-Oriented Effective in Categories – 1, 2, 3, & 8 High LPCs – Relationship-Oriented Effective in Categories – 4, 5, 6, & 7 Effective in Categories – 1, 2, & 3 Middle LPCs If individuals style matches appropriate category in the model, leader will be effective If individuals style does not match appropriate category in the model, leader will not be effective

How Does Contingency Theory Work? How Does it Work? Example: Situation Leader–Member Relation – Good Task Structure – High Position Power – High Category – 1 Low LPC – (Individual who is task-oriented will be effective) By measuring Leader’s LPC score and the 3 situational variables, it is possible to predict whether a leader will be effective in a particular setting

Strengths Empirical support. Contingency theory has been tested by many researchers and found to be a valid and reliable approach to explaining how to achieve effective leadership. Broadened understanding. Contingency theory has broadened the scope of leadership understanding from a focus on a single, best type of leadership (e.g., trait approach) to emphasizing the importance of a leader’s style and the demands of different situations. Predictive. Because Contingency theory is predictive, it provides relevant information regarding the type of leadership that is most likely to be effective in particular contexts.

Strengths Not an all-or-nothing approach. Contingency theory contends that leaders should not expect to be effective in every situation; thus companies should strive to place leaders in optimal situations according to their leadership style. Leadership profiles. Contingency theory supplies data on leadership styles that could be useful to organizations in developing leadership profiles for human resource planning.

Criticisms Fails to fully explain why leaders with particular leadership styles are more effective in some situations than others Criticism of LPC scale validity as it does not correlate well with other standard leadership measures Cumbersome to use in real-world settings Fails to adequately explain what should be done about a leader/situation mismatch in the workplace

Application Useful in answering a multitude of questions about the leadership of individuals in various types of organizations Helpful tool to assist upper management in making changes to lower level positions to ensure a good fit between an existing manager and a certain work context