The contingency approach is a form of business management in which the manager does not follow any single school of thought. Instead, he or she allows the situation to dictate managerial choices. The contingency approach may combine elements from the three major traditional schools of management thought. These are the classical, behavioral, and management science schools of management.
The contingency approach to management should not be misunderstood as a way of avoiding the use or knowledge of the traditional schools of management. Managers who use the contingency approach must study all three thought schools in order to effectively use elements of them to respond to situations as they arise. Other, more recent movements in management may also be integrated into the contingency approach.
In the 19th and early 20th centuries, the classical school of management evolved. This school encompasses two areas of thought: scientific management, which should not be confused with the management science school that developed later, and administrative theory. Scientific management focused on the productivity of each worker. It stressed job specialization, worker selection, and training and standardized wages. Meanwhile administrative theory was concerned with the organization as a whole, stressing authority, discipline, and unity of thought and mission.
The behavioral school of thought recognized that workers are not just automatons, but people who had thoughts, feelings, and needs. This school declared that the way people are treated impacts performance. Being aware of employee needs and rewarding employees for a job well done were integral parts of this school of thought. It assumed that people will more willingly be swayed by pressure from their fellow workers than by management incentive or punishment.
Finally, management science evolved during and after World War II. This management school applied the scientific method to problems facing managers in the workplace. It stressed efficiency and used mathematical models to find solutions to common problems.
Each of these classical schools assumes that it is possible to find a single best way to manage any and all types of business. The contingency approach rejects this idea. It accepts that the overall effectiveness of management style does not depend on following a particular school of thought, but on how well the chosen action fits the situation at hand. When choosing which action to take, a manager may take into account the needs of the company, the desires of the clients, and the ability and temperament of the employees.