CONTINGENCY THEORY (1960s-1970s)
Contingency theory derives from system theory but it focuses more on deeper aspects. Contingency theory is a management approach that emphasizes what managers do in practice depends on a given set of circumstances (situation) (Boehm, A &L. Howard, 1997). Basically, it is the practice of the mangers depending on their environmental circumstances or situation. It is also called as “It all depends” theory or “Situation” theory (Thenmozhi, 2010,2011). According to Howard (1997), although adapting a management decision to situation seems to be simple, but it is actually very complex due to unpredictable situation.
This theory exists during the emergence of new ...view middle of the document...
It is a system exists without any specific direction or predictability. It claims that events indeed are rarely controlled and this lead to emergence of new pattern (Cartwright, 1991).
This theory emerges during the start of internet age. The environment during that time is highly competitive environment in all types of industry. It is also during the emergence of communications technologies. Several new work methodologies is also being introduce during that time such as virtual teams, network organizations and many more.
This theory claims that one small change made in one particular area can give impact to the organizations or other area in overall systems. Edward Lorenz (1960s) refers this event as “Butterfly Effect”. He stated that “Flapping of a butterfly’s wings can greatly impact conditions elsewhere”.
In order for organizations to practice this theory, the organization can just let their employees to form an informal group within the organization structure and let them decide or think the best way to do their jobs. Basically it can be seen as collectivism. As time goes by, the groups usually will come up with set of patterns on how they are going to do the job which will help to shape the organization. (Saylor Foundation, 1999)
LEARNING APPROACH (1990)
Going into modern age, there are more theories that have been recognized. One of the theories that have been still of use today is the learning approach. It is define as management approach that based on an organization anticipating change faster than its counterparts to have an advantage in the market over its competitors. Generally, it is where organization taking advantage of the changing trend so that they will be able to gain competitive advantage.
This theory comes up during information and electronic age. Information and knowledge tend to readily available to us all. It can just be acquired easily through internet. According to this theory, it is predicted that the future is going to be dominated by our need to understand systems. (Peter Senge, 1990)
BUSINESS PROCESS MANAGEMENT APPROACH (2000)
Parallel with Learning Approach, there is also Business Process Management Approach that still being use until now. This Approach is a method of efficiently aligning an organization with the wants and needs of clients. It is seen as holistic management approach because it promotes business effectiveness and efficiency while striving for innovation, flexibility and integration with technology (Smart, Maddern, & Maull, 2007)
MANAGEMENT THEORIES AND PRACTICES AREAS AND DEVELOPMENT
Since the industrial revolution, theories have been evolving and extending throughout certain areas. In figure below, shows framework of the areas that theories evolve in and how theorist comes up with modern management thought.
[Hodgets, R. M., & Koratko, D. F. (1986)]
According to Hodgets and Koratko (1986), theories has been evolving from industrial revolution into 3 areas (covering all the theories made...