The Contingency Theory Of Leadership

You probably know Walter Elias Disney as the founder of the Walt Disney Company. Did you know he was also an innovator, dreamer and exceptional leader? Disney successfully built one of the most profitable entertainment companies in the world because of his flexible leadership style.

In addition to coming up with game-changing ideas, Disney involved his employees in the decision-making process. There were times when he would gather everybody in the studio and enact scenes to show what he had envisioned. He wanted others to share the same level of enthusiasm as him.

Disney’s leadership style falls under a broader umbrella of the Contingency leadership theory. Read on to understand what it entails and how you can develop a more flexible leadership style.

What Is the Contingency Theory Of Leadership?

Throughout history, multiple schools of thought have argued about the most effective leadership style. Popular among them is the Contingency Theory of Leadership. It states that a leader’s effectiveness doesn’t depend on their abilities. External factors like environment, culture and social relationships influence the leadership process. Contingency theorists suggest that no matter how talented leaders are, they’ll likely struggle to meet demands at some level. For example, the COVID-19 pandemic has forced some of the most successful leaders to shut down their business ventures.

Types Of Contingency Theories

Fred Edward Fielder, an Austrian-American psychologist proposed the first comprehensive Contingency Theory of Leadership. Subsequent contingency theories emerged: Hersey-Blanchards’ Situational Leadership Theory and Robert House’s Path-Goal Theory. Let’s look at the different contingency theories in detail.

Fielder’s Contingency Theory

This theory suggests that successful leaders exercise control over a situation that’s influenced by three distinct factors.

Leader-Member Relations:

If you’re well-liked and trusted by your team, you can communicate your ideas with greater conviction and it’s easier for you to exercise effective leadership.

Task Structure:

When there’s a structured approach to work, your team finishes their work on time. A well-specified plan of action directs everyone to their goals.

Position Power:

The more power (and influence) you have over your team, the greater control you have over your situation to exercise successful leadership.

Fielder’s Contingency Model also suggests two key leadership styles.

Task-oriented leadership: You prioritize performance, structures, plans and schedules to get things done
Relationship-oriented leadership: You foster positive relationships with your team, peers and coworkers by encouraging teamwork and collaboration

2. Hersey-Blanchard Contingency Theory

Created by two leadership experts—Paul Hersey and Ken Blanchard, the Situational Leadership Theory suggests that no leadership style is superior to another. Instead of focusing on environmental factors, individuals should adapt their leadership style based on activities and relationships. The theory proposes different leadership styles:

Delegating Style, where you allow your team to take responsibilities and make decisions
Participating Style, where you help those who struggle to meet their targets or lack the confidence to carry out responsibilities
Selling Style, where you communicate ideas and strategies in persuasive ways to boost your team’s productivity
Telling Style, where you provide direction and closely monitor your team’s progress

3. Path-Goal Contingency Model

Developed by Robert J. House, a professor of leadership and organizational behavior, the Path-Goal Theory states that a leader must shed light on the path to a goal. In other words, an effective leader is someone who provides clear direction, sets big milestones and supports those pursuing their goals. There are various path-goal leadership styles.

Directive Leadership: You let your team know about your expectations and help them schedule work accordingly
Supportive Leadership: You treat everybody with equal importance and create a friendly and supportive work environment
Participative Leadership: You consult your team members during decision-making; this establishes trust between you and your team
Achievement-Oriented Leadership: You set challenging milestones and expect everybody to perform their best; you guide them wherever necessary

Two Sides Of Contingency Theory Of Leadership

Now that we’ve established how leadership styles change according to situations, let’s explore the advantages and disadvantages of the Contingency Leadership Theory.

Advantages

Contingency theory is grounded in empirical research and has developed over the years. It has broadened the scope of understanding leadership.
Since the theory proposes that no particular leadership style is perfect, you get to define leadership the way you want to. You set your own rules, targets and expectations.
Since the Contingency Theory is situation-specific, it helps to keep up with changing business needs and is ideal for fast-paced businesses.

Disadvantages

As there isn’t any standard definition of effective leadership, you have no examples to learn from.
Your interpersonal relationships and contexts matter more than your abilities. There is too much emphasis on the situation.
As there isn’t any single optimal solution to a problem, you may spend hours before you’re able to resolve the problem(s).

An effective leader is someone who recognizes their own potential before empowering others. Harappa Education’s Leading Self course will teach you how to take charge of your life and growth. Learn how to overcome limiting beliefs with the Performance Equation framework and the Iceberg Model. Lead yourself to success before you try to successfully lead others.

Explore topics such as Leadership Theories, Opinion Leaders, Behavioral Theory, the Great Man Theory, Transformational Leadership & Transactional Leadership from our Harappa Diaries section and lead on a path of self-development.