Contingency Theory in Healthcare Management

Topic: Administration
Words: 1148 Pages: 4


In today’s constantly changing world, organizations need to do their best to create appropriate working conditions for employees and high-quality services for their clients. Sometimes, leaders are experienced enough to take the necessary steps and success. In some cases, managers should improve their understanding of theories and models and make the right choice. In a variety of modern environmental, economic, and organizational theories, the approach developed by Paul Roger Lawrence and Jay William Lorsch in the middle of the 20th century deserves special attention. These theorists were the first who proved that any organizational structure is divided into several subsystems with different configurations and characteristics (Valeri, 2021). In healthcare settings, the implementation of interventions mostly depends on how well all participants understand internal and external influential factors (Leeman et al., 2019). Thus, the chosen contingency theory should bring many positive outcomes and changes in the management of healthcare. Lawrence and Lorsch focus on individual behaviors, inherent characteristics, and environmental uncertainty, which serve as a solid basis for performance improvement and the recognition of the task environment.

Contingency Theory Essence

Contingency theory is a classical management theory that continues developing from one organization to another due to such processes as globalization, industrialization, and international relationships. Liu (2020) recognizes its essential role in management practice and how the practice affects the theory and vice versa. This theory may be used in many ways, depending on the organization’s structure, design, and resources. As such, theorists give several definitions of contingency theory and its implication in management. In Liu’s (2020) findings, this theory explains that there is no best way to manage working processes due to various environments and the acknowledgment of organizations as open systems. Another evaluation of contingency theory is related to strategic and structural choices and the impossibility of behaving according to universal rules (Valeri, 2021). Tom Burns and George Stalker contributed to the development of this theory before Lawrence and Lorsch, and their approach revealed an organization as an organic system that exists within the environment (Valeri, 2021). However, Lawrence and Lorsch used empirical observations to strengthen this approach and diversity organizational features.

The contingency approach to management is based on the balance between differentiation and integration through the prism of task orientation, time orientation, and goal orientation. According to Lawrence and Lorsch, organizational units are never the same because they have different goals, timeline structures, and interpersonal relationships (as cited in Valeri, 2021). In this theory, there are four major elements that define the quality of organizational performance: individual behaviors, internal characteristics of organizations, external conditions, and environmental uncertainty. It is possible to manage the uncertainty and complexity of tasks by recognizing organizational structures and promoting flexibility (Valeri, 2021). It is hard for professional organizations to predict all changes and requirements in a constantly developing environment. Therefore, contingency theory is necessary to learn how to deal with unstable environments, succeed in problem-solving and decision-making, and manage people from different systems.

Contingency Theories about Organizational Behaviors

Contingency theory is based on the idea that it is wrong for the manager to think that there is one best way for leadership. Thus, there is no specific structural type to be optimal for all organizations, and much depends on what individual characteristics employees develop or what external factors may emerge. The level of task environment uncertainty is critical in task coordination, depending on technological advancement, resource availability, or client preferences (Leeman et al., 2019). When uncertainty is insignificant, employees predict tasks and follow the rules and protocols with low or no changes (Leeman et al., 2019). When uncertainty begins to grow, the number of unplanned approaches increases, affecting performance effectiveness. In organizational behaviors, contingency theory may change communication and how decisions are made (Leeman et al., 2019). Some managers prefer to create a new coordination team, and others focus on real-time changes and available information.

In management practice, contingency theory cannot be permanent, and some changes are obligatory requirements for modern organizations. For example, the first version of the model did not include empirical observations that revealed the importance of individual characteristics. The improvements offered by such theorists as Lawrence and Lorsch affected the approach, but the contributions by Fred Luthans and Todd Stewards help generalize concepts and introduce performance as a gradual cycle process (Liu, 2020). However, Lawrence and Lorsch remain the major developers of the theory where stability and certainty define the effectiveness of the workplace. The competitive context may increase the number of contingent variables, and decentralization of power is necessary to re-establish responsibilities and implement new ideas.

Example of the Management in Healthcare

People may apply contingency theory following their demands and the level of knowledge, and the following example of the management in healthcare is a unique opportunity to understand the strengths and weaknesses of this framework. In most cases, the number of steps is the same: understanding the environment, determining variables, developing a solution, using resources, and analyzing an outcome. However, one should remember that this theoretical framework is characterized by flexibility, depending on the situation.

For example, a manager observes that one team is not able to offer a certain number of services to patients by the deadline several times. On the one hand, the manager can reduce the reward and punish the team, following the protocol and the inability to complete the required level of work. This step is strict and may provoke concerns, but everything is done according to the rules of the facility. On the other hand, the manager may decide to talk to employees and try to understand the reasons for their failures. This method is not perfect because additional resources should be spent, and the team will hardly learn to solve their problems independently. However, motivation and effective leadership are used to predict similar mistakes in the future. Both decisions are correct, and there is no best way to solve such situations in a healthcare organization where human lives and care quality are appreciated. Instead of thinking about how to make the right choice, contingency theory is applied, explaining the possibility of several solutions to the same situation.


Today, individuals cooperate under various conditions within organizations that change their functions and the methods of work frequently. The speed of decision-making and the impossibility of predicting all modifications and innovations challenge people. Still, managers and leaders are eager to use all available resources, experiences, and knowledge to offer the best solution. When failures or mistakes emerge, it is necessary to find an explanation, and contingency theory is one of the options for this situation. Lawrence and Lorsch introduced this theory to prove that it is possible not to have the best solution because of the existing individual characteristics, internal and external components, and the uncertainty of tasks. This model has its benefits and drawbacks, but its main idea is sufficient enough to be implemented in healthcare management.


Leeman, J., Baquero, B., Bender, M., Choy-Brown, M., Ko, L. K., Nilsen, P., Wangen, M., & Birken, S. A. (2019). Advancing the use of organization theory in implementation science. Preventive Medicine, 129. Web.

Liu, X. (2020). Understanding the classical researches in contingency theory: A review. 2020 3rd International Conference on Economic Management and Green Development, pp. 559-564. Web.

Valeri, M. (2021). Organizational studies: Implications for the strategic management. Springer.

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