Contingency Theory as an Approach to Explain Early Warning Behavior


Now the underlying theory of this work will be introduced. According to the research questions not only the early warning behavior of CEOs of medium-sized companies has to be assessed in general but also factors that influence this behavior have to be analyzed. Therefore, in the following the contingency theory which aims to explain organizational structure and design by considering contextual variables will be presented. First, the classical approach will be explained, followed by its extension. Then, the criticism of the contingency theory is presented and discussed. After that, it will be discussed whether this theory is appropriate to answer the research questions. In part four, the research model and its variables will be deduced by combining the classical approach of the contingency theory and its extension with the model of DAFT and WEICK. Finally, in part five the state of empirical research will be presented.


Design Variable Organizational Structure Early Warning Internal Model Organizational Design 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.


  1. 180.
    See Weber (2006).Google Scholar
  2. 181.
    See Taylor (1998).Google Scholar
  3. 182.
    “[I]t must be admitted that [Weber’s] conceptualization in terms of ideal types... presents many difficulties to the research worker.... [T]he main problem for the researcher has been how to use Weberian concepts in analysis with data on real functioning organization.” Pugh, Hickson, Hinings, MacDonald, Turner and Lupton (1963), p. 293f.Google Scholar
  4. 183.
    See Staehle (1973), p. 30. For further also theoretically based critics of Weber’s theory see Bennis (1971), p. 436f.Google Scholar
  5. 184.
    “It appeared that different technologies imposed different kinds of demands on... organizations, and that these demands had to be met through an appropriate form of organization.” Woodward (1975), p. 16. See also Woodward (1980) p. 247f.Google Scholar
  6. 185.
    Burns and Stalker for example analyzed the influence of dynamics of the environment on the organizational structure. See Burns and Stalker (1961), p. 19ff.Google Scholar
  7. 188.
    See Kieser and Kubicek (1992), p. 61f.Google Scholar
  8. 190.
    Child (1973), p. 237.Google Scholar
  9. 191.
    Parallels between the contingency approach and the biological evolutionary theory exist. “The idea is an elaboration of the biologist’s functionalist view of the adaptation of living forms to their environment. For example, elephants have trunks to enable them to feed from their great height, and apes have prehensile fingers and toes to enable them to swing from trees. Contingency theory indicates the kinds of structure that may be appropriate responses to each of several different organizational contexts or situations.” Khandwalla (1977), p. 237.Google Scholar
  10. 192.
    See Breilmann (1990), p. 2.Google Scholar
  11. 193.
    See Gerdin and Greve (2004), p. 307 and Donaldson (1996), p. 57ff.Google Scholar
  12. 194.
    Pugh, Hickson, Hinings and Turner (1968), p. 65.Google Scholar
  13. 195.
    See Hickson, Hinings and Turner (1968) Ibid., p. 72ff.Google Scholar
  14. 196.
    See Child (1975) and Burns and Stalker (1961).Google Scholar
  15. 197.
    See Pugh, Hickson, Hinings and Turner (1969), Hickson, Pugh and Pheysey (1969), Blau (1970), Child and Mansfield (1972) and Child (1975).Google Scholar
  16. 198.
    See Hickson, Pugh and Pheysey (1969), Child and Mansfield (1972) and Woodward (1975).Google Scholar
  17. 199.
    For an overview of possible contingency variables see Kieser and Kubicek (1992), p. 224 and Kieser (1999), p. 175.Google Scholar
  18. 200.
    See Gerdin and Greve (2004), p. 304ff.Google Scholar
  19. 201.
    Ibid., p. 304.Google Scholar
  20. 202.
    See Burns and Stalker (1961). See also Lawrence and Lorsch (1967), Bourgeois, McAllister and Mitchel (1978) and Argote (1982).Google Scholar
  21. 203.
    See Rushing (1966) and Pugh, Hickson, Hinings and Turner (1969).Google Scholar
  22. 204.
    See Woodward (1975). Other contingency variables were considered as well. For example Chandler analyzed the history of the 70 largest organisations of the United States. See Chandler (1966). He found out that the decentralized multidivisional structure was depending on the growth strategy of the organisation. A decentralized multidivisional structure was wide-spread for organizations in pursuit of a diversification strategy. The opposite was true for organizations pursuing a growth strategy within one single industry. This was later validated by Fouraker and Stopford. See Fouraker and Stopford (1968).Google Scholar
  23. 205.
    See Mintzberg (1979), p. 299.Google Scholar
  24. 206.
    Ibid., p. 300.Google Scholar
  25. 207.
    The assumption of a limited number of structural types is in line with the Darwinistic view. “[S]pecies at any one period are not indefinitely variable, and are not linked together by a multitude of intermediate gradations, partly because the process of natural selection will always be very slow and will act, at any one time, only on a very few forms; and partly because the very process of natural selection almost implies the continual supplanting and extinction of preceding and intermediate gradations.” Darwin (1968), p. 231.Google Scholar
  26. 208.
    See Mintzberg (1979), p. 305ff.Google Scholar
  27. 209.
    See Miller and Friesen (1984), p. 31ff.Google Scholar
  28. 210.
    Miles and Snow (1978), p. 35.Google Scholar
  29. 211.
    See Gerdin and Greve (2004), p. 306.Google Scholar
  30. 212.
    See Lawrence and Lorsch (1967), p. 186.Google Scholar
  31. 213.
    “The organizational setting limits and influences people’s behavior[.]” Payne and Pugh (1976), p. 1126. See also Breilmann (1990), p. 16 and Lawrence and Lorsch (1967), p. 17.Google Scholar
  32. 214.
    For an overview of effect of the organizational structure on the individual see Kieser and Kubicek (1992), p. 422f.Google Scholar
  33. 215.
    Adapted from Kubicek (1992) ibid, p. 61.Google Scholar
  34. 216.
    See Silverman (1968), p. 223.Google Scholar
  35. 217.
    See Child and Mansfield (1972).Google Scholar
  36. 218.
    See Mansfield (1972) Ibid., Hrebiniak and Joyce (1985) and Hrebiniak and Einhorn (1990).Google Scholar
  37. 219.
    Lorsch, in Child (1984), p. 7.Google Scholar
  38. 220.
    Child (1972), p. 13.Google Scholar
  39. 221.
    See Miles (1975), p. 31ff., DiMaggio and Powell (1983) and Meyer and Rowan (1977).Google Scholar
  40. 223.
    See Breilmann (1990), p. 105ff., Hambrick and Brandon (1988), p. 3f. and Baligh, Burton and Obel (1990), p. 35ff.Google Scholar
  41. 224.
    See Montanari (1979).Google Scholar
  42. 225.
    See Breilmann (1990), p. 175ff. for an overview of the most important empirical studies about the influence of the individual on the organizational structure.Google Scholar
  43. 226.
    Kets de Vries and Miller (1984), p. 1 (format of source not adopted). See also Romanelli and Tushman (1988), p. 129ff.Google Scholar
  44. 227.
    See Lang von Wins (2004), p. 29ff., Brandstätter (1997), p. 168ff., Eisenhardt and Schoonhoven (1990), p. 520f. and Rauch and Frese (2000), p. 130ff.Google Scholar
  45. 228.
    See Bobbitt and Ford (1980), p. 13ff.Google Scholar
  46. 229.
    See Meyer and Starbuck (1992), p. 102ff.Google Scholar
  47. 230.
    See Stopford and Baden-Fuller (1990).Google Scholar
  48. 231.
    See Dale (1962) and Clee and Sachtjen (1964).Google Scholar
  49. 232.
    See Channon (1973), p. 76 and Mayer (1974), p. 187.Google Scholar
  50. 233.
    See Sloan (1963).Google Scholar
  51. 234.
    See Greenwood (1974).Google Scholar
  52. 235.
    In addition, researcher also analyzed the influence of CEOs’ beliefs and values on organizational design. See Hambrick and Brandon (1988), Meyer and Starbuck (1992) and Baligh, Burton and Obel (1990).Google Scholar
  53. 236.
    Lewin and Stephens (1994), p. 189. See also Rokeach (1968), p. 82ff.Google Scholar
  54. 237.
    See Bass, Barnett and Brown (1989), p. 184 and Fishbein and Ajzen (1975), p. 5 and 21ff.Google Scholar
  55. 238.
    See Robinson, Shaver and Wrightsman (1991) in Lewin and Stephens (1994), p. 189.Google Scholar
  56. 239.
    See Miller, Kets de Vries and Toulouse (1982), Miller and Dröge (1986), Miller and Toulouse (1986) and Miller, Dröge and Toulouse (1988).Google Scholar
  57. 240.
    Miller and Dröge (1986), p. 539.Google Scholar
  58. 241.
    Miller, Dröge and Toulouse (1988), p. 544.Google Scholar
  59. 242.
    See Miller and Dröge (1986). For a detailed explanation of this attitude see D 2.3.Google Scholar
  60. 243.
    See Miller, Kets de Vries and Toulouse (1982), p. 244ff. For a detailed explanation of this attitude see D 2.1.Google Scholar
  61. 244.
    See Burns and Stalker (1961), p. 34f.Google Scholar
  62. 245.
    Lewin and Stephens (1994), p. 185.Google Scholar
  63. 246.
    Daft and Lewin (1990), p. 3. Other researchers employ the term organizational design as a synonym to organizational structure. See Galbraith (1977), p. 5ff.Google Scholar
  64. 247.
    Lewin and Stephens (1994), p. 183f. Nevertheless, they still consider the environment to be a fundamental contingency factor influencing organizational design.Google Scholar
  65. 248.
    Ibid., p. 190.Google Scholar
  66. 249.
    Ibid., p. 190.Google Scholar
  67. 250.
    For a detailed overview see Krohmer (1999), p. 44f.Google Scholar
  68. 251.
    See Schreyögg (1978), p. 6.Google Scholar
  69. 252.
    See Child and Mansfield (1972), p. 369.Google Scholar
  70. 253.
    See also Pennings (1992), p. 274.Google Scholar
  71. 254.
    See Brown (1978), p. 378.Google Scholar
  72. 255.
    See Smiricich (1983).Google Scholar
  73. 256.
    See Silverman (1968).Google Scholar
  74. 257.
    See Kieser (1999), p. 170.Google Scholar
  75. 258.
    For an example of such a procedure see Burns and Stalker (1961), p. 94f. Within this context two points have to be differentiated: 1) the reason of systematic relations and 2) the statistical explanation for them. A high correlation does not automatically imply a high degree of scientific explanation because variables that are statistically highly correlating can be independent from a scientific point of view. Therefore, a systematic check of statistical correlation is indispensable. See Rasch, Friese, Hofmann and Naumann (2004), p. 118.Google Scholar
  76. 259.
    See Frese (1992), p. 191.Google Scholar
  77. 261.
    See Otley (1980), p. 419.Google Scholar
  78. 265.
    See Child, Ganter and Kieser (1987), p. 87.Google Scholar
  79. 266.
    See Köhl, Esser, Kemmner and Förster (1989), p. 252f. and Schultz-Wild, Nuber, Rehberg and Schmierl (1989), p. 172ff.Google Scholar
  80. 267.
    See Hickson, Hinings, McMillan and Schwitter (1964).Google Scholar
  81. 268.
    See Clegg and Dunkerly (1980), p. 433ff., Clegg (1981), p. 545 and Benson (1977), p. 10.Google Scholar
  82. 269.
    See for example Miller and Dröge (1986) and Miller, Dröge and Toulouse (1988). For an overview of such studies see Breilmann (1990), p. 175ff.Google Scholar
  83. 270.
    See Kieser and Kubicek (1992), p. 223.Google Scholar
  84. 271.
    Lewin and Stephens (1994), p. 187.Google Scholar
  85. 272.
    Ibid., p. 188.Google Scholar
  86. 273.
    See Stephens (1994) Ibid., p. 188.Google Scholar
  87. 274.
    See Stephens (1994) Ibid., p. 202. See Kiesler and Sproull (1982), p. 556 for scanning as a specialized form of information processing.Google Scholar
  88. 275.
    See Gerdin and Greve (2004), p. 322 and Donaldson (2001), p. 141ff. Yasai-Ardekani and Nystrom also followed this approach for their analysis of the contingency theory in the context of scanning. See Yasai-Ardekani and Nystrom (1996).Google Scholar
  89. 277.
    See Burns and Stalker (1961), Child (1975), Bourgeois, McAllister and Mitchel (1978), Argote (1982) and Lawrence and Lorsch (1967).Google Scholar
  90. 278.
    See Aguilar (1967), Daft, Sormunen and Parks (1988), Sawyerr (1993), Auster and Choo (1993), Yasai-Ardekani and Nystrom (1996), Elenkov (1997) and May, Stewart and Sweo (2000).Google Scholar
  91. 279.
    See Yasai-Ardekani and Nystrom (1996), p. 198.Google Scholar
  92. 281.
    See Aguilar (1967), Daft, Sormunen and Parks (1988), Sawyerr (1993), Yasai-Ardekani and Nystrom (1996) and Elenkov (1997).Google Scholar
  93. 282.
    See Yasai-Ardekani and Nystrom (1996).Google Scholar
  94. 283.
    See Hambrick (1981), p. 305, Hambrick (1982), p. 163, Farh, Hoffmann and Hegarty (1984), p. 203, Daft, Sormunen and Parks (1988), p. 125 and Elenkov (1997), p. 293.Google Scholar
  95. 284.
    See Aldrich and Herker (1977), p. 218ff.Google Scholar
  96. 285.
    See Aguilar (1967), p. 63f.Google Scholar
  97. 286.
    See Ibid., p. 64f., Elenkov (1997), p. 294 and Daft, Sormunen and Parks (1988), p. 126.Google Scholar
  98. 287.
    See Aguilar (1967), p. 64, Culnan (1983), Rhyne (1985), p. 323 and Daft, Sormunen and Parks (1988), p. 126 and Elenkov (1997), p. 294.Google Scholar
  99. 288.
    See Aguilar (1967), p. 65, Kefalas and Schoderbek (1973), p. 66 and Smeltzer, Fann and Nikolaisen (1988), p. 60.Google Scholar
  100. 289.
    Own compilation. A similar overview is provided by Aguilar (1967), p. 66.Google Scholar
  101. 290.
    See Yasai-Ardekani and Nystrom (1996), p. 189.Google Scholar
  102. 291.
    See Nystrom (1996) Ibid., p. 189f. and Choudhury and Sampler (1997), p. 27f.Google Scholar
  103. 292.
    Daft and Weick (1984), p. 293.Google Scholar
  104. 293.
    Only the possibility of a change in the environment is interpreted to be a threat or an opportunity is analyzed in related studies. See Mintzberg, Raisinghani and Théorêt (1976), Nutt (1984), Dutton and Duncan (1987) and Thomas and McDaniel (1990). Additionally, Martins and Kambil analyze a personal bias in managers’ interpretation of new information technology. See Martins and Kambil (1999). See also Dentson, Dutton, Kahn and Hart (1996), Sharma (2000) and Gioia and Thomas (1996).Google Scholar
  105. 295.
    Daft and Weick (1984), p. 285.Google Scholar
  106. 296.
    For a detailed presentation of internal models see Schäffer (2001), p. 107ff.Google Scholar
  107. 297.
    Johnson-Laird (1983), p. 3f. “Like a pane of glass framing and subtly distorting our vision, mental models determine what we see.” Senge (1992), p. 235. See also Kim (1993), p. 39.Google Scholar
  108. 298.
    Senge (1992), p. 8. See also Krieg (1971), p. 81.Google Scholar
  109. 299.
    See Weber, Grothe and Schäffer (2000), p. 241.Google Scholar
  110. 300.
    See Daft and Weick (1984), p. 286.Google Scholar
  111. 301.
    See Herzhoff (2004), p. 162. For the importance of this instrument see Leemhuis (1985), Schoemaker (1995) and Tessun (1997).Google Scholar
  112. 302.
    See Yasai-Ardekani and Nystrom (1996), p. 194.Google Scholar
  113. 304.
    See Lewin and Stephens (1994), p. 188.Google Scholar
  114. 305.
    Tushman and Nadler (1978), p. 614.Google Scholar
  115. 306.
    See Galbraith (1977).Google Scholar
  116. 307.
    See Leifer and Huber (1976).Google Scholar
  117. 308.
    See Aguilar (1967), Auster and Choo (1993), May, Stewart and Sweo (2000) and McGee and Sawyerr (2003).Google Scholar
  118. 309.
    See Daft, Sormunen and Parks (1988), Sawyerr (1993) and Elenkov (1997).Google Scholar
  119. 310.
    See Yasai-Ardekani and Nystrom (1996), p. 196.Google Scholar

Copyright information

© Deutscher Universitäts-Verlag | GWV Fachverlage GmbH, Wiesbaden 2007

Personalised recommendations