Contingency in the Workplace

Contingency leadership theories are prevalent throughout my internship site. I have noticed that many forms of leadership are contingent on the situation at hand. For example, the CFO’s leadership style towards myself is contingent upon how stressed the company itself is. About 2-3 weeks ago, the company was undergoing slight financial stress as they were having trouble with certain investors. During that time, the CFO was slightly more distant and demanding in his leadership style. However, he recently went to New York and negotiated a new deal so for the present time that issue was remedied. The company refinanced to save itself a couple million dollars a year, and as a result the CFO had a different leadership style this past week. While always relatively serious, he was slightly more loose and helpful this week, being more willing to work with people and help them directly.

Proceeding from the financial stress from a few weeks ago, the stress of the situation is said to moderate certain traits contingent upon the situation. For example, leadership experience and intelligence are both moderated by the stress of the situation. Due to the CFO being older and having substantial experience and intelligence around the topic, the stress of the situation had less of a moderating effect on his effectiveness than it would a different leader within the organization.

Contingency theory appears to benefit the company in certain ways. As it pertains to the CFO, his demeanor and actions are dictated by the situation he is in. If it is a stressful or high pressure situation, then he tends to be more demanding of his staff, and thus far it has appeared to produce positive results. Additionally, the impact of stress upon his effectiveness is mitigated for himself personally due to his high level of intelligence and experience. For someone such as myself or another intern, the stress of the situation would likely have a stronger moderating effect.

The contingency theory may fall short in regard as to how to explain how to get the most out of those the CFO leads. For example, it can explain why he acts certain ways or how the stress of the situation impacts his actions, however it does not explain how to achieve optimal productivity within the office. It appears to explain more of the “why” aspect of why certain actions are taken or occur, rather than the “what” aspect of what is driving or motivating those actions. As a result, other leadership theories such as trait theories or charismatic leadership theories may be more explanatory in regard to my internship cite’s leadership dynamic.