Expert Answer:Contingency Theory Of Leadership Management Discus

  

Solved by verified expert:I have attached one references. no plagiarize, spell check, and check your grammar. Please only use the attached references below. The other reference please have access. I dont have access. Only 200 word. The discussion post is belowThe contingency theory describes aspects of leadership that apply to some situations but may not apply to other situations. This theory tries to show how certain aspects of leadership can change the leaders influence and therefore their effectiveness (Yukl, 2013). This theory began in strategic management back in the 1960’s, it remained popular through the 1960’s to the 1980’s (Collinson, Rugman, 2011 & Lawrence, Lorsch, 1967). There are task motivated leaders which perform best when the either have high or low control over situations, in contrast, relationship motivators perform best under moderate control (Fiedler 1978). This lends to the argument that a leader’s effectiveness is contingent on where this leadership takes place. The LPC contingency model describes a leader trait called the least preferred coworker score, this score has changed many times over the years and what exactly the score means remains in question. This question of that the scores actually mean is part of the reason that the model has received criticism. Fiedler’s (1978) interpreted that LPC scores will show the leader’s motive hierarch, a leader that exhibits a high LPC score is motivated to have strong interpersonal relationships with their staff. In contrast, a leader with a low LPC is motivated by achievement of task and tends to emphasize task oriented behavior when problems arise. There is still a place in the workforce today, when interviewing prospective employees, the interview questions should be geared toward the employee’s ability to fit into the organization. Due to the possibility of discrimination, testing for one’s ability to do a job become less used, instead in the contingency style of organization the interview would evaluate the interviewees skill or occupational aptitude (Jablin, 1975). While this model still has a place today, it may not be able to stand on its own, it may be better suited to be used alongside some of the new leadership trends being seen today. ReferencesKARIM, S., CARROLL, T. N., & LONG, C. P. (2016). Delaying Change: Examining How Industry and Managerial Turbulence Impact Structural Realignment. Academy of Management Journal, 59(3), 791–817. https://doi-org.proxy-library.ashford.edu/10.5465/…Yukl, G. (2013). Leadership in organizations (8th ed.). Upper Saddle River, NJ: Pearson/Prentice Hall
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r Academy of Management Journal
2016, Vol. 59, No. 3, 791–817.
http://dx.doi.org/10.5465/amj.2012.0409
DELAYING CHANGE: EXAMINING HOW INDUSTRY
AND MANAGERIAL TURBULENCE IMPACT
STRUCTURAL REALIGNMENT
SAMINA KARIM
Northeastern University
TIMOTHY N. CARROLL
University of South Carolina
CHRIS P. LONG
Georgetown University
This paper examines when firms pursue structural realignment through business
unit reconfiguration, specifically by recombining business units. Our results refine and
extend contingency theory and studies of organization design by drawing on theories of
decision avoidance and delay to describe environmental conditions when firms pursue or
postpone structural realignment. Our empirical analysis of 46 firms from 1978 to 1997,
operating within the U.S. medical device and pharmaceutical sectors, demonstrates that
while decision makers initiate structural recombination during periods of industry growth
(i.e., munificence), they reduce their recombination efforts during periods of industry turbulence (i.e., dynamism), and managerial turbulence (i.e., growth in top management team
size). We also find evidence that firms delay realignment and bide their time for better
environmental conditions of declining turbulence and industry growth before pursuing
more structural realignment. Together, these findings suggest that decision makers often
delay initiating structural recombination until they can effectively process information and
assess how structural changes will help them realign the organization to the environment.
Stalker, 1961; Miller & Friesen, 1984; Thompson, 1967;
Woodward, 1965). The perspective we develop in this
paper builds on the conceptualization of organization
design (i.e., and its redesign) “as something that organizations do, rather than merely as something they
have” (Orton & Weick, 1990: 218; italics added by
authors). Although contingency theory’s expectations
of how to realign (e.g., through structural change) are
generally supported in the literature, our understanding of when firms make these decisions is less
well established. In this paper, we address this issue
by examining a series of factors that influence when
firms choose to initiate and enact structural realignment decisions. We draw upon decision-making
and group dynamics research to inform contingency
theory about expectations relating to the speed of
decision making and consensus-building within executive teams.
We examine this general, theoretical question about
structural realignment by evaluating when and how
firms recombine their business units (Eisenhardt &
Brown, 1999; Karim, 2006). In developing and modifying their organizations’ designs through structural
INTRODUCTION
This paper asks a fundamental question in organization theory—how and when do firms align their
structures with environmental changes? Contingency
theory suggests that firms, when faced with changing
external conditions, should realign to gain fit with their
environment and better capture market opportunities
(Donaldson, 1987; Duncan, 1972; Hofer, 1975). One
mechanism by which to achieve this realignment is
to redesign the structure of the organization (Burns &
We wish to thank seminar participants at Boston University, Ohio State University, Tulane University, the University
of Illinois, University of Minnesota and University of Wisconsin, as well as attendees of the 2010 Strategy Research
Forum, 2009 Organization Science Winter Conference and
Strategic Management Society Conference, and 2008 CORE
Organization Design Workshop for their comments and
suggestions on earlier versions of this paper. We are also
grateful for the constructive feedback from the anonymous
reviewers and our associate editor, Kyle Mayer. We gratefully
acknowledge research assistance by Victoria Lee, ChienChun Liu, and Marketa Sonkova.
791
Copyright of the Academy of Management, all rights reserved. Contents may not be copied, emailed, posted to a listserv, or otherwise transmitted without the copyright holder’s express
written permission. Users may print, download, or email articles for individual use only.
792
Academy of Management Journal
recombination, decision makers attempt to create or
enhance value by reconfiguring their firms’ existing
resources (Karim, 2009; Karim & Kaul, 2015; Karim &
Capron, 2015). A “recombined” unit is any unit that
has experienced a change in boundaries through some
addition or deletion of activities and resources that
have been moved within the firm. We focus on structural recombination in this paper because firms routinely use this mechanism to redistribute resources
inside the organization in order to regain congruence or
alignment with changes in environmental conditions.
Unit boundaries expanding and contracting indicate
a firm’s efforts to reallocate existing resources (Karim,
2012). Thus, examining structural recombination allows us to take a close look at the processes behind
organization design changes.
Because structural recombination can often represent costly and risky initiatives, it is important to
understand what factors influence decision makers
to use this mechanism to achieve realignment with
their environments (Helfat & Karim, 2014). Drawing
on existing contingency theory studies, we expect
that decision makers’ perceptions of environmental
industry growth should increase recombination
initiatives. However, whereas classic contingency
theory suggests that industry turbulence may also
trigger this realignment, we identify information
processing challenges that inhibit executives from
engaging in structural recombination during periods
of environmental industry turbulence (i.e., when
relationships between key performance antecedents
and indicators change very rapidly).
We use research from the decision-making literature (Dobrajska, Billinger, & Karim, 2015) on decision avoidance and delay to explain these dynamics
(Anderson, 2003). Specifically, we argue that because strategic decision makers in turbulent industry
environments are unable to collect and process the
information necessary to assess cause-and-effect
relationships, they cannot develop decision-making
strategies to effectively predict how structural changes
can positively influence firm performance. The resulting difficulties they experience in identifying organizational forms that are appropriate for environmental
contingencies decrease their overall willingness to engage in structural recombination during periods of environmental turbulence (Davis, Eisenhardt, & Bingham,
2009; Siggelkow & Rivkin, 2005).
Because structural realignment decisions are usually made by the top management team (TMT)
Galunic & Eisenhardt, 2001; Helfat & Karim, 2014),
we also examine how factors within these collectives
may foster or inhibit firms’ tendencies to recombine
June
business units. We specifically demonstrate how
executive turnover and increases in overall TMT size
decrease the overall level of structural recombination that firms engage. Here, we translate research
on decision delays in groups to theorize how these two
factors limit the capacities of TMTs to build the levels of
consensus and commitment necessary to identify appropriate organizational forms and initiate structural
recombination (Amason & Sapienza, 1997; Bavelas,
1951; Dooley, Fryxell, & Judge, 2000; Eisenhardt, 1990).
By examining the influences of both external industry (i.e., market) turbulence and internal managerial (i.e., within TMTs) turbulence on firms’ tendencies
to initiate structural recombination, our theory refines
arguments put forth by contingency theorists and organization design scholars about how and when firms
align their structures with their environments
(Duncan, 1972; Lawrence & Lorsch, 1967; Thompson,
1967). While general contingency theory suggests that
firms initiate structural realignment to adapt to environmental changes, our research demonstrates that
firms tend to delay the initiation of structural recombination until industry turbulence lessens and decision makers are able to more effectively assess how
these structural changes may benefit the firm (Burns &
Stalker, 1961; Miles & Snow, 1978; Miller, 1988;
Mintzberg, 1979; Siggelkow & Rivkin, 2005). Further,
we find that turbulence in TMTs created by overall size
increases leads to less realignment activity. We suggest
that this happens because executives are less able to
process environmental information and build consensuses around key organizational design decisions
(Bourgeois & Eisenhardt, 1988; Shank, Zeithaml,
Blackburn, & Boyton, 1988; Sutcliffe, 1994).
The empirical setting for this study is the medical
marketplace and includes 28 (4-digit North American
Industry Classification System [NAICS]) market segments within the medical device and pharmaceutical
sectors. We observe 46 firms over the period 1975–1997.
For each firm we track its structural evolution noting
how the firm adds, deletes, and recombines its business
units; we also trace the movement of executives into and
out of a firm’s TMT. To evaluate environmental change,
we examine the growth and turbulence present in the
industries in which these firms are active, as well as
changes in their TMTs.
The paper is organized as follows. It begins by
drawing from literatures on contingency theory, decision making and organization design to develop
several hypotheses about the conditions under which
firms facing turbulence will initiate structural recombination. This is followed by a description of
our methods and measures which outline the data
2016
Karim, Carroll, and Long
and sample, the operationalization of variables, and
the methodology of this study. Finally, the paper concludes with a presentation of results and a discussion
of our findings.
LITERATURE AND HYPOTHESES
Structural Realignment
The question of how best to organize firms has
long held the interest of organization design scholars (Galbraith, 1977; Lawrence & Lorsch, 1967;
Thompson, 1967). Because “organizational design is
one of the key levers available for top managers to
affect how decisions are made within organizations”
(Siggelkow, 2011: 1130), a significant amount of
research in organization theory has been dedicated to
understanding how decision makers can navigate
their firms through changing environments to achieve
an optimal organization design. Classic organization
design studies were built on the premise that efforts to
coordinate work (or tasks) should be integrated into
a common structure (or unit) to facilitate information
processing and the effective implementation of strategic initiatives (Chandler, 1962; Galbraith, 1973;
Mintzberg, 1979; Tushman & Nadler, 1978).
Contingency theorists interested in organization
design depict the challenge that firms face by describing how they adapt their structures to better align
with changes in external environments (Duncan,
1972; Lawrence & Lorsch, 1967; Thompson, 1967).
Classic contingency theory proposes that firms perform better when they align themselves to better fit
key factors in their environments, and that environmental changes should lead firms to initiate structural
changes (Donaldson, 1987; Duncan, 1972; Hofer,
1975). Related studies adopting this perspective
have highlighted how different design characteristics
are more or less appropriate for different strategic
environments (Burns & Stalker, 1961; Miles & Snow,
1978; Miller, 1988; Mintzberg, 1979; Siggelkow &
Rivkin, 2005), either because they allow firms to
better utilize resources (Lawrence & Lorsch, 1967;
Thompson, 1967) or process information (Galbraith,
1973; Tushman & Nadler, 1978).
Structural Realignment as Business Unit
Recombination
scholars who have examined how organizations respond to changes in their environments have devoted increasing levels of attention to understanding
how firms use structural recombination to capitalize
on new market opportunities (Karim, 2009; Karim &
Kaul, 2015; Karim & Mitchell, 2004). In contrast to
more traditionally defined restructuring activities
where firms attempt to enter into or exit from markets
by adding (i.e., acquiring) or deleting (i.e., divesting)
business units (Bowman & Singh, 1990; Hoskisson &
Johnson, 1992; Porter, 1987),1 structural recombination
describes initiatives that firms undertake to reorient
how they organize their existing resources and activities (Karim, 2006, 2009).
While comprising one common way that firms
reconfigure themselves to react to their environment
(Karim & Capron, 2015), firms also use structural
recombination to proactively seek opportunities and
realign their structures with environmental demands in ways that allow their business units to
better utilize resources and organize activities
(Karim, 2012; Karim & Williams, 2012). Although
these activities can be disruptive to organizations,
previous research has shown how firms can use
structural recombination as dynamic capabilities to
adapt to their environments and allow them to increase levels of innovation and overall firm performance (Karim, 2009; Karim & Kaul, 2015).
To illustrate how these activities impact firm
evolution, we describe a segment of Johnson and
Johnson’s (J&J’s) history where the firm engaged in
structural realignment activities through a series of
recombinations (Karim & Mitchell, 2004). Figure 1
depicts a sequence of structural recombinations
within (J&J) as it reconfigured its structural organization to respond to market demands over a 20-year
period. Between 1982 and 1989, J&J recombined its
units Applied Fiberoptics and Kees Surgical Specialty with Codman & Shurtleff to bolster its market position in neurostimulators and orthroscopes.
Then, to have greater impact in the general orthopedic market as a whole, in 1993 J&J recombined
Codman & Shurtleff with J&J Orthopedics to form the
division J&J Professional. Through these realignment
activities, J&J succeeded in growing its overall presence and market share in orthopedics.
1
While scholars have made significant progress in
understanding how organizations can achieve an
appropriate fit with their environment, we know
much less about the processes that organizations
take to get there. Over the past decade, however,
793
Note that we are not directly examining why firms add
or shed activities since there is an established body of work
on corporate restructuring that already addresses these
issues. We do, however, account for these other forms of
structural change (i.e., adding and shedding) in our study
and explain more about this in our Methods section.
794
Academy of Management Journal
June
FIGURE 1
Examples of Business Unit Reconfiguration (including recombination) at J&J, Inc. (modified from Karim, 2009)
by 1975
by 1986
By 1986 recombine
AF into CS.
By 1989 recombine
KSS into CS.
Codman &
Shurtleff, Inc.
Codman &
Shurtleff, Inc.
Internally developed unit (I) Acquired unit (A)
Industry Growth and Structural Realignment
Classic contingency theory proposes one way to
generalize these dynamics by suggesting that firms
that do not align with the demands or volatility of their
industries should alter their structures and attempt to
regain and maintain an effective “fit” with their environment (Donaldson, 1987; Duncan, 1972; Hofer,
1975). Building from this proposition, scholars have
demonstrated that firms facing more dynamic environments are most effective when they enable flexibility and experimentation by using more organic
structures, while firms facing less dynamic environments are more successful when they adopt more
routinized structures that encourage stability and
consistency (Burns & Stalker, 1961; Miller & Friesen,
1984; Thompson, 1967; Woodward, 1965).
Prior work developed from this perspective describes
how firms use structural recombination to bring resources and activities together in ways that reveal new
synergies and address strategic prospects (Eisenhardt &
Brown, 1999; Galunic & Eisenhardt, 1996; Galunic &
Rodan, 1998). For example, Galunic and Eisenhardt
(1996) found that firms’ decision makers often used
recombination as a means of moving “charter” (i.e.,
market) responsibilities between business units to
foster a “dynamic realignment” between a firm and its
market opportunities. In addition, Eisenhardt and
Martin (2000), in describing a “patching” process that
By 1993 recombine
CS and J&J
into new J&J Prof.
J&J Professional,
Inc. (created from
recombination 1993)
J&J Orthopedics,
Inc. (internally
developed 1986)
Entry into J&J
by 1993
Kees Surgical
Specialty
(acquired 1987)
Applied
Fiberoptics
(acquired 1982)
Codman &
Shurtleff, Inc.
(acquired pre-1975)
by 1989
Mix of I units
Mix of A units
Mix of A and I units
is similar to structural recombination, observe that firms
will attempt to develop their dynamic capabilities
through “processes that use resources. . .to match and
even create market change” (p. 1107).
Building from these observations, we expect that executives will consider industry growth, labeled “munificence,” as a favorable, but dynamic environmental
condition that encourages them to initiate increased
numbers of structural recombinations. As a common
characteristic highlighted in studies of environmental
change (Dess & Beard, 1984; Nadkarni & Barr, 2008;
Sutcliffe, 1994), munificence represents a strong and
clear indicator of industry growth (Bergh, 1998; Dess &
Beard, 1984; Sharfman & Dean, 1991) that can serve to
signal that market conditions are abundant with opportunities for firms that adapt and capitalize on them.
Thus, we expect that firms in industries that are growing
will be proactive in using structural recombination to
adapt in ways that enable them to capture potential
economic gains that are present in these markets.
Hypothesis 1. Industry growth experienced by
a firm in its environment has a positive relationship
with the firm’s degree of structural recombination.
Industry Turbulence and Structural Realignment
Having established that firms in munificent environments will tend to recombine their structures
2016
Karim, Carroll, and Long
in ways that allow them to capitalize on perceived
opportunities, we now turn our attention to how
firms experience turbulent environments. While
Hypothesis 1 outlines a positive relationship
between industry growth and structural recombination, the arguments below describe that, while
predictable, the process by which firms engage
in structural recombination is neither linear nor
continuous.
In Hypothesis 2, we predict that firms will less
frequently engage in structural recombination during periods of environmental turbulence (Bourgeois
& Eisenhardt, 1988; Duncan, 1972; Nadkarni & Barr,
2008; Perlow, Okhuysen, & Repenning, 2002). Environmental turbulence describes how rapidly the
links between particular actions and key performance indicators can change (Siggelkow & Rivkin,
2005). This can occur, for example, in environments
where a number of important contingencies evolve
so rapidly that the information decision makers require to formulate strategic decisions is routinely
incomplete or obsolete (Eisenhardt & Bourgeois,
1988).
Our ideas on this build from decision-making
research on avoiding and delaying decisions
(Anderson, 2003). This research suggests that actors
tend to avoid decisions when selecting an appropriate course of action becomes too complicated or
difficult for them (Dhar & Sherman, 1996; Tversky
& Shafir, 1992). These “selection difficulties”
(Anderson, 2003) tend to occur when option sets
change so rapidly that they hamper actors’ capacities to identify appropriate decision-making
strategies and formulate clear preferences. Under
these conditions, decision makers cannot effectively
evaluate the range of potential options that they must
consider in formulating potential solutions to problems (Beattie, Baron, Hershey, & Spranca, 1994; Dhar,
1996, 1997). As a result, they tend to de …
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