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A Review of “Toward a Contingency Theory of Business Strategy”

In: Business and Management

Submitted By jcha999
Words 416
Pages 2
Over the past decades contingency theorists have demonstrated the apparent interaction between the environment and organizational variables. Although open system analysis emphasized the input of external environment into organizational structuring, the contingency approach attempts to establish functional relationship between environmental variables and the organizational variables. Later Perrow (1970) and others have suggested that other technological classifications such of knowledge based variables are related to organizational structure variables. According to Lee, Luthans and Olson the best contingency theory came from the work Lawrence and Lorsch (1967) in which theory they analyzed how differences of external environments were related to differences in the internal environments using 10 firms of 3 industries. Significant progress has been made toward the development of a theory of the strategic planning process even though much work remains to be done.

According to CHARLES W. HOFER much less progress has been made toward the development of theories of corporate and business strategy. One of the major reasons for this lack of progress has been the assumption that such strategies were situational, i.e., that they depended on so many factors unique to a given situation that no general propositions could be developed. In his paper “Toward a Contingency Theory of Business Strategy” published in “Academy of Management Journals” Volume 18 Number 4, 1972” CHARLES W. HOFER focused on the development of concepts about the content of strategy at both the business and corporate levels while much work regarding this concept failed to differentiate between business and corporate strategies. For that he summarized most of the important contingency theories that are developed through research and conceptual basis.

However it seems few theoretical investigations was…...

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