Contingency theory is aimed at emphasizing the interconnection between decision-making, the situation, and existing circumstances under which this decision is made. Such characteristic features as environment, goals for performing, and the tools for operating create specific situation where managers have to seek one possible variant in each particular case. The organizational design should be unique in each situation in order to attain the best results (Lussier & Achua, 2016, p.112). The case with James Parker, who was the CEO of Southwest when the company faced difficulties, proved that the given theory plays a significant role in achieving success by the leader and creates better climate for the development of the company.
The scholars have studied contingency theory in regard to organizational structure and leadership behavior. The theory does not provide stable elements for definition or specific explanation of how it works in both cases. Many researchers and business authors have worked on this topic, and they provide different contingent variables according to which the researcher can judge whether a contingency theory is represented in particular case or not. For example, Nohria and Khurana (2010) argue that the main features which can clarify the matter of contingency are leader power and influence, the degree of congruence between leader and the followers about goals of the company, and leader’s skill to maintain and fortify his followers’ belief in the goals and success of the company (Nohria & Khurana, p. 419).
The core concept of the theory regarding leadership is the following: in order to become a successful leader, one is not supposed to always follow the models of behavior and decision-making but to be ready to evaluate each situation separately with regard to circumstances surrounding the matter. There is no single behavioral model that is applicable for all situations, and there is no ideal key for solving the tasks as the factors and structural elements for each situation are variable (Lussier & Achua, 2016, p.114).
The case study of Southwest Airport and Parker who was the organization’s CEO at that moment can serve as a clear example of contingency theory. This leader was able to generate profit for his company at times when other industry players facing the same situation were at a loss what to do. Undoubtedly, some characteristic elements of the situation could have been different; however, the conditions were the same. Obviously, James Parker had strong belief in his company’s success. When he set an objective to prevent lay-offs by preserving the headcount at difficult times when airlines work was put on hold, he strengthened his employees’ belief and improved internal cooperation.
The other airports did not have the same view on the situation because as it was mentioned in the case study: “…company may be less profitable in the short-term”, but the company’s reputation will definitely reflect on the long-term perspective. Thus, the decision to cooperate with the customers and support them along with the employees of the company who could not work temporarily was not characteristic for such situation. No other leader provided a similar solution. James Parker could have faced many objections about his idea. However, the top manager presented himself as a strong leader and succeeded because of his immediate decision and correct estimation of all factors.
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The given case includes the elements of other leadership theories as well. According to Ingo Winkler’s description, the leader-member exchange theory implies that leaders can develop an exchange with each of their subordinates. As a result, such cooperation leads to increase of subordinates’ responsibility, participation in decision making and interest of general profit (Winkler, 2010, p. 48). In case with Parker, there is care about the employees from his side and workers’ eagerness to accept new responsibilities from their side. Undoubtedly, this situation only strengthened Parker’s leadership; therefore, leader-member exchange theory can be justified for the case.
Many scholars research on the topic of leadership. Thus, there are numerous theories, and it often appears that one case in reality can have features of different theories. The case with Southwest Airlines and James Parker particularly represents this situation. According to Winkler, there are leaders who try to create new strategies in order to meet group goals. Such leaders usually obtain many idiosyncrasy credits, which describes an individual’s capacity to deviate from group expectations (Winkler, 2010, p. 55). Idiosyncrasy credit model of leadership represents leaders with progressive solutions for various problems. These solutions can be unexpected. However, they can bring positive results for all group members. The case with Airlines Company and Parker’s decision is an example which includes such unexpected decision.
In general, there exist different styles of leadership; therefore, there is no single scheme how to become a successful leader. A contingence theory is one of leadership concepts representing the idea of leadership where the person can succeed accepting a unique decision. This theory includes many variables which can influence and change person’s decision-making process. The circumstances and leader’s power as well as their influence are the main elements according to this theory.
In conclusion, the case with Southwest Airlines and Parker’s management in a challenging situation proves the possibility of leader’s success if he or she applies contingence theory. In addition, it appears that one case may include features of several leadership theories. While analyzing the given study, it was concluded that the features of leader-member exchange theory and idiosyncrasy credit model of leadership are both present in the case.