Situational Theories
A third phase of leadership theories grew out of a group of contingency theories whose central idea was that organizational behavior is contingent on the situation or environment. This means that which theory or style is the best all depends on the situation at hand. What is needed by the leader is diagnostic ability. The leader observes and analyzes which abilities and motives are present in the followers. With sensitivity, cues in the environment can be identified and used to make choices regarding leadership style. One choice a leader has is to alter his or her own behavior and the leadership style used. Personal flexibility and leadership skills are needed to vary one’s style when the followers’ needs and motives change or vary. The ability to diagnose, choose, and alter behavior to implement a leadership style best matched to the situation is a critical skill needed for effective leadership. Thus no one leadership style is optimal in all situations. The nature of the situation needs to be considered. Styles can be chosen to match the situation.