Rather, an appropriate action is one with appropriate internal states and processes of organisation contingent upon external environment and internal needs. Contingency theorists find that systems approach does not adequately spell out the precise relationship between organisation and its environmental components. To a great extent, contingency approach fills this lacuna.

Some scholars distinguish between contingency and situational approaches on the basis that while situational approach merely implies that what a manager does, depends upon a given situation, contingency approach implies and active interrelationship between the variables in a situation and the managerial solution devised. According to some scholars, contingency approach takes into account not only given situations but also the influence of given solutions on behaviour patterns of an organisation. Despite varying degrees of emphasis, contingency model builders show consensus on common themes. In fact some authors believe that the them contingency is misleading and instead they should have used the term situational.