Neoclassical Organizational Theory: An Overview
Neoclassical organizational theory was born around World War II. In a way, it could be viewed as reactionary to the classical organizational theory which developed earlier in the twentieth century as industry exploded. The rise of classical organizational theories had emphasized the organization as the machine and the workers as the gears (Yang, Liu, & Wang, 2013). Once employee education improved and productivity developed, then the strict, rigid, and mechanical approach of the classical theories began to create problems (Yang et al., 2013). Thus, the neoclassical theory was introduced. This paper will define neoclassical organizational ...view middle of the document...
The desired performance is achieved when employees are motivated under a culture which values creativity and autonomy (CSU-Global, 2014).
Application and Practice
A very common and practical application of neoclassical organizational theory being used today is the anonymous employee survey. In fact, SurveyMonkey, the most popular tool currently being used, boasts that almost every Fortune 500 company is using their services (SurveyMonkey, 2013). The proper use of surveys can allow management to understand their employees better, including what motivates them, and the state of their current job satisfaction. A company could then use this data to refine their neoclassical management approach. The human resources department is another place this theory can be used. This department may be asked to design benefit packages that encourage a good work life balance. A study by Chimote and Srivastava (2013) concluded that there are many benefits to both the organization and the employees when a good work life balance is achieved. The organization sees increased productivity, loyalty, and reduced absenteeism while the employee has better job satisfaction, security, improved health, and reduced stress (Chimote & Srivastava, 2013).
This paper has provided an overview of the rise of neoclassical organizational theory, important concepts of the theory, and practical examples being used today. This theory has made a strong impact on the way organizations view, value,...