Neoclassical Organization Theory

(1920, 1945-1950s)

Mark Bryan Loyola

• Evolved from the tough and authoritarian
structure of the classical theory
• It revises and criticizes the classical perspective
citing the “humanness of organizational
members”.
• suggested that workers have social and
psychological needs along with economic needs
in order to be motivated to complete their
assigned tasks.
George Elton Mayo
• Hawthorne Study (1920) [Elton Mayo]
– Began in the 1920s with the Hawthorne studies: gave
emphasis to “affective and socio-psychological
aspects of human behavior in organizations.”
– proposes that sense of belonging in the workplace is
important to increase productivity levels in the
workforce
– helped conclude that “a human/social element
operated in the workplace and that productivity
increases were as much an outgrowth of group
dynamics as of managerial demands and physical
factors.”
CHESTER ROBERT HERBERT
BARNARD MERTON SIMON
• Chester Barnard
– Defines the role of the executive:
• To create a sense of purpose and moral code for the
organization
• To establish systems of formal and informal communication
• To ensure the willingness of the people to cooperate
• To employ different strategies for inducing cooperation
• Robert Merton
– Proclaimed that an “ideal type” of bureaucracy has
inhibiting dysfunctions.
• Herbert A. Simon
– Asserted that organization theory is about the bounded
rationality of a human being who “satisfice” since they
do not have the intellectual capacity to maximize.
PHILIP RICHARD JAMES MELVIN TALCOTT WILLIAM
SELZNICK CYERT MARCH DALTON PARSONS WHYTE
• Philip Selznick
– Stated that “organizations consist not simply of a number of positions for
management to control, but of individuals, whose goals and aspirations
might not necessarily coincide with the formal goals of the organization”
• Cyert and March
– Discussed the formation and activation of coalitions
– Reasoned that corporations tend to “Satisfice” rather than to engage in
“economical rational profit maximizing behavior”
• Melvin Dalton
– Focused on the structural frictions between line and staff units and
between the central office and its branches.
• Talcott Parsons
– Defined an organization as a social system that focuses on the attainment
of specific goals and contributes
• William Whyte
– studied “stresses” that result from interrelations and status differences in
the workplace
 Its Fine Point and Flaws
• Fine Point • Flaws
– Attempted to revise the – Did not develop a body
classic perspective, of theory. It just
urging the schools who modified the classical
followed theory.
– Incorporated professions
such as sociology into
organization theory