IGNTU, AMARKANTAK

Department of Business Management

Presentation on Neo Classical Theory

Submitted By : Abhishek Tripathi

MBA 1st Sem
Submitted to: Miss Deepandi Mam
 NEO CLASSICAL THEORY

 The neo- classical theory is the extended version of the classical

theory. The word ‘ neo means new in the theory. Neo classical
theory is also called human relations and behavioural science
approach. Neo – classical theory have greater focus on man
behind the machine and stressed the importance of individual as
well as group. It treats organization as social system.
Features of Neo Classical theory
 Focus on structure – Recognize the importance of flexible
organizational structure that accommodate human needs.
 Motivation – Introduces the social and psychological aspects of
motivation beyond the monetary reward.
 Decision making – Decentralized decision making, including lower
level employee in certain decisions.
 Employee participation – Encourages employees
participation in decision making process valuing their
insights and perspective.
 Communication – Encourage open communication and
recognize the importance of informal communication.
 Leadership Style – It believes on democratic
leadership.
 Job Satisfaction – Recognize the role of job
satisfaction in enhancing productivity and various
factor contributing in it.
 Organisationalobjective – Acknowledges that
acheiving organisational objective is closely tied
to employee satisfaction and motivation
 Human element –Recognize the importance of the
human factor in organization, considering social
and psychological needs.
 WorkEnvironment – Emphasize on more balanced
approach, considering both productivity and well
being of employee.
 Human relation – Value of positive human
relations.
Limitations of Neo Classical Theory

 Narrow in scope.
 Unrealistic assumptions.
 It studied for developed countries only.
THANK YOU