The neoclassical theory, initiated by Alfred Marshall and founded by George Elton Mayo, emphasizes the importance of human relations and employee motivation in organizational settings. It advocates for a more employee-centric approach to management, highlighting the social needs and wellbeing of individuals within work groups. Key elements include participative management, democratic leadership, and attention to employee development to enhance productivity and satisfaction.

1. Neoclassical
Theory
Here is where your presentation begins

2. History of Neoclassical Theory
• Neo classical approach was first set
out by Alfred Marshall in his book
principles of economics, published in
1890’s.
• George Elton Mayo is considered as
founder of neo classical theory.

3. Introduction
• The word neo means “new”
• The word classical refers to work done
by group of economists in the back (18
& 19) century

4. Neo classical approach
• Behavioral system
• Human relation movement

5. Human relation movement
• Proposed by Elton Mayo. He mainly
focused was on the people working in
an organization.
• Human relation development contributed to:
• Employee-centric, democratic and participative
style of leadership is more efficient.

6. Human relation development
contributed to:
* Psysiological needs
*safety Needs
*love And belonging needs
*esteem needs
*self actualization

7. Behavioral system
• It can also be called as mature
version of human relation theory.
• This theory is how the managers should
behave to motivate the employees and
encourage them to perform at high levels
and be committed to the achievement of
organizational goals.

8. 1. Individual
2. Work Group
3. Participative management
4. Oreintation
5. Motivation
6. Leadership
7. Employee Development
Elements of Neo-Classical
Theory

9. • Every individual has emotions,
feelings, attitudes, hopes, aspirations,
and expectations.
• Neo-classical theory recognized the
individual differences which were
ignored by the classical theory.
Individual

10. • An individual in a group develops
Social wants.
• As he is a social being, he develops a
desire to belong & to be accepted by
his work group.
Work Group

11. • Neo-classical theory suggested
workers participation in
management for improving their
productivity.
Participative management

12. • Classical theory was job oriented
while neo-classical theory is
employee oriented.
Oreintation

13. • Neo-classical writers considered
business organization as a social
system.
Motivation

14. • Democratic style of leadership
is essential to develop co-
operative attitude of employee
towards management.
Leadership

15. Employee Development
• As there is a close connection between
moral and production, neo-classical
writers emphasized that management
that must take greater interest in
employee development workers
satisfaction.

16. “It’s fine to celebrate success
but it is more important to heed
the lessons of failure.
- Bill Gates