There are various organizational theories that attempt to evaluate the behavior of people in organizations, whether as a group or individually. Neoclassical theory focuses on the needs of workers and emphasizes empowering employees with the goal of maximizing their production (Colorado State University-Global Campus, 2010). Research by Sultana and Manivannan (2009) concludes that workers with institutional knowledge are a company's most important asset. A company must do what it can to retain these valuable assets, and neoclassical thinking helped to emphasize job satisfaction and the social aspect of the workplace. History of Neoclassical Theory Neoclassical theory became prevalent in the early and mid-20th century, and marked a shift in the way management and organizational behavior were viewed. The previously prevailing idea was that a harsh and authoritarian structure was the best way to improve productivity (Regina, 2012). Neoclassical thinking theorized that this was not the case, but that productivity was best achieved through worker satisfaction and empowerment. One of the important early contributors to neoclassical theory was Elton Mayo. Mayo's group conducted a study known as the Hawthorne Study at a power plant. They studied factory working conditions and investigated the role that social elements played in worker satisfaction and productivity (Mayo, 1933). The study concludes that employees are more productive when they are motivated by recognition and praise rather than financial reward, and that management should be aware of the role that social elements play in impacting productivity (Almusaileem , 2012). were Chester Bernard and Herbert Simon. Bernard attempted to create a comprehensive theory of behavior in organizations based on the need for cooperation. Simon hypothesized that previous classical beliefs were not applicable to most management situations. Neoclassical theory helped introduce a new way of thinking about productivity and the importance of worker satisfaction (Regina, 2012). This led to other theories that continued to emphasize the correlation between worker satisfaction and productivity. Applications of Neoclassical Theory Elements of neoclassical theory, namely the emphasis on worker satisfaction, are applied to many areas of management. It influences hiring, evaluation, motivation, reward and discipline practices. This is also one of the reasons why many managers and leaders place so much emphasis on creating and developing a culture that encourages employee creativity and innovation...