There are various organizational theories that attempt to evaluate the behavior of people in organizations, both as a group and individually. Neoclassical theory focuses on the needs of workers and emphasizes the empowerment of employees in an attempt to maximize 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 corporate asset. A company must do what it can to conserve these valuable resources, and neoclassical thinking has helped generate a new emphasis on job satisfaction and the social aspect of the workplace. History of Neoclassical TheoryNeoclassical theory became prevalent in the first half of the 20th century and marked a change in the way managerial and organizational behavior was viewed. Previously prevailing thinking was that a tough, authoritarian structure was best for productivity (Regina, 2012). Neoclassical thinking theorized that this was not the case, but rather that productivity was best achieved through worker satisfaction and empowerment. One of the first important contributors to neoclassical theory was Elton Mayo. Mayo's group conducted a study known as the Hawthorne study at an electric company facility. They studied working conditions in the plant and investigated the role played by social elements in worker satisfaction and productivity (Mayo, 1933). The study concluded that employees are more productive when motivated by recognition and praise rather than financial rewards, and that management needs to be aware of the role that social elements play in influencing productivity (Almusaileem, 2012). Others who made important contributions to this movement were Chester Bernard and Herbert Simon. Bernard attempted to create a comprehensive theory of behavior in organizations based on the need for cooperation. Simon theorized that previously held classical beliefs were not applicable to most management situations. Neoclassical theory helped usher in 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 The elements of neoclassical theory, namely the importance placed on worker satisfaction, are applied to many areas of management. It influences hiring, evaluation, motivation, reward and discipline practices. It's also one of the reasons why many managers and leaders place such importance on creating and cultivating a culture that encourages employee creativity and innovation..