The Management Theory of Elton Mayo

The management theory of Elton Mayo

Based on his well-known Hawthorne experiments, Mayo’s HR management theory grew from his observations of employee productivity levels under varying environmental conditions. His experiments drew a number of conclusions about the real source of employee motivation, laying the groundwork for later approaches to team building and group dynamics. 

Mayo’s management theory states that employees are motivated far more by relational factors such as attention and camaraderie than by monetary rewards — or by environmental factors, such as lighting, humidity and more.

Mayo developed a matrix to illustrate the likelihood that a given team would be successful. His matrix demonstrates the role that varying combinations of group norms and group cohesiveness play in team effectiveness. [Read related: 5 Reasons Why Teamwork Is Crucial to Workplace Success]

Group norms vs. group cohesiveness

Mayo’s theory identifies a “norm” through the degree to which a group encourages positive or negative behaviors. This is typically expressed through an employee handbook or workplace policies and can include formal or informal rules.

Group cohesiveness is how a unit cooperates together. It’s defined as a group’s overall camaraderie or level of teamwork.

The following are the four combinations of a group’s norm in relation to its cohesiveness:

1. Low norms and low cohesiveness: This group is ineffective and has minimal impact since none of the members are motivated to excel.
2. Low norms and high cohesiveness: This group has a negative impact since fellow members encourage negative behavior. In a typical workplace, an example would be a group that gossips together and actively fights against management. In other words, a group with high camaraderie and low structure.
3. High norms and low cohesiveness: This group has a small degree of positive impact through individual member accomplishments. Each employee must maintain a high standard of work but does not cooperate as part of a team.
4. High norms and high cohesiveness: This group has the greatest positive impact, is held to a high standard and works together to achieve its goals.

How Mayo’s theory applies to small businesses

To survive in a competitive business market, a small business must unlock the potential of its limited workforce. Mayo’s theory of management is the key to unlocking that potential. 

“Small business leaders who embrace Elton Mayo’s management theory improve their chances for success,” Jim Camp Jr, former military professional and owner of Camp Negotiation System Group, told us. “Although it’s tempting to measure success by focusing on the bottom line, paying close attention to your people is a must.”

Here are a few common benefits that small businesses realize when implementing the human relations theory.

Compensates for limited payroll resources.

The core premise of Mayo’s theory is that relational factors are better motivators than simply increasing employee pay. This is beneficial to small businesses since their payroll potential is typically limited. 

Adrien Kallel, CEO and co-founder of Remote People, agreed with this sentiment by stating that workplace productivity is directly linked to social relationships and group dynamics, while physical conditions are merely there. 

“Small businesses can take advantage of this, fostering strong team connections, leading to increased output and innovation without significant financial investment,” said Kallel.

Enhances responsiveness through open communication.

When employees feel empowered to voice concerns and frustrations, managers can address issues before they snowball into massive problems. 

“Mayo’s focus on group dynamics enables more effective collaborative problem-solving,” said Kallel. “When employees feel socially connected, they share information more freely and contribute diverse perspectives, creating robust solutions to business challenges.”

Additionally, employees can typically identify production or customer issues before management encounters them. Therefore, a business can respond more quickly to sudden problems by opening a consistent communication channel between employees and management. Mayo’s management theory relies on this consistent communication channel.

Develops stronger management capabilities.

To implement Mayo’s theory, a small business must have managers who are capable of engaging with employees on a regular basis. Managers utilizing Mayo’s theory may be seen as more approachable and provide greater contributions to the overall success of the business.

For example, Kallel said that managers can develop their ability to recognize social patterns, facilitate team cohesion and address interpersonal challenges before they impact productivity.

Increases employee retention.

An employee who is emotionally invested in a business will typically stick around longer than they would for a business with which they do not connect. This increase in employee retention will significantly reduce the amount of money a small business will need to invest in hiring efforts.

“Mayo’s emphasis on worker satisfaction through social integration creates stronger organizational loyalty, valuable for small companies where replacement costs are proportionally higher,” said Kallel.

Fosters a healthier work environment.

Mayo’s theory relies on engaging with employees on personal matters. The ability to speak openly about frustrations and search for solutions will lead to a healthier work environment.

“Fostering an environment where your teammates know that you truly care or, as Mayo calls it the Hawthorne effect, will lead to more overall job satisfaction,” said Camp. “Employees who are comfortable communicating with their boss will help the leader hear what they need to hear, which isn’t always what they want to hear.” 

Teamwork and cohesion don’t happen by accident. The leader is responsible for creating an environment of trust and respect, said Camp.

It reduces employee burnout.

Burnout is a significant problem for employers today. A recent survey found that 65 percent of employees reported experiencing burnout and 72 percent said burnout impacted their performance. There are many ways to prevent burnout and implementing Mayo’s human relations management theory is one of them. Mayo’s theory reduces burnout and relieves staff shortages by creating more cohesive teams and camaraderie.

10 ways to implement Mayo’s theory in your business

There are many ways that a small business can use Mayo’s HR theory. Here are 10 top strategies that you can implement immediately:

1. Implement strong communication: Mayo’s theory states that increased communication and cooperation improve a team’s cohesion. Small business owners should communicate with their teams regularly and openly. Additionally, consider providing teammates with both formal and informal feedback.
2. Create more group projects: According to Mayo’s teachings, intense interaction and cooperation through teamwork increase business productivity. On the manager’s part, feedback should be given to the team at large as well as each individual’s contributions.
3. Increase involvement between managers and employees: Mayo’s theory states that decreased productivity may arise due to a lack of attention. Supervisors and managers should spend some time interacting with employees on a personal level. Try to learn about your employees’ personal lives, motivations and feelings.
4. Reduce the number of negative interactions: Mayo’s theory states that negative supervisor interactions increase stress and fatigue. Don’t micromanage — let your employees use their creativity and ingenuity to solve problems. If a negative interaction is inevitable, openly communicate with empathy and kindness and don’t drag out the issue.
5. Set established rules: “High norms” result in a positive impact, according to Mayo’s theory. Establish workplace rules and regulations and let your employees work within that established framework. To increase camaraderie within your team, consider formulating the rules together. Employees who share their input are more likely to follow the set rules.
6. Create a feedback system: Mayo’s theory states that employees thrive when they have the opportunity to express their opinions. Don’t let complaints fester. Instead, listen to the complaints and make attempts to address them. It is always better to provide an outlet where employees can voice any concerns.
7. Let employees determine their own working conditions: A happy employee is a productive employee, according to Mayo. To increase employee happiness, consider allowing your employees to dictate where they will complete their tasks. This can be as simple as giving employees the freedom to decorate the office, work remotely a few times a week or set their own work schedule.
8. Understand the concepts of Mayo’s theory and how they can benefit you: Numerous websites provide valuable information about Mayo’s theory. In addition to diagrams, summaries and explanations of Mayo’s management principles, you’ll find various videos and instructional materials. These can help you develop the background knowledge and practical expertise to put Mayo’s theory to work for your company.
9. Utilize consulting services regarding Mayo’s management theory: Consultants with knowledge and experience in the management theory of Mayo can guide you in maximizing the benefit of his principles in your own company’s unique environment.
10. Use resources designed to help you implement Mayo’s management theory: Widely available online tools and resources can help you more easily implement Mayo’s management principles. Videos and other various Mayo-theory-based products, information and services let you choose the resources most valuable to your business.

Consider the many benefits of putting the Mayo management theory to work for your business. If you decide to use it, why not go all out and practice it in all the areas it can effectively address: your own leadership of the company, your managers’ development and your employees’ engagement.

Alternatives to Mayo’s management theory

Although Mayo’s management theory is widely used in business, it’s not the only theory at your disposal. Here are a few other popular management theories that small businesses can explore.

Mintzberg management theory explained

Henry Mintzberg’s management theory centers around defining clear organizational structures and roles to enhance business efficiency. It identifies five distinct organizational structures and posits that effective management skills are gained through experience rather than classroom learning. Mintzberg’s theory helps businesses streamline operations, improve employee engagement and align roles with strengths and workflow. By choosing an appropriate structure, small businesses can resolve conflicts and optimize performance based on their specific needs and goals.

>> Learn more: The Management Theory of Henry Mintzberg

Taylor management theory explained

Frederick Taylor advocated for increasing productivity by scientifically analyzing tasks, rewarding workers for higher output and fostering cooperation rather than individualism. Taylor’s management theory, outlined in his 1911 book The Principles of Scientific Management, prioritizes industrial efficiency through job simplification and systematic management. Its key principles focus on science over guesswork, harmony over conflict and maximum output. While not universally applicable, his methods can be adapted to increase efficiency and collaboration in various businesses.

>> Learn more: The Management Theory of Frederick Taylor

Weber management theory explained

Known for its bureaucratic approach, Max Weber’s management theory advocates for a structured and efficient organization through strict rules and a clear distribution of power. Weber believed that bureaucracy ensures maximum productivity by enforcing uniformity, precision and a hierarchical management system. In this ideal model, roles are defined by expertise, advancement is merit-based and work relationships remain professional and impersonal. Weber’s theory emphasizes efficiency and fairness, which can benefit businesses by implementing clear rules and well-defined roles.

>>Learn more: The Management Theory of Max Weber

Fayol management theory explained

Henri Fayol’s management theory suggests that effective management involves planning, organizing, leadership and controlling organizational resources. Fayol proposed 14 principles of management, including division of work, authority, discipline and unity of command, which aim to improve organizational efficiency. His theory highlights the importance of managerial functions — along with the need for clear organizational structure and hierarchy — for small businesses to achieve peak performance.

>>Learn more: The Management Theory of Henri Fayol

Follett management theory explained

Mary Parker Follett’s management theory highlights the importance of coordination, collaboration and employee engagement within organizations. She advocated for a participative approach, where managers and employees work together to achieve common goals and solve problems. This management theory, particularly its focus on coordination and employee engagement, remains relevant to today’s businesses.

>>Learn more: The Management Theory of Mary Parker Follett

Gilbreth management theory explained

The Frank and Lillian Gilbreth management theory focuses on workplace efficiency through standardization and consistency. The husband-and-wife team believed in finding “one best way” to perform tasks, minimizing unnecessary motions and time to increase productivity. Their approach sought to streamline processes, increase profits and ensure a healthy work environment. It puts an emphasis on practical workspace and procedural improvements.

>>Learn more: The Management Theory of Frank and Lillian Gilbreth

Kanter management theory explained

Rosabeth Moss Kanter’s management theory focuses on the importance of empowerment and innovation in organizations. Kanter advocated for creating a supportive environment where employees have access to resources, autonomy and opportunities for growth. Her theory emphasizes fostering a culture that encourages participation, creativity and collaboration, which in turn drives organizational success and adaptability.

>>Learn more: The Management Theory of Rosabeth Moss Kanter