During the 1920s, humans in organizations were treated as machines or it can be said that there was a mechanical model of human behaviour.

Individuals did not give proper response to work and thus led to lot of research to increase productivity of workers. The most important and famous experiment known as The Hawthorne Studies was carried out by Elton Mayo and associates in 1927 in the Hawthorne plant of Western Electric Company near Chicago to study this behaviour of employees. An experiment called Relay assembly test room experiment was carried out with a group of six female workers.The workers were selected in such a manner that they would like to work in a friendly manner and do the equal type of work throughout.

They were also supervised by another lady in a friendly manner. The research was done keeping the temperature, humidity, time of rest during work, number of working hours and payment system on output. The result was surprising, because the productivity increased in variation of all the variables. Even when the original conditions were restored, the productivity still increased. Elton Mayo said that the main change that took place in the room was a social system to work.

The women formed themselves into social group and worked to increase the productivity. The two effects which brought this change were: the experiment itself, the workers felt that management was showing interest in them and, the friendly supervision, which allowed the social organization to develop. (Fincham and Rhodes, 2005) The Hawthorne Studies gave rise to “Human Relations Movement”, which is a key in management and emphasis on importance of social factors in work. According to this theory, management provides environments in organizations where employees can get their social needs fulfilled.They do team-building, supervision, increasing communication, participation in decision-making and counseling (Fincham and Rhodes, 2005). Crainer (1996) says, “The management styles and informal work organization plays an important role in improving performance.

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” (Mullins, 2005) Are Two Heads Better Than One? An experiment was carried out by Alan S. Blinder and John Morgan (2000) in a laboratory of Princeton University. They had two aspects of experiment: a statistical urn problem and a monetary experiment policy.

During the experiment they had taken five students in a group and asked to guess in which direction electronic urns shown on a computer screen would change in composition and direction. The conclusion drawn from the experiment was that groups performed better and faster in decision-making. Thus it was proved that group-based theories helped in better performance and were innovative in nature (Blinder and Morgan, 2000). Effect of Group Size An experiment was carried out by Laughlin et al.

(2006) saying groups performance is better than individuals.In the experiment they divided individuals into groups of 2, 3, 4 and 5. They also considered some individuals for their experiment. They asked all to solve teo letter-to-number problems which required participants to code letters-to-numbers by proposing equations in numbers, getting answers in letters, giving a hypothesis and receiving feedback, if the hypothesis was correct or not. It was seen that groups of 3, 4 and 5 individuals gave good response to equations and hypothesis. Thus, it was concluded that group of 3 members performed better than individuals oh highly intellective problems.Hence it is proved that group size also matters in performing well in organizations with innovative ideas (Laughlin et al, 2006). Teamwork in a Small Company Eddie Brennan describes about the growth of his company due to teamwork through a detailed description named “Teamwork in a small company”.

He says that he started a small company with a group of four executives of different work backgrounds. He increased the number of people to ten to carry out work with ease. He faced some problems at the beginning because of inexperience of the six new staffs.They could not meet the requirements of their client in time. After a meeting, they developed some strategies: not to depend completely on one client and develop an innovative atmosphere in the company.

But they found that the young staff members were unable to produce well and understand the strategies (Mullins, 2005). They developed autonomous teams to be responsible for specific areas. They started a series of sessions with the staff for three hours, which covered subject like, organizational development, stress management, management theory and financial management.

They also held some workshops on team building, interpersonal relationships and customer relationships. Every evening meeting was held followed by drinks in a pub. “The management was surprised to see maturity, interest and responsibility the staff took in the health and the development of the company and supporting the strategic goals of the company. ” (Mullins, 2005) The staff was paid 15% less salary than industry norms, but still they were willing to work because of the friendly atmosphere and fun in the work.

Company received some applications also from outsiders who were willing to work with them. The company was recognized by the ISO 9000 standard within 18 months by introducing this new team structure. “This unexpected development has been the formation of the ‘social norms’. ” Thus they believed that autonomous teamwork works and saves money, saves time and enables management to concentrate on development of business, quality of work improved and good customer relations were developed (Mullins, 2005).

Thus, it is seen that group-based theory increases performance and innovation in organizations.