The classical theory is based on the following three assumptions:
1. The relationship between employees and management is defined by means of formal
structured communication process, defined tasks, defined accountability, and formalized
procedures and practices to avoid any conflict in their relationship.
2. Workers have been treated as economic man who can be motivated by means of money
only.
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3. The third assumption is that the workers have been considered as a product of means of
production or as a cog in the wheel.