Theories of Group Formation

PSYCH-105 Industrial Psychology

Chapter 8: Group Dynamics

Unit 1

Unit 2

Unit 3

Unit 4


Theories of Group Formation

Propinquity Theory

Propinquity means nearness. This theory states that people affiliate with each other or forms informal groups because of geographical or spatial closeness. Quite often, individuals affiliate with one another because of spatial or geo-graphical proximity. In an organization, employees who work in the same area of the plant or office would more probably form into groups than who are not physically located together. The propinquity theory explains a basic factor, i.e., proximity of people at the workplace, which leads to formation of groups. This phenomenon is observed in daily practice by all of us.

Homans Interaction Theory

More comprehensive theory of group formation comes from the theory based on activities, interactions and sentiments. These three elements are directly related to each other. The more activities persons share, the more numerous will be their interactions and the stronger will be their sentiments (liking or disliking). The more sentiments people have for one another more will be their shared activities and interactions. The major element in this theory is interaction. Persons in a group interact with one another not just in the physical propinquity sense but also to accomplish many group goals such as cooperation and problem solving.

Balance Theory

Theodore Newcomb

The theory as proposed by Theodore Newcomb. He stated that “Persons are attracted to one another on the basis of similar attitudes towards commonly relevant objects and goals. Once a relationship is formed, it strives to maintain a symmetrical balance between the attraction and the common attitudes. If an imbalance occurs attempts are made to restore the balance. If the balance cannot be restored, the relationship dissolves”. Both propinquity and interaction play a role in the balance theory. Thus, the balance theory is additive in nature in the sense that it introduces the factor of ‘balance’ to the propinquity and interaction factors. There must be a balance in the relationship between the group members for the group to be formed and for its survival.

Exchange Theory

John W. Thaibaut and Harold H. Kelly

This theory is propounded by John W. Thaibaut and Harold H. Kelly. Exchange theory of groups is based upon reward-cost outcomes of interactions. To be attracted towards a group, a person thinks in terms of what he will get in exchange for interaction with group members. A minimum positive level (reward greater than cost) of an outcome must exist in order for attraction or affiliation to take place. Rewards from interactions gratify needs, while costs incur anxiety, frustration, embarrassment, or fatigue. Propinquity, interaction, and common attitude all have roles in exchange theory.

Author – Dr. Niyati Garg

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