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The X Theory and Y Theory

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Douglas McGregor, a social psychologist, introduced us to his famous X-Y Theory in his 1960 book The Human Side of Enterprise. Theory X and Theory Y are most commonly referred to in the field of management and employee motivation. McGregor’s theories, although over 40 years old, remain a basic principle from which to develop positive management. Both the X and the Y theories begin with the premise that management’s role is to assemble the factors of production.

Theory X assumes that the average person: dislikes work and avoids it by all measures; has no ambition; prefers to be directed. In essence, Theory X implies that people work for money and security only.

Under Theory X, managerial approaches can range from hard to soft. The hard approach relies on threats, very close supervision, and extremely tight control. The soft approach is to be lenient in hope that in return employees will cooperate with management. However, neither of these approaches seems to be the most advantageous. The best management approach under the X theory probably is medial.

McGregor argued that the problem with Theory X is: “That the satisfied need no longer motivates”. Under Theory X the company relies on money and benefits to satisfy its employees’ lower needs, and once these needs are met the source for motivation is gone. The only way to fulfill higher level needs is to work for higher compensation.

Theory Y makes the general assumptions that: Work can be as natural as rest or play, people will be self-directed to meet their work goals if they are committed, people will be committed to their objectives if rewards are in place, people will seek responsibility.

Under the assumptions of Theory Y there is an opportunity to align personal goals with organizational goals by using peoples own ambition for self fulfillment. If Theory Y holds true, then businesses can do many things to grasp this motivation. The best management approach under the X theory probably is medial.

Businesses can broaden the scope of an employees job adds variety and opportunities to satisfy ego. Consulting employees in the decision making process taps their creative capacity, and having the employees set objectives and participate in evaluating on how they were met. If these things or properly implemented, motivation of employees will be at a higher level, due to a less hostile environment.

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