McGregor's Organization Model: Theory X and Theory Y-A Comparative Discussion - By Grace Hinds

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There are so many fascinating organization models and theories. I've been analyzing McGregor's Organization Model. Here are some of my conclusions.

Douglas McGregor 1906-1964 was a management professor at the Massachusetts Institute of Technology. He proposed that a manager's attitude impacted employee motivation during the 1950s and 1960s. In his 1960 book, The Human Side of Enterprise, McGregor proposed two theories by which managers perceive and address employee motivation. He referred to these opposing motivational methods as Theory X and Theory Y management. Each assumes that the manager's role is to organize resources, including people, to best benefit the company. However, beyond this commonality, the attitudes and assumptions they embody are different.

Theory X

According to McGregor, Theory X management assumes the following:

Work is inherently distasteful to most people, and they will attempt to avoid work whenever possible.

Most people are not ambitious, have little desire for responsibility, and prefer direction from others. Most people have little aptitude for creativity in solving organizational problems.

Motivation occurs only at the physiological and security levels of Maslow's hierarchy of needs.

Most people are self-centered. As a result, they must be controlled and often coerced to achieve organizational objectives.

Most people resist change.

Most people are gullible and unintelligent.

Essentially, Theory X assumes that the primary source of employee motivation is monetary, with security as a strong second. Under Theory X, one can take a hard or soft approach to get results.

The complex approach to motivation relies on coercion, implicit threats, micromanagement, and tight controls— essentially an environment of command and control. The delicate process, however, is to be permissive and seek harmony in the hopes that, in return, employees will cooperate when asked. However, neither of these extremes is optimal—the complex approach results in hostility, purposely low output, and extreme union demands; the gentle method results in a growing desire for greater reward in exchange for diminished work output.

McGregor asserts neither approach is appropriate since the basic assumptions of Theory X are incorrect.

Based on Maslow's hierarchy of needs, McGregor argues that a requirement, once satisfied, no longer motivates an individual. The company uses monetary rewards and benefits to help employees. However, motivation dissipates after the exchange of money. Theory X management hinders the satisfaction of higher-level requirements because it does not acknowledge that those necessities are relevant in the workplace. As a result, the only way that employees can attempt to meet higher levels at work is to seek more compensation, so, predictably, they focus on monetary rewards. While money may not be the most effective way to self-fulfillment, it may be the only way available. People will use work to satisfy their essential requisites and seek to satisfy their more fulfilling attainments during their leisure time. However, employees can be most productive when their work goals align with their higher-level goals.

In most cases, the optimal human resource management approach would lie between these extremes. However, McGregor asserts neither approach is appropriate since the basic assumptions of Theory X are incorrect.

McGregor points out that a command-and-control environment is not practical because it relies on lower demands for motivation. However, in modern society, those needs are mostly satisfied and thus are no longer motivating. In this situation, one would expect employees to dislike their work, avoid responsibility, have no interest in organizational goals, and resist change, creating, in effect, a self-fulfilling prophecy. To McGregor, a steady supply of motivation seemed more likely to occur under Theory Y management.

Theory Y

The higher-level emotions of esteem and self-actualization are ongoing and, or most people, are only partially satisfied. A more positive approach leads to better employee motivation.

In strong contrast to Theory X, Theory Y management makes the following assumptions:

Work can be as natural as play if the conditions are favorable.

People will be self-directed and creative to meet their career and organizational objectives if they are committed to the task.

People will be committed to their quality and productivity objectives if rewards are in place that addresses higher needs such as self-fulfillment.

The capacity for creativity spreads throughout organizations.

Most people can handle responsibility because creativity and ingenuity are common in the population.

Under these conditions, people will seek responsibility.

Under these assumptions, one could align personal goals with organizational goals by using the employee's need for fulfillment as the motivator. McGregor stressed that Theory Y management does not imply a gentle approach. McGregor recognized that some people may have yet to reach the level of maturity assumed by Theory Y and may initially need tighter controls until the employee develops.

If Theory Y holds, an organization can apply the following principles of scientific management to improve employee motivation:

Decentralization and delegation: If firms decentralize control and reduce the number of levels of management, managers will have more subordinates and consequently need to delegate some responsibility and decision-making to them.

Job enlargement: Broadening the scope of an employee's job adds variety and opportunities to satisfy ego needs.

Participative management: Consulting employees in the decision-making process taps their creative capacity and gives them some control over their work environment.

Performance appraisals: Having the employee set objectives and participate in the process of self-evaluation increases engagement. If properly implemented, such an environment can increase and continually fuel motivation as employees work to satisfy their higher-level personal needs through their jobs.

As a student and teacher of leadership and organizational theories, I must admit that I found Theory X to be profoundly negative, with a lack of understanding concerning human behavior. Yes, some people are simply lazy and uncommitted; however, I attribute that behavior to a lack of intellectual stimulation and some emotional developmental issues. Like most people, I've worked in a myriad of jobs in multiple industries, and I've formed a few opinions about less-than-motivated people.

Fear of the unknown, self-doubt and underdeveloped critical thinking skills are a plague on too many human beings. I've had several conversations with individuals over the years. Those who many would classify as lazy or without ambition tell similar stories concerning their upbringing. Unfortunately, many were told from childhood that they were not unique and should not strive to accomplish anything extraordinary; this ideology can create self-doubt and arrested development.

?A few years ago, I encountered a young woman who was one of my students. It was plain to me that she was highly intelligent; however, everything seemed difficult for her. One day we had the opportunity to talk about her life; she said her parents were extremely strict and had antiquated ideas about a woman's place in the world. This information explained a lot about her basic demeanor. She was taught to embrace a lackluster life and understand her parents' archaic views concerning women's roles; she wanted more but didn't know how to change.

Every semester, I scheduled student presentations. A person can build self-confidence and self-awareness over a period of time. After she made her first presentation, I knew my initial assessment of her intelligence was correct; however, I could see that she was almost crippled with fear and self-doubt. The class applauded after she completed it; she seemed shocked by the display of approval. I congratulated her as well. The next day she called me at home. At that time, I told her how gifted and intelligent I thought she was and that she had so much to offer. She said no one had ever told her she was intelligent, and then she started to cry. From that point on, in every subsequent presentation and class participation, she blossomed and emerged as a more positive, confident, and talented professional young woman.

There is a great need for more transformational leaders. The professional world can be daunting and intimidating, and it's even more treacherous if you are insecure and unmotivated. It's easy to dismiss people by calling them names or doubting their intelligence just because they don't express themselves well, seemingly unable to make much of a contribution. There are always reasons why people have less than stellar work performances. A little human kindness and understanding can make a difference in someone's life.

I subscribe entirely to the assumptions proposed by Theory Y.??Self-fulfillment for most people is priceless. A transformational leader can help employees evolve to better self-awareness and accomplishment. Like so many others, I know the value of this particular leadership paradigm. I've had the great pleasure of having three transformational leaders as managers, and it made my experiences exponentially better and more rewarding. I learned the most important lesson from these leaders. Human capital is the most valuable commodity, and individuals in leadership roles should be cognizant of that ideology at all times.

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Meet the Author:

Dr. Grace Naomi Hinds, Ph.D., M.Ed., is an adjunct professor/mentor at Lehman College (CUNY- City University of New York). Dr. Hinds teaches Leadership and Organizational Theories within the MSOL- Master of Science in Organizational Leadership program; she is also an experienced executive holding leadership positions in education, business, and music management. Dr. Hinds is also a life coach.