Management Hall of Fame
Most Respected Management Gurus
Theory Y in Managing and Leading People (1906-1964)
"Commitment to objectives is a function of the rewards associated with
their achievement." (Douglas McGregor)
Douglas McGregor is a pioneer in the field of industrial relations.
Abraham Maslow viewed McGregor as a mentor. His book " The Human Side of
Enterprise: laid the foundations for the modern, people-centered view of
management. He believed that managers' basic assumptions have a dominant
influence on the way that organizations are run. He argues that these
assumptions fall into two broad categories - Theory X and Theory Y.
Theory X and Theory Y describe two views of people at work and two
opposing management styles.
McGregor was a Management professor at the MIT Sloan School of
Management whose 1960 book The Human Side of Enterprise had a profound
influence on management practices. In the book he identified an approach
of creating an environment within which employees are motivated via
authoritative, direction and control or integration and self-control,
which he called theory X and theory Y, respectively. He earned a B.E.
Mechanical from Rangoon Institute of Technology, an A.B. from Wayne
State University in 1932, then earned an M.A. and Ph.D. in psychology
from Harvard University in 1933 and 1935 respectively.
In his youth he worked in his grandfather's Institute for transient
laborers in Detroit, where he gained insight into the problems faced by
labor. As district manager for a retail gasoline merchandising firm, he
learned the concerns of management. He was the first full time
psychologist on the faculty of MIT, and helped to found its Industrial
Relations Section. Throughout his career he consulted for union and
management alike and served on the panel of arbitrators for the American
Arbitration Association. McGregor resigned the presidency of Antioch to
rejoin the MIT faculty in its new School of Industrial Management in
Theory X: The Traditional View of Direction
And Control. It is based on the
- Average human beings dislike work, wishes to avoid responsibility it
if at all possible. Therefore most people must be coerced, controlled to
achievement of organizational objectives. Theory X management style
therefore requires close, firm supervision with clearly specified tasks
combined with financial "carrot and stick" approach as motivating
- Managers working under these assumptions will employ autocratic,
detailed controls that can lead to mistrust and resentment from those
The Integration of Individual And
It is based on the assumptions that:
- Average human beings does not dislike work and they will in many
times seek responsibility. Depending on personal meaning and conditions
of work ( ownership, responsibility and empowerment) , work may be a
source of satisfaction, or a source of resentment. Employees will
exercise self-direction and self-control in the service of objectives to
which they are committed. The personal meaning and social and financial
rewards, such as success, satisfaction of ego and self-actualization can
integrated with organizational objectives;
- Avoidance of responsibility, lack of ambition are generally
consequences of negative experiences, like not getting the rewards
associated with their efforts and achievements.
- The capacity and potential to to produce and innovate is widely,
not narrowly, distributed among people. creating the right conditions to
unleash this potential is the challenge of the management and leadership
When he & Maslow' put theory into practice at several factories. They
found that an organization driven solely by Theory Y or Theory X could not
Successful motivation is a complex result of company policy and
administration, level of supervision vs. self-scheduling and creative
environment, working relationships, working conditions, status, security,
pay, advancement or growth, among others.
- For McGregor, leadership was not a
property of the individual characteristics but a function of the
relationship between the leader the situation it is a product of a
complex relationship among several variables like the attitudes and
needs of the followers, the nature and structure of the organization
itself, and the social, economic, and political environment.
Books & References:
The Human Side of Enterprise, Annotated
Edition. New York: McGraw-Hill, 1960.
Leadership & Motivation. Cambridge, MA: MIT
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