Theories X and Y, developed by Douglas McGregor in his work 'The Human Side of Enterprise', published in the 1960s, are the most famous theories defining managerial approaches. This blog explores extensively the perspectives of Theory X and Theory Y.
Theory X and Y present two different assumptions about employee motivation and behaviour:
This theory presupposes that people are lazy, do not have motivation, do not like working, and can only be compelled to work, managed or threatened with something if they are to work. It presupposes that there must be strict central control of subordinates of organisations with punitive measures, rules and regulations, and incentive systems to pressure workers into optimal performance.
Essentially, Theory X has been linked with the traditional autocratic management styles. It is hinged on the assertion that if organisations do not closely monitor or control employees, they will not work as expected.
On the other hand, Theory Y has it that people are motivated towards work, willing to be responsible, and capable of being directed towards achieving the organisational objectives. It encourages various management practices where decisions are made based on mutual trust and confidence.
According to Theory Y, managers have positive assumptions about the attainability of subordinates' idea contribution and their willingness to initiate activities towards organisational objectives.
Hence, Theory Y is a more positive approach to people and complies with the current management philosophies. It creates a goodwill working culture that recognises and embraces its employees as organisational resources, potentially creating much value for the organisation.
It is essential to understand that the concepts of Theory X and Y have far-reaching consequences on an organisation's behaviour, performance, and productivity. Such awareness is beneficial for managers to ensure they apply the correct leadership approach depending on the organisational culture and employees' requirements.
Companies that apply Theory X can expect employees' output to increase in the short term because of monitoring and close supervision. In the long run, this leads to poor employee morale, higher turnover, and the absence of innovations.
On the other hand, Theory Y is much more productive, and the employees are motivated to do their work. The employees are likely to be innovative, proactive and focused on change when their employer shows appreciation and grants them autonomy.
Hence, Theory X, due to its highly authoritarian standpoint, raises the problem of employees' demotivation. If new employees are not appreciated and engaged, the morale can drop, and people's job satisfaction can be reduced. Also, they regularly ditch work.
Theory Y also helps increase the level of commitment and participation of the employees. Subordinates are most likely to be committed to the goals set due to the feeling of ownership they develop, improving their job satisfaction and associating them closely with the organisation.
Managers who embrace Theory X may develop or maintain a strictly bureaucratic working environment where everybody operates under close supervision. This can restrain people's vocal freedoms and information sharing, negatively affecting the organisation's flexibility.
Theory Y leaders foster a more receptive and lenient environment in their organisation. In their design, they ensure that communication is encouraged and facilitated so that groups are adaptive to change and allow for creativity.
Theories X and Y are of paramount importance in the current and modern world, and these theories guide modern leaders to improve their managerial techniques and organisational performances. They apply to:
Healthy organisations' heads know the importance of proper control and freedom, depending on the situation and the scope of work. Nevertheless, when work requires fine-tuned following of standard procedures and guidelines, certain aspects of Theory X might be helpful in compliance and standardisation.
Nonetheless, when it comes to incidental activities that are creative and problem-solving in nature, Theory Y principles should be fully implemented to foster talent realisation among the employees.
Principles from Theory Y principles implies that the organisation should embrace a growth attitude. The following is how leaders can realise this goal: Offering opportunities for learning and development, initiation of experimentation, and reward. In this way, they establish conditions for people to experience and encourage risks and changes.
According to Theory Y, trust forms a foundation and, thus, can be developed by establishing openness, positive feedback, and employees' inclusion in the decision-making system. Thus, delegating work and responsibility to the employees and allowing them to make decisions is essential to the organisation's success.
Different needs and desires among employees characterise the contemporary labour force. Thus, leaders should learn to be adaptable and respect diverse people. Essentially, Theories X and Y, if implemented in the right way, will provide leaders with the means of ensuring employees get the right management style based on their behavioural patterns in a company, thus fostering organisational commitment.
Therefore, an element of truth in both Theories suggests that most organisations may benefit from a mixture of the two theories. However, based on the context, type of tasks the employee performs, and personality factors, managers may need to apply elements from both theories.
For example, it was seen that job activities such as following schedules and timetables need a Theory X. In contrast, the job activities that require innovations and strategising need a Theory Y.
Douglas McGregor's Theory X and Theory Y are instrumental in understanding the psychological dynamics of the managerial and motivated worker aspects.They enable managers to appreciate the specific characteristics of self and organisation and how they can effectively manage the people around them.
However, having faced and discussed Theory X, we understand that such management may be helpful in specific operational settings, while in the modern knowledge-based, creativity-oriented world, people around us increasingly expect Theory Y's principles of trust, delegation of authority and cooperation. Therefore, the correlates of these strategies can be harvested to achieve the optimal flow of human capital in a firm and promote high organisational performance and staff contentment.