Theory X & Y

This theory was developed by Douglas McGregor in 1960 and is often referred to as the human relations theory that focuses on the interaction between superiors and subordinates. The idea behind these theories is that the relationship between superiors and the subordinates, in terms of attitude and beliefs, have a direct impact on the management strategy implemented by superiors, which in turn effects the behavior and performance of their subordinates.

McGregor’s x theory was based on a number of assumptions that existed behind every managerial decision or action, some of them include:

- The average human being has an inherent dislike of work and will avoid it if he can.

-Because of this human characteristic concerning the disgust towards work, most people must be coerced, controlled, directed or threatened with punishment to get them to put forth adequate effort toward the achievement of organizational objectives.

-The average human being prefers to be directed, wishes to avoid responsibility, has relatively little ambition, and wants security above all.

The growth of knowledge in the social sciences over the years has made it possible to reformulate some of these assumptions about human nature and behavior. With this in mind, organizations now can be provided with an improved basis for prediction and control of human behavior in industry.

McGregor’s Y theory was a contrast of the aforementioned X theory. He proposed a number of propositions that he felt managers should adopt in order to achieve greater employee satisfaction and more effective organizations. His propositions include:

-Managers are responsible for organizing elements of the organization.

-Employees are not by nature resistant to organizational needs. They have become that way because of prior organizational capabilities.

-Managers should create organizational conditions so that subordinates can achieve their own goals through achieving organizational goals.

*A lesser known theory under the same general principle of human relations is the one that was developed by William Ouchi known as Theory Z.

Based upon old Japanese practices, this theory hypothesizes that the key to effective and efficient organizations is long-term employment. Ouchi states that stability leads to a high level of commitment from the worker with respect to his or her job. Since they will have a personal “stake” in the organizations success, it is to their advantage to put forth a strong effort to be productive to ensure the success of the organization which in turn will lead to their own personal success