Theory of Management

The Theory of Management States that People Dislike work.

In the 1950s and 1960s, Douglas McGregor, a management professor at MIT, is largely considered the first person to suggest that a manager’s attitude might affect the motivation of their employees.

In his 1960 book, “The Human Side of Enterprise,” McGregor outlined two ideas that managers use to grasp and address the motives of their employees. These two opposing philosophies pull motivation from employees

They were dubbed “Theory X management” and “Theory Y management.” These management definitions begin with the idea that the manager’s primary responsibility is coordinating the organization’s assets. Nevertheless, despite their superficial similarities, their core worldviews could not be more divergent.

The letter X represents conventional notions, whereas the letter Y represents Theory Management, based on the study of behavioral scientists interested in how society now perceives the working man.

These two concepts reflect opposite ends of the spectrum of possibility. The beliefs of theory management and how supervisors act significantly affect how employees act.

Assumptions for Theory X:

Theory X assumes that managers who accept its premises would organize, oversee, and constantly monitor the work of their personnel.

When dealing with unreliable, reckless, and immature employees, these CEOs think external control tactics are essential to employee needs.

McGregor found that the theories underlying X’s assumptions about the idea of motivation are often inaccurate and that, consequently, theory-based X-based management practices frequently fail to motivate workers to contribute to the organization’s overall goals.

The importance of Maslow’s hierarchy of wants in forming this conclusion cannot be overstated. Management telling people what to do and making them do it may not work.

Because it isn’t an excellent way to motivate people whose physiological and safety needs are already being met and whose social, esteem, and self-actualization needs are becoming more important for employee motivation.

Important points 

  • Employees have a natural distaste for their job and will avoid showing up whenever possible.
  • Since employees despise their jobs, they must be coerced, controlled, or threatened with punishment to meet their obligations.
  • A worker who wants to avoid responsibility for their actions may do so by seeking assistance from superiors.
  • The employees’ motivation will prioritize their safety above everything else and lack drive.

Assumptions for Theory Y:

Managers who subscribe to the premises of Theory Y on human nature do not care to organize, supervise, or monitor their staff.

Instead, these managers foster employee development by providing fewer opportunities for direct monitoring and more autonomy at work. Consequently, the employees will be able to accept more personal responsibility under the motivation theory.

In such an atmosphere, employees can satisfy their psychological requirements for belonging, self-respect, and future growth.

As a result, Theory Management Y’s goal is to create an environment where employees feel comfortable discussing, participating in, and expressing themselves about the company’s goals, increasing the likelihood that they will achieve their own goals.

Workers are expected to have significant levels of intrinsic drive throughout this phase.

According to Theory X, human beings are driven by their fundamental wants. In Theory Y, it is claimed that individuals’ higher-order wants are the most significant.

According to McGregor, the basic assumptions of Theory Y are sounder than those of Theory X.

Important points 

  • The workers’ tasks should seem as natural to them as resting or having the pleasure of pulling off motivation.
  • Individuals are more likely to take responsibility for their actions and influence their outcomes if they have a stake in them.
  • A normal individual may learn how to accept and even seek responsibility and employee needs.
  • The capacity to think creatively and generate unique strategies varies considerably throughout the population.

Ouchi’s assumptions for Theory Z

According to management expert William Ouchi, American and European firms could learn a great deal from their Japanese counterparts.

Although Ouchi was born and educated in the United States, he is of Japanese descent and spent a significant amount of time in Japan studying that country’s approach to workplace cooperation and participatory management.

Consequently, we created Theory Z, which was superior to Theory X and Theory Y, by combining the finest aspects of Eastern and Western management practices.

In 1981, Ouchi’s book Theory Z: How American Management Can Meet the Japanese Challenge offered the notion for the first time. Ouchi says that putting the theory of motivation into practice would lead to significant productivity gains, less staff turnover, more employee commitment, higher job satisfaction, and better morale.

According to Theory Z, it is more vital to assist in employee motivation and become well-rounded experts than to teach them to become specialists. Through job rotations and continual training, you may enhance employees’ awareness of the business and its operations, and the company can benefit from a wider variety of skills and abilities.

Workers are often given enough time to learn their jobs, move up the ranks, and get used to the organization’s quirks. It tends to make the process of getting promoted take longer.


Such an atmosphere, if effectively implemented, would result in a highly motivated workforce by motivating individuals to pursue greater personal fulfillment via their employment and theory management. Maslow, McClelland, Herzberg, and McGregor have distinct views on what drives individuals. However, they both value close interdependencies in networks.

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