2. Key Concept
• Management is responsible for organizing the elements of productive enterprise –
a) Money
b) Material
c) Equipment's
d) People on interest of economic ends
• With respect to people there is a process of directing their efforts , motivating them ,
controlling their actions, modifying their behaviour to fit the needs of the organization.
• Without active intervention by men people would be passive even resistant to
organizational needs. They therefore, must be persuaded, rewarded , punished , controlled ,
their activities must be directed.
3. Key Concept
• The average men in nature is indolent , he works as little as possible.
• he lacks ambition, dislikes responsibility , prefers to be led.
• He is inherently self cantered indifferent to organizations need.
• He is by nature resistant to change.
• he is gullible , not very bright
• Conventional organization structures and managerial policies & practices
reflect these assumptions.
4. Key Concept
• In accompanying the task management has conceived of range of
possibilities :-
A. At one extreme management can be hard or extreme , this method of
directing behaviour involves –
a. coercion and threat
b. close supervision
c. Right control over behaviour
5. Key Concept
A. At the other extreme management can be soft or week, this method of
directing behaviour involves –
a. being permissive
b. satisfying people’s demand
c. achieving harmony
Then they will be tractable and accept direction .
6. Theory
• Theory X and Theory Y was an idea devised by Douglas McGregor in his 1960
book “The Human Side of Enterprise” .
• It encapsulated a fundamental distinction between management styles.
1. Theory X - authoritarian style
2. Theory Y - participative style
• McGregor looked at the way in which employers and employees traditionally viewed work – The employer
paid the money and gave instructions, and the worker did the job without asking questions
7. Theory X Theory Y
Don’t like working Enjoy their work
Do as little as they can get away with Will work hard to get rewards
Don’t like things to change Want to see new things happening
Need to be told what to do Will work independently
Cant be trusted to make a decision Can be trusted to make decisions
Are only interested in MONEY Are motivated by things other than money
Must be closely watched
Cant be trusted or relied upon
Can work unsupervised
8. Relativeness of the theory with different
theories
• McGregor urged companies to adopt Theory Y. Only it, he believed, could motivate human beings to the
highest levels of achievement. Theory X merely satisfied their lower-level physical needs and could not hope
to be as productive. “Man is a wanting animal,” wrote McGregor, “as soon as one of his needs is satisfied
another appears in its place.”
• There are parallels with Abraham Maslow's hierarchy of needs, and Maslow was indeed greatly influenced
by McGregor. So much so that he tried to introduce Theory Y into a Californian electronics business, but
found that the idea in its extreme form did not work well. All individuals, he concluded, however
independent and mature, need some form of structure around them and some direction from others. Maslow
also criticised Theory Y for its “inhumanity” to the weak, and to those not capable of a high level of self-
motivation.
• People don't hate work. It's as natural as rest or play. They don't have to be forced or threatened. If they
commit themselves to mutual objectives, they'll drive themselves more effectively than you can drive them.
But they'll commit themselves only to the extent they can see ways of satisfying their ego and development
needs.
9. Application of this theory in real life
circumstances
• Decentralisation & Delegation
• Job Enlargement
• performance appraisal
• Participative and consultative management
Notes de l'éditeur
Theory X is an authoritarian style where the emphasis is on “productivity, on the concept of a fair day's work, on the evils of feather-bedding and restriction of output, on rewards for performance .
It reflects an underlying belief that management must counteract.
an inherent human tendency to avoid work”. Theory X is the style that predominated in business after the mechanistic system of scientific management had swept everything before it in the first few decades of the 20th century.
Theory Y is a participative style of management which “assumes that people will exercise self-direction and self-control in the achievement of organisational objectives to the degree that they are committed to those objectives”. It is management's main task in such a system to maximise that commitment.
