McGregor theory X and Y

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This was developed by Douglas McGregor in the 1960s. The X and Y theory explains how a manager's beliefs about what motivates their subordinates can affect their management style. McGregor assumed in his book "The Human Side of Enterprise" that all managers make certain assumptions about human motivation, even if they might not be aware of them. (Sahin, et al., (2014)

Figure 1: Source: Compiled by Authors from Fundamentals of Management, Otokiti (2006)

Theory X 

Theory X managers assume that their subordinates are lazy, will avoid responsibility, and merely get by. According to theory X, it is assumed that the workers should be controlled and threatened with punishment. (Allio, 2009). According to McGregor's theory X, it is the responsibility of management to organize, guide, regulate, and modify employee behavior, lest they become passive or even resistive to work (Gannon & Boguszak, 2013). Gannon & Boguszak, (2013) further explain that as a result of these assumptions, management styles such as "hard" and "soft" management emerged. A "hard" strategy was perceived as coercive, demanding strict monitoring and tight control, which frequently resulted in resistance and obstruction, while a "soft" approach was resulting in management abdication and indifferent performance.

Channell (2021) explains that managers in high-pressure, high-output departments such as production and manufacturing will tend towards Theory X in order to achieve their daily or monthly target as efficiently as possible. He further shows this in an example: a manager who needs to achieve a certain level of output for his department per month. Any amount above this target output will earn him a bonus. Now he will push the team to produce a set number of products for their department to get the required monthly output. Unfortunately, there is no learning for the "X" category employees as they do not have time for learning. The strict punishment/reward structure makes it clear to the employee what they need to do. And when they achieve the target, they too get bonus benefits. Money is the most important factor in the X theory.

Theory Y

In the theory, McGregor shows that Theory Y managers hold assumptions that their subordinates care about the organization, will take responsibility, and practice self-control (Bobic & Davis, 2003). Russ (2011) states that theory Y assumptions contribute positively toward the organizations' growth in more participative decision-making, ultimately benefiting the organization (Russ, 2011). Based on the Y theory Bobic & Davis, (2003) shows that it is the job of management to provide opportunities for employees to grow and develop their potential by providing conditions that allow people to channel their efforts toward corporate goals.

Channell (2021) shows that theory “Y” employees are active in the decision-making process, self-motivated, take ownership of their work, and solve issues using their creativity. He further explains this in an example. If a manager is given a new project, he explains this to his subordinates and gets their involvement in decision making. He creates flexibility in their workplace. Their staff is motivated by different rewards. He trusts his team. 

Advantages of McGregor's theory X and Y

Below listed are some of the advantages that Channell (2021) shows for McGregor's theories X and Y.

·       Theory X

    • Some employees grow through a commanding management style.
    • Focus on achieving the company's growth.
    • There's no room for unclearness, which makes duties and responsibilities clear.

·       Theory Y

    • management style that is much more appealing. 
    • It allows employees to have more flexibility and responsibility, allowing them to perform better. 
    • It encourages teamwork, development, and problem-solving creativity.

Disadvantages of McGregor theory X and Y

According to Channell (2021), below listed are some of the main disadvantages that managers face by following McGregor's theories X and Y.

·       Theory X

o   Some employees struggle to work under such strict conditions.

o   Because not everyone is motivated by money, they may not put up much effort to achieve more.

o   Employee learning and development may be limited.

·       Theory Y

o   Undefined working boundaries will not appeal to everyone.

o   It would be easy to take advantage of the trust and freedom.

o   Because there is less emphasis on quantifiable measurements, measuring performance might be difficult.

Reference

Allio, R. J., (2009). Leadership The five big ideas. Strategy & leadership, Vol, 37. Pp 4

Bobic, M. P., & Davis, W. E., (2003). Journal of public administration research and theory, 13(3) pp 239-250

Channell, M., (2021). McGregor’s Theory X vs Theory Y: How to increase performance in your team [online]. Available at: https://www.tsw.co.uk/blog/leadership-and-management/mcgregors-theory-x-vs-theory-y/#:~:text=If%20you%20make%20good%20choices,%2C%20so%20they%20will%20move.%E2%80%9D. [Accessed on 05 May 2022]

Gannon, D., & Boguszak, A., (2013). Douglas McGregor’s theory x and theory y [online]. Available at:http://archive.sciendo.com/CRIS/cris.2013.2013.issue-2/cris-2013-0012/cris-2013-0012.pdf. [Accessed on 05 May 2022]

Russ, T. L, (2011) Management Decisions, Vol. 49. pp 823

Sahin,F., Gurbuz, S., & Koksal, O., (2014) Revisiting of Theory X and Y[online]. Available at:https://www.researchgate.net/publication/277531199_Revisiting_of_Theory_X_and_Y_A_Multilevel_Analysis_of_the_Effects_of_Leaders'_Managerial_Assumptions_on_Followers'_Attitudes. [Accessed on 06 May 2022].

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