1 Theory X and Theory Y Pros and Cons Eric Zeidman 8/21/2008 1 2 Eric Zeidman Week 1 – Motivational Theories Douglas McGregor has come up with two different theories that account for motivation in employees. Theory X and Theory Y say management need to put in place the parts so the company can make a profit. Theory X says: 1. Most people do not like to work 2. Most people do not want responsibility, are not ambitious and want to be directed 3. Most people do not really care about business goals 4. Motivation happens only at physiological and security levels 5. People need to be controlled and forced to achieve company objectives Theory Y tells us: 1. If conditions are good work is natural like play 2. Self control is necessary to achieve goals 3. Many people in the company are creative 4. Motivation occurs at social, esteem, and self actualization levels 5. If properly motivated people can be self directed and creative McGregor tell us the managers who use Theory X try to control and manipulate their employees, and that is the only way to deal with people that are not reliable or are irresponsible. McGregor himself questions the use of Theory X to people whose 3 safety and physiological needs are mostly met. Net.MBA explains to us that Theory X can be used with either a soft or hard approach. The soft approach seeks harmony with people, while the hard approach results in hostility and bad work ethic. The problem with Theory X seems to be that when people have no money they will do anything that they are told in order to satisfy their physiological needs. I myself have seen this in practice in a few of the operations I have run. About twenty years ago I had a dry cleaning business in a relatively poor neighborhood. While I treated everyone fairly, sometimes I needed some speed in certain parts of the operation or needed people to work overtime and they almost never said no due to the fact that they would be afraid of the consequences. Besides that, I would offer them a monetary incentive to produce more. Interestingly enough, after they had worked awhile and gained some monetary security they would then be open to challenging my authority as the business owner. This sometimes resulted in termination if the employee could not be brought back “under control”. I agree with McGregor about Theory X because it relies on motivation of physiological needs. The problem today is that almost everyone in our society has their needs met by government reform programs to help others. People have lost their motivation because they feel they can easily sign up for Welfare or Food Stamps form governmental programs. Unemployment insurance is another option when all they have to do is say that they were harassed by the employer. It is a lot easier for poor people to stay home and do nothing than to go to work and to expend needless energy. Sometime people are just happy being poor with no motivation and sitting in front of their television sets. 4 Theory Y is a completely different story and McGregor tells us that it leans to people that work together for goals and are very team oriented. People by their nature are not lazy and really will work hard to get ahead with their goals. I have also seen this in my vast experience in management. Following up with the dry cleaning business that I was in, the core or key workers were well motivated and worked very hard on a pay for performance plan. The more they produced the more they earned and they were very eager to work extra hours for more pay. This satisfied a need that they were good breadwinners and their families knew that they could be relied upon. Were there occasionally problems or differences of opinion? Yes, but they were usually cordially resolved. I agree with the fact that Theory X mangers are controlling and manipulative, and Theory Y mangers are supporting and helpful. With Theory Y people can align their personal and professional goals on the same path. We must remember that while you may not like Theory X, it does work in some situations. If Theory Y is run properly it results in an environment that can be pleasing and beneficial to all people. I also believe that each theory has its place in different types of business. A small “Mom and Pop” operation that is struggling may have no choice but to use “Theory X” to extract the most out of people. There are also people that have a selfless disregard for others and enjoy using Theory X. Theory Y seems to be much more appropriate in larger organizations that are profitable and continue to make money. When the boss is nice and not on everyone’s case it is only because there is little or no pressure on him or her. People in that type of atmosphere seem to enjoy working 5 and helping one another. References: 1. Hersey, Paul, Blanchard Kenneth H., Johnson, Dewey E., 2008. Management of Organizational Behavior: Leading Human Resources Ninth Edition. Pearson Prentice Hall 48-51. 2. Net.MBA, (2002-2008).Theory X and Theory Y. Retrieved from http://www.netmba.com/mgmt/ob/motivation/mcgregor/