Theory X managers create situations where workers
become dependent and reluctant
– Theory Y managers create situations where workers
respond with initiative and high performance


• Douglas McGregor’s Theory X assumes that workers:
– Dislike work
– Lack ambition
– Are irresponsible
– Resist change
– Prefer to be led

Can also be called ‘Authoritarian’ style( close supervision, intimidation, penalty/rewards)

• McGregor’s Theory Y assumes that workers are:
– Willing to work
– Capable of self control
– Willing to accept responsibility
– Imaginative and creative
– Capable of self-direction
Can also be called ‘Participative’ style( enabling environment,
encouraging initiative taking, suggestions are welcome)

• Implications of Theory X and Theory Y:
– Theory X managers create situations where workers
become dependent and reluctant
– Theory Y managers create situations where workers
respond with initiative and high performance
• Central to notions of empowerment and self-management

• Most managers will likely use a mixture of Theory X and Theory Y. You may,
however, find that you naturally favor one over the other. You might, for
instance, have a tendency to micromanage or, conversely, you may prefer to
take a more hands-off approach.

• Although both styles of management can motivate people, the success of each
will largely depend on your team’s needs and wants and your organizational

• You may use a Theory X style of management for new starters who will likely
need a lot of guidance, or in a situation that requires you to take control such
as a crisis

• But you wouldn’t use it when managing a team of experts, who are used to
working under their own initiative, and need little direction. If you did, it
would likely have a de-motivating effect and may even damage your
relationship with them.

• However, both theories have their challenges. The restrictive nature of Theory
X, for instance, could cause people to become demotivated and non- cooperative if your approach is too strict. This may lead to high staff turnover and could damage your reputation in the long term

Conversely, if you adopt a Theory Y approach that gives people too much
freedom, it may allow them to stray from their key objectives or lose
focus. Less-motivated individuals may also take advantage of this more
relaxed working environment by shirking their work.

• If this happens, you may need to take back some control to ensure that
everyone meets their team and organizational goals.

• Circumstance can also affect your management style. Theory X, for
instance, is generally more prevalent in larger organizations, or in teams
where work can be repetitive and target-driven.

• In contrast, Theory Y tends to be favored by organizations that have a
flatter structure, and where people at the lower levels are involved in
decision making and have some responsibility.

Theory Z

The Theory Z was invented by the American economist and management
professor William Ouchi, following the X and Y theory by Douglas
McGregor in the 1960s. The theory Z was introduced in the 1980s by
William Ouchi as the Japanese consensus style. He argued that western
organisations could learn from their Japanese counterparts. In 1981
William Ouchi, of Japanese heritage, wrote his book ‘Theory Z: How
American Business can meet the Japanese Challenge.‘ According to Ouchi,
the theory Z promotes stable employment, high productivity and high
morality and employee satisfaction. The loyalty of employees is increased
by offering them a job for life with a strong focus on employee well-being
both on the job as well as in their private lives.

• The Type Z organization emphasizes on communication, collaboration,
and consensus in decision making

• Argyris’s theory of adult personality( Maturity Theory)
– Classical management principles and practices inhibit worker maturation and
are inconsistent with the mature adult personality
– Psychological success occurs when people define own goals

For Reading this-Management theorist Chester Barnard believed-Click here

• According to this theory, a persons’ development is processed along a continuous
break of an immaturity situation to a maturity situation. A mature person is
characterized for being active, independent, self-confident and self-controlled. On
the contrary, an immature person is passive, dependent, has lack of confidence
and feels need of control by others.

• Argyris’s believed that managers who treat people positively, and are responsible
adults, will achieve the highest productivity. He thought that common problems of
employee avoiding work, lack of interest, alienation and low morale may be signs
of mismatch between management practice and mature adult personality. His
solution to the problem is to expand job responsibilities; allow more task variety
and adjust supervisory styles to allow more participation and promote better
human relations.

Argyris’s theory of adult personality
– Management practices should accommodate the mature
personality by:
• Increasing task responsibility
• Increasing task variety
• Using participative decision making

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