Theory X and Theory Y

While the work of Maslow and Herzberg advanced the importance of motivation in management, industrial psychologist Douglas Mc Gregor (1960) noted that many managers still clung to traditional managerial assumptions that workers had little interest in work and lacked ambition. McGregor labeled this style of management Theory X, which emphasized such tactics as control, threat, and coercion to motivate employees.

McGregor offered a diffrent approach to management, which he called Theory Y. Under Theory Y, managers did not rely on control and fear but instead integrated the needs of the workers and those of the organization. Employees could exercise self-control and self direction and develop their own sense of responsibility if given the opportunity. The managers role in Theory Y centers on matching the talents of the individuals with the proper position in organization and providing an appropriate system of rewards.