After graduating from Harvard with a PhD, McGregor was the first full time psychologist at Massachusetts Institute of Technology.
He helped create its Industrial Relations Section. McGregor later went on to be the President of Antioch College for 6 years, and throughout his career he advised for union and management the same and served on the panel of arbitrators for the American Arbitration Association. When he was a child, McGregor worked in his grandfather's institute for laborers in Detroit, where he gained knowledge into what mental challenges were caused by abor.
Later, as district manager for a retail gasoline merchandising firm, he learned the importance of management and its dealings with organizational behavior. In 1960, McGregor took his knowledge of the management world of business and went on to write a book named, The Human Side of Enterprise, which broke down the managerial side of busi
...ness into two sets of assumptions about human nature and described how these elements affect people's mental state and influence the behavior of others, especially describing the affect managers' attitudes have on employees.
McGregor suggested that the way that manager's, and other authoritative figures, were affected by the subtle, but frequent unconscious effects of their assumptions about people. The following a breakdown of how the specific theories that Douglas McGregor brought up in his book, The Human Side of Enterprise.
Theory X Management
- According to McGregor, Theory X leadership assumes the following:
- Work is inherently distasteful to most people, and they will attempt to avoid work whenever possible.
- Most people are not ambitious, have little desire for responsibility, and refer to be directed. Most people have little aptitude for creativity
in solving organizational problems.
The Hard Approach and Soft Approach
- Under Theory X, management approaches to motivation range trom a nard approach to a soft approach. The hard approach to motivation relies on coercion, implicit threats, micromanagement, and tight controls essentially an environment of command and control.
- The soft approach, however, is to be permissive and seek harmony in the hopes that, in return, employees will cooperate when asked. However, neither of these extremes is optimal. The hard approach results in hostility, purposely low- output, and extreme union demands.
- The soft approach results in increasing desire or greater reward in exchange for diminishing work output. It would appear that the optimal approach to human resource management would be lie somewhere between these extremes.
- However, McGregor asserts that neither approach is appropriate since the foundations of theory x are incorrect. The Problem with X Theory Drawing on Maslow's Hierarchy of Needs, McGregor argues that a need, once satisfied, no longer motivates. The company relies on monetary rewards and benefits to satisfy employees' lower level needs.
Once those needs have been satisfied, the motivation is gone. This management style, in fact, hinders the satisfaction of higher- level needs. Consequently, the only way that employees can attempt to satisfy higher level needs at work is to seek
more compensation, so it is quite predictable that they will focus on monetary rewards.
While money may not be the most effective way to self-fulfillment, it may be the only way available. People will use work to satisfy their lower needs, and seek to satisfy their higher needs during their leisure time.
Unfortunately, employees can be most productive when their work goals align with heir higher level needs. McGregor makes the point that a command and control environment is not effective because it relies on lower needs for motivation, but in modern society those needs are mostly satisfied and thus no longer motivate. In this situation, one would expect employees to dislike their work, avoid responsibility, have no interest in organizational goals, resist change, etc. , thus creating a self-fulfilling prophecy. To McGregor, motivation seemed more likely with the Theory Y model.
Theory Y The higher-level needs of esteem and self-actualization are continuing needs in hat they are never completely satisfied. As such, it is these higher-level needs through which employees can best be motivated.
- In strong contrast to Theory X, Theory Y leadership makes the following general assumptions:
- Work can be as natural as play if the conditions are favorable.
- People will be self-directed and creative to meet their work and organizational objectives if they are committed to them.
People will be committed to their quality and productivity objectives if rewards are in place that address higher needs such as self-fulfillment. The apacity for creativity spreads throughout organizations.
- Most people can handle responsibility because creativity and ingenuity are common in the population.
Under these conditions, people will seek responsibility. Under these assumptions, there is an opportunity to
align personal goals with organizational goals by using the employee's own need for fulfillment as the motivator. McGregor stressed that Theory Y management does not imply a soft approach. McGregor recognized that some people may not have reached the level of maturity assumed by Theory Y and
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