1. Describe McGregor's Theory X and Theory Y.

Mary Jones is a Theory X

manager. Bill Nolan is a Theory Y manager. Explain how each of these managers
would try to motivate bridge inspectors. Which theory do you think better
describes how people who inspect bridges are motivated? Why? Give examples
to support your major points. (30 points)

In 1960, Douglas McGregor formulated Theory X and Theory Y suggesting two

aspects of human behaviour at work, or in other words, two different views of
individuals (employees): one of which is negative, called as Theory X and the other is
positive, so called as Theory Y. According to McGregor, the perception of managers
on the nature of individuals is based on various assumptions.

Assumptions of Theory X

• An average employee intrinsically does not like work and tries to escape it whenever
possible.

• Since the employee does not want to work, he must be persuaded, compelled, or
warned with punishment so as to achieve organizational goals. A close supervision is
required on part of managers. The managers adopt a more dictatorial style.

• Many employees rank job security on top, and they have little or no aspiration/
ambition.

• Employees generally dislike responsibilities.

• Employees resist change.

• An average employee needs formal direction.

Assumptions of Theory Y

• Employees can perceive their job as relaxing and normal. They exercise their
physical and mental efforts in an inherent manner in their jobs.

• Employees may not require only threat, external control and coercion to work, but
they can use self-direction and self-control if they are dedicated and sincere to achieve
the organizational objectives.

• If the job is rewarding and satisfying, then it will result in employees’ loyalty and
commitment to organization.

• An average employee can learn to admit and recognize the responsibility. In fact, he
can even learn to obtain responsibility.

• The employees have skills and capabilities. Their logical capabilities should be fully
utilized. In other words, the creativity, resourcefulness and innovative potentiality of
the employees can be utilized to solve organizational problems.
Thus, we can say that Theory X presents a pessimistic view of employees’ nature and
behaviour at work, while Theory Y presents an optimistic view of the employees’
nature and behaviour at work. If correlate it with Maslow’s theory, we can say that
Theory X is based on the assumption that the employees emphasize on the
physiological needs and the safety needs; while Theory X is based on the assumption
that the social needs, esteem needs and the self-actualization needs dominate the
employees.

McGregor views Theory Y to be more valid and reasonable than Theory X. Thus, he
encouraged cordial team relations, responsible and stimulating jobs, and participation
of all in decision-making process.

Implications of Theory X and Theory Y

Quite a few organizations use Theory X today. Theory X encourages use of tight
control and supervision. It implies that employees are reluctant to organizational
changes. Thus, it does not encourage innovation.

Many organizations are using Theory Y techniques. Theory Y implies that the
managers should create and encourage a work environment which provides
opportunities to employees to take initiative and self-direction. Employees should be
given opportunities to contribute to organizational well-being. Theory Y encourages
decentralization of authority, teamwork and participative decision making in an
organization. Theory Y searches and discovers the ways in which an employee can
make significant contributions in an organization. It harmonizes and matches
employees’ needs and aspirations with organizational needs and aspirations.

THEORY X

Theory X is based on assumptions regarding Mary Jones, the theory X manager.This

management style assumes that the typical worker has little ambition, avoids
responsibility, and is individual-goal oriented. In general, Mary Jone(Theory X) style
manager believe her employees are less intelligent, lazier, and work solely for a
sustainable income. Management believes employees’ work is based on their own
self-interest. Managers who believe employees operate in this manner are more likely
to use rewards or punishments as motivation. Due to these assumptions,Mary Jones(
Theory X )concludes the typical workforce operates more efficiently under a hands-on
approach to management. Mary Jones( Theory X) manager believe all actions should
be traceable to the individual responsible. This allows the individual to receive either
a direct reward or a reprimand, depending on the outcome’s positive or negative
nature. This managerial style is more effective when used in a workforce that is not
essentially motivated to perform.

According to McGregor, there are two opposing approaches to implementing Mary

Jones (Theory X): the hard approach and the soft approach. The hard approach
depends on close supervision, intimidation, and immediate punishment. This
approach can potentially yield a hostile, minimally cooperative workforce that may
cause resentment towards management. Managers are always looking for mistakes
from employees because they do not trust their work. Mary Jones(Theory X) is a “we
versus they” approach, meaning it is the management versus the employees.
The soft approach is characterized by leniency and less strict rules in hopes of creating
high workplace morale and cooperative employees. Implementing a system that is too
soft could result in an entitled, low-output workforce. McGregor believes both ends of
the spectrum are too extreme for efficient real-world applications. Instead, McGregor
feels that an approach located in the middle would be the most effective
implementation of Mary Jone (Theory X).

Because managers and supervisors are in almost complete control of the work, this
produces a more systematic and uniform product or workflow. Mary Jones (Theory X
)can benefit a workplace that utilizes an assembly line or manual labor. Using this
theory in these types of work conditions allows employees to specialize in particular
work areas which in turn allows the company to mass-produce a higher quantity and
quality of work.

Theory Y

Bill Nolan(Theory Y) manager assume employees are internally motivated, enjoy their
job, and work to better themselves without a direct reward in return. These managers
view their employees as one of the most valuable assets to the company, driving the
internal workings of the corporation. Employees additionally tend to take full
responsibility for their work and do not need close supervision to create a quality
product. It is important to note, however, that before an employee carries out their
task, they must first obtain the manager’s approval. This ensures work stays efficient,
productive, and in-line with company standards.

Bill Nolan(Theory Y )managers gravitate towards relating to the worker on a more

personal level, as opposed to a more conducive and work-based relationship. As a
result, Bill Nolan( Theory Y) followers may have a better relationship with their boss,
creating a healthier atmosphere in the workplace. In comparison to Mary Jone (Theory
X), Bill Nolan (Theory Y) incorporates a pseudo-democratic environment for the
workforce. This allows the employee to design, construct, and publish their work in a
timely manner in co-ordinance with their workload and projects.

Although Bill Nolan(Theory Y) encompasses creativity and discussion, it does have

limitations. While there is a more personal and individualistic feel, this leaves room for
error in terms of consistency and uniformity. The workplace lacks unvarying rules and
practices, which could potentially be detrimental to the quality standards of the product
and strict guidelines of a given company.

The following is listed as forms of motivation for Mary Jones could be described as
Theory X: –

• Understand what moves or breaks the individual. What makes the person happy and
unhappy is a catalyst for getting them to do what is required of them. Don’t just leave
your employees without knowing what is eating them up.

• It is not sufficient to establish strict rules and close monitoring. The lazy or non-
motivated staff should be given equal tasks as that of Theory Y. Place them in the
same environment (office, room, workspace, etc.). The Theory X person is likely to
observe how the Theory Y person is working. The learning and motivation process
begins here.

• Motivate Mary Jones(Theory X ) by praising them for the little efforts they put up.
This goes a long way to let them step up their efforts.

• Have time for both the self-motivated and the lazy ones. Frequently take them out
for coffee, lunch or dinner. At these events, ask about their performance targets and
find out how their work could be enhanced. A more relaxed atmosphere of the sort
brings the best out of people for them to openly speak out.

• Reward people openly for their great achievements. This encourages other staff to
take up the challenge with the hope of getting the same.

Motivating Salespeople
The Burnett corporation manufactures automatically controlled production systems,
costly equipment usually purchased by senior executives. Only 16% of its sales force
has five or more years of experience selling with the company. The best young
salespeople try to get out of the sales force and win a promotion our management.
Joe Morporgo, the national sales manager, views this turnover as a problem because
of the high cost of constantly training new salespeople.
He thinks it would be desirable to find a way to motivate people to become "career
salespeople," especially if their strongest abilities are in selling rather than in
administration or management.

1. How would Frederick Herzberg suggest that the Burnett Corporation might
persuade people to become career salespeople? How would goal-setting theory
suggest that the company might persuade people to become career salespeople?
Using relevant insights from the class and the textbook discuss the advantages and
disadvantages of each approach.

2. Would you use either or both of the two strategies if you were the sales
manager? Why?
Frederick Herzberg's Two-Factor Theory suggests that people are motivated by two
types of factors: hygiene factors and motivators. Hygiene factors are necessary but
not sufficient for motivation and include things like salary, job security, and working
conditions. Motivators, on the other hand, are the things that truly drive people and
include things like recognition, achievement, and responsibility.
To persuade people to become career salespeople, Herzberg would likely recommend
that the Burnett Corporation focus on motivators. This could involve providing
salespeople with opportunities for achievement and recognition, such as through a
commission-based pay structure or a formal recognition program. It could also involve
giving salespeople more responsibility and autonomy in their work, which can be a
powerful motivator for those who are passionate about sales.

Goal Setting Theory, on the other hand, suggests that people are motivated when
they set specific, challenging goals for themselves and receive feedback on their
progress. To persuade people to become career salespeople, the Burnett Corporation
could use this theory by setting clear, challenging sales targets and providing regular
feedback to salespeople on their progress towards these targets. This could be
combined with a reward system that provides incentives for achieving these goals.

Advantages of Herzberg's approach:

Focuses on intrinsic motivators, which can lead to longer-lasting and more meaningful
motivation for salespeople.
Encourages salespeople to pursue a career in sales, rather than simply using it as a
stepping stone to other roles.
Can help build a sense of community and teamwork among salespeople.
Disadvantages of Herzberg's approach:
May be less effective for salespeople who are primarily motivated by extrinsic factors
like salary or job security.
Can be difficult to implement in practice, particularly in a sales environment where
metrics like revenue and customer acquisition are often the primary focus.
Advantages of goal setting theory approach:
Provides a clear roadmap for salespeople to follow, which can help them stay focused
and motivated.
Can be easily measured and tracked, allowing sales managers to provide regular
feedback to their team.
Provides a clear path for career progression based on performance.
Disadvantages of goal setting theory approach:
May lead to a focus on short-term results rather than long-term success, as
salespeople may be incentivized to prioritize meeting their targets over building lasting
relationships with customers.
Can be demotivating for salespeople who consistently miss their targets, particularly
if they feel that the targets are unrealistic or unfair.
If I were the sales manager, I would likely use a combination of both strategies. I would
focus on providing salespeople with opportunities for achievement and recognition, as
well as giving them more responsibility and autonomy in their work. At the same time,
I would set clear, challenging sales targets and provide regular feedback on progress
towards those targets. I would also provide a reward system that incentivizes
salespeople to achieve these goals, but would be careful to ensure that this doesn't
lead to a focus on short-term results at the expense of building long-term customer
relationships. Overall, I believe that a combination of Herzberg's and goal-setting
theory approaches would be most effective in motivating salespeople to pursue a
career in sales with the Burnett Corporation.
Definition of Theory X and Theory Y:

Theory X and Theory Y was an idea started by Douglas Mcgregor  in the year 1960. It was first
published in his book ‘The Human Side of Enterprise’.  Both theories centre around the
Management Styles in a working environment.

Theory X applies to individuals whom are reluctant to work and need to be urged to work in most
cases and are more inclined to work for extrinsic rewards, and as such, an authoritarian style needs to
be adapted in order to keep these individuals in line. It highlights the limitations of manpower within
an organization, and that an authoritarian style needs to be used in order to correct these limitations.

Theory Y applies to individuals who have a high level of autonomy within a workplace. The
authoritarian style from Theory X is highly ineffective on them, as these individuals have a high degree
of self-direction, crave for intrinsic rewards, and show an unwavering commitment towards achieving
any given objectives. A participative style is much more suited to these individuals as more
participation means that these individuals can easily satisfy their intrinsic needs of self-respect and
achievements.

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Five Important Limitations about Theory X & Theory Y:

1. Theory X style of management fosters a very hostile and distrustful atmosphere- An authoritarian
organization requires many managers just because they need to constantly control every single
employee, and the method of control usually involves a fair amount of threat and coercion.

At times, an employer that is overly threatening will lead to dissatisfaction among employees, or they
might even attempt to blame each other in order to save themselves from the threats.

Conversely, Coercion might work better with the prospects of bigger rewards for more, but employees
might purposely try to cheat or attempt to hide the truth itself. Also, employees might try to sabotage
the efforts of each other in order to make it easier for them to achieve the rewards.

2. Theory Y style of management  is tough to uphold in reality- The core belief of Theory Y, is that
with the right support and the right environment, self-directed employees will be able to perform
their jobs well. However, because every individual is different from one another, creating an
environment which fits all does not sound very practical in the current era of organizations.

3. Theory X and Theory Y is very hard to be used with each other- Just because we think that utilizing
 different theories  in order to accommodate different types of employees does not mean that it
would be beneficial to the companies. In the end, the human labor of the company might be improved,
but at the cost of creating monetary loses as well as inefficient allocation of resources.

For example, a company decides to use both theories together. So, in order to accommodate the need
of employees who are managed based on Theory X, more employers will need to be hired and paid. Â
The company also needs to pay and to create a comfortable environment for employees that are self-
motivated based on a theory Y concept. It costs a small fortune for the company to cater to the
different tastes of so many employees. It is estimated that the company spending would be high
enough based on these factors alone.

Therefore, it might just be more beneficial for the company to utilize a single theory and hire
employees that can be consistently managed with that theory alone.
4. Theory X and Theory Y makes employment harder- Previously, I’ve said that companies should
only use a single theory at once. The theory that should be used is the one that can effectively manage
all employees within the organization.

However, this in turn causes a problem during the employment process, because it is likely that a
company will reject an applicant solely because he/she is not consistent with the theory that the
company uses.

Therefore, if companies actually follow these theories closely, it will be harder for potential candidates
to get a job just because the company cannot handle their characteristics within the workplace and
may give candidates that the company discriminates heavily upon its applicants.

5. Theory X and Theory Y work on assumptions- I think organizations should be careful, and not rely
too heavily on Theory X and Theory Y because there are a lot of assumptions.

The workforce is changing nowadays, and the workplace is a dynamic mix of employees from different
backgrounds, races and genders. Also, employees might have completely different motivations and
goals for choosing to work within an organization.

Nowadays, an employee from Generation X might come into the workforce from his/her previous
retirement, and Generation Y employees might be wrongly perceived as ‘slackers’ for relying
more on technology to manage their meetings and make their jobs easier .

There are so many other factors that influence the employee behaviour within an organization in this
current era, so Theory X and Theory Y may even be slightly obsolete.

Discuss McGregor's Theory X and Theory Y concept in detail.

Douglas McGregor - leadership theory by McGregor which we have known as

Theory X and Theory Y). This theory deals with the managers and their way of
managing people in which Douglas identifies perception X and Y about people.

Theory X

In Theory X, He pointed out the old and generic concept of management where it is
assumed that a manager knows his or her team well and what he or she portrays is
the actual picture of the team and hence it needs a close supervision to form the
managers and more micromanagement. So it is assumed that as per theory X that
people generally don’t want to work and are lazy in nature and try to avoid work until
and unless they are being supervised as people are by nature love to being
controlled by managers while at work and don’t want to take any responsibilities of
their work

Theory Y

This is something opposite to the theory Y. Here managers think that people are
motivated by themselves and work enthusiastically for the task given and they don’t
need any supervision and hence no further reward and punishment system hamper
much of their performance.
McGregor's Theory X and Theory Y relate to:

McGregor's Theory X and Theory Y explains the perceptions that a manager holds
towards their employees in the organization. This theory was created by Douglas
McGregor. These theories describes the contrasting models of workforce
motivation used by managers in human resource management in organizations.

Managers belonging to Theory X category believes that most of the employees do

not like to work and will try to avoid it as much as possible. So inorder to make the
employees work, they believe that they should control, threaten punishment and
should force employees to do their jobs. The managers who fall under this category
believes that employees can be motivated by fear and money and tends to watch the
employees very closely. In these cases punishment is more common than reward.

Managers belonging to Theory Y assumes that the employees like to work and they
enjoy working towards a goal. They believe the commitment towards the goal
increases based on the reward given for achieving them. Employees seeks
responsibility and their creativity, cleaverness and imagination can be used to solve
problems. In this case, employees are motivated by a variety of rewards.