DOUGLAS

MURRAY
MCGREGO
R
AND HIS “THEORY X”
AND “THEORY Y”
DOUGLAS MCGREGOR
 Born in the metropolis of Detroit, Michigan
 Worked as a night clerk in a family-owned business
at McGregor Institute
 Studied Psychology at College of the City Detroit
(now widely known as Wayne State University)
 At the age of 19, drop out from school and got
married
 DOUGLAS
 MCGREGOR
In the year 1932, he finally finished his College studies
and earned his first degree at McGregor Institute
 He further continued his graduate studies at Harvard
University which he earned his Masters and PhD in
Psychology
became one of the lecturers of Psychology in Harvard
University
DOUGLAS
MCGREGOR
In the year 1960, he published his first book entitled
“Human Side of Enterprise”
 Considered as the contemporary Abraham Maslow
 First theorist to apply behavioral science to the
world of business and leadership
HUMAN
SIDE OF
ENTERPRIS
E
HUMAN SIDE OF
ENTERPRISE
An attempt to alter the traditional and
conventional managerial approach towards its
employees
 Theory X And its
Theoretical Assumptions

Theory Y and its

Theoretical Assumptions
and its application

How Managerial Talent Can

Be Developed
THEORY X
 management by control
 the conventional and traditional management
approach of a manager towards its employees
 reflects the conventional organization structures,
managerial policies, practices and programs
THEORETICAL
ASSUMPTIONS
In terms of the management:
1. Management is responsible for organizing the
elements of productive enterprise – money
materials, equipment, people – in the interest of
economic ends.
THEORETICAL
ASSUMPTIONS
In terms of the management:
2. With respect to people, this is a process of
directing their efforts, motivating them, controlling
their actions, modifying their behavior to fit the
needs of the organization.
THEORETICAL
ASSUMPTIONS
In terms of the management:
3. Without active intervention by the management,
people would be passive – even resistant – to
organizational needs. They must therefore be persuaded,
rewarded, punished, controlled – their activities must be
directed. We often sum it up by saying that management
consists of getting things done through other people.
THEORETICAL
ASSUMPTIONS
In terms of the employee/individual:
1. The average man is by nature indolent – he works
as little as possible.
2. He lacks ambitions, dislikes responsibility, and
prefers to be led.
THEORETICAL
ASSUMPTIONS
In terms of the employee/individual:
3. He is inherently self-centered, indifferent to
organizational needs.
4. He is by nature resistant to change.
5. He is gullible, not very bright, the ready dupe of
the charlatan and the demagogue.
 TWO EXTREMES
HARD OR STRONG SOFT OR WEAK
inclined with command is endowed with being
and control permissive, satisfying
people’s demands, and
seeking and achieving
harmony between
managers and employees
 LOOPHOLES
HARD OR STRONG SOFT OR WEAK
“Force breeds counterforces: “It leads frequently to the abdication
restriction of output, of management – to harmony,
antagonism, militant unionism, perhaps, but to indifferent
subtle but effective sabotage of performance. People take advantage
managerial objectives” of the soft approach. They continually
expect more, but they give less and
(Management Review, 1957) less (Management Review, 1957)”
 SATISFACTION OF
NEEDS
 In the Theory X, the managers and the organization
believe and assume that the only needs of its employees
are money and security
 Nonetheless, managers failed to note and foresee that
the more they satisfy the so-called needs of its employees,
the less they become motivated to do their work in the
organization since these needs are being satisfied
a satisfied need is not a
motivator of behavior

Douglas McGregor
THEORY Y
 management by objectives
 approach of creating new opportunities,
releasing potentials of employees, removing
obstacles, encouraging growth within the job
environment and within its fellows, and
providing guidance by its managers.
THEORETICAL
ASSUMPTIONS
1. Management is responsible for organizing the
elements of productive enterprise – money, materials,
equipment, people – in the interest of economic needs.
2. People are not by nature passive or resistant to
organizational needs. They have become so as a result
of experience in organizations.
THEORETICAL
ASSUMPTIONS
3. The motivation, the potential for development, the capacity for
assuming responsibility, the readiness to direct behavior toward
organizational goals are all present in people. Management does not
put them there. It is the responsibility of management to make it
possible for people to recognize and develop these human
characteristics for themselves.
4. The essential task of management is to arrange organizational
conditions and methods of operation so that people can achieve their
own goals best by directing their own efforts towards organizational
objectives.
LOOPHOLES
 its application to the industrial organization
and its vantage point in organization cannot
be easily imposed and adopted since
conventional and traditional approach is
deeply rooted in the people management
INNOVATIVE
APPROACHES
1. Decentralization and Delegation
2. Job Enlargement
3. Participation and Consultative
Management
4. Performance Appraisal
CRITICISMS
Miner (2003)
 the theory presented by McGregor has few direct tests
of formulation
did not conducted nor attempted to test his
assumptions for him to be able to prove the operational
capacities of the variables he presented in his theory
CRITICISMS
Kopelman, Prottas, and David (2008)
 the impact of managerial assumptions towards its
employees has remained virtually unexamined due to the
absence of prior construct validation research
 the practices of management which McGregor believes to
be in consonance with his Theory Y are “often interpreted as
a proxy for assessing the validity of McGregor’s theorizing”
CRITICISMS
Fiman (1973)
 The said existence of Theory Y was
positively related to job satisfaction but
totally unrelated to job performance.
 CONCLUSION
 McGregor’s Theory X and Theory Y spur not only the capacities of the
organization on how to deal with its employees and on how to handle the
needs and behavior of its employees but also the empirical studies of
understanding human behavior in the context of organization and business
 McGregor has not only challenged the theorists and scholars in the field of
organizational management but also the managers itself in how effective
and efficient they could get in managing their subordinates since they play
a vital role in the achievement of the organizational goals.