Management theorist Douglas McGregor coined these terms to describe two fundamentally different approaches to managing people. Theory X is based on the assumption that the average person has an inherent dislike of work (physical and mental effort), does not want responsibility, and lacks ambition. Therefore, managers must direct employees, control them through close supervision, and coerce them into putting in effort with threats of punishment. In contrast, theory Y assumes that the average person enjoys work, wants responsibility, and is ambitious. The manager must harness the employees' effort and creativity through gaining their commitment to the organization's goals, which entails allowing self-direction and discretion, reinforced through a system of feedback and rewards. By conceptualizing theories X and Y, McGregor drew attention to the assumptions about human nature that lie behind different approaches to managing people. In fact, he was describing two opposite extremes, and was suggesting that managers have a tendency more towards one than the other and that this influences their management style. McGregor advocated the superiority of theory Y in unleashing human potential, but theory X still thrives in many successful contemporary organizations.
Subjects: Human Resource Management.