McGregor Theory X and Theory Y

McGregor idenfied two styles of managing:

    Theory X    =    Autocratic Management
    Theory Y    =    Participative Management

Theory X assumes the following:

•     The average person dislikes work and will try to avoid it
•    Because people dislike work, they must be coerced through threat and punishment if   they have to contribute to organizational objectives
•    Above all, people want security, they prefer to be led and avoid responsibility.

Theory Y assumes:

•    Work is as normal as play
•    Threat of punishment is only one way to make people work
•    Committed people are self motivated and self directed
•    Under the right conditions the average person will seek and like responsibility
•    The ability to think creatively, to innovate and solve problems are widely distributed among people.


McGregor felt that theory X assumptions were used in most industrial organization but were inadequate for the full utilization of each worker's potential. Theory X advocates for external motivation mainly through threat or punishment. Theory Y looks at employees as self fulfilling and highly internally motivated. With the proper environment i.e one which employees can best achieve their own goals by committing themselves to the organizational goals, employees will exercise a large degree of internal motivation.

The heavy emphasis on internal motivation (Y) implies that all employees will be motivated by self esteem and self actualization needs while on the job. This is not always so—some people are uncomfortable with too much freedom.

Managers must remember that each employee is unique and should be understood and treated as such. Therefore external motivation should be flexible enough to accomodate each unique person in the organization. People should not be forced to fit into rigid theory or into one manager's view point.