Theory X and Theory Y

'Theory X' and 'Theory Y' are theories of human motivation and management. They were created and developed by Douglas McGregor at the MIT Sloan School of Management in the 1960s. These theories describe two contrasting models of workforce motivation applied by managers in human resource management, organizational behavior, organizational communication and organizational development. McGregor terms the two models as 'Theory X', which stresses the importance of strict supervision and external rewards and penalties; and 'Theory Y', which highlights the motivating role of job satisfaction and allows scope for workers to approach tasks creatively.

Theory X

Theory X considers that on the whole, workers dislike their work, and have little inherent motivation to perform well. Therefore, if organizational goals are to be met, 'Theory X' managers must rely heavily on detailed rules and instructions, on close monitoring, and on the threat of punishment to gain employee compliance. When practiced, this theory can lead to mistrust, highly restrictive supervision and a punitive atmosphere. The 'Theory X' manager believes that all actions should be traced and the responsible individual given a direct reward or a reprimand according to the action's outcomes. This managerial style is more effective when used to motivate a workforce that is not inherently motivated to perform. It is usually exercised in professions where promotion is infrequent, unlikely or even impossible and where workers perform repetitive tasks. A flaw of this management style is that it limits the employee's potential and discourages creative thinking.