8.2 Styles of Management

Theory X

In an influential book titled The Human Side of Enterprise, M. I. T. management professor Douglas McGregor described two contrasting perceptions on how and why people work, formulating Theory X and Theory Y; they are both based on Maslow’s hierarchy of needs (Maslow, A., 1954; Maslow, A., 1970). According to this model, people are concerned first with physical needs (e.g., food, shelter) and second with safety. At the third level, people seek love, acceptance, and intimacy. Self-esteem, achievement, and respect are the fourth level. Finally, the fifth level embodies self-actualization.

McGregor’s Theory X asserts that workers are motivated by their basic (low-level) needs and have a general disposition against labor. In this viewpoint, workers are considered lazy and predicted to avoid work if they can, giving rise to the perceived need for constant, direct supervision. A Theory X manager may be described as authoritarian or autocratic, and does not seek input or feedback from employees. The view further holds that workers are motivated by personal interest, avoid discomfort, and seek pleasure. The Theory X manager uses control and incentive programs to provide punishment and rewards. Responsibility is the domain of the manager, and the view is that employees will avoid it if at all possible to the extent that blame is always deflected or attributed to something other than personal responsibility. Lack of training, inferior machines, or failure to provide the necessary tools are all reasons to stop working, and it is up to the manager to fix these issues.

Theory Y

In contrast to Theory X, Theory Y views employees as ambitious, self-directed, and capable of self-motivation. Employees have a choice, and they prefer to do a good job as a representation of self-actualization. The pursuit of pleasure and avoidance of pain are part of being human, but work is also a reward in itself and employees take pride in their efforts. Employees want to reach their fullest potential and define themselves by their profession. A job well done is reward in and of itself, and the employee may be a valuable source of feedback. Collaboration is viewed as normal, and the worker may need little supervision.

Theory Z

Theory X and Y may seem like two extremes across the range of management styles, but in fact they are often combined in actual work settings. William Ouchi’s Theory Z combines elements of both, and draws from American and Japanese management style. It promotes worker participation and emphasizes job rotation, skills development, and loyalty to the company (Luthans, F., 1989). Workers are seen as having a high need for reinforcement, and belonging is emphasized. Theory Z workers are trusted to do their jobs with excellence and management is trusted to support them, looking out for their well-being (Massie J. and Douglas, J., 1992).

Each of these theories of management features a viewpoint with assumptions about people and why they do what they do. While each has been the subject of debate, and variations on each have been introduced across organizational communication and business, they serve as a foundation for understanding management in an intercultural context.