What’s your management style?

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An Introduction to Workforce Motivation Theory

Theory X and Theory Y

Theory X and Theory Y were developed by MIT Sloan School of Management professor Douglas McGregor in his 1960 book, The Human Side of Enterprise.

Similar to Abraham Maslow’s hierarchy of needs, McGregor’s Theory X and Theory Y developed from his understanding of human motivation. The two theories explore the different ways managers handle their reports and how assumptions about those employees lead to (or hinder) the success of the individual contributor.

Who uses Theory X?

A manager who falls under Theory X starts from the assumption that the average person is lazy. They view their employees as having little ambition to do well, preferring to loaf or evade tasks–they’re only there to collect a paycheck. In this point of view, an employee’s decision-making process is self-motivated and not for the benefit of the company as a whole.

To handle those perceived ‘bad employees,’ a manager might take two approaches: the hard approach and the soft approach.

For the hard approach, Theory X managers might be overly critical and micro-managerial, practicing close supervision. Their point of view is one of a ‘we vs. them,’ where they believe that the core structure of their organization is ‘employees versus management.’ This division fosters distrust and dislike of management from the employees, perpetuating a cycle of assumptions and tension. So the outcome of the hard approach, according to McGregor, is diminishing results, low-output, and hostility from employees.

For the soft approach, Theory X managers may be overly lax and non-proscriptive, believing that by letting workers do what they want, they’ll feel cared for by the company and in return, do their part to make it successful. We call this the ‘cool mom’ approach. It often fails–instead, a soft approach leads to ever-increasing demands from the employees for more money, benefits, and perks.

McGregor asserts that neither scenario is practical for workplace productivity. With the soft approach, workers are satisfied by their employment and thus already at a high enough rung of motivation. With the hard approach, the work environment hinders employee motivation by keeping them stuck in the lower levels of Maslow’s hierarchy and unable to care about any rewards beyond monetary gain.

Who uses Theory Y?

Theory Y managers see employees as capable, talented, and motivated for reasons beyond money. They believe their employees desire self-actualization and do fantastic work because of an innate passion for their domain. Theory Y management trusts that employees can work independently, and feel that trust will allow the employee to do their best work. With this in mind, the relationship between managers and their reports should focus on the human side of work like interpersonal relationships in the workplace, career objectives, and skill development.

By believing employees want to do good work and allowing them to practice self-direction, Theory Y managers are potentially freeing their employees to attain the highest level of Maslow’s hierarchy: self-actualization.

Many modern managerial styles and activities have arisen either directly from or concepts similar to Theory Y. Think of one-on-onesdistributed responsibility companies, and skill matrixesMany performance review frameworks have been developed based on Mcgregor’s concept of, ‘performance appraisals’–where employees set objectives for themselves based on organizational goals and rate their progress on those objectives.

Which management style should you use?

Before you jump to Theory Y, McGregor himself said the most effective workplace would incorporate a blend of the two styles. To understand why we should look to contingency theory.

What is the contingency theory?

Contingency theory is an organizational theory positing that there is not a single best method to organize a corporation, to lead a company, or to make decisions.

McGregor was influenced by Fred Fiedler, who had developed his theory on organizational behavior now known as ‘Fiedler’s contingency model.’ This model asserted that one’s leadership style is generated from their life experiences and is not able to be changed (easily). So, instead of trying to change managers, help them understand their particular style, and put them in situations where they are best suited to lead.

Part 1: Determining leadership style

Fiedler developed a scale with the unfriendly name of “Least Preferred Coworker” (LPC). LPC asks the person taking the test to think of someone who they like working with the least and rate their attributes on an eight-point scale like so:

The result is not a rating about the leadership style of the object of the test (that ‘least preferred coworker’) but instead informs one about the style of the person taking the test. With whom do they work well? What are their motivators?

If someone rates their least preferred coworker as having some positive attributes, they are known as a ‘relationship-motivated leader.’ Whereas someone who is more cynical about the coworker likely values productivity and performance and is known as a ‘task-motivated leader.’

Part 2: Determine the best situation for the leader

Neither leadership style is better than the other in a broad sense, but on a case-per-case basis, each method has an advantage. To determine which case a situation falls into, you have to start from the point of view that a manager (as the organizational leader) must be able to control a situation efficiently to have any positive impact.

There are three main components for judging a situation:

  1. Leader-Member Relations: How much mutual trust, respect, and confidence exists between the leader and the subordinates? — When leader-member relations in the group are poor, the leader has to shift focus away from the group task to manage tension

  2. Task Structure: Are group tasks are clear and structure? -When a task is unstructured, it has no clear solution. When a task is structured, anyone performing that task knows how to approach and solve it.

  3. Leader Position Power: What’s the leader’s title? How much power do they have?

Task-motivated leaders (those who received a low rating on the LPC scale) perform best at extremes. Meaning, they perform well in situations where their power, control, and influence are very high, or where uncertainty is very low, or where the situation is unfavorable, or where they have little power, control, and impact.

Relationship-motivated leaders (those with a high LPC rating) perform best in the middle-ground–where they have moderate power, control, and influence.

Cognitive resonance theory

Critics say Fiedler’s theory does not take into account individual attributes like intelligence. For example, a powerful and influential task-motivated leader who is also very, very stupid is not likely to be useful in any situation.

This criticism led to Fiedler developing his cognitive resonance theory, which takes into account a leader’s intelligence and how they react to stress as predictors of their efficiency. Another factor that researchers have found to be positively impactful for leadership is experience. Some researchers have found that a leader’s experience matters more than intelligence about performance.

What does this all mean?

Fiedler built his contingency model on the theory that there is no single best way to manage people.

You have to try a lot of different methods, be open to feedback, and also be continuously looking to change–with each personnel change in the company, managerial styles may also need to shift.

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