H. isthey are some useful rules of thumb. Anyone who calls themselves a thought leader should be avoided. A man with no socks can’t be trusted. And a company that holds an employee appreciation day does not value its employees.
Not only is the message sent by recognizing employees for one out of 260 odd working days a little bit of giving (there is no Valentine’s Day or national day for the t-be-a-total). – bastard week for the same reason). It is also that the comments are usually so unhappy. You’ve been working hard all year to get a slice of cold pizza or a rock stamped with the words “You rock”?
This approach reveals more about the beliefs of the ideal bosses than it does about what really motivates people at work (the subject of this week’s final episode of Boss Class, our management podcast) . In a book published in 1960, called “The Human Side of Enterprise”, Douglas McGregor, a professor at MIT Sloan School of Management Division, Managers’ perceptions of employees in two departments. He called them Theory X and Theory Y.
McGregor, who died in 1964, was a product of his time. The vignettes in the book feature men with names like Tom and Harry. But his ideas are still useful.
Theory X managers believe that people naturally like to work; their job is to try to get the slackers to put in some effort. That requires exercising authority and control. It relies heavily on the idea of giving and holding awards to motivate people. Perks and pizza fit this picture but pay is critical to theory X; labor is the price to be paid for wages.
Theory Y, the one McGregor himself was involved in, is based on a much more optimistic view of people. It assumes that people want to work hard and that managers do not need to direct if employees are committed to the company’s goals. He argues that pay can be a shame if it is too low or unfair, but once people earn enough to take care of their basic needs, wells another more important incentive. In this, McGregor was a follower of Abraham Maslow, a psychologist whose hierarchy of needs moves from having enough to eat and feeling safe up to higher-level concepts such as belonging, self-esteem and reason.
Theory X is not dead. It lives on in low-wage businesses where workers must follow the rules to the letter and in high-wage ones where payaaa It shows in the fear of managers that working from home is a golden excuse for people to do nothing. It shows in the behavior of employees who call in and bosses who bully and behave.
Nevertheless, theory Y is on the rise. You can’t move for research that shows that if people think what they are doing is important, they work harder. A meta-analysis of such research, conducted by Cassondra Batz-Barbarich of Lake Forest College and Louis Tay of Purdue University, found that meaningful work is strongly linked to levels of employee engagement, job satisfaction and commitment. Trust is seen as an important part of successful companies; a recent report by the Institute for Corporate Productivity found that high-performing organizations were more likely to be characterized by high levels of trust.
Companies of all kinds are asking themselves Y. Companies in prosaic industries are trying to concoct purpose statements that give people a reason to come into work that goes beyond paying the rent. The appeal of independence and responsibility permeates the management philosophy of not only creative companies like Netflix but also lean manufacturers who encourage employees to solve problems on their own. Some retailers have raised salaries in the Theory Y hypothesis that reducing employee financial insecurity will improve employee retention and organizational performance.
McGregor himself wrote that the purpose of his book was not to get people to choose sides but to get managers to make their assumptions clear. On this score it is not so successful. It is still possible to run financial companies according to Theory X. It is impossible to admit.
